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QUESTION: If the metals are usually not buying and selling at a good worth relative to every part else, then does that not show they’re manipulated?
SN
ANSWER: Your downside is the belief that every part have to be buying and selling at some honest worth. That’s up there with the speculation of random walks. ALL markets commerce for durations the place they continue to be nicely under honest worth. That was the whole takeover increase of the Nineteen Eighties which additionally they blamed on me as a result of I used to be advising lots of the takeover gamers. I merely confirmed these charts again then which present by way of guide worth, the Dow Jones bottomed in 1977. The market was grossly undervalued since you may purchase an organization, promote all its tangible property, and double or triple your cash. Michael Douglas’ well-known speech in that film about “greed” wouldn’t even be potential if every part all the time commerce like some legendary robotic at honest worth. The whole lot overshoots and undershoots.
The metals are NO DIFFERENT. Each market swings between grossly UNDERVALUED after which grossly OVERVALUED. That is a part of the enterprise cycle. If there have been no durations of gross undervaluations, there wouldn’t be a sudden increase both.
That is what you must come to grips with. There may be such a factor and the enterprise cycle. Our cyclical evaluation wouldn’t be potential if every part was buying and selling at a flat line of honest worth. This nonsense in metals is made up of people that have been incorrect, and have to blame another person. It’s like blaming local weather cycles on CO2. This notion of honest worth is rooted, I hate to inform you, in Marxism, as a result of he too didn’t perceive the enterprise cycle.
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