David's Commentary (In Blue):
Jim Sinclair is called “Mr. Gold.” But did you know that Jim Dines is called “The Original Gold Bug?” What sets Dines apart from all of the other precious metals analysts is his approach is based on human nature. Change is the way of life, but the one thing that remains the same is human nature. People react the same way, so if you focus on human nature, you stand a better chance to be in front of the crowd when trying to determine market trends.
Dines' summary for the markets in 2019 starts as follows:
No change in our great “Sell” signal for stocks and bonds near their all-time highs, and the switch to a “Buy” for havens such as gold and others.
Mass Fear suddenly stalks the investment world because nobody knows whether 2018’s stock market plunge was discounting a recession, war, or something else. We are now looking forward to our next market “Buy” signal and a probable terrific opportunity anywhere near the bottom of this decline, the steepest since the 2008 crash, so far. And December’s tumble was its steepest since 1931.
It's easy to understand why the level of optimism toward the stock market is so high. It’s been over 10 years since we experienced a bear market and investors can’t even conceive of the possibility.
When the next bear market unfolds, ETFs will experience redemptions. They will have to sell large blocks of expensive stocks. These stocks rose slowly, over time, during the bull market stage, but there won’t be buyers for these large blocks of expensive stocks as their prices tumble. You have to get out front of the selling,.... and it is coming. Relying on his understanding of human nature, Dines says,
Once the main downplunges begin, Mass Fear and Contagion will drive others to sell, and that’s where a severe stock-market plunge could begin. Because of the huge professional component, we expect the next bear market to be steep rather than drifting slowly lower. Massive buying of gold should arrive soon. We wish we could provide the precise moment.”
Dines acknowledges the current rally and says it could be a strong one, but it is unlikely to set a new all-time high. It will mark the end of the bull market. His recommendation: Hold some cash and buy some precious metals.
Gold investing is out of favor with mainstream investors and gold analysts aren’t even mentioning it. This is the perfect contrarian set up for gold. Buy when the blood is running on the streets. Dines is not bothered by this kind of negative Mass Psychology because it starts to occur at the beginning of bull markets. He says:
For patient investors wishing to drink upstream from the herd, gold won’t double overnight, but there’s no bull market as profitable as a monster gold bull market, and Super Major Upwave III will have its day.
What will cause the move to gold that will ignite the mother of all bull markets? Dines says, When stocks start to fall far enough, “
Mass Contagion kicks in
a flight to the haven of gold should be one of its refuges. So far, there has been no Mass Fear sufficient to trigger that.
The naysayers tell you that in a serious recession industrial production will fall and it will pull metals production lower, as is now starting to happen in China. But this will only affect industrial metals, and not the monetary metals – gold and silver whose value is controlled by monetary factors, not industrial factors.
Dines final words on gold:
We’ve made clear, in almost every issue of The Dines Letter, that if a major bear market emerges, our primary havens would be gold and silver.
Our favorite gold coin is the St Gaudens double eagle and buy in the best condition affordable.
We think this is sound advice, especially NOW. We have been offered a large grouping of uncirculated, certified, high quality Saint Gaudens and the lowest prices we have EVER seen. They can be had for very close to bullion gold prices. I am personally selling 60 of my Gold Buffalos and using the funds to purchase MS/64 Saint Guadens. In the coming bull market, these coins will be worth far more than any bullion coin. This really is a great opportunity to buy these magnificent coins at the best time possible – the price of gold is at or near a bottom and the premiums on the Saint Gaudens is the lowest we have ever seen. The convergence of these two factors presents the best buying opportunity I have seen in a long, long time.
Today, Christians and Jews celebrate the beginning of Easter and Passover
May peace and prosperity bless all of our friends and clients.
Today Jews around the world celebrate Passover. The Last Supper was a Passover Seder. That’s why Christians celebrate Easter Sunday the same weekend that the Jews celebrate Passover, and that’s why Easter is not celebrated on the same date, every year, like the other holidays such as Christmas or Thanksgiving. The Hebrew calendar is lunar-based, meaning that months are based on lunar months, but years are based on solar years and Passover is based on their calendar. The current Hebrew year is 5779. The most widely used calendar, used in most of the world, is called the Gregorian calendar. It was named after Pope Gregory XIII who introduced it in 1582.
For a number of years, my wife Susan has hosted a Passover dinner for our entire family, and several friends, both Jewish and Christian. It’s a tradition.
Every year I give a small speech. Susan insists. I have learned to never argue with the cook. I always start the evening off with the same quote: “Passover is like all Jewish holidays; they tried to kill us, we prevailed, let’s eat.”
I am not religious. Ever since I was a teenager I questioned the meaning of life and contemplated if there is a God, or a personal God who is involved in people’s everyday life. So for me, Passover is not just a religious holiday, it is all about tradition. It also gives me reason to ponder the question, what makes one a Jew? Who is a Jew? If a Jew is an atheist, is he still a Jew? If a person converts to Judaism from another religion, is he a Jew? Was Sammy Davis a Jew? What if your mother is Christian and your father is Jewish. Are you a Jew? According to the Rabbis, you are a Jew if your mother is Jewish. Not your father, your mother. Growing up in the 50s and 60s and beyond, I found that most people were influenced by your name and/or how you looked. In Nazi Germany, you were considered a Jew if you had 1/8 Jewish blood – that meant if just one of your grandparents was Jewish then you were considered to be Jewish.
