Pull the Trigger
Richard Russell
snippet
Dow Theory Letters
Nov 17, 2003
Extracted
from the Nov 15, 2003 issue of Richard's Remarks
Gold --There are a few
times in an investor's life when the opportunity for huge profits
lies ahead. Such periods in the stock market occurred in 1932,
1942, 1949, 1974 and 1980-82. People who loaded up with common
stocks at those times and held those stocks made fortunes.
I believe another
such a time is now. And I'm referring to the current young bull
market in gold. Subscribers who have been with me during recent
years were urged to buy gold stocks back in 1999. Those who did
buy the suggested gold stocks and held those stocks now have
substantial profits.
I believe that
fortunes will be made in the years ahead by those who are now
establishing major positions in gold and gold shares. I've said
this a number times before, but I want to repeat it --
These primary
moves last longer than anyone believes possible -- and they take
the items higher than anyone thinks possible. We're now in a
primary bull market in gold.
I believe gold
(and very probably silver) will make fortunes for those who now
take major positions in the precious metals.
I want to repeat
something that a prominent Wall Street millionaire told me half
a century ago -- tough words that I never forgot. "Russell,
my boy" this gentleman offered, "Do you know why stock
brokers never make big money in a bull market?"
I confessed
that I didn't know."
He answered,
"They don't make big money in a bull market, because they
never believe their own bull shit."
In other words,
the brokers tell their clients "what a great market this
is," but they're just blabbing. If they really believed
that it was a great market they'd be loading up on stocks themselves,
which if course, they never do.
So this is
my position -- I believe gold below and even somewhat above 400
dollars an ounce is dirt cheap. In view of the amount of Fed-generated
fiat paper that will have to be churned out in coming years (it
will be in the multi-trillions of dollars), gold is the cheapest
thing around. The US government, states, cities, corporations
and individuals are currently loaded with $32 trillion in debt.
On top of that, the US government has additional unfunded liabilities
of around $44 trillion, all of which will have to financed.
For these reasons,
it's my thesis that gold at $400 an ounce is ridiculously cheap.
As a comparison, gold today is less than half the price it was
at its 1980 high.
I believe three
or four or five years from now we'll look back at today's price
of $400 dollar gold and ask ourselves, "Where the devil
were we? What were we thinking about? Gold at $400 was cheaper
than dirt. Why didn't we recognize this back in the year 2003?"
As I see it,
this is one of those rare times in an investor's life when he
can buy an undervalued asset at a bargain price. This is a time
when you can buy real money with fiat paper. At this time you
can buy real money, gold, with "junk" fiat paper which
is created "out of thin air" by the Federal Reserve.
Big profits
have already been made by those who bought gold and gold shares
two or three years ago. But that is nothing compared with what
I see ahead -- as the bull market in gold moves on. We are now
in the accumulation phase of the gold bull market, This is the
phase where seasoned, knowledgeable investors build their positions
-- even while the public and most neophyte "investors"
are either ignorant of what's happening or at a time when the
public actually dislikes the very product which could make them
a future fortune.
But the secret
to all this is the necessity to ACT. Knowledge is wonderful,
but in this business, knowledge isn't worth a damn unless you
have the courage to "pull the trigger" -- to ACT.
I've listed
gold stocks and gold and gold funds until I'm dizzy, until some
subscribers have written to tell me that I should "get off
gold," that they're tired of hearing about it. So, dear
subscribers, it's now up to you. Bull markets are great, knowledge
is great -- but there's no substitute for acting. Act, act, act.
More follows
for subscribers . . .
Nov 15, 2003
Richard Russell
website: Dow
Theory Letters
email: Dow Theory Letters
Russell Archives
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