An Inverse Relaqtionship???I've been thinking and reflecting lately on many things, and I know, as many reading here will point out
that I think too much, or no doubt out think myself. Some will tell you that I don't actually think at all!!!
However;
I still remember my university haze, scratch that---I mean days.
First year---Economics 101. This introductory course was basically split up into two equal parts, and rightfully so.
The first half concentrated solely on MICRO economics, and the second half solely on MACRO economics.
I must admit that I loved Micro Economics. I was facinated by the laws of supply and demand, and all the graphs.
It was meat & potatoes stuff that you could sink your teeth into. I really believe it should be a REQUIRED course
for all university students.
Macro Economics to me was far too wishy-washy-----a bunch of abstract junk.
I look back now and realize that I was wrong.
So what you say?----and rightfully so!
Anyhows-----
Any one who reads my garbage, knows that at the end of each & every day, I review a bunch of stocks that I
follow (about 15 exploration stocks). Rightfully or wrongfully, I believe them to be somewhat GCU like.
On the weekend, with nothing else to do, I really analize them and try to figure things out---general trends
and whatnot. I try to figure out if what happened over the past little while, was unique to GCU (pent up demand,
insider activity, volume, anticipation of News Releases, actual NR's, new articles, new or revised recommentations,
Up dated price targets----etc.) OR was what happened with GCU basically the same as with the rest of the
bunch of stocks on my "watch list". NOTE: that's not to say that I own all or any of them.
I do this so that I don't just fall in love blindly with ONE stock, which I believe is very easy to do----a trap so to
speak. I try to rationalize and understand-----always on a learning curve.
Naturally------one has to keep a close eye, ALWAYS, on the prices of Gold and Silver and the bull market in
commodities. I've been doing this for years.
Surprisingly lately, all of my beloved stock charts and share prices have basically behaved the same way,
sort of a reflection of one another. I love charts, and I even do a manual chart on each. This is because
It slows things down, and really makes one think more----instead of "rushing" and taking the easy way out
and just going "click, click, click". The result is you can overlay them for clarity and comparison purposes.
Two exceptions here are for the good----XG and for the bad---EVG (which in my twisted mind I now call it
"Disolving Gold")
A lot of what I've been seeing doesn't make much sense. It must be Macro Herd Mentality.
Since late last April and especially May, and perhaps part of June the price of Gold and especially Silver
had a correction downwards. Sell in May and Go away mentality perhaps?
The prices of my bundle of stocks fell accordingly, regardless of News---many to levels not seem since
last November!!! Which I have commented on.
Then, the price of Gold began a rather slow comeback---a sizeable comeback-----but the share prices of the
bundle basically went SIDEWAYS-----Ie. they didn't respond accordingly.
Last WEDNESDAY, the price of Gold had climbed all of the way BACK UP to close at roughly $ 1,550 US per
ounce----but----my bundle of stocks price-wise got very little RESPECT!!!
Yes, it is TRUE that they reversed their downwards trend, and had it seemed "turned the corner' and the
share prices "ALL" rose a BIT------BUT----NOT and no way near to the levels that they were when the Gold
price was LAST at the $ 1,550 level!!!!
Why----are 'they' just out of favour? Are people all on holiday? Are investors afraid of the dreaded "DEAD
CAT BOUNCE"???
THEN, and MOST IMPORTANTLY, in just TWO DAYS----Two mere days ago---last THURSDAY and FRIDAY,
the Price of Gold took a SEVERE "NOSE DIVE" of FIFTY DOLLARS-----to close on Friday basically back
at $ 1,500 US Dollars!!!!! Did my bunch of junior Gold Exploration Stocks FALL accordingly????
NO----IN FACT INSTEAD they basically ACTUALLY ROSE a bit in share price!!!!!!
UNREAL----to me anyway-----and that's why I entitled this post, "An Inverse Relationship"!!!!
It would appear---TO ME at any rate----that these share prices are reacting in an inverse relationship, as of
late, to the movement in the price of Gold!!!!
IS it JUST ME who doesn't understand what just went down/happened???
Must be that MACRO HERD that I don't understand!!! I guess I should have paid more attention to the
last half of that Economics 101 course.
Even worse-----to me, IT was VERY CLEAR the severe drop in the price of Gold was about TO HAPPEN.
Mind you I didn't think it would DROP FIFTY in Two DAYS!!!
It was easy to see it coming----to me IT WAS TELEGRAPHED----Just like in the baseball movie
"Bull Durham" when the hero, the catcher, told the hitter what pitch he had called for NUKE to throw, just to
teach his young stubborn pitcher a lesson. You just knew what was going to happen.
News Monday??? Who knows!! It is well, well overdue---and what will happen if so---MICRO or MACRO---
and will there be "a day's grace" for price reaction, as we have all seen in the past?
Another thing that somewhat puzzles me----with our share price SO LOW in general, and way UNDERVALUED,
why aren't the "Big Boy Insiders" buying hand over fist----like before, even when GCU's share was MUCH
HIGHER----and certainly FAR BELOW the financing price of $ 3.65 ???
Like I said BEFORE: "Is it just me?" Have I gone completely BONKERS and over the edge?
Who cares-----come on HERD !!!!
Oh yeah, and a higher Gold price---a quick rebound!! Then again, MAYBE, if recent events are a new trend,
we should be very warry---"be careful of what you wish for!!!!!!????"
Confused and probably wrong, as always----notoriously yours as always,
BARN BREATH