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   Strategies & Market TrendsPrecious Metals mutual funds (gold, silver, PGMs)


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To: Larry S. who wrote (943)9/25/2005 10:42:18 PM
From: Larry S.
   of 972
 
Dan Wade et al,

I didn't find anything in Barron's this week concerning PMs and lease rates don't seem to be doing anything special; so I will get the GMI bit directly.

The GMI/POG ratio:

On 9/22, the Barron's GMI was 747.47 up significantly from the previous week's 719.55. With the POG also up at 462.65 (9/23), the ratio was up at 1.62.

The ratio has reached the high side of the middle range but it doesn't yet suggest strongly a rise or drop in the POG or stocks. It may be indicating that interest in mining stocks is beginning to increase significantly.

The ratio a year ago was 1.56, almost as high as today.

Larry

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To: Larry S. who wrote (944)10/7/2005 1:04:41 PM
From: Larry S.
   of 972
 
Dan & Wade et al,

I didn't find anything in Barron's this past week concerning PMs; however changes in lease rates may be telling us something of interest. I've noticed that lately the gold lease rates, which are very low, move up when the POG moves up. This correlation is the same as during the late 90s when the price was declining. However, it seems to me that it is now reflecting a shortage of gold available to lease; that is, CBs are less willing to lease. This seems bullish to me. The story being told by the silver lease rates is clearer. The lease rates are very high and rising suggesting to me that stock piles are in fact dwindling as has been stated by several gurus.

The copper situation is at least as interesting. Note that its price continues to make to new highs even though gurus continue to say it will fall with an increasing dollar. It hasn't. It is clearly in short supply.

The GMI/POG ratio:

On 9/29, the Barron's GMI was 781.95 up significantly from the previous week's 747.47. With the POG also up at 473.25 (9/30), the ratio was up at 1.65.

I believe the ratio has reached the high side of the middle range but that it doesn't yet suggest strongly a rise or drop in the POG or stocks. However, I can't access the website with the data on the meaning of the ratio. It may have been shut down. If we can't access it, it is not clear to me that continuing to post the ratio is worth while. I can't seem to find the time to put the data in a spread sheet; so that we could build our own model.

The ratio a year ago was 1.61, almost as high as today.

Larry

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To: Larry S. who wrote (945)10/31/2005 11:10:32 PM
From: Larry S.
   of 972
 
Dan & Wade et al,

I see that I have missed nearly a month and I'm missing one week's data for the GMI/POG ratio. Sorry. Our drought ended a early in the Month and it was followed with a very bad storm. So I went from spending a lot of time trying to keep our shrubs alive to trying to fix leaks in the roof. My lesson is to never again hire people because you feel sorry for them. In any event, I haven't had time lately to really absorb potentially interesting info in Barron's so I will get on with posting the data I have on the GMI.

The GMI/POG ratio:

On 10/6, the Barron's GMI was 745.40 down significantly from the previous week's 781.95. With the POG also down but only slightly at 472.70 (10/7), the ratio was down at 1.58.

Data for the follow week is not available.

On 10/20, the Barron's GMI was 708.71 down significantly from the two weeks prior 745.40. With the POG also down at 462.85 (10/21), the ratio was down at 1.53.

On 10/27, the Barron's GMI was 743.98 up significantly from the two weeks prior 708.71. With the POG also up at 470.75 (10/28), the ratio was up at 1.58.

I observed in my last post that I can't access the website with the data on the meaning of the ratio. It may have been shut down. If we can't access it, it is not clear to me that continuing to post the ratio is worth while. I can't seem to find the time to put the data into a spread sheet; so that we could build our own model. In any event, I will continue to post the ratio bit for a few more weeks.

The ratio a year ago was 1.52, almost as high as today.

Larry

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To: Larry S. who wrote (946)11/20/2005 8:40:06 AM
From: Larry S.
   of 972
 
Dan & Wade et al,

I see that I have missed two weeks so I will post the past two week's as well as this week's GMI ratio bit today. However, it is most interesting that with gold at a several-year high, this week's Barron's carried an interview with JOHN HATHAWAY the Tocqueville Gold Fund manager. Of course, he is very bullish long term and sees major interest coming into the market when the price breaks $500.00/oz. He sees this happening during the next few months. Abelson also had some bullish words concerning gold in his "Up and Down Wall Street" column this week. So that they covered both sides of the debate, the Economic Beat Column this week was written by Carl B. Weinberg, the economist at High Frequency Electronics and he is very bullish on the dollar and obviously not bullish on gold. The Commodities Corner is devoted to Copper and discusses the Chinese Trader that is in trouble with a large short position. The general thrust of the story is bullish - supplies are low and demand continues to hold (it won't drop unless we have a global recession, in which case the dollar is likely to fall hard. In any event, when Barron's starts publishing bullish stories on gold, it is time to look for a pull back.

The GMI/POG ratio:

On 11/03, the Barron's GMI was 773.23 up significantly from the previous week's 745.40. With the POG down but only slightly at 460.50 (11/04), the ratio was up at 1.68.

On 11/10, the Barron's GMI was 779.80 up from the prior week's 773.23. With the POG also up at 466.75 (11/11), the ratio was down slightly at 1.67.

On 11/17, the Barron's GMI was 833.72 up significantly from the prior week's 779.80. With the POG also up at 485.85 (11/18), the ratio was up at 1.72.

I observed in my a previous post that I can't access the website with the data on the meaning of the ratio. It may have been shut down. If we can't access it, it is not clear to me that continuing to post the ratio is worth while. I can't seem to find the time to put the data into a spread sheet; so that we could build our own model. In any event, I will continue to post the ratio bit for a few more weeks. However, I recall (I think) that a higher ratio must be achieved before the probability of a major decline becomes substantial.

The ratio a year ago was 1.58, almost as high as today.

Larry

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To: Larry S. who wrote (946)11/20/2005 9:04:55 AM
From: Larry S.
   of 972
 
Dan & Wade et al,

I see that I have missed two weeks so I will post the past two week's as well as this week's GMI ratio bit today. However, it is most interesting that with gold at a several-year high, this week's Barron's carried an interview with JOHN HATHAWAY the Tocqueville Gold Fund manager. Of course, he is very bullish long term and sees major interest coming into the market when the price breaks $500.00/oz. He sees this happening during the next few months. Abelson also had some bullish words concerning gold in his "Up and Down Wall Street" column this week. So that they covered both sides of the debate, the Economic Beat Column this week was written by Carl B. Weinberg, the economist at High Frequency Electronics and he is very bullish on the dollar and obviously not bullish on gold. The Commodities Corner is devoted to Copper and discusses the Chinese Trader that is in trouble with a large short position. The general thrust of the story is bullish - supplies are low and demand continues to hold (it won't drop unless we have a global recession, in which case the dollar is likely to fall hard. In any event, when Barron's starts publishing bullish stories on gold, it is time to look for a pull back.

The GMI/POG ratio:

On 11/03, the Barron's GMI was 773.23 up significantly from the previous week's 745.40. With the POG down but only slightly at 460.50 (11/04), the ratio was up at 1.68.

On 11/10, the Barron's GMI was 779.80 up from the prior week's 773.23. With the POG also up at 466.75 (11/11), the ratio was down slightly at 1.67.

On 11/17, the Barron's GMI was 833.72 up significantly from the prior week's 779.80. With the POG also up at 485.85 (11/18), the ratio was up at 1.72.

I observed in my a previous post that I can't access the website with the data on the meaning of the ratio. It may have been shut down. If we can't access it, it is not clear to me that continuing to post the ratio is worth while. I can't seem to find the time to put the data into a spread sheet; so that we could build our own model. In any event, I will continue to post the ratio bit for a few more weeks. However, I recall (I think) that a higher ratio must be achieved before the probability of a major decline becomes substantial.

The ratio a year ago was 1.58, almost as high as today.

Larry

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To: Larry S. who wrote (948)11/29/2005 9:15:30 AM
From: Larry S.
   of 972
 
Dan & Wade et al,

What a difference a week makes, I didn't find any mention of PMs in this week's Barron's. I had mentioned last week that, when Barron's starts publishing bullish stories on gold, it is time to look for a pull back. It shows what little I know as the POG spiked above $502.00 last night. It has pulled back this AM and many experts expect a consolidation here before rising further; so maybe I wasn't far off.

Lease rates are showing an interesting pattern. The 1-month rate is higher than the 1-year rate. This inversion has been apparent for a few weeks. I don't know what it means but it is different condition than I've noticed in the past 10 years.

The GMI/POG ratio:

On 11/24, the Barron's GMI was 833.31 down very slightly from the prior week's 833.72. With the POG also up at 487.60(11/25), the ratio was down slightly at 1.71.

