I am, at heart, a buy and hold investor. The trick is knowing when to buy and hold. As in life, everything in the market runs in cycles. If you buy at the top, or near the top, of a cycle buying and holding can be a very painful experience. Timing is critical short and long term. "Timing in life is everything" is one of my favorite sayings. That is especially true in investing. People who bot at the previous top in gold of around $850/oz in 1980 were in for one heck of a wait. It took until 2008, nearly 30 years, for it to return to that price. Who's got that kind of time to wait? And what about those folks who invested in the NASDAQ in 2000? Their wait is far from over.
In 1998 I started studying gold and the gold market. I became convinced it was a buy and hold investors dream. Gold was universally loathed, as an investment. In 1999 I started buying gold and gold shares. Gold was selling at around $300/oz. The HUI, the gold bug index, was averaging in the 60's. I told everyone I knew to buy gold and or gold shares because I was convinced gold was going to $1500/oz. I got two distinct reactions to my suggestion; a glazed look or a pity the poor fool look. Pity the poor fool was by far the most prevalent. I soon threw in the towel on sharing my insight.
I favored gold shares over physical gold because they provide greater leverage. They also provide more excitement. By 2000 the HUI had been cut in half. There have been times when the sell offs in gold shares have set my hair on fire. I was undeterred in my vision and have held through it all. The HUI has been as high as 600. Ten times your money in ten years isn't all bad. Gold got quite close to breaching $2000. On Friday gold closed at $1678 after dropping nearly $40. The HUI is back 475.
This weekend I will be preparing a shopping list as I intend adding to my gold share collection next week. I must be crazy right? I don't think so. I was clearly wrong about gold going to $1,500. I was too conservative. But then, who could have foreseen The Fed would literally melt down the presses printing money. If you can believe what you hear they intend to provide QE to infinity. It seems they are intent upon destroying the dollar. China is buying gold as fast as it can and encouraging its citizens to do the same. Hmm, I wonder why that is? Could it have something to do with this old saying "He who owns the gold makes the rules"?
Gold has been in a correction for awhile now and Friday may have been the final flush out. If we aren't at the bottom we are getting very close. I think this presents a very attractive opportunity to hop on the gold train if you haven't already.
I was wrong about where the price of gold was headed. But, in 1999 $1,500 sounded to most people like the prediction of a madwoman. I may well be a madwoman, living out here in the Montana wilderness with just my dog, my cat and my camera. But, in view of the world in which we find ourselves, this madwoman now thinks $3,500/oz. is not unrealistic and may also prove to be too conservative.
Even a buy and holder sells one day because the trade has run it's course and there is a new opportunity waiting in the wings. In my opinion that day is still a ways off for gold and the best is yet to come. If you don't own any gold shares or bullion you might want to get some.Your trade won't last as long as mine but I wouldn't be surprised if there isn't another five to eight years left. Those years will include the manic/panic stage.
If I turn out to be right I won't tell you I told you so but please don't tell me I didn't.
©Kinsey Barnard
Showing posts with label investing. Show all posts
Showing posts with label investing. Show all posts
03 November 2012
12 January 2012
SOMETHING DARK THIS WAY COMES
Sorry, no pretty pictures today.
I have been an investor since I was ten years old. As of today that would make it fifty three years. My grandmother passed away when I was ten and left me 100 shares of AT&T. That began a life long interest in stocks and investing. I even went so far as to go into finance eventually becoming a VP with Lloyds International Corporation the investment banking arm of Lloyds Plc.
I have been a member of a site called Silicon Investor for the past fourteen years. It's a public forum where people of all investing skills get together and talk, stocks, finance, the economy etc. Over the years I have cut the wheat from the chaff, and believe me there is a lot of chaff, and come to respect certain opinions above others.
This morning I read a post from TH. It resonated with me because I have been having similar feelings myself. I believe the markets have been so corrupted and manipulated that there is no such thing as investing any longer. Other than some natural resource plays I am quit the markets to a great extent. But, I still pay attention because what's going on will impact each and every one of us whether we are in the markets or not.
With TH's permission I am just pasting his post verbatim.
"The Ten at 1.9 and the Thirty below 3.
Just one of many things that are not, "right". I see those yields not as a measure of fear, but out of requirement to keep the game running. And I can't see how these yields offer anything but a negative return. In light of the reality of our fiscal concerns and compounding debt/interest payments, it is nothing short of a measure of insanity.
Or, manipulation.
To my thinking it must be one of the other. Is it played out? One respected pundit says that 1.5 might be the ultimate top for the Ten. Based on all the broken markets, I would not bet against that prediction.
