I always know when gold has fallen by $20 or more. Jim Sinclair sends out an email that says: “Don’t panic.”
He predicted $1,650 gold years ago. Now he predicts $3,000 gold. (Why didn’t he predict $3,000 gold years ago? What changed his opinion? Why didn’t he tell people to sell half their gold at $1,650? That’s the problem with setting a target price. You may turn out to be accurate. Then what?)
Anyway, when gold fell under $1,700 this week, 300 subscribers sent him frantic letters. So, he dutifully sent out a digital change of underwear for them. He reassured them that things are OK for gold’s price, meaning an ongoing catastrophe for the economy.
These poor souls haven’t a clue about gold or anything else. You know they did not buy when it was under $300, when Sinclair, Bill Bonner, and I were begging people to buy. That was over a decade ago. They waited and waited and waited. Then they bought. They missed the big move. Now they fear losing wealth, as denominated in fiat dollars. They refuse to think in terms of gold’s future value in a frightening economy.
Sinclair thinks we will get hyperinflation. He calls it “QE to infinity.” His readers should be selling their homes, buying semi-rural retreats, food storage, and tools. Urban living is bad in hyperinflations. But these people prefer to trust gold to save them from the comprehensive negative effects of hyperinflation. Worse, they really do not believe him. If they believed him, they would ignore short-term moves in gold’s price in dollars.
I do feel sorry for them. They need reassurance. If Sinclair wrote that gold is going to $3,000 because the bildag has just been inserted to the gazorningplex, they would calm down. They just want to be reassured by their guru. They are not looking for logic. They are looking for this: “There, there. It’s all right. Really.”
Decide what you are hedging against. Then adopt a plan to prepare for this. Don’t let short-term price moves bother you.