Board-Ansicht
Mix-Ansicht- Bill Bonner liegt gegen Prechter nach einem Jahr klar vorne - kingsolomon, 30.10.2003, 20:32
Bill Bonner liegt gegen Prechter nach einem Jahr klar vorne
-->
By: Tim Wood
Posted: 2003/10/30 Thu 08:54 ZE2 | © Mineweb 1997-2003
NEW ORLEANS -- At last year's New Orleans Investment Conference, deflation was on everyone's lips. We doubt it is going to feature as prominently this year though there is no shortage of dire predictions for the US economy judging by speakers' topics listed on the schedule.
If there is one immediate note to make it is that of all the prognosticators last year, Bill Bonner stands out as among the most perspicacious urging investment in all metals for all the reasons now commonly cited as the cause of their improvements.
Bonner, publisher of the Daily Reckoning newsletter engaged in an informal, but memorable, head-to-head forecasting contest with Elliot Wave's Bob Prechter who had billing on the same day. Prechter, who was always at risk of being mobbed by fans, advocated US Treasuries, American dollars and Swiss francs. He was firmly in the deflation camp and argued that bullion and gold equities would be a bust. Bonner went the other way in his deflationary scenario, advising to sell out of the dollar in favour of anything to do with gold.
A great call although the emphasis on deflation seems misplaced; at least insofar as the bet seemed to be that it would happen in the near-term. Yet we do have the Federal Reserve warning just a few days ago that its monetary policy remains biased toward preventing deflation. The problem is not vogue, but it remains.
Nevertheless, we did say that the outcome of the Bonner-Prechter contest could only be usefully judged after three or five years; the first year is a handsome victory to Bonner and more so because Prechter insisted that gold was due for minor gains before plumbing record lows because of a deterministic “wave structure down”.
It was at this conference last year that gold raconteur, Jim Sinclair, became especially dismissive of the Elliot Wave thesis for gold and so far he can also claim Prechter's scalp.
Someone who won't be too quick to scoff at gold this year will be Karim Rahemtulla, of the Oxford Club. He was merciless in declaring that gold had probably overshot since a majority of the audience thought it was still cheap. Therefore, he said, it was no longer a profitable “contrarian” opportunity. Ouch. Yet it's worth noting that gold has been a fashionable pick - other commodities have done considerably better with little salesmanship.
What nearly all the speakers had in common was an unremitting pessimism about the US economy. Bonner spoke for many when he said the US Federal Reserve was determined to inflate the dollar to worthlessness. He was as dispirited about the whole world: “There are epic waves of confidence followed by epic waves of despair,” Bonner said, predicting a “huge global collapse of consumer demand” as capital assets are deflated.
Prechter was as gloomy, recommending that multimillionaires ship all their liquid assets to Switzerland, whilst he also warned followers to quit speculating in real estate. Rahemtulla thought a 4,000-5,000 Dow Jones Industrial Average was possible, even probable, along with a 400-700 point Nasdaq.
Then there was investment guru Richard Russell, due to speak again this year, who has continued to urge an accumulation of bullion assets. He warned that the late nineties investment bubble had to be matched by an unwinding of equal proportion. He expects that to manifest in a rout of general equities to a point where the S&P500 will be trading at six times earnings - his buy trigger. Russell was also a deflationist and suggested that it could take two decades for the US to work itself out of its problems.
When it came to gold, Russell was quite specific - a crossover of $3,000 per ounce of gold and 3,000 on the Dow.
Early indications are that New Orleans 2003 will be absorbed with America's deficits, its global role, Chinese consumption of hard and soft commodities, the dollar and competitive devaluation and gold, gold, gold. But will anyone dare to call the yellow metal overbought this year?
Thread gesperrtgesamter Thread:
