"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


Wednesday, February 13, 2013

HUI / Gold Ratio Chart

By request...


  1. Thank you Dan.

    It is obvious to me how manipulated these shares are now. I am convinced that Govt-Fed-big money is trying their best to destroy the very companies that are to be the future Fed-Treasury-Mint all in one. When will the powers to be finally get their foot off of the throats of everyone who believes that the Federal Government and all its tentacles are no longer serving the best interests of the American people rather the big International banks, and all Socialist backers everywhere. When they fail, lookout it is lights out, for all the currencies around the world. These manipultors are destroying the system so that they can manage whatever is left. The life is being sucked out of the private markets in a slow death fashion by the facist Obama and his cronies.

  2. I am fed up and starting to feel like I cannot take this slow death, manipulation, government controlled market system any longer. IN fact, when the war begins, and I believe that this period of time will end similar to 1865, but, this time Ronald Kennedy may be prove correct, The South was Right.

  3. $1500 of cost per oz White Wolf is the mining industry average. These charts back-up the fundamentals...until margins widen significantly the miners are fundamentally and fairly valued....the charts told have told us to stay away for 3 years and its backed by fundamentals...last fall I heeded the call of the charts as all good agnostic traders should, and I am short the miners...I will leave the knife catching to others....buy and pray and buy and rationalize against the message of the charts is a sure way to lose your lot....

  4. Ride the wave. I think that when the market is completely manipulated from Currencies to who wins and who loses, their is no process by which to judge value. Schumpeter never said that "creative destruction of capitalism" is not for the banks. It has gotten completely out of hand. I live in the real world. I made a career out of lending to entrepreneurial capitalist for various finance oriented business. Now, the banks judgement and higher ups demand so much information that it is nearly impossible for a small business to get loan that has a reasonable rate. It disgusts me that those who broke the back of capitalism, were bailed out against the wishes of the American people, hoard the cheap money so they can leverage it and invest in this stock market which is completely "rigged". I for one, will not put a nickel into the market until I see all the investment BANKSTERS hanging from trees. Period. One exception, the miners. I am going to leave all the money in several miners and wait for the demise of this socialist regime, and the followers. If people understood what these "thiefs" did, and continue to do, they would certainly have their pitchforks and gallows ready. I will get popcorn and enjoy the show. Snap,Snap, snap, their goes Mr. Blanfein, Mr. Paulson, Mr. Geitners vertabrae. Ben, well I can tell he might snap the rope with the weight starting to gain around his mid section. FUNDAMENTALS...What fundamentals are you even talking about. 3 trillion worthless assests and growing. 16.5 Trillion that will never be repaid in US deficits. Rates set at zero? Ride, I think you are smoking something.

  5. Well articulated and excellent points White Wolf

    As far as the companies being fairly valued - no way. There are an endless number of techniques to manipulate the prices. Hitting the HUI related companies is the easiest way to cause a chain reaction to push down most of the gold mining companies. Entities like Barclay Capital can do that.

    At 1500+ gold price, gold mining companies in general will be very profitable. This is all there is to know about what gold shares will do in future. Let them give them to you at fire sale prices. Make sure you buy a large basket of companies. This is when the little people need to buy - when there is blood in the streets. there is enough blood in the streets to start buying. shares are worth way more than fiat.

    They could send Gold price down to $1200 but that would likely virtually shut down the industry that is trying to expand supply. That would be counterproductive to the powers that be. There is a balancing act going on.

    1. Conspiracy is a convenient excuse to point fingers at anyone but yourself.

  6. If the miners go out of business that's even better for physical prices because of less supply and the rich elites you talk of probably have plenty of physical to boot. So it makes what they have worth even more. In 2008 Miners pulled it out for $500 to $700 an oz at $1000 peak prices. At today's $1500 to $1700 an oz prices nary a miner is making such profits. It is what it is. The tape is always right and the manipulation that you conspire to blame for the foibles of the miners has existed since Livermore made money trading the direction of the tape. The key is to recognize being long most miners is the wrong trade until it isn't. It's still the wrong trade until it isn't. When $1800 on gold is breached in fast enough fashion to outgun input costs like oil then the miners chart should reflect that with with better price action. Until then denial is a river in Eqypt and denial of the tape telling you that you are wrong is a bad trading strategy.

  7. I might be wrong, but my understanding of mining stock is that it is fairly priced at its current levels. A mining company recently announced preliminary report for 2013 and in it I saw an all-in cast cost of between 1,100 to 1,200 an ounce to sustain the business. This means to me that the gold in the ground is only worth about 450 dollars to the shareholders. Also since this is gold yet to be mined and many problems could prevent it from ever being mined, this 450 dollar an ounce gold needs to be discounted. Depending on where the gold mine is located means the discount could be more or less depending on stability, government, etc. This is just my opinion on why the miners are performing the way that they are. This could always change depending on sentiment.

  8. Thanks Dan. That chart is screaming BUY!! Not too many opportunities like this, look at that upside. Just awesome, thanks again.

  9. Yep. Thanks to folks like Billy, hopium springs eternal in miners....and thus with that buy and hope there must be more pain....miners can now only bottom when the sentiment indicators turn negative.....and when those even few left standing have hope and dreams expunged into bucket of bile...its then and only that the bottom is in.....still too much hope and lack of belief in the charts being horrid for a bottom to be in....6 to 10% + more to go at least to the downside....


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