$SPTGD/$GOLD Weekly

TSX gold miner's index vs. gold is a very revealing chart. It goes against every expectation of investors interested in gold mining stocks. Instead of rising against gold, or at least keeping their value, gold miners declined.

In log scale form, GBN.V has only performed poorly along with the rest. The shares are cheap, but in diluted form, so buying in can be problematic and costly.

The bottom should have been in August 2012, as bond markets topped out at that time. U.S. Treasury Bonds, which are the principal hedge used in equity swaps, have lost their triple-A status. Enter DUST, which is an ETF that primarily shorts gold miners. So instead of selling the gold miner and buying treasury futures, trading is now selling the gold miner to raise cash in order to buy the ETF that shorts gold miners.

http://scharts.co/18jQ0nJ

-F6