In search of intrinsic value

Guido Romero Rank: 95 Followers: 5 Votes: 0 Years Member: 8 Last Update: 26 May 2015, 21:11 Categories: Relative Performance Charts
Gold / Gold Stocks

May 26/15 - I have the feeling the US$ is off to the races again. The Yen has taken out the recent lows and the vitals are not good for the currency. Short of global war being declared shortly, oil is about to fall out of bed again. Metals are churning looking for a bottom. With the great and the good advocating the abolition of cash, gold coins are gaining in utility both as portfolio diversification and potential backstop should this dystopian absurdity become reality.

May 11/15 - The gold to Yen chart, presages that the Yen is about to break down yet again...

Apr 26/15 - We are in the final innings of this monetary system. The IMF and the UN have suggested and the EU has already drafter legislation to 'restructure the debt of developed countries' - ergo, an increased tax burden across the board for individuals and small and medium companies and the confiscation of pension plans. This legislation is scheduled to go into effect as of January 1st, 2016 except for Austria that has already adopted it to shore up Heta Bank. Greece has already demanded that all entities and municipalities funnel whatever cash they may have to the central bank. The Bank Recovery & Resolution Directive adopted by the EU along with House Proposition H41 in the USA are similar new directives aimed at divesting the general public of what savings may be left in the system. The latest attempts at banning cash transactions in the EU and the USA indicate that monetary policy has reached its limits. What is now left to toy with, is fiscal policy. Gold and silver kept outside the banking system may not be the answer to all our problems but, today, I would rather have some coins and bullion within reach than not.

Apr 2/15 - Charts 125 and 126 look interesting and are worth monitoring in coming weeks.

Mar 7/15 - Dangerous close for the precious metals bringing the Fib retracement levels that have not yet been satisfied, back in play. CEF is now selling at a discount of 8.5% and it appears to me that there is still a flow of money into bu


050 - $GOLD:$XEU - Monthly Candlesticks, Landscape

Jan 14/15 - If history should repeat (a big if), an RSI cross over is quite propitious to coming price action. Conversely, it may not be so propitious for the Euro

100 - $SPX since 1980

Mar 10/15 - There is a school of thought that holds that as the US$ rises, capital will be drained from global markets and will concentrate in US$ assets. In this scenario, the US bond and share markets may suffer temporary wobbles as the storm buffets global markets but, eventually, the US share market will be the last refuge of capital (which will also eventually leave the US bond markets) driving it to dizzying highs.
Dec 3/14 - The US$ has recently broken out of a long basing pattern. I am going out on a limb here to say that this is, in my opinion, the beginning of a tectonic shift that is heralding asset price deflation. If this should indeed be the case, this 700 points formation is looking ever more probable...

101 - US$ purchasing power versus CPI

Mar 2015 - This may come a bit late. The underlying conclusion of the search for intrinsic value in this monetary context and at this particular junction, must necessarily lead one to completely divest of any property in descending order. Immobile property such as real estate is the first to succumb to the fiscal impasse of the sovereign. All other property in descending order will too succumb in turn. The more liquid the property, the farther down the line of extortable (if the word exists) priorities it lies. Art and collectibles will too be taxed particularly those items that have a paper trail.
Dec 2014 - The recent US$ breakout that I've been tracking since 2010 is a powerful signal. If this change is confirmed by the price taking out the 95 - 100 level convincingly, this would indicate a significant change in the financial landscape of the past twelve years. Most importantly however, my opinion is that this is the manifestation of global asset price devaluation. If I am correct in my assessment, this would imply that going forward a lot of money is going to leave some highly leveraged positions notably in emerging markets. Too, if the change we are currently witnessing should develop at the same speed, a lot of hedges and derivative positions are going to generate significant losses for sovereigns, sovereign funds, investment funds and pension funds. Adapting to this new reality for large investors is going to be fraught with traps and dangers of all sorts, just at a time when we are witnessing unprecedented economic, financial and monetary conditions...

103 - Emerging Markets Free Index

Jan 5/15 - I am adding this index of Emerging Markets to monitor the US$ advance. If the US$ breakout is sustained, it should play havoc with EMs. One curious thing is how this chart is very similar to the chart of crude. Coincidence...?

105 - 30years US Treasury Bond since 1980

110 - $SPX, the 30yr US TBond and the US Dollar since 1980

Dec 3/14 - This is an important break out. It may very well herald a period of asset price deflation in which case the major indexes may not fare as well going forward...
Apr 15/14 - The reason I think the US$ is on the rise is not due to a belief of economic or financial strength in the USA. Rather, the Dollar is headed higher simply because the currencies of member countries that have adopted the US$ as reserve currency (Floating Exchange Rate Mechanism) must arithmetically suffer from aberrant US$ monetary policy...

120 - $SPX and gold since 1980

125 - Gold since 1980

126 - Gold bullion inflated by the purchasing power of the US$

127 - Mining shares investment sentiment

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