October 25, 2021 

Gold Enters Major Bull Market


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 By bluejay

07/06/2008  8:50PM


Harry Schultz just sent out an alert warning people to be prepared for the coming international financial storm.

I believe he said, "Get out of U.S. dollars. Put 50% of your funds into governement bonds, not the U.S., but other big countries." I believe he said the Swiss Franc is the better choice.

"Put about 50% into various gold futures and the rest into good senior gold companies and the rest into oil and special situations."

I found it odd that he didn't mention gold coins. I guess the British government going into safety deposit boxes without the owners permission spooked him. What happens first over there usually finds it way over here.

I have lately been reading some business writers who are very concerned with the banks and the investment banks. Saying that we are approaching a time that not everyone will be bailed out.

Everything, excluding our home and some debt on it, that we own is heavily weighed to gold and silver and the related companies that are producing the metals or are looking for them.

Good luck my friend.
 By Rick

07/05/2008  8:17PM

BlueJay...I've been averaging into a down market with mutual funds. More shares in the broad spectrum while the value is lower; latent effect a better value if/when they do.

Now it's become an "if" instead of a "when."

I've toyed with the idea of selling low (not high) to instead buy gold. Or gold stocks; against all instinct since selling low is generally just plain dumb and results in losing money.

All sound rules point to holding an existing equity position (hold the nose) all the way through a downturn, since so far history shows how the long-term patient and wise holder of main stream securities ends up with a rebound, instead of a potential loss by bolting.

My gut says, "Hey gut? Buy gold."

My bank account, and portfolio says, "Woah, not here, we're going to withstand and with pride will rebound the temptation."

What, in your opinion, (and if Sinclair had a voice with your answer,) figuring the gold picture-to-immerge, would someone like me do?
 By bluejay

07/04/2008  5:35PM

The key to making money in stocks is not to get scared out of them. --Peter Lynch

Posted On: Friday, July 04, 2008, 7:25:00 PM EST

In The News Today

Author: Jim Sinclair

Dear Friends,

The problems out there are incalculable. Both the Fed and Treasury know this. That is why we got the show and tell the day before the ECB raised rates.

The damn OTC derivatives gang has killed us all to some degree. Oblivious to the obvious and driven by greed, those criminals are still writing OTC derivatives.

Hang on as the default derivative problem blows sky high when called on to perform.

Could GM be the match that lights the default derivatives fuse? The Financial Big Bang is just around the corner.

Are you prepared?

 By bluejay

07/01/2008  9:40AM

Posted On: Tuesday, July 01, 2008, 11:43:00 AM EST

It Is Now!

Author: Jim Sinclair

Dear Friends,

There are two subjects of extreme importance today.

I sent you an email months ago saying, “This Is It.”

1. I am now telling you, “It Is Now.”

Gold is preparing for an assault not on $1000, but for a brief penetration of $1200.
Violent chopping will occur, then off it goes to $1650.

This violent chop we have been living in here and now will resolve itself very soon and the take will be seen by history as having occurred in this last formation HERE AND NOW.

2. Where your juniors are concerned please give equal attention to the fundamentals before you make any decision. When beaten down, as they have been, think about gold at $1200 and $1650 coming sooner than anyone expected.

Call the company and respectfully demand to speak to management, not an IR officer. If management is in the country but will not speak to you, put that in the debit column. Allow time for a call back as many other investor may be doing the same thing.

The questions are simple. Property, finances and costs are the subjects you approach.

As an example, a high cost mining company in Ghana just experienced an increased production cost per ounce of gold as a byproduct of increased electrical costs in the country. Before you push the panic button the question to the company is “What are your total costs per ounce, not cash cost?” Once you have that answer think about gold at $1650.

I will discuss the “why” of all this on www.JSMineset.com this evening.

