June 21, 2010

1. There’s so much good news to report this morning, I don’t know which cash register to start at. Well, perhaps I should say….Ounces Register. Wasn’t there a saying that went, “decisions, decisions….” It’s a tough job counting all our growing wealth while Elmer Fudd Pofessional Price Chaser burns to the ground, but as they say, “somebody has got to do this job:

2. Wheat, corn, oil, gas, Australian dollar, Canadian dollar, Euro, silver, Dow, are almost ALL….SOARING this morning. Those of you who checked the weekend update and the site can probably guess at the theme for the week is: KACHINGO MANIA!!!

3. GoldLion noted that the Baltic Dry Goods index may be bottoming after falling FIFTEEN DAYS IN A ROW!!! Both GoldLion and Mr. Macro follow this index bottoming as something that could indicate a TOP in the US DOLLAR.

4. I warned the gold bears, who are now NAKED SHORT both gold bullion and gold stock, and BURNING like the hindenburg, the gold bears who are also long the US dollar into the HIGHS, that they faced coming OBLITERATION. Jim Sinclair has joined the gold stocks “SuperBull” camp this weekend with what could become an EPIC call, that the past THIRTY years of price action on gold stock charts represents a CONSOLIDATION. A consolidation that we are breaking out upside from RIGHT NOW.

5. All gamblers should be reporting to the gold stocks gambling deck. Long term call options on stocks like Agnico Eagle, Barrick, Goldcorp, Newmont should be at the top of the gamblers’ shopping list. I’m talking about making 20-100 times your money in the next 6-12 months if the show goes astro, and I think it should. If “big jim” is correct, and the chart action now is not just a breakout from the HSR (horizontal support & resistance) extending back to the May 2006 highs, but if the correct big picture interpretation is that the entire price action from the 1980 high is a CONSOLIDATION then the maximum possible upside for the GDXJ is probably 1000 or MORE.

6. Remember that I’ve outlined the possibility that the gold bullion bull ends within 12 months, but the gold stocks bull runs another DECADE as gold is LOCKED to the dollar at PERMANENTLY ballistic levels. If you remember the Dow breaking out in 1980, and I do, since I had just sold my gold and had a 20 foot wall chart of the Dow HAND DRAWN with my cousin running 30 indicators thru an ATARI computer, and I was looking at a technical target of the Dow breakout of around 17 HUNDRED. It went to 14 THOUSAND.

7. I believe many gold stocks are going to hit a HUNDRED DOLLARS a share. Sad Sack barely covered his MENTALLY RETARDED NAKED GOLD BULLION SHORT POSITIONS last week before gold took off upside. He was caught naked short in 1979 and he almost just gave a repeat performance. This time, if he’s caught short again, if the worst case scenario I outline below occurs, I’ll give you 99% odds that he KILLS HIMSELF.

8. Don’t follow MORONS like Sad Sack. Those of you who have dumped huge portions of your gold while people like GoldLion are INCREASING their physical positions, you need to take a hard look in the mirror because the gold tidal wave is going to take NO PRISONERS. NO BEAR will survive what is coming.

9. The DOW is at risk of HYPERINFLATING and all goldland can do is buy put options for 30 years straight. End the madness, end the insanity. There’s NO SHAME in being a dow bull in a depression, and there’s no shame in being a goldbug AND a dow bull. It isn’t about any recovery. Quite the opposite. It’s about the HORRIFIC state of the Gman around the world. His rob and murder show financed with debt heroin has PEAKED. Step number one is to focus on a Pgen to zero on the Dow. You begin to view the Dow as an asset, which it IS, instead of the Gman enemy, which it ISN’T. If you want your largest buys at Dow 1000, or Dow 1 for that matter, that’s up to you, but start viewing the Dow as a gridline, not a toy balloon that is always about to pop “any day now”. The risk of shorting any ASSET when the risk of hyperinflation of ALL the world’s paper currencies is REAL, as it is NOW, is a risk that is OFF THE CHARTS and today I plan to make you not just understand the risk in your mind, but FEEL it. The reward on the Dow short side is small, and the risk is UNLIMITED both in size and VELOCITY.

10. The banksters and the Gman are at WAR. The banksters won’t just win, they will CRUSH the Gman, by definition. Why? Because the banksters are fighting with GOLD, and the Gman is fighting with toilet paper money and is a heroin (debt) addict. It’s not a question of whether the banksters win or not, it’s a question of TIME, a question of HOW BIG THE WIN IS. A sea of heroin addicts holding rolls of toilet paper versus a specialized army of financial doctors holding vaults of gold bullion. Who outlasts the other and who wins any WAR? The answer is 100% clear.

