The Bull 'n Bear on Gold, Uncle Sam's 'AAA' Rating
In today's WSJ:
- The Wall Street Journal's page announces that the World is Bitten by Gold Bug. Is this the sign of a top in the gold market, just as BusinessWeek's infamous 'Death of Equities' headline in 1979 was the sign that stocks had bottomed and were about to embark on a huge bull run? I don't think so; I don't perceive that there is the sort of frenzied buying of gold across all types of investors that precedes an exhaustion in interest, and, eventually a reversal that marks the bursting of a bubble.
On the topic of gold, I challenged a few gold bulls to rebut my quantitative argument that gold is substantially overpriced at these levels. Dave in Qatar (whereaminow) took up the challenge with brio; you can find his response here. I will respond when I get the chance.
- On a related note, there is a good pice by the WSJ's Heard on the Street column regarding Monday's warning from S&P concerning the outlook for Uncle Sam's 'AAA' rating (from 'stable' to 'negative'). Apparently Deutsche Bank has produced a report, according to which the U.S. is riskier than Italy, Spain or Belgium!
Enjoy Good Friday!