Respectfully yours,
 By bluejay

06/15/2008  10:44PM

Jun 3 2008 10:22AM


What is the biggest mistake you can make with your money in 2008? Ignoring gold, silver and their related inflation hedges can lose you more money than all the other mistakes you can make put together, except for playing the roulette table in Vegas.

Once in a lifetime, there comes a chance to turn a relatively small amount of money into a fortune, and this is one of them. We are in the early stages of a massive multi-year bull market in the metals. The supply-demand situation beggars belief. This is as close to riskless as anything I have ever recommended in 31 years of publishing The Ruff Times. You can put a list of mining stocks on the wall, throw a dart at them, invest in the holes and make a lot of money, in effect creating your personal mutual fund. When the wind blows, even the turkeys fly. Of course you can make lot more money picking the sheep from the goats, and that is what the Ruff Times is for, separating the biggest winners from the holes in the ground surrounded by liars.

A word of caution: all my words of advice are for the long term only. In the short term, gold and silver can do anything, go anywhere. In the last bull market of the ‘70s-‘80s gold went from $120 to $850, but there were discouraging retreats of as much as 30% several times along the way. It was attacked by speculators, central banks, and even Uncle Sam through Jimmy Carter. But gold and silver prevailed, even though chickens bailed out from time to time. I was new to the advice business back then, and even I got scared out once for a little while.

Actually, this is “déjà vu all over again,” as said the master of malapropism, Yogi Berra. It’s an eerie repeat of the 1970s, only more so. All the same factors that drove that historic 1970s bull market are back, only a lot more so; an explosion of money creation by the Federal Reserve that is so great they have even stopped publishing a monthly report on M-3, the most trustworthy measure of changes in the money supply. I guess they no longer know, or don’t want you to know, the embarrassing numbers.

Actually, it’s worse than that. Did you know that the phrase “printing press” no longer means much when it comes to money? Actually, less than five percent of the money is actually minted, printed or coined! The rest of it is in cyberspace, created at the Federal Reserve, or by commercial banks. The amount is beyond comprehension. This process is called “monetary inflation,” and that is what ultimately drives price inflation and drives gold and silver. The more money is created, the higher go the precious metals.

Also, they react to the prospect of war, or actual war itself, and America has never been more threatened by war that will affect us at home than we are now, by terrorism and nuclear proliferation by rogue nations.

History tells us that ever since the invention of Guttenberg’s movable type press, and the subsequent development of paper currency. The average time each currency lasts is 50 to 75 years before the world is littered in dead paper currencies, and until we invent a new one, gold and silver coins reign supreme, but not before they soar to the moon in value. There is not a time in human history when gold and silver have not been considered real wealth and instinctively turned to when paper decorated with ink has become so much confetti.

How long will it take us, and are we near the brink? No one knows. We have become immensely sophisticated at postponing the inevitable. It might be five years, ten years, or twenty-five or fifty years before the inevitable drama plays out. But play out it will.

In the meantime, we will make a bundle in the metals and their derivatives. In fact, they will be a new way for the middle class to in effect print money, and in dollar terms, the metals are going to the moon. $2500 gold or $125 silver anyone? And what about 500% to 2000% profits in the next few years. That is written in cement over the next few years – or in gold or silver.

By Howard Ruff
The Ruff Times
 By bluejay

04/22/2008  9:25AM


The dollar is 71.25 this morning. It is making a five week low and in position to continue lower in the days ahead.

Your question concerning its correction appears directed at its upward correction. My opinion of its recent strength is feible at best.

