They Are Tapering QE! Get Out of Gold!!

This is perfect… Gold falls to June lows as Fed plan to taper sinks in and I thought I’d put up my own sensational headline since the MW headline is so understated.

headline

I was actually a little surprised when the precious metals turned up after the taper news because that is not what I had been planning for.  Well, sure it was a possibility but the preferred plan was for the Fed to come with the goods and for the precious metals to get clobbered – and if it came with a spike upward in the stock market, so much the better.

We are in the process of eliminating all of the 2001-2011 geniuses.  Ref. Scary Gold Bug Article on Cue, as the gold luminaries trotted themselves out to take a bow before the ink had even dried on the Fed’s September statement in which they rolled over and held full QE intact.

At the bottom there will be no gold generals spewing the dogma that worked in 2001-2011.  There will only be survivors sitting in their bunkers sucking their thumbs, and predators.  If pre-market today is any indication, the final phase – finally initiated by the Fed – could be kicking in.

There are targets to the downside and there are upside targets in the S&P 500 vs. gold.  There is also a target for gold bug sentiment and it is not its current ‘0’.  That is too bullish so the target is not shown on this graphic because it is going to blast right out the left side like a bullet through a window… or a looking glass.

sentiment
Sentiment graphic courtesy of Sentimentrader.com

This looks like the final phase where the last inflationists who have a fetish for a ‘dollar collapse’ and hyperinflation are going to be compelled to reevaluate (and come up with a new sales pitch).

Gold is going to bottom somewhere.  I think it will be soon and I think gold’s bottom will start the clock ticking on the next phase of economic failure (which could be many months yet, not for gold’s bottom but for the Fed’s policy of the last year to prove to have been a reckless failure).

As I wrote in a post yesterday, things are making sense and changes are coming.  The sooner the Fed came with the ‘taper’ token, the sooner gold could get on with its search for an important bottom.  It is time for people who are prepared to be getting bullish.

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