I observed in my a previous post that I can't access the website with the data on the meaning of the ratio. It may have been shut down. If we can't access it, it is not clear to me that continuing to post the ratio is worth while. I can't seem to find the time to put the data into a spread sheet; so that we could build our own model. In any event, I will continue to post the ratio bit for a few more weeks. However, I recall (I think) that a higher ratio must be achieved before the probability of a major decline becomes substantial.

The ratio a year ago was 1.58, almost as high as today.

Larry

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To: Larry S. who wrote (949)12/26/2005 5:26:11 PM
From: Larry S.
   of 972
 
Dan & Wade et al,

It benn a month since I posted the Barron's GMI bit but I have the data, so I will post the missing bits below. As indicated, the POG has had a wild ride the past few weeks but is back about where is was a month ago. If Barron's is the contrary indicator it has been in the past, it should pull back further as this Christmas week edition contains a very bullish story by one of the Barron's staff. It includes the following quotes;

""Most people on Wall Street have a very strong opinion on gold, but very few people know what they're talking about," says Trey Reik, who runs Clapboard Hill Partners, a long/short equity fund that focuses on mining shares. "The fact is, you don't know [the reasons for the spike] until after the peak and you see how it unwinds."

Certainly, eager speculators have played a role in the big run-up. "Investors have been scrambling to find anything they can bid up in price," says Peter Perkins, a global investment strategist at BCA Research.

The level of speculation has led some, including Reik, to predict a price pullback, perhaps to $480 an ounce, before the longer-term bull market plays out. But James Turk, founder of GoldMoney.com, a well-regarded Internet site for buying and selling gold, expects prices to top $850 an ounce next year. He's worth listening to: In the fall of 2004, Turk correctly forecast that gold would break $500 in 2005.

Turk sees the move above $500 as "an international buy signal" that confirms for investors that "this move is for real." He notes that gold has been rising against all of the major currencies, something that hasn't occurred since the 1970s, the start of the last major bull market in gold. He points out that in current dollars, gold's all-time high of $850 an ounce, reached in 1980, would be $2,200."

Lease rates continue at very low levels and the rates for different lease durations are almost the same. As I indicated a month ago, I don't know what it means but it is different condition than I've noticed in the past 10 years.

The GMI/POG ratio:

On 12/01, the Barron's GMI was 848.19 up from the prior week's 833.31. With the POG also up(breaking 500) at 502.55(12/02), the ratio was down slightly at 1.69.

On 12/08, the Barron's GMI was 876.16 up from the prior week's 848.19. With the POG up significantly at 525.50(12/09), the ratio was down at 1.47.

On 12/15, the Barron's GMI was 845.58 down from the prior week's 876.16. With the POG down significantly at 507.50(12/16), the ratio was up at 1.67.

On 12/22, the Barron's GMI was 863,74 up from the prior week's 845.58. With the POG down at 505.00 (12/23), the ratio was up at 1.71.

As I have observed in my recent posts, I can't access the website with the data on the meaning of the ratio. It may have been shut down. If we can't access it, it is not clear to me that continuing to post the ratio is worth while. I can't seem to find the time to put the data into a spread sheet; so that we could build our own model. In any event, I will continue to post the ratio bit for a few more weeks. However, I recall (I think) that a higher ratio must be achieved before the probability of a major decline becomes substantial; it is clear that the ratio is on the high side of the mean.

The ratio a year ago was 1.50; the GMI was nealy 200 lower.

Larry

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To: Larry S. who wrote (950)12/26/2005 10:55:12 PM
From: Wade
   of 972
 
Larry and Dan,

Sorry for lagging of my responses.

I have reduce my PMPIX holding significantly due to its unable to keeping up 150% XAU leverage and exposure to hedged stocks. I added USERX to the line up. This fund has been lagging due to several poor stock selections. But, I like its new line up right now. I'll keep on watching its performance and will move away from it if it doesn't perform well.

I feel the same way that POG will move higher because it has becoming an international currency when all paper currencies are printing in record speed and quantities.

GMI/POG ratio can be replaced with XAU/POG for research. I used it very often:

smcurl.com

Good luck for 06.

Wade

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From: Wade12/29/2005 6:56:05 PM
   of 972
 
The key to make good money from the mutual funds is to look for those can beat both XAU and HUI indexes. Otherwise, there is no point to pay those mangers to look after our money. <G>

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From: Wade1/28/2006 7:52:07 PM
   of 972
 
smcurl.com

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