Remember, according to James Sinclair, the dollar will hit 52 in the months ahead which will support a gold price of, at least, $1,650. Today's gold price is $923.50.
 By Rick

04/18/2008  7:09AM

Hey Bluejay, what do you make of the "correction" in the dollar?
 By bluejay

04/10/2008  10:39PM

John Maynard Keyens, in his 1924 tome entitled "Monetary Reform" said,

The best way to destroy the capitalist system is to debauch the currency. By a continuing process of inflation governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens.
 By martin newkom

04/09/2008  12:29PM

The only viable form of an
investment that resembles a
derivative in my book is a
Bankers Acceptance which is
listed in the "Money Rates"
section of the WSJ. Nowdays
only the biggest and "best"
bank customers can get them.
 By bluejay

04/08/2008  10:19PM

Posted On: Tuesday, April 08, 2008, 7:52:00 PM EST

Overconfidence Always Costs

Author: Jim Sinclair

Dear CIGAs,

The spin of the proper valuation of credit derivatives is that all is well and the problems ended with the Bear rescue. This meltdown process is now called a mortgage subprime problem.

The equity participants have signed on to this lie, as demonstrated by the demand for financial shares.

The risk in this overconfident spin is that it is blatantly wrong and risking exposure.

That exposure lies in the almost unreported and not discussed Fitch downgrade of a significant issuer of credit default derivatives in the municipal bonds.

It does not take a brain surgeon to understand the principles of credit default derivatives cannot in any manner meet their responsibilities should more than one significant failure take place.

Already the trend towards such a potential event occurring is moving east from California and west from the Sunbelt.

Now that Fitch has announced a major two-step downgrade, it puts tremendous pressure on the other rating agencies as they maintain double and triple AAA ratings for the debt of the remaining issuers of default swap derivatives.

Yesterday the shares of Washington Mutual rallied from an injection of $5 billion. This injection was meant to assist in the giving of a better mark to model cartoon value for their inventory of derivatives.

Today they needed $7 billion. The truth is no one really knows what anyone needs as the offending financial vehicles have no market in real terms. Of course the silly stock buyers turned around and became sellers.

The huge risk is in declaring the problem SOLVED while it has the equivalent risk of sitting atop a barrel of black powder while smoking a large cigar.

The potential back blast is that the SOLVED situation goes up in smoke.

Risks like this are not new. Last week al-Sadr beat the pants off the Iraq military even when air strikes had been called in. That was not supposed to happen. The US was sure it would not happen but it did.

You can bury the Iraq super-embarrassment, but not the $45 trillion in default derivative swaps looking like an accident about to happen.

Better spin would have been closer to the truth. Saying the problem still exists but is being controlled presently raises hopes that it will be entirely contained, but that is not the case.

Tight rope walking might pass in combat situations but is ill considered when used in the financial world where there is no patriot to save the day. There is no flag to wave and the motivation is to screw the other before being screwed yourself and take off running at any event.

I see the danger has been heightened by the extreme level of spin. This time I feel they are pushing a strategy that has so far functioned to the limit.

That may be the first major mistake in “Operation White Noise.”

The lock up in the credit market is not behind us.

Insolvency is the manifest and the alarm is capital requirement changes.

That does not repair the system. It makes it weaker.

That does not repair the system. It creates more danger.

That does not protect investors but instead puts them in the path of serious harm. This grandstand spin play is overconfident and in that sense the most risky move yet.

We wish the Fed well, however CONSEQENCES are not being considered and that is extremely dangerous.

Consequences cannot be avoided but they can be accelerated. Problems in the credit default derivative arena will occur.

Then what?


THIS is it! Are you prepared?

Ownership of gold is the first level of protection.
 By martin newkom

04/01/2008  9:34AM

There is near to frantic drilling activity in my area, Sutter Buttes and surroundings for natural gas by one or more
companies. I presume it's the
same elsewhere.
 By bluejay

03/31/2008  10:53AM

Gold $917.20 - $13.70
Silver $17.24 - $0.64
Gold/Silver Ratio 53.31
Gold/XAU 5.24

Barron's magazine for this week has a lead article of the bubble in commodity prices. This is more of the same from the anti-gold community to force down commodity prices along with indirectly pushing down base metals and precious metals.

On Friday the German banks spoke of the Bundesbank selling some of their gold holdings to shore up bank financial difficulties but the Bundesbank denied they would sell gold. The Bundesbank still continues to release a few tons here and there for local coinage.

