Metals & Phase Transition

Phase v Bell

QUESTION: 

Hi Martin,

Thanks for all of your reports, they are very informative. I am an institutional portfolio manager here in Canada. I know you mentioned that the gold correction will go on until all the Bulls have thrown in the towel. I have never been a gold bug. I am only employed to make money for clients. But it is interesting over the past couple of months. All of the gold bugs I know, have completely given up on gold and in particular gold producers. They are actually anti-gold now. I can count on one hand the number of sales calls I have received on anything to do with gold over the last two months. I guess with that long-winded preamble, I was interested to know if a gold cycle has ever ended without entering a phase transition?

Thanks.

Peter

SVNYNF-Y Adusted

ANSWER: NEVER. You require the Phase Transition for it to be a bubble. We have NOT accomplished that in the metals. Gold adjusted for inflation has not exceeded the 1980 high.Here is silver in cash. We also have a double top. This is why I have said that there will be the traditional correction that could be up to 5 years under the worse case scenario pushing the low into 2015. But if that were the case, the 2015 low would be a double bottom with 2013 or a new low that is marginal. Always 90% of the decline unfolds within the first 2 to 3 years. That makes the low now possible or extending into June/July 2014 for the finish.

Keep in mind, this is TIME & PRICE sensitive. Meaning it is not just reaching the target in price, it has to come with the cycle to be meaningful.