Tuesday, May 15, 2012

Catch a Falling Knife*Updated

The precious metals complex looks like it has found an intermediate bottom here. I can't say with absolute certainty that the metals will not leg down another 10% or so from here....and stay there for a year or so, but...

I have always been a momentum investor. Buying metals as they fall is so counter to my intuitive senses. Yet I cannot escape the fact that there is no solution to the worldwide debt problem. Nothing has fundamentally changed. There is just this patient lull as the FED and it's conspirators sit quietly, contemplating their only move. Print more money. Issue more debt. Ignite inflation to prevent deflation.

The precious metals that I will buy today and in the next month (I always average in) will leave me at acceptable and permanent levels. This store of wealth represents nearly 1/2 of my liquid net worth. I am not afraid to wade in here and buy through another 10% dip.

At some point, you have to be satisfied with your holdings. I am getting pretty close. My hands might get a little bloodier- but they will rinse off. I've just never been precise with buying at bottoms or selling at tops. That's a fool's game but I have to admit- I still try it.

If you are going to try and catch falling knives- this would appear to be a good time to take a stab- so to speak. Those coin shop guys love me.

* Have you ever noticed when gold takes a 5-10% plunge how quickly the media proclaims gold's death? If there are any of you- who have the slightest doubt that bankers and corporate masters are in charge of economic propaganda- read this typical piece of mainstream garbage. http://money.cnn.com/2012/05/14/markets/thebuzz/index.htm


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