UK Stockmarket 2009 and beyond

gadgetmind

I'm bearish gold and gilts. My only holdings in either are via RIT, Ruffer and Personal Assets.

lvader

Gold has dropped below the 200 day MA, it did it last year and managed to recover so who knows. I bought some ABG today on the drop. I would be very nervous if most of my wealth was in gold though.

worldtraveller

Unsurprisingly, based on my recent posts, I remain bearish on all commodities and expect further falls in the coming months, but I'll probably be using that as a buying opportunity. In effect that means that I'm hoping for overall further falls of at least another 10-15% before I'm happy to even start drip feeding funds back in.

sabretoothtigger

I remain bearish on all commodities

Seems fair but I struggle to be optimistic on dollar or the rise of any other great interest paying bond or currency.
So that leaves weaker currency and rising costs to business mostly as commodities due to rising world GDP

My largest holding now is emerging bonds but I still prefer commodities, its a bull market set over decades. Simple as that, stocks arent, western bonds are a bubble. Anything challenged is going down in value if not price


1600 is my target for gold low this year as this matches the declining highs of 2011. I expect it to be positive after this withdrawal and to beat 1720, the top price hopefully will be beyond belief.

I can remember 2009 the gold price at 850 was seen as very high, beyond feasible long term. Yet it keeps going, I think we got to look at the pressures forcing this. All the commoditys relate in a similar way I guess


Just about to close out Sarasin agriculture and buy CF eclectica agriculture as I think they have not risen as much as they could. It was that or Newton Asia but I think I might save that choice for a more negative market

If we get a commodity selloff now I'd buy FRES as I like that profit sharing dividend policy

worldtraveller

sabretoothtigger wrote: »

If we get a commodity selloff now I'd buy FRES as I like that profit sharing dividend policy

Surely though the general commodity selloff started in earnest way back in Q2 2011, after the heady peaks of early 2011. I'm just expecting it to continue to fall back a bit further over the next few months, at which point it will maybe be worth dipping back in.

The "rising world GDP" is also largely an illusion, IMHO, especially in China, where, as I've stated before, many times, things are likely to get a lot worse than many seem to think over the coming months. China has, of course, been the major driving force in the rise in commodity prices over the past decade, or so.

sabretoothtigger

I dont like China but I do like Asia and china has potential to do well enough. They have a problem with falling workforce numbers to support a large population, their wages must rise which loses them that vital price advantage they always have.
Things will be harder for them and the world beyond as they recall funds I guess

general commodity selloff started in earnest way back in Q2 2011

I dont see it as ongoing downwards. GDP is positive largely because population growth is positive.

There is always the choice of just getting poorer but in general we do have growth and more people working to support themselves and producing that growth. Also Asia will benefit from techonology, they are still coming out of the darkness with electricity and mobiles.
Its like handing ipads to middle ages London, gigantic growth potential but obviously not guaranteed

Growth is failing to satisfy their debt in USA and west generally. This will be negative but not for everyone.



This is the FTSE in gold. Gold is zero growth and we are not beating it, Im far more concerned about general purpose business growth in uk
http://i.imgur.com/7LP7Y.png

Copper vs gold looks similar http://i.imgur.com/8gmEt.png
Copper vs ftse also flat. I think longer term charts are need to make the case but in a bull market stocks should grow faster
http://i.imgur.com/RSBp7.png

lvader

I'm sure we will see another shares/commodities drop in the summer months but there are a few months to go before then. I expect commodities to rally in the meantime as the USD weakens from it's current highs.

sabretoothtigger

I will play it like 1987. Main thing is which recovers after a fall better

The USD isnt that high really but I know what you mean


Here is DOW in gold, how many ounces to buy the index. In the great depression it was 1 and also 1980 and recently for us 6.

Seems a fair guide to general value vs panic





Main thing about Dollar is its been falling badly for years except 2008. Since all the world uses it, its an easy explanation for high commodities (ie. price is just balancing loss of trade value from this fall). Trend is definitely down




ABG very weak again today, I guess its no surprise. I will buy some when gold reaches 1600 and see how it goes, its out of line and too negative ?

How many companies raise their prices 20%, similar revenue and lose this much of the share price. Dont think thats right is it

amictus

sabretoothtigger wrote: »

ABG very weak again today, I guess its no surprise. I will buy some when gold reaches 1600 and see how it goes, its out of line and too negative ?

I'm inclined to agree with most of what you're saying, but I'm not sure how you can be certain gold will go down to $1600. Is there some TA which points to this as a bottoming out level? How can you tell the rise from yesterday's minimum of $1640 won't continue?

sabretoothtigger

Can never tell its just I already own tons of miners.

I'd be surprised at 1000 gold, Marc Faber says he is waiting for a big fall so he must see something i dont.

Long story short, its in the region and judging short term is very hard. I do have 1640 as a bottom in one view. There is usually alot of false starts before any big rise, 1600 might happen anyway


http://i.imgur.com/eKZVF.jpg