The recent plunge in gold and silver has hurt gold bugs. The bugs have always contended that central banks and governments manipulate prices of gold and silver to support fiat currencies. It never occurred to most gold bugs that they would be hurt by the gold momo crowd.
I have to admit that my respect for gold bugs is relatively newly found. Like most people, I knew about gold bugs, but never had much interaction with them until a number of accurate calls on gold and silver started bringing a deluge of emails, mostly negative.
The hate mail started in earnest when I recommended selling all silver holdings as silver approached $50. I thought I had seen enough of it until I recommended selling half of the gold position at $1,904. At that time, the flood gates opened.
When I recommended selling the remaining half of the gold position at $1,757, for the first time, I started getting a large number of emails other than hate mail from intelligent gold bugs.
Subsequently, when I recommended short-selling gold, a totally unexpected event occurred. I started getting fan mail from gold and silver investors.
The foregoing background is important so that the readers of this article can put their arms around the point I am making.
Gold bugs and the gold momo crowd are often confused. The reality is the differences between the two groups as I have assessed from a large number of emails is stark.
Gold bugs tend to be intelligent and well-steeped in economics, especially monetary policy. They understand the arguments against gold and silver….Read more at MarketWatch