-->Sinclair-Gold's fundamentals



Tuesday, June 01, 2004, 6:21:00 PM EST

Fundamental Support For Gold Becoming Intense

Author: Jim Sinclair

As the floor traders on the COMEX once again chase their tails like crazed dogs, the fundamental support for gold is moving from strong to intense.



Can you imagine what will happen to the price of gold once these numb nuts get on the same page as the rest of us? How stupid can you be to sell gold just because it touched a round number only to see it hold tightly to the Fib support line? These fellows are in most cases not wealthy individuals but simply gamblers on short financial ropes that are trying to make a living. Their time horizons for a trade due to lack of financing is shorter than the memory of a goldfish.

Gold is on its way to $480 so these geniuses would be better off holding one contract long than all their hot shot long selling and short sales against the $400 level. I can tell you there are no Livermores or Seligman's in this crowd.

As we approach"D" Day - in this case"Decision Day" for the Saudis concerning flooding the market with oil - one must wonder how comfortable the Saudi Royal Family is these days. Who is going to pump all that oil if you have to wear body armor to work every day?

So far, I haven't heard of air-conditioned body armor and I am told that the Saudi oilfields are actually hotter than hell and not just from a temperature perspective. On one side, you have the US as the business partners of the Saudis; on the other side how much protection can the 2000 members of the Saudi Royal Family expect from the US when the ramifications of their decision on increasing oil production becomes evident?

I don't know if you noticed, but the number of hostages that were announced as taken in the Memorial Day weekend attack at the expats compound in Saudi Arabia was 50. The real number is 254. The number killed has been given as 22. The correct number, including the seven Saudi guards,is 29.

The three al-Qaeda operatives that escaped from Saudi hands did not actually escape but were let go by the Saudis who claim that they threatened to blow up the hostages if they were not given free passage. That claim is disputed. Yet the Saudi ambassador to the US is quoted as saying the Saudis will eliminate the al-Qaeda menace once and for all. It is not what the Saudis say but rather what they do and they have done very little to prevent al-Qaeda's terrorist activities in Saudi Arabia.

The talking heads are asking if a Saudi increase in oil production will ease prices but what they should be asking is if that increase will in fact reduce the 2000 member population of the Saudi Royal Family significantly and immediately.

The new Iraqi security force has now mutinied twice. What makes you think that the appointed Iraqi interim government will not mutiny? Haven't they just done that in turning down the favored candidate for president?

April and May have been the deadliest months for US troops in Iraq since the war started. The bloody fight for the city of Fallujah raged throughout April but has calmed down in the past few weeks but only because the US forces pulled out turning over the city to the former mutinous Iraq security force.

In total, the Iraqi conflict has taken the lives of more than 800 American troops and last week the Pentagon reported that the number wounded in action is approaching 4,700 which independent sources say is probably on the low side.

All of the above does not touch on the systemic economic reasons for dollar weakness which will be the major reason for gold's coming strength.

Gold is now a currency. That differentiates it from commodities that can be traded by technical analysis alone. No good currency trader deals with TA exclusively because it overstates price up and down that fundamentals will always correct.

Gold as a currency is running into the power of fundamental reality versus lines, squiggles and hoards of mad people running around the floor of the COMEX making fools of themselves. Gold is headed higher than any TA purest is willing to admit.

So take a few more weeks off and then you can see gold at new highs for this bull market. All of this impacts the US dollar and regardless of the dogs of the COMEX that chase their short gold tails daily, gold is going much higher and very soon, IMO.

So if you must rely solely on TA, I suggest Fibonacci Support and Resistance as it remains the magnet of the gold's action.

Click here to see the proof in gold.

Tuesday, June 01, 2004, 11:16:00 AM EST

Gold Market Summary

Author: Jim Sinclair





My firm belief is that the price of gold is only starting its price appreciation despite the claptrap coming from all the purely technical analysts who have no fundamental understanding of gold and what drives it. Right now the fundamentals are in place for gold to deliver $480 plus.



Afghanistan cut the jugular vein of the former Soviet Union so what makes you think that Iraq and Afghanistan are not going to mortally injure Western capitalism?

