The Contrarian Call on Gold
ksammut
Posts: 1,074 ✭✭✭
The Contrarian Call on Gold
Numerous recent busts (technology, banks, internet, oil, stocks, etc) have given rise to the principle of contrarian investing. Contrarians seek to buy when sentiment is bearish or when a market is completely ignored. They seek to sell when a market is overpriced or overvalued. The problem nowadays is that everyone has bubble fatigue. The herd seems to think that whatever rises is a bubble and will automatically go bust.
However, there is much more to contrarian investing than simply going against the herd or prevailing trend. First, the herd is actually right most of the time. As a bull market develops, more and more people come on board. Sentiment will inevitably become more bullish as time goes on. Furthermore, an investor should also consider technicals, fundamentals and value in their contrarian approach.
Numerous recent busts (technology, banks, internet, oil, stocks, etc) have given rise to the principle of contrarian investing. Contrarians seek to buy when sentiment is bearish or when a market is completely ignored. They seek to sell when a market is overpriced or overvalued. The problem nowadays is that everyone has bubble fatigue. The herd seems to think that whatever rises is a bubble and will automatically go bust.
However, there is much more to contrarian investing than simply going against the herd or prevailing trend. First, the herd is actually right most of the time. As a bull market develops, more and more people come on board. Sentiment will inevitably become more bullish as time goes on. Furthermore, an investor should also consider technicals, fundamentals and value in their contrarian approach.
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The dollar however, has been in a bubble and is in the process of bursting. What's really crazy is that the government sees it as their personal checkbook.
In a roadrunner cartoon (no aspersions towards our own roadrunner), when roadrunner runs off the edge of the cliff and is dropping at 32 ft/sec squared, from his point of view the cliff looks like it is going up, when in reality our roadrunner is going down.
It's about like that. Gold is the cliff and the cliff really just sits there while the roadrunner drops on by.
I knew it would happen.
<< <i>My contrarian view is that gold hasn't been doing squat. It's gold that is totally static, and it always has been.
The dollar however, has been in a bubble and is in the process of bursting. What's really crazy is that the government sees it as their personal checkbook.
In a roadrunner cartoon (no aspersions towards our own roadrunner), when roadrunner runs off the edge of the cliff and is dropping at 32 ft/sec squared, from his point of view the cliff looks like it is going up, when in reality our roadrunner is going down.
It's about like that. Gold is the cliff and the cliff really just sits there while the roadrunner drops on by. >>
I like your analogy jmski52.
Here's mine......
Gold is the beach ball that you try to hold under water.
Eventually your grasp on the beach ball slips and the ball propels high into the air.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
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<< <i>My contrarian view is that gold hasn't been doing squat. It's gold that is totally static, and it always has been.
The dollar however, has been in a bubble and is in the process of bursting. What's really crazy is that the government sees it as their personal checkbook.
In a roadrunner cartoon (no aspersions towards our own roadrunner), when roadrunner runs off the edge of the cliff and is dropping at 32 ft/sec squared, from his point of view the cliff looks like it is going up, when in reality our roadrunner is going down.
It's about like that. Gold is the cliff and the cliff really just sits there while the roadrunner drops on by. >>
Actually, in the Roadrunner cartoons, when he runs off a cliff, the cliff DOES go up, but at a slow enough rate that he lands safely. Now when Wile E. Coyote runs off a cliff...
You are right! roadrunner runs so fast that he actually does a turnabout in mid-air. It's Wiley E. who models the fall of the dollar. Especially when you see it from his perspective with the ground coming up fast. And then, the crater in the shape of his silouette.
I knew it would happen.
<< <i>My contrarian view is that gold hasn't been doing squat. It's gold that is totally static, and it always has been.
The dollar however, has been in a bubble and is in the process of bursting. What's really crazy is that the government sees it as their personal checkbook.
In a roadrunner cartoon (no aspersions towards our own roadrunner), when roadrunner runs off the edge of the cliff and is dropping at 32 ft/sec squared, from his point of view the cliff looks like it is going up, when in reality our roadrunner is going down.
It's about like that. Gold is the cliff and the cliff really just sits there while the roadrunner drops on by. >>
That's right. If you're holding Swiss Francs, Austrailian $s, or Yen, gold hasn't gone up. I don't understand how these prognisticators with all of their "wisdom" spew their idiotic notions about gold being in a bubble. They're the bubbleheads, imho.