Reports in the past have spoken of the Bundesbank leasing out or swaping out most of their reserves. The Bundesbank originally had the second largest gold holding behind the US holdings which have been, also, suspected of not being there anymore.

With the article in Barron's, this is considered to be just another propaganda push to sway the public away from precious metals indirectly and back into the stock market.

When these negative articles are published they are joined with fierce bullion bank selling of gold in the paper market, at the COMEX in New York.

Although it had been suspected that gold may have hit a low at $914 some days it continued lower to the $905 area where support surfaced.

After reviewing a recent article by Alf Field concerning gold's trading habits since this bull cycle started in 2001, it became apparent that gold has a little further to decline before a meaningful turnaround takes place.

Alf is forcasting a 16% to 18% retracement from the recent $1033 high. 16% equals $867.72 with an 18% fall equalling a price on gold of $847.06

The good news is that Mr. Field is looking for a price on gold of $1250 at the extent of the next rally.

Once gold is established over the magical $1000 area in the months ahead the whole psychology of investing in junior and exploration gold stocks will significantly change for the better.

During the time period directly ahead the hedge funds will be covering their naked short positions and will be going long this group. It is also suspected that the rich reservoirs of venture capital money will be finding their way into these recent laggards of the group.

The immediate time period ahead may be the last opportunity for the informed to move into juniors along with the exploration companies.

If history repeats itself the real big winners will be in the exploration sector.

During the last big push in prices gold advanced 53%, Silver 80% and platinum and palladium 82% each. The big gold stocks advanced during this same period just over 25%.

The Gold/XAU Ratio currently at 5.24 has the ability to trade down to the 3 level which would make the Index worth 417 with gold at $1250 or 667 if gold hit $2000 ahead into the future combined with intense public participation.

Currently the XAU Index at 175.36 is down 4.91 and looking into the future with significantly higher gold prices, we could see the strong possibilities of the stocks in the XAU, plus generally all gold stocks, moving higher from over 200% upwards to 400%.

A side note here is there will be some precious metal exploration stocks that will be higher in the multiples of 10's and 20's. You could hold five or ten of these explorers and with just one catching fire, with the rest just up nomimally, could still make you very rich.

Lower prices will always present opportunities within existing bull markets. Over the next few months opportunities galore will be ever present as gold is expected to be soft.

Good luck!
 By bluejay

03/24/2008  8:22AM

Gold $923.70
Silver $17.12
Gold/Silver Ratio 53.95
Gold/XAU Ratio 5.28

The following are some excerpts from a February 12, 2003 article by Jim Sinclair.

Sell-Off Today(by $30 to $352) Did Not Alter Structure Of Long-Term Bull Market.

The recent sell-off from the high in gold has not, in my opinion, altered the structure of this long-term bull market in gold.

Gold has always, and will continue to be, a market with supply/demand skirmishes between titanic forces and vested interests in the resulting price.

The almost straight up action of gold, followed by a similiar reaction, has all the earmarks of a forced short cover. The word in the marketplace is that we have just witnessed our first derivatives unwrap and market cover.

I expect this reaction to end either at the low today or $340-$343 or the next Fibonacci support level($332.50) outlined in the chart below.

As Harry Schultz said recently: "We have two choices when we experience such declines. To be disappointed with the market or as the Asian/Islamic interests see it: as an opportunity."
 By bluejay

03/23/2008  8:42PM

Gold $908.50
Silver $16.83
Gold/Silver Ratio 53.98
Gold/XAU Ratio 5.28

Another informative article has just appeared on the jsmineset.com website entitled, "The Financial Destruction Of The Average Man."

Isn't it strange that the caliber of this type of information and the editorial content never makes it to our newspapers and TV?
 By bluejay

03/22/2008  7:45PM

In the below entry on the second to the last line the year 2001 should read 2011, sorry.
 By bluejay

03/22/2008  5:49PM

Gold $919.20
Silver $17.21
Gold/Silver Ratio 53.41
Gold/XAU Ratio 5.34

The week-ends are usually good times when the markets are closed to do some thinking.

