U.S. Dollar – I said the bullish camp was overrun with almost 100% bulls and it was nothing more than a dead-cat bounce in a secular bear market for the terminally ill U.S. Dollar. Watch for a dramatic short covering rally if the Euro can close above $1.25 (I think its when).
U.S. Stock Market – The least resistance continues to be up but a pullback as it nears all-time highs is likely.
Bonds – The worse investment for the next decade remains just that and look for some more switching from bonds to stocks when 10-year goes above 2%
Oil and Natural Gas – $100+ oil near and I’m near certain Israel is close to attacking Iran in next 60 days. Natural gas remains an avoid.
Junior Resource Market indeed saw an exhaustion of selling and is bouncing but any thought of one getting even this year is foolish (except if gold runs to new highs). But the bottom has been put in.
IF YOU ARE GOING TO FOLLOW MY BLOG, THE FOLLOWING IS A MUST READ. IT IS TAKEN FROM MY “2012 OUTLOOK” AND CAPSULIZES MUCH OF WHAT I KNOW AND BELIEVE ABOUT THE JUNIOR RESOURCES INDUSTRY. PLEASE REVIEW THIS BEFORE ANYTHING ELSE. IF YOU DISAGREE, DON’T BOTHER READING ANY FURTHER.
“Those of us who look into a crystal ball end up eating lots of broken glass.”
The finest gentleman I ever met in nearly three decades of being in and around the financial services industry, Mr. Kennedy Gammage, often said the above when asked for his outlook. At best, some of us can make an educated guess. At worst, one would have been better off with darts. In 2011, yours truly fell somewhere in between.
In a world where “what have you done for me lately” is paramount, I begin 2012 with a mixed bag of thoughts and a sense it shall end up better being a live chicken versus a dead duck. Because I derive a living and much of my personal investing dollars are geared towards an industry where failure is the norm, the junior resource market, I believe I’ve become more realistic of my chances and have borrowed an old slogan of “bet with your head, not over it.” Unfortunately, too many people don’t treat it as gambling and are not prepared financially and mentally to lose part or all their capital – a feat all too common in the junior resource market.
Instead of having a very small amount of high-risk capital allotted to the junior resource segment with a true understanding that failure is the norm and losing part or all of one’s capital is very real, they instead plow a large percentage of their monies and then look to blame anybody but themselves when the odds stacked against them play out. The fact that most of the pundits in this arena never note the dark side doesn’t help.
So first and foremost, to any and all readers of my blog I say that when it comes to the junior resource market, failure is the norm and I will have my fair share of it. Don’t fool yourself into thinking a business where 9 out of 10 companies eventually failed to go the whole nine yards is a place where you should place any capital that you’re not fully financially and mentally prepared to lose.