Stock Market
All comments and Stock Market Ananlysis are made by Guy Brumley. Guy has been trading the Stock Market daily since 1992.
Trading, evaluating stock prices and predictions
Stock Market Commentary 10-07-2009
The market ran in place Wednesday while it waited for Alcoa’s earnings after the bell.
The numbers were great, and their conference call stated they see the second half continuing to stabilize.
The big story of the week has been gold. The $1000 level has finally been left in the dust, and the projections are $1100 by as early as Friday, and the next target at $1230.
I bought the GLD JV call option at $2.05 and sold it for $3.10 over a two-day stretch, and am looking for a longer- term position in gold to shelter some cash.
The group of talking heads on CNBC Wednesday evening is saying this is the beginning of the great inflation spiral the US government needs to make its debt cheaper.
The way this game works is gold priced in US dollars is going up. In terms of the other currencies of the world, the price of gold has not changed. This is similar to the oil prices over the last couple of years. In US dollars, we saw prices double. In euros or yen, the price moved very little, if at all.
The market is taking the Alcoa news as great. The economy may have bottomed out. As long as the dollar continues its weakness, the stock market will continue to rally.
And everything is good. The hidden truth is the market will go higher, but our dollars will buy less. The net effect could be people on fix incomes run short years earlier then they counted on.
Gold or real estate may preserve capital better than CD’s and stocks. We will be watching closely for answers.
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