Bob Hoye presents a look at the proper – as opposed to imagined by legions of anti-dollar, inflationist gold bugs – gold stock sector fundamentals
You’ve heard me go on about it for years upon years. Here is Bob Hoye’s version of gold stock sector fundamentals. If the macro goes over a cliff in 2023 as the inflated (and multiple times reinflated) bubble really starts to let out air (definitely possible if not probable), gold mining fundamentals are going to improve, sort of like real investments (did someone actually just write that? Investments??).
We’ve lived and managed markets in a bubble age in my experience since 2001 or so. The age of Inflation onDemand.
So you’ve heard me go on about the proper gold mining sector fundamentals repeatedly in this space. Now read Bob, who is an early influence of mine with respect to becoming educated (rather than brainwashed) about the gold mining sector from a macro fundamental perspective.
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I’d like to reproduce my reply to a subscriber who emailed me, as a comment to this post. He asked me about why I’d focus on the miners as opposed to gold. Normally, I don’t. I’ve had my gold position for over 2 decades now. But as Bob notes in the post above, the question… has something changed for real in the continuum of decades old bubble making? Here is my response…
Mike,
If you read my Hoye post, you might see that while gold stocks almost always suck, the only time to be bullish for real (i.e. not a trade like 2008, 2016 and 2020 turned out to be) historically is during a bubble collapse and/or deflation. The end of the mother fucking everything bubble. Now, what have we had non stop since 2000? INFLATION, interrupted by deflationary scares met by balls out inflationary policy.
Gold stock promoters of course use inflation as the pitch. They have all along. What else do they have? But they’ve been wrong and led the herds astray. I have banged the drum Hoye bangs all along. But that does not mean it comes about at convenient intervals like the bubble in cyclical assets have reliably, with the Fed at their back for these decades.
Why do you think I’ve made such a big deal about the [currently] broken indicators and grotesque extremes in NFTRH? [while Bob has projected post-bubble contractions that were thwarted several times, I have reason to take it seriously now]. The point being that the Fed as bear market/deflation fighter is screwed and that is something completely different than over the ‘continuum’ of the last few decades. At least that’s the message these indicators tell me is very possible, if not likely.
With any luck, the next gold mining bull will catch everyone – including the worst of the buggish inflation promoters – off guard. I’d love it.
As for you, you have to do what is best for you. All I do is dig up the information and indications and form strategies by them.
Regards,
Gary