11. TIME is your greatest ally in the markets, and it is the least understood and least appreciated TOOL. 99% of investors demand time to work for them, instead of submitting themselves to time. “I demand these returns in this time frame, I have financial needs” –Elmer Fudd, Public Investor. “You deserve to choose your returns in your time frame” –Banksters, laughing their heads off at the impatient price-chasing wienerheads.

12. I have a survey on my site, and some of you have done it. The survey covers the estimated price of gold for Dec 31, 2010. The vast majority of you picked $1400 or higher. If price didn’t make it, and I put the survey up again next year, I know you would pick the high prices again, because you have something the rest of the world’s investors DO NOT HAVE; you have FAITH. When you have faith, you have ability to understand TIME. Gold will do all that you want it to do against paper money, and probably, horrifically, much much more.

13. Goldblood in England has joined GoldLion in buying more physical and securing it. The Brain has done the same, as have I. Goldblood says he has a “GENUINE FEAR” that the whole system is on the verge of blowing apart. My words to goldblood, and to YOU are: If you think YOU are scared now, wait til to get a look at the world at gold $2000, $3000, and gold $5000. Your worst fears stand be fully realized.

14. Elmer Fudd Public Price Chasing MORON is going to get the same fear, but it will come as an EVENT, not the PROCESS that YOU are going thru. Think suicides, divorces, and breadlines, and maybe STARVATION, while you get RICHER. That’s the future for Elmer Fudd, Master Price Chaser.

15. When I talk about thinking in ounces and shares, what I mean is that you need to stop valuing your CORE positions of gold bullion and gold stock in paper money, because it is on FIRE. Why value wealth in ASHES? “I can buy 1200 ashes with my gold!” –Elmer Fudd. Well, congratulations to Elmer Fudd, soon he’ll be able to buy 2000 ashes with his gold. Oops, he doesn’t have any gold. All he has is ashes. If he wants to load up on ashes, good for him, and he IS.

16. Until the time comes that paper money is backed by gold, it will remain classified as toilet paper and ashes. Not a measurement of WEALTH. The Dow is measured in POINTS, not in DOLLARS. Think in terms of how many barrels of oil it takes to buy an ounce of gold, how many bushels you get if you sell a little gold buy some wheat.

17. Thinking in dollars is important when the dollar is strong, and even when it is weak. NOT WHEN IT IS ON FIRE. Men like Jim Rogers believe that perhaps DECADES of this kind of thinking may be required to SURVIVE financially. I hope I’m not being too subtle in this key point; the time is NOW to drop valuing your wealth in dollars. The time to value your wealth in dollars will likely return with the return of a gold ratio standard, but that’s not GUARANTEED. The dollar COULD instead go to ZERO. I’m in the camp that it does NOT go to zero, but remember there are a lot of wild cards out there, that could actually take all paper money to full hyperinflation, meaning it loses 99.9999% of its CURRENT value against GOLD. My decision to go to a commodity measurement of wealth and do so NOW, is because I believe the banksters are planning a MAJOR devaluation of the paper currencies this fall, and into early next year, and whether it is a market-based devaluation, or a G20 type of announcement, or both, we cannot know in advance.

18. All we can do is BE PREPARED.

19. Currently some of you are running oil/gas pgens, some are running Dow pgens, and some are running food pgens, and various paper money pgens. I would suggest the time is now to give serious consideration to valuing those accounts and pgens in OUNCES instead of paper money.

20. Would you value your account in Enron or Nortel or Fannie shares? “I’m worth 10 billion Enron shares!” Does that make any sense? “The US dollar chart looks WORSE than ENRON” – Jim Sinclair.

21. There’s an old saying that pigs get slaughtered and the public has become OBSESSED with increasing the amount of PAPER MONEY they own. The banksters have totally indoctrinated the public that paper money is lower risk than gold bullion. That is a mindset that I seriously believe is literally insane. Is it conceivable that much of the public and government could be diagnosed as partially INSANE by a medical doctor? That’s a serious question and it carries major ramifications. There’s no question that the banksters have turned the Governments of the world, and most citizens of the western world, into heroin (debt) addicts. Then they began the asset destruction war. Their opponents believe they will win the war with more heroin. I would suggest it is the exact opposite; we are at the point where any more heroin starts a WAVE of fatalities.

