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elastic bounces bounce

  • Tue, Dec 02, 2014 - 10:45am

    #2

    Michael_Rudmin

    Status Gold Member (Offline)

    Joined: Jun 25 2014

    Posts: 860

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    elastic bounces bounce

When I look at the 5-year graph, I don’t see this as a ‘bottom’. I see it as an elastic bounce in a /eneral fall.
Gold bugs are saying ‘bottom’, and I understand, because they are SO SO tired of watching the price of gold fall, contrary to reason.

But we haven’t gotten to the ‘throw in the towel’ moment. That is probably going to happen AFTER a number of fracking companies and a number of gold miners go bankrupt, because of irrationally low prices for an irrationally long time.

I don’t know if you remember ‘Calvin and Hobbes’, and the game Calvin Ball, but the basic rule was that the rules change. Under such a situation, only politics matters in valuation; and the politics goes with the stupid money more often than not.

Regardless of that, yes, there eventually will be a crash; but– think on this — how long did it take the nazi officers of Germany to lose their assets, despite the fact that their game had to crash? And weren’t Hitler’s last orders to the troops that they should retreat, slaughtering the German people as they went?

Admittedly, that’s the mst extreme form of Calvin Ball in most peoples’ minds; but don’t forget that it isn’t the most extreme possible. Rules change.

And you might say, ‘well then gold can go up’, if rules change. But part of Calvin Ball is that the rules change, but typically speaking the winner doesn’t. So if the winner isn’t into gold, gold doesn’t win.

Point being, that I don’t see this as a bottom. The best economic theory of polxtics and Calvin Ball I’ve seen so far is Elliott, and Elliott seems to indicate on the slide of the last 4 years, that we’re headed farther down. I’d not be terribly surprised to see 750.