Minneapolis is a very liberal city. After the Viet Nam war, Minneapolis sponsored and accepted tens of thousands of Hmong people. There are currently over 66,000 Hmong reside in Minneapolis and St. Paul. In recent years Minneapolis accepted more Somalis than any other city in America. There are currently around 80,000 Somalis living in Minnesota, mostly in Minneapolis. By contrast, there are less than 15,000 Jews living in the Twin Cities. Minneapolitans are very liberal and very kind and accepting of minorities and non-Christian people. But when it came to Jews, it was different. In the 1950s a Jew could not live in Edina, the “affluent” Minneapolis suburb. Even if they wanted to, no one would sell them their house. For many years, neither could a Catholic. It remanded that way for decades. Jews were not allowed to join the exclusive, upscale country clubs. They had their own country clubs, and their membership was open to all. In 1973, when I was in training for my job with Champion (the folks who make athletic uniforms and imprinted sportswear), Stuart Grossfield, Champion’s regional sales manager, took me with him to call on The Minneapolis Club, a bespoke health club. They used Champion socks and jocks and t-shirts and shorts. The club’s general manager escorted us down to the locker room and introduced us to a man behind the counter – the guy who passed out towels and soap, etc. When he heard the name Grossfield he stared at the manager and said, “What are they doing in here, you know that Jews aren’t allowed in this club.” The manager turned red with embarrassment and we quickly left. But that’s the way it was. Actually, it was much worse. In the 1950s a Jewish doctor could not bring a patient into any of the local hospitals. It’s hard to believe, but here in Liberal Minneapolis, Jewish doctors were not allowed to practice in any of the local hospitals. So Jay Phillips, a wealthy Jewish businessman, built the Mt. Sinai Hospital so Jewish doctors would have a place to practice. Dean Phillips is a relative and is a freshman member of Congress this year. Things have changed, but beneath the surface things never change. Jim Dines would not be surprised. He understands that what doesn’t change are people’s attitudes. It’s been this way for since before the Jews exited from Egypt in the 16
th
century BCE.
This is what I think about when we celebrate Passover. Passover is a reminder that the Jews have been persecuted for the last 3500 years, and it still goes on to this day.
Most of my close friends are Christian. Most of them tell me that I am wrong and that they don’t see any anti-Semitism and that I am imagining it. No, they are wrong. It is always there, but from time to time, it goes underground, but it is always lurking beneath the surface. Now I am not saying that all non-Jew are anti-Semitic. But many are, they just don’t talk about it in public.
It is a shame that most of the wars and persecutions that have taken place are Religious in nature. Why is it so important what anyone else believes? To each his own, I say, but that is not the nature of things.
In the 1970s Susan worked in the woman’s ready to wear industry. One of her clients was from India. India has a caste system. There are four castes, the top being the Brahmins. They were priestly people and were always very well educated. Susan’s client and her husband were members of the Brahmin caste. She invited her client and her husband to our house for dinner. After dinner I spent considerable time discussing religion with the husband. He told me that when he was a teenager his father sent him overseas ever year to study a DIFFERENT religion. After returning home from a year of studying the Catholic religion, he asked his father, “The Catholics say if I don’t accept their savior I will go to Hell. Is that true?” His father smiled and said, “Son, I have a story I want to tell you. A man died and was met at the gates of Heaven by a guide. For weeks they traveled together in Heaven, which was the most beautiful, amazing place he could have imagined. And then, they came upon a wall. It was too high to get over and too big to get around. The man asked the guide, ‘What is this wall doing here? It does not belong here?’ The guide said, “Oh, the Catholics live on the other side; they think they are the only ones up here.” This was the lesson his father taught him. Those who think that their way is the only way are walling themselves off from everyone else. I have never forgotten that story, and it is not meant to demean Catholics; it applies to any religion that says. “Ours is the only way”. Unfortunately, most of them do exactly that. I cannot imagine a loving God that wants it that way. I say, live and let live. We are, after all, all God’s children. I don’t worry about religion. I lead my life as best as I can, being honest, and caring and helpful and I try and make the most of my limited time on this earth. What comes next – I have no idea, but at my age, I will find out soon enough. Maybe the psychic I wrote about last week, Daryl Jason, is right, and we all are reincarnated and come back lifetime after lifetime until there are no more lessons to learn? Then we can remain in a spiritual state. Or maybe there is no God. Or maybe the Christians are right. As the Danish philosopher, theologian, poet, social critic and religious author who is widely considered to be the first existentialist said 175 years ago, man can only find God through “a leap of faith.” Knowledge and empirical evidence will never prove the existence of God. It takes what he called a leap of faith. I have never been able to take anything on faith alone. After 60 years of thinking about it, I still haven’t been able to make up my mind.
I recommend that you watch Jesus, Countdown To Calvary on Netflix. Host Hugh Bonneville traces Jesus' last days to learn how the execution of an itinerant Jewish preacher had an immense impact on society. "Jesus: Countdown to Calvary" host Hugh Bonneville was also the star of "Downton Abbey."
