An August August for Gold?
The comments below are an edited and abridged synopsis of an article by Mark Mead Baillie
Baillie says that gold will record another good August, but not necessarily up to its all-time high ($2,089), let alone his forecast high for this year ($2,401). Nonetheless, an up month lies ahead, if for no other technical reason than the price’s refusing to succumb to the ongoing parabolic short trend.
Gold’s absolute best shot to accelerate upward will occur during the September/October period when, for everything else, it all goes wrong.
When Baillie asks financial advisors how they’re preparing to protect clients’ portfolios, the subject is changed or he hears crickets. And as he has said, upon the price/earnings ratio of the S&P reverting to its mean (19.2x)—which it has always done throughout the Index’s 64-year history—the loss this time around regressed into Dow terms may exceed -20,000 points in as little as three trading-suspended days. As a recent reminder exercise, calculate the Dow high from February 19 to its March 18 low of just a year ago.
No one wants to see gold soar because it generally means that the world ends. Rather, gold should rise to meet its scoreboard debasement value, presently shown as $3,888.
Up for discussion: Bonds; GDP; June’s personal income, new home sales and pending home sales; the Q2 earnings season; and silver.