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Strategies & Market Trends : Precious Metals mutual funds (gold, silver, PGMs) -- Ignore unavailable to you. Want to Upgrade?

To: Larry S. who wrote (948)11/29/2005 9:15:30 AM
From: Larry S.  Read Replies (1) | Respond to 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.