The Gold/Silver Ratio hit an intra-day high of 56 last week while closing at 53.41. This means for every ounce of gold you can trade it for 53.41 ounces of silver. The 52 to 56 area is a chart location of major resistance.

During periods of wide swings based on extremes in buying and selling pressure support levels and resistance levels just get overrun at times. The major trend is towards gold buying less and less silver in the many months ahead. This means one thing, silver is expected to apppreciate on a percentage basis better than gold but gold will always be the crown jewel, not silver, for security purposes.

The Gold/XAU Ratio with Friday's close stands at 5.34. This means, being above 5.00 on the scale, that gold stocks are very inexpensive compared to gold's last price. The Philadelphia Gold & Silver Index price is divided into gold's price to get the Index figure.

Index followers bought gold stocks last week and will continue buying them next week. When the Index approaches the 3.0 level these same players will start to take their profits. That's the way it works.

The Philadelphia Gold & Silver Index(XAU) closed out the week at 172.01. The Index high this year has been 209.27. The Index is spiraling lower and approaching a massive area of support in the 150.00 to 160.00 area. This area was significant resistance for 20 years from 1987 to 2007. Based on very strong fundamentals for gold continuing higher, a major buying opportunity is close at hand for the gold shares as we approach major support.

During bull markets it is senseless in calling tops but more appropriate in acknowledging areas for entry or reentry based upon sound long term support logic on the charts.

A Tuesday, March 11, 2008, the following significant article was written by Mr. Jim Sinclair.

Federal Reserve Action Announces New Loan System To Member Banks.

The Federal Reserve action today formalizes what has been the policy of the fed from almost day one of the visibility of the credit and default derivative meltdown and credit market lockup.


The predictable result of monetizing bankruptcy is a significant increase in inflation and a sharply lower dollar.

The action speaks negatively for the 30 year US Treasury bonds.

Waht needs to be understood is that there are more than $20 trillion dollars worth of credit and default derivatives out there.

The next key point is that nominal value of this $20 trillion of credit and default derivatives becomes full value when the derivative fails to perform.

This comes on a modest capital injection into a bond guarantee company that facilitates pinning a tin AAA debt rating heart on them; something that is a total fallacy.

The problem at the heart of the deteriorating credit lockup situation is OTC credit and default derivatives that have failed to perform.

The inviting conclusion then is that $200 billion is as (a) pimple on the ass of an elephant.

Nobody in his or her right mind wishes to see what is coming in 2011. It approaches the ?Day After? and ?Mad Max? in a financial sense.

The only protection is hard assets of any type, shares or kind, and the Federal Reserve Gold Certificate Ratio, modernized and revitalized.

This time gold is not going to crater after achieving its max market valuation. That nullifies every top caller from $248 to middle-late 2001 without exception as well as those now so inclined. This will make mining companies very attractive businesses.
 By bluejay

03/20/2008  11:20AM


Thanks for the update.

The number one concern of the Fed is to not let the "daisy chain" of derivatives break.

If it did, the economy and the public would be sucked into a bottomless black pit of financial ruin.

As Mr. Jim Sinclair has said, there is no practical solution to the derivatives meltdown.

The Fed will try and instill confidence, while this continues, but putting bandages on a major crash victum that is slowly bleeding to death will not work.

We must protect ourselves. The only answer is to hold gold until such time that the anticipated financial wipeout has run its course.
 By martin newkom

03/20/2008  9:42AM

I read that now other investmt
bankers, ie Soldman Sachs, etal
are now allowed to borrow from
the FED. Res.
 By bluejay

03/19/2008  5:40PM

Gold $919.10
Silver $17.49
Gold/Silver Ratio 51.46
Gold/XAU Ratio 5.16

Gold continues lower tonight in Asian markets.

