Your Most Important Questions, Answered!

Larry Edelson

First, let me wish you all a very happy and healthy holiday season! I’m always amazed how time flies, so please make the most of the holidays and spend some quality time with friends and loved ones.

For this week’s column, I’m getting so many questions from readers, I decided it would be best to answer the most important ones. So let’s get started!

Q: Larry, you were right as rain about gold again this year. It crashed and came close to one of your targets at the end of November. Is the bottom in yet?

A: It could be, but it’s really too soon to say. By that I mean we have no proof of a bottom. Yes, gold has tested major support at the $1,048 level and it did so at the right time, cyclically speaking. So that’s good.

But, gold has not yet climbed enough above overhead resistance to issue a buy signal that would confirm the low. If it fails to do so, then gold could easily move lower into early January.

The specific support and resistance levels and buy and sell signals for gold are of course reserved for members of my services. But for now, generally speaking, keep an eye on the first initial level of major resistance at the $1,095 level and support at $1,036. A close above or below either one of those figures (nearest futures) will determine the next big move.

For silver, you want to watch $15.46 on the upside and $13.75 on the downside. Yes, that’s a big range, but in between those two figures for silver is effectively no-man’s land. Other than for short-term futures traders, there is nothing to do in silver at this time (same for gold).

Q: Why isn’t inflation a big problem now? I just don’t get it and there are still so many experts out there saying it’s coming.

A: As I’ve said all along, printing money by itself is not inflationary if the majority of investors and consumers don’t want to spend or borrow money. That’s been the case for years as consumers, investors and businesses — the private sector — all retrench …

Either by their own volition, or where it’s been forced upon them by governments via financial repression of higher taxes, confiscations, capital controls, and more. Which has been the case in many countries in Europe.

There are many more reasons, too many to discuss in a short column. Two biggies though are A) Global debt is now well over $200 trillion, so printing $5- or even $10- or $20 trillion is hardly going to make a dent …

And B) Banks are reluctant to lend. In fact, most of the money printed by the Fed has been reinvested by banks back with the Fed in what are called “excess reserves” … which are bank reserves that banks don’t need to keep on hand.

The European Central Bank (ECB), unlike the Federal Reserve in the U.S., is actually charging banks that place excess reserves back with the ECB in the form of negative interest rates. The theory there is that if the banks get charged for not lending, then penalize them and they will start lending.

But it’s not working, at all. That shows you just how intense the deflation is, and the money hoarding is.

Q: Where do your war cycles stand?

A: Precisely as forecast, they continue to ramp up big time. You can see it all over the world, in Syria, with ISIS, in Asia between China and Japan, in social unrest in Europe, in increasing terrorism and more.

The war cycles point up all the way into 2021, so fasten your seatbelts.

Q: You’ve been forecasting that the U.S. stock market will take a moonshot to as high as 31,000 — over the next few years. Is that forecast still on target?

A: Absolutely. There is no doubt in my mind we will see the Dow move to at least 31,000 and possibly much higher. And not despite turmoil in the world, but because of it. The Dow and other blue-chip type stocks can and often do act just like gold, as a safe haven for capital and as an inflation hedge.

But the Dow has not yet completely broken out to the upside. A sharp, swift correction is still way overdue. When that comes, I will be giving the signal to back up the truck for stocks. But not until then.

Q: You really nailed oil on the head Larry, predicting it would fall well below $40. Has oil bottomed now?

A: No, but I think a bottom is very close. My models show it coming the first week of January, so stay tuned. I should have some very important comments coming about oil, right after the holidays.

Q: Has the mining sector bottomed? You saved my entire life savings by getting me out of the way back in 2011. Thank you!

A: You’re most welcome. The carnage in the mining sector is one for the record books, losses of 90% on average for most publicly-traded mining companies.

The bottom is not in yet, but it could be right around the corner. So stay tuned!

That’s it for now, stay tuned — my models are showing that this month and next will be pivotal for almost all markets, leading to major trends unfolding and a slew of new profit opportunities.

Best wishes,

Larry

P.S. Check out my NEW Supercycle Investor Podcast with Mike Burnick. Topics and investing strategies include technical analysis, hedge funds, gold prices, silver trading, commodities, emerging markets, currencies, interest rates, government debt crises and tangible assets, to name a few. Leave a review and let us know what you think!

Larry Edelson, one of the world’s foremost experts on gold and precious metals, is the editor of Real Wealth Report and Supercycle Trader. Larry has called the ups and downs in the gold market time and again. As a result, he is often called upon by the media for his investing views. Larry has been featured on Bloomberg, Reuters and CNBC as well as The New York Times and New York Sun.

