Printer Friendly

eMail Article

January 02, 2006

Stripped Down to the Basics
by Gary Tanashian

The Dow is the embodiment of a going-nowhere market. How well has "buy'n hold" worked for most investors? Still, looking at this chart in a vacuum, it is hard to be overly bearish. Note that Dow has remained mostly above its 61.8% fib retracement level (10,020+/-) of its cyclical bear market for 2 years.

While the mess at the top of the page has done all it could to avoid the abyss, gold investors simply locked on to the fact that inflation policy runs the show. No inflation? No economy. Simple.

We have shown variations of this chart many times. But it is important in illustrating the idea that while there may be a cyclical "bull" market in force in equities, it is a price thing, not a value thing. Stocks, when measured in gold, look sickly heading into the new year.

Gary Tanashian
http://www.biiwii.com/

Disclaimer: biiwii.com does not recommend that any trading or investment positions be taken based on views expressed on this site. If you speculate or invest it is suggested that you consult a financial advisor qualified in your area of interest.

Copyright © 2005-2008 Gary Tanashian

Image rendition and html coding Copyright © 2000-2008 SafeHaven.com

« BullionVault.com -- Buy gold online - quickly, safely and at low prices »
« Honest Money: A History of U.S. Gold & Silver Currency -- by Douglas V. Gnazzo »

« Opinions expressed at SafeHaven are those of the individual authors and do not necessarily represent the opinion of SafeHaven or its management. Articles are available via RSS/XML. Please visit RSSHelp for instructions. »