It appears since the Bear Stearns collapse that the anti-gold boys are pulling out all the stops to teach the gold enthusiasts a good lesson.

Earlier this evening the metal hit a low of $914.50 and currently is pushing higher at $925.10.

The Gold/Silver Ratio is at an important resistance area of 52.00 on its chart. This appears significant and gold may have already hit its low on this move.

Gold's abrupt weakness should be a lesson in understanding the freight that the anti-gold people had late Sunday night seeing gold above the $1000 mark and the following publicity that followed on Monday.

Well, what better way to inform the public that it was just a fluke than by gold hitting the skids directly afterwards?

Come on boys, do you really think that you can control a limited precious metal like gold while you flood the system with unlimited depreciating dollars??? Give us a break, please.

Gold continuing strong from its low with a last sale of $928.50.
 By bluejay

03/19/2008  11:54AM

Gold $937.20 -$44.10
Silver $18.37 -$ 1.30
Gold/Silver Ratio 51.20
Gold/XAU Ratio 5.22

Not too long ago Mr. James Sinclair stated that $100 swings in the gold price could become a reality. At gold $937.20 versus a high of $1033 Sunday night in Asia, we're almost there.

Gold is a tiny market compared to other markets. When you have so many players all stepping in at the same time, volatility is the result. Does this change anything? Absolutely not, gold is going forward.

At the heart of the problem is the Federal Reserve. As they run around plugging this financial hole and the many more expected to follow, they are ruining our money. They are making it worth less and less. This is an indirect form of taxation on the people that many just don't comprehend. The people just blame it on inflation but where does inflation come from? Inflation comes from the increase in money supply which the Fed is injecting unrelentlessly into the system just to save the fat greedy cats on Wall Street.

How did we ever come to this point? It was allowed to happen by the regulators. They did not ever choose to regulate or even control in the least, derivatives. Why? Because the amount of money made just alone on commissions for brokerage houses was just too good to be true for the Wall Street players and what is good for Wall Street, should be good for us all too, right? WRONG!! What the regulators were supporting by their inaction to safeguard the people was greed using an untested financial tool, derivatives. Now Americans must pay for the mess.

Mr. Alf Field recently submitted to kitco.com an article entitled "Till Debt us do Part" dealing with derivatives and the Fed. The following are some excerpts:

"The problem with drivatives is that these are individuals transactions between 2 or more parties. Often the transactions are arbitraged onwards to several other players. Everyone in the chain relies on all other parties to meet their obligations. If one party in the chain goes bankrupt, it can cause a domino like collapse of all the other parties in the chain - if the bankrupt party is a large player in derivatives. They are all "inter-connected."

"Bear Stearns is known to be a big player in the derivatives markets and must have a major counter party to many transactions with JP Morgan, given Morgan's huge derivatives positions. Hence Bear Stearns had to be rescued because of "inter-connectivity;" to prevent a melt down in the derivatives market. It can hardly be a coincidence that the bail out was routed through J P Morgan."

"Let us be clear about where this will end. It will end with the Fed and/or the US Governemnt owning or guaranteeing all the bad debts and losses from sources in order to preserve the existing system. It has serious implications for the value of the US Dollar, the international monetary system and for inflation. The vast quantity of new liquidity that needs to be created will almost certainly result in runaway inflation."

Today is a value shopping day for gold and other precious metals and the companies that produce these metals along with those that own properties that contain them.

While the anti-gold forces use funds that are guaranteed in one manner or another by our citizens to depress gold, they are on the other hand jacking up the money supply to increasingly historical levels which will support hyperinflation and financially ruin the common man.

Our only hope is to buy gold and the companies that own it in the ground.

Historically, with the Gold/XAU Ratio at 5.22, the Index is screaming buy me!

Historically, the buy area is above 5.00 and the sell area is at around 3.00.

Gold may be down $44.10 today but it is also the day of opportunity along with any other days like this that follow during this current spell of weakness.

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