22. Some of you who are financial advisors have told me horror stories of clients who have literally screamed at you because the paper money price of their gold fell at various points. They demanded paper money IMMEDIATELY and now they have their wish.

23. DON’T WISH FOR SOMETHING TOO HARD, OR YOU JUST MIGHT GET IT.

24. The banksters are sitting here watching what I term the “bizarre and surreal” BIG SHOW unfold, and what they no doubt term the INSANE actions of the public investor and governments. I am absolutely convinced that the banksters believe the government and the public are actually partially insane, and it’s very possible the banksters planned and executed to create that actual state of partial insanity.

25. I posted the RATIO chart for gold and oil on the site this morning. I don’t think most teckies really are focusing on what the ratio IS, and until now, I would argue it hasn’t been that important, again, because the risk of all the world’s paper currencies hyper-inflating has not existed before. The risk does exist now, and it is 100% REAL and some of you like GoldBlood and KingKong have a FEEL for the HORROR that is hyperinflation. Holding gold in real hyperinflation makes buying internet stocks in 1995 and holding to 1999 look like internet stocks were FLAT in that period.

26. The gold to oil ratio is simply the gold price divided by the oil price. The ratio sits around 16 right now. The ratio chart shows how many barrels of oil it takes to buy and ounce of gold. The answer today is: 16 barrels. Now here’s the key point:

27. It’s not about whether the ratio is going to 12 or to 20, which is what the teckies are thinking. They are thinking about whether they make more PAPER DOLLARS in gold or oil if the ratio moves. That mindset worked for the big picture in 1979. NOT NOW. Today’s big picture is like combining 1929 and 1979, and then LEVERAGING it many times over. Using the ratios is about mitigating the REAL RISK of hyper-inflation of paper money, about you doing whatever it takes, in a practical sense, to keep your mindset away from valuing your wealth in paper money…

THE REAL RISK OF ACTUAL HYPERINFLATION IS NOT GONE. THE RISK IS REAL AND ACCELERATING TO A POINT THAT MAY BE MONTHS AWAY FROM CRITICAL MASS AND IT COULD EXPLODE LIKE KRAKATOA WHEN THAT CRITICAL MASS IS HIT.

28. If you own gold, you can buy about 344 bushels of wheat with one ounce, this morning. Keep an eye on that ratio. Use it to build more bushels and ounces by moving from one to the other, but value the holdings in total bushels, total ounces, NOT TOTAL DOLLARS. You CAN do this!

29. One last key point. IF there is REAL HYPERINFLATION, and YOU make ONE ERROR playing gold to dollars TRADER, you could find yourself TEN TIMES POORER in 24 hrs. If you sell gold because it went to $5000, and then real hyperinflation comes, it could go to $50,000 the next DAY. HOW WILL YOU EVER CATCHUP TO THAT?

30. YOU WERE JUST DEVALUED BY 90%.

31. Now you see why I keep hitting hard at the leveraged paper gold traders who have NO PHYSICAL GOLD. If that is YOU, it’s time to wake up and smell the gold bankster coffee, who would love nothing more than to MAKE IT HAPPEN. As I keep saying, this is the BIG SHOW. The risk of hyperinflation is REAL and GROWING, and if does, ALL paper gold traders will be DESTROYED by govt REPEATED revaluations of gold to paper money. There will be NO EXCEPTIONS. ALL WILL BE 100% DESTROYED. In hyperinflation, as a paper gold trader, If you are OUT OF GOLD on just ONE of those Gman revaluations, you are FINISHED FOREVER.

32. And all the money the greatest traders in the world have made will become IRRELEVANT, if it is all paper money. In full hyperinflation, gold rises to MILLIONS, BILLIONS, or TRILLIONS of dollars an OUNCE. Do all of you who are traders now see why I say TAKE CARE OF YOUR PHYSICAL GOLD FOUNDATION AS YOUR FIRST ORDER OF BUSINESS. Manage RISK first. Doing so was not a question of TIMING before. NOW IT IS. All the money you and I have made together, trading gold, trading sp500 futures and options, all of it is a PEANUT compared to the money you make on PHYSICAL GOLD if REAL HYPERINFALTION occurs. And you go to the POORHOUSE if you get ONE paper gold play wrong during the REPEATED REVALUTATIONS OF PAPER MONEY TO GOLD THAT OCCUR DURING REAL HYPERINFLATION.