And each morning, around the usual magic hour of 3 AM EST, we get a futures ramp and a gold wacking.
And you, me, the entire world apparently, accepts these things as perfectly normal.
This is not normal.
Miners are sold down to levels reflecting much lower gold and silver valuations. And there appears to be very little real interest in what are now value plays. All while shorts continue to pound way at miners near 52 week lows. If these were financial or housing stocks in 07/08, I could see it.
The reason I think its so quiet on SI and all the threads I haunt around the net is there is a growing confusion and uneasiness. I see it on social websites and financial websites. Something is in the air, and while it can't be defined, the collective has grabbed hold. And yet no one can define it. I can't.
I look at the primary coverage for Paul. And while I'm a strong Paul supporter, I also believe I can step back and objectively look at how he is being treated by the media. The fact that the effort to smear and marginalize him is so pervasive has shocked even a cynic like me. For me it's like the machine has shown itself in full. No mystery here. Its overt and in your face. And it operates on the assumption that the majority are either stupid or don't care. And maybe those assumptions are accurate.
Now there is talk about this internet piracy bill. This is nothing but a tool to stop free and open communication. That is ALL THIS IS. And we stand by and do nothing, while our rights are being stripped away by this liar and fraud Obama (and yes, it is Obama, for it is the President who must step up and do the right things...and yet, we have just the opposite).
It's a rant, but not really. It's more a reference point. Something has changed in just the past few weeks or months and it feels like it's about to snowball.
And while it is just a feeling, it's worth noting that many must be tuned into it.
Something bad is coming, but the smoke from all the recent bad is so thick, I have no a clue what it is.
Maybe going physical and really getting off the grid is the path. I usually just joke about such things, but more and more I'm starting to wonder if that is absolutely the right play.
GT
TH"
©Kinsey Barnard
I have been an investor since I was ten years old. As of today that would make it fifty three years. My grandmother passed away when I was ten and left me 100 shares of AT&T. That began a life long interest in stocks and investing. I even went so far as to go into finance eventually becoming a VP with Lloyds International Corporation the investment banking arm of Lloyds Plc.
I have been a member of a site called Silicon Investor for the past fourteen years. It's a public forum where people of all investing skills get together and talk, stocks, finance, the economy etc. Over the years I have cut the wheat from the chaff, and believe me there is a lot of chaff, and come to respect certain opinions above others.
This morning I read a post from TH. It resonated with me because I have been having similar feelings myself. I believe the markets have been so corrupted and manipulated that there is no such thing as investing any longer. Other than some natural resource plays I am quit the markets to a great extent. But, I still pay attention because what's going on will impact each and every one of us whether we are in the markets or not.
With TH's permission I am just pasting his post verbatim.
"The Ten at 1.9 and the Thirty below 3.
Just one of many things that are not, "right". I see those yields not as a measure of fear, but out of requirement to keep the game running. And I can't see how these yields offer anything but a negative return. In light of the reality of our fiscal concerns and compounding debt/interest payments, it is nothing short of a measure of insanity.
Or, manipulation.
To my thinking it must be one of the other. Is it played out? One respected pundit says that 1.5 might be the ultimate top for the Ten. Based on all the broken markets, I would not bet against that prediction.
And each morning, around the usual magic hour of 3 AM EST, we get a futures ramp and a gold wacking.
And you, me, the entire world apparently, accepts these things as perfectly normal.
This is not normal.
Miners are sold down to levels reflecting much lower gold and silver valuations. And there appears to be very little real interest in what are now value plays. All while shorts continue to pound way at miners near 52 week lows. If these were financial or housing stocks in 07/08, I could see it.
The reason I think its so quiet on SI and all the threads I haunt around the net is there is a growing confusion and uneasiness. I see it on social websites and financial websites. Something is in the air, and while it can't be defined, the collective has grabbed hold. And yet no one can define it. I can't.
I look at the primary coverage for Paul. And while I'm a strong Paul supporter, I also believe I can step back and objectively look at how he is being treated by the media. The fact that the effort to smear and marginalize him is so pervasive has shocked even a cynic like me. For me it's like the machine has shown itself in full. No mystery here. Its overt and in your face. And it operates on the assumption that the majority are either stupid or don't care. And maybe those assumptions are accurate.
Now there is talk about this internet piracy bill. This is nothing but a tool to stop free and open communication. That is ALL THIS IS. And we stand by and do nothing, while our rights are being stripped away by this liar and fraud Obama (and yes, it is Obama, for it is the President who must step up and do the right things...and yet, we have just the opposite).
