Do you believe that the Bear Stearns bail-out would be the last chapter of the credit crunch ? For me, I feel it is a case of the dead cat bounce. Should you have to unload your stocks, it is time to do so. Otherwise, it would be too late for the last train.

The 75 basis points cut , the bailout of Bear as well as taking MBS as collateral for the $200 Billion offer for Treasury Securities (that are easily tradeable) for troubled investment banking community is a shame and using taxpayers money to bail out the commercial sector is a bad precedent sice the Great Depression and I do believe it is just the beginning of the end i/o the end itself.

The credit crunch as well as the subprime mortgage woo amounts to a $ 2 to $ 6 trillion problem that could not be solved just by the Fed ( unless it forgets about inflation or hyperinflation to print out more greenback for the market or the financial market just for the sake to soaking it with liquidity to salvage this endangered species).

We are in fact in a recession no matter how hard you deny it or how high hand the Fed as well as Hank Paulson to stabilise the market.Yes,it seems true that business cycles are replaced by ‘Bubble Cycle’ because the Fed is determined to do whatever it can to salvage the market dating back to when Alan Greenspan took office 20 years ago. Unlike Paul Volcker who followed the rules of the market and stayed independent of politics so that he could raise the nominal rate to over 20% to kill hyperinflation irrespective of economic growth but both Alan Greenspan and Ben Bernanke are not Paul Volcker and they succumb to not only political pressure but to Wall Street and have been too afraid of even slowing economy, not to mention a recession. If Bernanke is in office for the next 20 years, we may see more bubble to be formed and to bust and his heavy-handed ways to save Wall Street. Are we going to have no more business cycles and to be replaced by bubble cycle? If we look at dot-com bubble, housing bubble, credit bubble and the most recent commodity price bubble, it seems evident we are in for a very rough ride.

Dear Mr. Frugal, what do ya think?

I dont see gold falling lower than that. Maybe a day or two, but that support is Major.

my 2 cents

I can’t really give advice for individual requests. You’re responsible for any of your decisions taken (see my legal disclaimer).

Right now, the markets are still unclear. If gold breaks $900, then we will be looking at a deeper and longer correction. (But of course, by that time, it’s a little late to sell.)

I’m currently holding, but I could sell anytime without further notice.

>Can the gold bull market be finished right here? I think the chance is quite slim.
Again my sentiments exactly. I am no gold bug but I do see it reaching 14-1500 by 2009.

I’m strictly into physical. Bought AU at 700 and AG at 20. Rarely do I trade but I’d love to hear your opinion because it may be appropriate to take profit and wait till the late summer. And what would you do with the cash in the meantime if I were you? We are taking large sums so I am also considering selling AU 20 rands a time. Please advise and thanks.

For example, I dont know what an elliot wave 1-5 is, although i could look it up. I dont understand the significance of the tonnes GLD(gold?), or what “hot money” is, or why its important to know where its comming from.

What is “over-boughtness” and what is its relation to the long term moving average, and what does it mean that things could get ugly?

thanks