Ten years ago this week the Gold price was bobbing along generational lows, until finally the first week of June 2001, the Great 21st century Gold Bull was born. Back then, it was trying (for the umpteenth time) to break $265 on the upside. That $265 level was the first hurdle it cleared - and its never looked back. To those of us in the market at the time, the $265 level seemed insurmountable. Little did we know what a rambunctious bull he would become. Ten years in now, he has ten straight years of gains to show - and still people do not believe. We are truly a nation of cynics.
This isn't your normal bull market either - it is a Behemoth. This is evidenced by the fact this Bull hasn't even learned to buck yet. We are a decade in without a single 1/3 off sale; like this bulls 6 year old cousin Silver is offering right now. More proof of what a behemoth this bull is comes by looking at who is buying at these levels & who is selling. In one corner, on the buy side we have central banks (some of the most powerful suits on the planet). In the other corner, on the sell side we have the general public (how else can you explain "sell your gold here" shops on every corner). So basically you have the suits on one side and the masses on the other side of the trade. This can only end one way, because if there is one ironclad no fail way to make money in the investing arena it is this: bet opposite the masses. The smart money suits are doing it, are you?
Bull markets travel thru 3 phases. Accumulation - Runup - Distribution. This Bull is 10 years old and yet strong hands are still accumulating at these levels. Make no mistake, the strong hands buying today are not paying $1500 for gold to sell down the road at $2000 or $2500. The Strong hands play for Zeroes. Ten baggers, twenty baggers, or thirty baggers are more the norm for generational Bulls. When this bull finally gives up the ghost, 10-15 years from now - there will be "buy your gold here" shops on every corner. While this may seem crazy now, its not. Its distribution, and its how bull markets end.
Enough of that, today is a Birthday celebration. My gift to you is this insight. As bull markets mature the price rises at an accelerated rate. The last 10 years have brought us 18% a year compounded - the next ten will dwarf that. Buy an ounce- take the ride!!
But I thought gold was a barbarous relic!
ReplyDelete