It's a rant, but not really. It's more a reference point. Something has changed in just the past few weeks or months and it feels like it's about to snowball.
And while it is just a feeling, it's worth noting that many must be tuned into it.
Something bad is coming, but the smoke from all the recent bad is so thick, I have no a clue what it is.
Maybe going physical and really getting off the grid is the path. I usually just joke about such things, but more and more I'm starting to wonder if that is absolutely the right play.
GT
TH"
©Kinsey Barnard
03 August 2011
Is Gold a Crowded Trade?
Some of these financial images are better than anything I could produce with my camera.
Back in 2000 I was telling everyone I knew to buy gold because I believed it would go to $1,500. I was universally laughed at or looked at as some kind of a kook. Well, it appears I was wrong. Gold is going a lot higher than $1,500. Yesterday it stood at $1,660 and it's hittin' licks again this morning. I would not be surprise if it didn't eventually go to $5,000. But, in my defense who could have ever predicted the stupidity of the US government and it's lackey politicians?
Is gold a crowded trade? You be the judge.
©Kinsey Barnard
Back in 2000 I was telling everyone I knew to buy gold because I believed it would go to $1,500. I was universally laughed at or looked at as some kind of a kook. Well, it appears I was wrong. Gold is going a lot higher than $1,500. Yesterday it stood at $1,660 and it's hittin' licks again this morning. I would not be surprise if it didn't eventually go to $5,000. But, in my defense who could have ever predicted the stupidity of the US government and it's lackey politicians?
Is gold a crowded trade? You be the judge.
©Kinsey Barnard
22 March 2011
No Spring in Northwest Montana
The snow just keeps on coming and according to the extended forecast there seems no end in sight. Very frustrating as I am chomping at the bit to get started working in my forest cutting up windfall and burning slash.
The Nikkei was up over 400 points following Buffett's proclamation yesterday. Always makes me wonder what comes first the chicken or the egg? Our own Dow was up triple digits. And, there was much chest thumping about being back over 12,000.
This is a pretty good little history of our empire. A Brief History of the United States. Ironically, I think success is an empire's ultimate doom. Empires grow and proper in the production phase of their life cycle but once people become "wealthy" they move into the consumption phase and it's all down hill from there. That's where the US is now. The only thing this country produces in quantity is dollars. Unfortunately, the rest of the world is becoming less than enamored with our currency and when it loses it's status as the world reserve currency, and it's well on it's way, our standard of living is going straight into the dumper. I wonder if one day people will wake up and realize that they sold their very souls for cheap trinkets from China?
Speaking of cheap trinkets form China .... they really aren't cheap. They just give the illusion. The quality is so crappy you have to keep buying the stuff over and over because it doesn't last. Oh, for the days when Americans made great, quality products. I have tools, kitchen utensils, furniture and a host of items that were American made 100 years ago and I still use them today. The junk you buy at Wal-Mart is lucky to make it a year.
I found this an interesting article. Maybe people are starting to catch on to the fact that there is no difference between the Democratic and Republican parties. It matters not the party, the politicians of both are nearly all self serving thieves. And we elect them, go figure! Tea Party will back Democrats challenging GOP big spenders in 2012. Also interesting, Montana's own Denny Rehberg is in their crosshairs.
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| March 22, 2011 |
The Nikkei was up over 400 points following Buffett's proclamation yesterday. Always makes me wonder what comes first the chicken or the egg? Our own Dow was up triple digits. And, there was much chest thumping about being back over 12,000.
This is a pretty good little history of our empire. A Brief History of the United States. Ironically, I think success is an empire's ultimate doom. Empires grow and proper in the production phase of their life cycle but once people become "wealthy" they move into the consumption phase and it's all down hill from there. That's where the US is now. The only thing this country produces in quantity is dollars. Unfortunately, the rest of the world is becoming less than enamored with our currency and when it loses it's status as the world reserve currency, and it's well on it's way, our standard of living is going straight into the dumper. I wonder if one day people will wake up and realize that they sold their very souls for cheap trinkets from China?
Speaking of cheap trinkets form China .... they really aren't cheap. They just give the illusion. The quality is so crappy you have to keep buying the stuff over and over because it doesn't last. Oh, for the days when Americans made great, quality products. I have tools, kitchen utensils, furniture and a host of items that were American made 100 years ago and I still use them today. The junk you buy at Wal-Mart is lucky to make it a year.
I found this an interesting article. Maybe people are starting to catch on to the fact that there is no difference between the Democratic and Republican parties. It matters not the party, the politicians of both are nearly all self serving thieves. And we elect them, go figure! Tea Party will back Democrats challenging GOP big spenders in 2012. Also interesting, Montana's own Denny Rehberg is in their crosshairs.
