understood but may I ask your opinion on an influencing factor not mentioned above. Yes it is easy to see the deflation happening particularly in the U.S., also Europe. Geez, everything’s on sale. But to my question, China, along with its Asian siblings, has resolutely risen as the economic power and here in China, there is enormous spending and growth/bubble INFLATION now. How might this impact or offset the U.S. deflationary issues? Cheers, Mario

So all down and US dollar rally coming. Start end of October. When Goldman, JP Morgan and the like tell you to buy the ES and YM….sell and get out of dodge.

I told you where all is going in my previous predictions…US index to 41 by 2012. Last rally for index will take it from 75-72 to 82-85 by Mar/July 2010. The big drop may start in Jan 2010…but one drop at end of October then retrace then bam down.

Watch and see. Gold down etc

Dollar is a poor yardstick.
Measured against the swiss franc, which was fully backed by gold, the drop was much more pronounced. 1930-1935 saw a drop from 25 to 15. Settled around 17 until 1950 where it had dropped to 12. Then the the “socialist revolution” let its presence be felt, and late 60’s and 70’s started the enormous slide, until genius Brown decided that 70 years of an obvious trend was fallacious and a good time to sell against Gold. At that time the pound had lost 90 percent of its value versus the Sw Fr, down to 2.5…and we now now that it dropped another 75% against gold since the late 90’s…I believe that is a 97.5% loss against gold from 1920….. Not much leveling off.

Pound was appropriately named. It got pounded.

Observing history and observing the ego-drunk, historically uneducated leadership we have, and a populous that is unwilling to try to “get it”, I see nothing in the way of much higher gold prices in most all western currencies. I don’t want to see this happen as I am concerned about the social implications. Ugly, folks, really ugly. We fret about each wiggle (me included), but this enormous trend seems to be in place, not for days, weeks, but decades…
Dr Marc Faber is a voice to be heard and absorbed. His book “Tomorrow’s Gold” is my source for the above data. He says hyperinflation is baked in the cake. I don’t want to believe him, but he has been miles ahead of most all forecasters, so far.

Thanks for the stock picks. SKYVF and PGXPF up 50 percent since I bought from your previous recommendation in an earlier article. Ditto MEAOF and PEZGF up 25 percent. I have a few others you recommended up 10-15 percent and not one loser.

Thanks so much for you contributions to Rick’s Picks as there are scantt few experts who talk about any recommendations to invest in. Please keep them coming.

Rich

Here’s a chart of the British Pound during the depression:

http://www.nowandfutures.com/d2/pound1910-1950.png

Bottomed, rallied, then a lower low, then chronically firm. Should we take this as an essential guide? One thing is for sure. Gold prices advancing in all currencies takes some of the currency risk out of the cost equation when it comes to mining.

I would be watching the Yen/USD, and how it advances along with gold for the moment.

Seasonality. It didn’t work out too well if you bought shares at precisely this time in ‘07, or, for that matter, in ‘00. My point here is not to dispute the statistical evidence showing that the period from October to April tends to be stronger than the one from April to October, but simply to remind prospective “investors” that it is far from a foolproof guideline with respect to trend.

And while it is true that the Decisionpoint share charts (I too am a subscriber)are, in general, and in the aggregate, bullish, there are signs, for example, in a host of other Decisionpoint indicators that warn the advance from approximately 1019 cash SPX is going to culminate soon (this week) and give way to selling into November that should lop 10 to 15 percent of the averages.

take a look at the technicals discussed in this article
October has not been kind to stocks or gold
there will be a pullback, buy then

http://www.safehaven.com/article-14697.htm
http://www.hondoazul.com/GoldSeasonals.pdf
http://news.goldseek.com/GoldSeek/1255068360.php