Gold, Gold, Gold
Gold, Gold, Gold….. NEW HIGH!!!! That’s the story today. Nothing else. Gold blew off the top of the gold chart today. Why?? India bought 200 tons of the IMF’s 403.3 tons that it said it was going to sell. India’s purchase of this gold (a) reduced the overhang of the IMF sale, i.e. reduced the downward pressure on the price of gold, and (b) more importantly, India thumbed its nose at the US Federal Reserve (who has always told India to ignore Gold in favor to the US $), so this is a blow to the US Dollar Reserve status again. India’s purchase was the largest gold purchase in the last 30 years. India paid $1045/ounce, so it’s already making a big profit.
The world’s stock markets melted down 2% yesterday, but when it came time for the US market to open, it didn’t melt down, but was down just a little. Why? The tail doesn’t wag the dog, and the NYSE is the dog.
All other markets were basically sideways.
In the news today……
Warren Buffett – is betting the farm on Burlington Northern RR. He currently owns 22% of the company and is buying the rest of the company – which has been approved by the boards of both companies. This is a bet that the US Economy will recover. Burlington is a major mover of energy, food and products across the USA. As the US recovers, there will be more movement – and that’s what Warren is saying with his money – about $34B worth of Berkshire Hathaway money.
Here are the last numbers for today:
Dow Jones 30 Industrial – 9765 (down 25 points)
10 Year Treasury Bond – 3.47% (up 0.05%)
Euro – $1.4714
Gold – $1085 (up $32) – A NEW HIGH
Oil – $79.31 (up $1.18)
Gasoline – $1.96 (down $0.03)
I concur, Buffett is “betting the farm” on BNRR. I don’t see it but he’s been successful doing his thing for decades. Perhaps it is a huge case flow play which seems most plausible to me.
We’ll see how this turns out. WB did make multi-billion dollar bets on Goldman Sachs and GE and those turned out well in just one year.
Amen!!! Only a fool would bet against Warren Buffett. Oh, byw, i own some Berkshire stock, so i’m part of the party too.
However, that doesn’t mean there isn’t a bunch of ways of making money in this market. I am betting on Gold, and am waiting for the sign to sell the markets short. The sign is close, but it hasn’t signalled me yet.
Tom