Comments 39

supharaj chokwonganun December 23, 2015

Many experts are saying USA stock mkt outlook is bad and likely to collapse BUT MR market is going up Some say because of FANG share price S&P/Dow etc moving up we are talking abt short time for next 3/6 month if really the undercurrent of mkt is bad then why it is not coming down to $1800 for S&P500 ur comment rgds suppharaj

Nick December 23, 2015

To my knowledge, there is no one in the world who understands what Money really is more than Larry Edelson and Martin Armstrong. The stock markets are so volatile, that no one is going to get it completely right, (too many emotion variables) in regards to the stock market near term behavior. However get the Money equation right longer term and in the end, your going to be profitable (on the right side of the equation). Best we pay attention and be on the right side. N

Howard December 23, 2015

It seems more important on this site to get the ego right than the policy settings

JohnLamb December 23, 2015

There seem to be 2 main theses going into the future, Larry's supported partially by Dr. Doom, and (Stockman's/Rickards) from Agora. Larry's is based on huge external from USA capital transfers due to wars/upheavals seeking safe haven. A logical and historically observed occurrence. (Walks like a duck, quacks like a duck, swims like a duck). Dr. Doom from "Doom and Gloom", also factors in external transfers for safe haven ports but is more jittery as to USA legal repercussions. Stockman is being a bit more parochial in seeing only the USA and not factoring in external transfers to take up the slack prognosticates a sooner demise of the "bubble ". Rickards coming from even a wider and more in depth analysis also foresees a sooner demise, but due to more widespread geo-political reasons and lack of time as well as discounting the external transfers. There you have it two different schools of thought. Like Nick writes above, "Best we pay attention and be on the right side". Just remember what J.P. Morgan said: "Gold is money. EVERYTHING ELSE is credit" and he meant physical gold. Good luck all.

JohnLamb December 23, 2015

John Maynard Keynes said: "When facts change, I change my mind, what do you do sir?"

John T December 23, 2015

I stick with real money, GOLD ???

stan r. December 23, 2015

j m keynes is an anacrosism. no longer relevant. solution is not jumping off the cliff his theories brought USA to.

Will December 23, 2015

I have a question Larry. How is the stock market going to double during a world wide economic crisis; or do you not see a recession coming up?

$1,000 gold December 23, 2015

if the dow nearly doubled in just a few short years like larry is predicting, we'd end up like china.

$1,000 gold December 23, 2015

the fed would clamp down on a parabolic move like this. 31,000 dow? yes. but more like 10 years vs 3.

Dan December 23, 2015

Just curious Robert - You're always here poking fun or worse. You've made it painfully clear you think the man is a charlatan. This begs the question: "Have you nothing better and more productive to do with your time?" Obviously not! How very sad!

Ted Solomon December 23, 2015

The program you suggest is too pricy for the average person. I suggest a trial at a lesser rate.

Jim December 23, 2015

If we are facing a "war cycle" period what do you think of the Rare Earth stocks, U.S. based (like REE)?

Bob December 23, 2015

I go with Ted Solomon, That is the investment money for some of us.

Chuck Burton December 23, 2015

Gold WAS money, but hasn't been for some time in most peoples' minds. When it comes right down to it, only THINGS have value: food, water, fuel, REAL property - the things that preserve life, and provide for comfort. Then come things that stimulate the mind in some way, and make life interesting. Gold is hard to come by, has a certain beauty, and is hard to destroy. It doesn't oxidize and disappear. These are the characteristics that probably gave it value in earlier times. It is a decent conductor of electricity. Otherwise, it just sits there and does nothing, so its useful value is limited in modern times.

Don December 23, 2015

I'll take your's then! Ok?

cliff December 23, 2015

I totally agree with the above statements relative to the cost and scope of "Supercycle Trader". I'll wager that your asking for,what would amount to 25 to 50% of funds available to alot of your readers that would love to join. Good luck to all that can afford to go forward and also to the ones that can't...... Merry Christmas to all ! !

WARREN BEELER December 23, 2015

May I WISH YOU JESUS CHRIST. Warren Beeler

WARREN BEELER December 23, 2015

That was only part of what I said. I said let us celebrate the birth of Jesus Christ our Lord and Savior. May you, your family, Dr. Weiss and family a wonderful Christmas. Best Wishes, Warren Beeler

Max December 23, 2015

Few people ever mention the fact that the Gold/Silver ratio helps with pinpointing their turning points. Look at a long term chart of it and you'll note when it gets really high (around 80) that generally corresponds with a low point in the prices. And such high readings were hit twice in the last 12 months and it is currently hovering near that level.

