Tuesday, March 15, 2011

Quote Of The Year So Far - From Marc Faber:

"We may drop 10 to 15 percent. Then QE 2 will come, (then) QE 4, QE 5, QE 6, QE 7—whatever you want. The money printer will continue to print, that I'm sure. Actually I made a mistake. I meant to say QE 18."  (I sourced this from zerohedge.com)

That is almost verbatim the conversation I had with my business partner this morning.  Hedge funds are dumping everything in sight in order to avoid catastrophic margin calls.  The selling may come in waves as margin calls are issued.  But, use this volatility to add to good quality mining stock positions, especially junior miners.  Also make sure you add to your physical gold/silver holdings.

I expect the Fed to ease the fiat paper spigot even more today, although they may not explicitly make that clear when they release their FOMC meeting policy decision later today.  However, there is no doubt whatsoever in my mind, and I made this call in a post last week, that the Fed will use the Japan catastrophe as a "cover" to continue with its QE sequence.  I also expect them at some point to include mortgage-backed garbage (FNM/FRE crap) and eventually muni paper.  Get out of all fixed income paper - inflation isn't coming, it's here now - and move your money into hard assets.

Through a combination of luck and instinct, we moved our stock portfolio into a 33% cash position yesterday morning and we are now moving some of that cash back into our favorite positions.


  1. Regarding the drop in Gold & Silver, it looks like many already understand the baby was thrown out with the bathwater, as the prices have been creeping back up since 8:30 EST.

    Some savvy (and brave) traders have already made a nice profit today.

  2. I'm just holding, buying more on the dips. When commodities explode, I stand to make a handsome profit.