The bitter fact is that nobody, no brilliant analyst, has any idea of where this bear market will end. What if earnings and dividends collapse, and price/earnings sink below 6 (it's happened before)? Under those circumstances, the Dow could sink as low as 1000 or even lower. We know that bear markets, following great bull markets, tend to overrun themselves on the downside. Therefore, my own advice (to you and myself) is that we should have no preconceived notions as to where this bear market will end.

How bad can it get? I honestly don't know. A lot of seasoned investors are congratulating themselves on being smart enough to be largely in cash over the last year. But wait -- suppose the US dollar collapses along with most fiat money. In that case, nobody will want to hold Federal Reserve Notes. Nobody will want any fiat money backed by any country (remember, all fiat money must be backed by the country of issue).

Wait, there's only one currency that needs no backing by any nation -- the money that has no counter-party liability -- gold. When all is lost, when the Dow is down to 2000 or less, when the dollar has no friends, the last asset standing will be gold.

Those who denigrate gold don't seem capable of understanding this. The reason they don't "get it" is that they can't conceive of how bad a bear market can be. It's the reason I've coined the term "dollar bugs." These are the poor optimists who cannot visualize how bad things can get. They can't believe that Federal Reserve Notes (dollars) can fall. Fall how far? Fall to the point where no one wants them.

If the dollar can fall to uselessness, gold can rise to infinity. I think it could happen. I think it "could" because I can visualize how bad things can get.

RR has been THE dow theory guy for 50 years. Hasn't been a gold bug. Is smart enough to know value. He recommended gold for tha last couple of years. He is as mainstream as an honest person can get.People listen to him. I hope people can also extend his gold recomendations to silver. yesterday