Will Iraq become a democracy with its newly-appointed government or can you democratize a country that is devoid of democrats? With recent poles showing strong support for the fanatical martial cleric al-Sadr, can elections be expected to institute a democracy?

If Saudi Arabia does in fact flood the market with oil, will that action signal the end of the Saudi Royal Family in a blood bath? Is Western capitalism changing its traditional form both of government and of balance sheet health?

Is Western capitalism on the same road to nowhere that the Soviet Union took when it invaded Afghanistan with the purpose of imposing Soviet autocracy on that traditionally ungovernable country?

Have you checked the definition of the word"Sovereignty?"
The American Webster dictionary defines this word"sov·er·eign·ty" as follows:"n. pl. sov·er·eign·ties - Supremacy of authority or rule as exercised by a sovereign or sovereign state. Royal rank, authority, or power. Complete independence and self-government. A territory existing as an independent state."

If this is not what is turned over to the appointed members of the new Iraqi government, will it not be embarrassing to those who state it has occurred? Does the management of Iraq really believe that Americans are so stupid that they do not know what words mean?. Well, maybe.

The answers to all of the above questions are the fundamental factors that will impact the dollar which in turn will impact gold. This is what the nit wit technicians should have known when they issued their bearish forecasts about gold and their even dumber bullish dollar pronouncements.

Shame on every gold advisor who pushed you into a loss for no reason whatsoever. Shame on you for following them. Greater shame on you for sending them your money.

Shame on the web sites that post every opinion so as to lead you into the type of confusion that sets the stage for the gold geezers to issue their bearish technical calls in the face of fundamentals that are going to give you gold over $500 in the near future.

I pose the final question: Why in the world sell gold this morning at $399.80 when it is going to or above $480 by August 15th. If you were fooled once by the nit wits, are you going to be fooled twice?

Who with credentials was out there yelling,"stop the madness" to you when gold was being hammered and the professional interests were covering as fast as they could?

Gold at only $400 is madness in light of the fundamental condition now present and forming in the market.

Remember that oil impacts the dollar and the dollar impacts gold.

-->Ã-l ist für das Leben wichtiger als Edelmetalle. Edelmetalle werden nicht benötigt, um zu (über)leben, sondern ist vor allem ein Luxusgut. 100 Liter Ã-l kann man verwenden als Benzin, Kerosin, Heizöl, usw.! Und 1 kg Gold?

Ich war auch schon mal optimistischer eingestellt, was den Goldpreis anbelangt und überlege mir, ob ich meine beiden Edelmetallminenpositionen (DROOY und CDE) verkaufe und dann entweder als cash im Depot liegenlasse, in einen CHF- oder Euro-Wert oder in eine Ã-laktie investiere. Aber ich werde sicher keine Yukos- oder Sibneft-Aktien kaufen. Oh, nein! Bestimmt nicht. Ausserdem will ich nicht mehr zuviel in $-Aktien investieren.

Gruss!
Prosciutto

-->>Ã-l ist für das Leben wichtiger als Edelmetalle.

Ein Tank mit 10x10x10 Meter fasst eine Million Liter. Man müsste nur 100m² seines Vorgartens dafür opfern. Gefüllt mit Superbenzin, könnte man ein ganzes Weilchen davon leben.

Ich stelle mir grad das Gesicht des Naturschützers am Landratsamt vor, wenn ich mit meinem Baugesuch um einen Benzintank ankomme.

Grüsse,
Yak

-->wieviel Millionen Ã-ltanks gibt es in deutschen Vorgärten/Kellern?

Und das ist erst ein paar Jahrzehnte her, dass die Zollfahndung hinter Privaten und vor allem LKW's her war, die regelmässig Heizöl statt Diesel im Tank hatten.

tschuess
G.C.

-->Hallo Yak,


>Ein Tank mit 10x10x10 Meter fasst eine Million Liter. Man müsste nur 100m² seines Vorgartens dafür opfern. Gefüllt mit Superbenzin, könnte man ein ganzes Weilchen davon leben.

sind eher 1000 cm und die Füllung kostet schlappe 1,2 Millionen Euro- wenn das deine Cashposition aushält, dann nur zu

Gruß,
Sorrento