21 March 2011
Spring? Happy Days are Here Again?
Well, the calendar may say it's spring but I sure wouldn't know it by looking out the window or at the thermometer. It snowed all day Friday and it's snowing right now. The temp is 35. Must be global warming. I said global warming was a boondoggle from the start and nothing has happened to change my opinion. The whole thing is just another scam to scare people and part them from their hard earned cash. Like we need more of those types of things.
Over the weekend the UN started to bomb the heck out of Libya and there seemed to be some progress on getting Japan's nuclear reactors under control. This morning the Dow made a moon shoot on all the happy news. Well, there was some not so good news on the economic front but on one wants you to focus on those. Building permits came it at an historic low and this morning real estate sales were reported down nearly 10%. Oil, which dropped during the Japanese earthquake, is now soundly back above $100.
These markets are just insane. It's like watching a manic depressive or someone with ADD. One minute this is good next minute it's bad. It happens so fast that it's hard to keep up.
There is one thing that seems to just keep moving along and that's precious metals. When I got into them, in 1999, gold was around $300/oz. Today, it's trading above $1,400/oz. I told many of my friends and acquaintances that gold was the place to put your money. But, the dot-com craze was the gamble du jour and I was laughed at universally. It always amuses me how people cannot wait to take the advice of so-called experts, all of whom have a vested interest in your taking that advice. And, when someone with absolutely nothing to gain tries to advise a little common sense they are shunned. There is an old saying "The more things change, the more they remain the same." One thing that never seems to change is peoples endless desire to be led down the primrose path.
The "Oracle of Omaha" came out and said Japan is a buy. So, I guess everyone will be buying the Nikkei. I use to have a lot of respect for Warren Buffett but that was before the media and the public decided to deify him. If you think Buffett gives a fig about you and your wealth think again. What he cares about is his shareholders and Bershire Hathaway. He talks his own book. He is well aware of the impact of his public proclamations.
Now I hear there is a new comet, Elenin, headed our way this fall and it's supposed to be a bad omen, as if we need more bad omens especially in the fall.
The "big" moon yesterday was quite something to see. They say it won't be that large again until 2029. It was much more extraordinary in person.
Things are changing and they are changing faster than most realize. I think within two years life as we have known it is going to be changed forever. How do I know? The same way I knew gold was a great investment back in 1999.
Over the weekend the UN started to bomb the heck out of Libya and there seemed to be some progress on getting Japan's nuclear reactors under control. This morning the Dow made a moon shoot on all the happy news. Well, there was some not so good news on the economic front but on one wants you to focus on those. Building permits came it at an historic low and this morning real estate sales were reported down nearly 10%. Oil, which dropped during the Japanese earthquake, is now soundly back above $100.
These markets are just insane. It's like watching a manic depressive or someone with ADD. One minute this is good next minute it's bad. It happens so fast that it's hard to keep up.
There is one thing that seems to just keep moving along and that's precious metals. When I got into them, in 1999, gold was around $300/oz. Today, it's trading above $1,400/oz. I told many of my friends and acquaintances that gold was the place to put your money. But, the dot-com craze was the gamble du jour and I was laughed at universally. It always amuses me how people cannot wait to take the advice of so-called experts, all of whom have a vested interest in your taking that advice. And, when someone with absolutely nothing to gain tries to advise a little common sense they are shunned. There is an old saying "The more things change, the more they remain the same." One thing that never seems to change is peoples endless desire to be led down the primrose path.
The "Oracle of Omaha" came out and said Japan is a buy. So, I guess everyone will be buying the Nikkei. I use to have a lot of respect for Warren Buffett but that was before the media and the public decided to deify him. If you think Buffett gives a fig about you and your wealth think again. What he cares about is his shareholders and Bershire Hathaway. He talks his own book. He is well aware of the impact of his public proclamations.
Now I hear there is a new comet, Elenin, headed our way this fall and it's supposed to be a bad omen, as if we need more bad omens especially in the fall.
The "big" moon yesterday was quite something to see. They say it won't be that large again until 2029. It was much more extraordinary in person.
Things are changing and they are changing faster than most realize. I think within two years life as we have known it is going to be changed forever. How do I know? The same way I knew gold was a great investment back in 1999.
06 December 2010
Buy the F'ing Dip!
This is one of the funniest and truthful videos I have seen about the markets. Please be advised that there is liberal use of the F-word so please do not watch if that offends you.
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