33. I think we get partial hyperinflation, not full hyperinflation, I think the situation appears to go out of control to Elmer Fudd, but isn’t really out of control, but the fact is that gold bullion will become virtually untradeable anyways, to all but those with HUGE pgens that span MASSIVE price bands. Some believe the Fort Knox gold has been sold to the banksters. I don’t know, but if that’s the case, then we’re definitely going to FULL HYPERINFLATION because then there’s NO GOLD to build a gold ratio standard to stop the dollar from collapsing to ZERO. Collapsing to ZERO as ALL Gman currencies have done throughout history.

34. The fed refuses to allow audits, some very rational people believe there’s NO GOLD in Fort Knox , or if it’s there, it’s owned by the banksters, not the taxpayers. These two possibilities open the door wide open to full hyperinflation and a gold price that goes to millions of dollars and even trillions or quadrillions. I think it goes to whatever the numbers are required for the banksters to collect what they are owed NOW on the OTC derivative bets, which I estimate is around $300-500 trillion. Throw in the banksters’ phoney short position on the comex, which they pretend is their ONLY gold position, and you have a situation that could send gold to INFINITY as they pretend they have to cover the entire short position or risk bank closures (and let the taxpayers pay for the “comex bailout”), and totally wipe out MOST OF THE WORLD as gold goes VERTICAL.

35. I’m about 500,000 times more bearish on the big picture than most Dow bears are. Which is, ironically, why I’m LONG the stk mkt. In Zimbabwe, the stk mkt actually OUTPERFORMED HYPERINFLATION and if it hits the Western world, then it will be the SAME situation for the DOW. If you are terrified of gold confiscation, my suggestion is look at owning some DOW.

36. I’m a more active trader than many of you, but take care of RISK first. Now you know why I say, WHO CARES WHICH ANALYST IS CORRECT ABOUT THE NEXT $100 GOLD MOVE IF ALL YOU HAVE IS A LEVERAGED PAPER GOLD TRADING ACCOUNT WITH ZERO PHYSICAL GOLD, BECAUSE THE BANKSTERS MAY BE PREPARING, AS I WRITE THIS, TO STOMP ON EVERY SINGLE PAPER TRADING ACCOUNT IN THE WORLD AND NOT A SINGLE ONE OF YOUR TECHNICAL INDICATORS WILL SAVE YOU FROM 100% DESTRUCTION IF THEY DO IT. GET YOUR PHYSICAL GOLD INSURANCE POLICY TAKEN CARE OF AS YOUR FIRST ORDER OF BUSINESS. IRONICALLY, YOU ACUTALLY WANT YOUR PAPER TRADING ACCOUNTS TO GET STOMPED BY HYPERINFLATION, BECAUSE THEN EVEN THE TINIEST AMOUNTS OF PHYSICAL MAKES YOU RICH WHILE THE REST OF THE WORLD IS FINANCIALLY EXTERMINATED BY THE BANKSTERS. YOU’LL PROBABLY BE ABLE TO BUY WHOLE BLOCKS OF HOUSES FOR A FEW OUNCES OF GOLD IF IT HAPPENS. IF HYPERINFLATION DOESN’T HAPPEN, FINE, BUT DON’T BET YOUR LIFE ON BEING SMARTER THAN PHYSICAL GOLD BULLION BECAUSE YOU ARE NOT, I AM NOT.

37. NOBODY IS SMARTER THAN PHYSICAL GOLD BULLION BUT ALMOST NOBODY UNDERSTANDS THIS MOST IMPORTANT OF ALL MARKET REALITIES.

38. For those of you with physical gold insurance taken care of, see you on the gridlines in paper trading land. For those of you with no physical gold, I would take the day off from trading today, and do what you know you must do. The banksters want their trillions of OTCD winnings, and there’s nothing more dangerous to Elmer Fudd Public Investor whose prays to the Gman heroin addict and paper money as God, than a bankster who wants his money paid in GOLD because the BUSTOUT can’t pay what he owes. I absolutely believe the banksters want the amounts owed to them in gold ounces owed to them at the same they were supposed to be PAID. The revaluation of the banksters’ gold and the devaluation of Elmer Fudd is the MECHANISM of payment. How much revaluation is required, and will the banksters settle for less than full payment? Does full payment define full hyperinflation? I don’t know the answers to those questions, but I would suggest the more important question is… Are You Prepared?

See you out there on the gridlines….

ringing the ounces register.

Cheers,

st