Ronnie S December 23, 2015

I lean more towards Silver. It has more industrial, medical and high tech uses that may tighten supply. Silver has a long history as Money. There is a deficit in silver production, again this year. In a financial crisis or shortage of available cash, silver coins or small bars would be more practical for spending than cold coins or bars. Recent worldwide demand for silver is outstripping Mints around the Globe. I am making my own small "mutual fund" of miners...50 to 100+ share "nips" ..mixing in some gold, as well (ASM)200 @0.90, 100 today @0.84 (GORO)100 @2.00 PGLC) 100 @3.40 (PPP) (HL)50 @2.00 (NG)50 @2.45 (AEM) (SAND) 100 @2.67 (SSRI) (GPL) (SBGL) (TAHO) (AG) (SA) (LODE)600 @0.38 (LSG) (AXU) (GDX under $ 13.20, 2018 $20 calls @0.90) And (TCK) bought 15 TCK 1/18 $5 calls between 0.53 and 0.69 ...anyway, I'm watching others, as well, planning on entering or adding to positions over the next 2-3 months .....also shorting the US Dollar (UUP) over $25.60 1/18 $23 puts between .020 and 0.25 a contract...5 at ea. of those prices (small moves). If it goes above $26, I'll be looking at $24 strikes

RT December 23, 2015

So Watcher: If reading Larry is so "blahblahetc.", why do you continue to read him?

John December 23, 2015

Larry Any negative comments from your readers? I wonder why none are published ? John

$1000 gold December 23, 2015

looks like the censorship is strong in this forum today. lots of comments about comments that no longer exist

$1,000 gold December 23, 2015

if there was censorship, you'd be deleted, troll.

$1,000 gold December 23, 2015

who's on first, what's on second, where is were? what happened to were?

$1,000 gold December 23, 2015

looks like your comma no longer exists, $1000.

Justin December 23, 2015

Fedzilla's ZIRP has driven all asset classes to equivalent valuations - except real estate who's ship sailed nine years ago. With tons of margin debt and even more tons of margin debt hidden in corporate stock repurchases funded by junk bonds, a recipe of unravelling the whole mess in a rising interest rate environment is created. This is the thing that fuels historic bear markets. The premise that EU trouble could cause a migration of money across the Atlantic is not without merit, but major US corporations are multinational corporations, so financial duress in EU equals financial duress on all large US corporations. The Dow 30 Industrials used to have lots of "safe haven" stocks, but not so much now with the inclusion of Nasdaq listed tech corporations. If we get a significant selloff in the coming weeks, we could see a predictable short-squeeze initiated rally. If it decelerates as all the rallies in the 2000-2002 bear market did, and similarly fails to come anywhere close to established highs, expect much of the same as we saw in 2000-2002. The whole Dow 30,000 thing has already had two failures: the first at the beginning of last year when the October 2014 short-squeeze rally fizzled, and then just recently when the August 2015 short-squeeze rally fizzled. The more it happens, the more improbable Dow 30,000 becomes. I'm not saying it can't happen, but that a bear-trap rally is more likely following any upcoming corrections. What we need, is tons and tons of creative-destruction to force all of the morons who are ruining the world to change their policies or be thrown out of office. Then, on the next market cycle, we could see Dow 30,000.

Ken Mccall December 23, 2015

Silver is vastly superior over Gold for so many reasons. It is used for so many things. Batteries,refelectors ,electronics , switches. solar panels, bandages, solarscreen, and many other things, so much so that every year since 1991 the world industry has consumed more than 95% of all above ground silver and most of that is unrecoverable at any price! Therefore all above ground silver will become very rare and the price will skyrocket trying to pull the remaining above ground silver from it's many hiding places. In the mean time one company Silver Wheaton SLW on the ticker is positioned to be a major player when that happens! A quick study of this company will reveal a very smart business plan.

David H December 23, 2015

When will iron ore make a comeback?

Howard December 23, 2015

David Iron ore is seriously over supplied. Even India is selling iron ore to China now and China who take most of the worlds seaborne supplies from the major producers is losing money on steel. There is a world wide glut and the major producers are competing with volume to squeeze out the smaller players. It may be time to cut your losses. Vale, BHP and RIO are the only ones making any real money at US$35 tonne.

Will December 23, 2015

China is exporting their surplus steel production to keep the furnaces burning up excess ore in hand from what I read.

David H December 23, 2015

When will iron ore be a sought after commodity again?

Howard December 23, 2015

David The lead time to get major mining projects, shipping and distribution in place means several years of over supply. Iron ore prices may be depressed for many years. The new Roy Hill mine in Australia is a perfect example of a $10 billion investment at the end of the boom for iron ore. It now comes down to the lowest cost producers and least debt exposures going forward in an environment of rising interest rates.

Verne Collier December 23, 2015

Larry: I really appreciate your frequent updates. It really helps calm my anxieties waiting for things to happen as you predict. Keep up the good work., Verne Larry: I really appreciate your frequent updates which helps calm my anxieties waiting for things to happen as you predict. Keep up the good work. Verne Collier

Bob Wortock December 23, 2015

In supercycle I am following your suggestion to the letter,but i am not investing in options at all. Is there any way to compare your gains or loss YTD with out incuding option plays?

stan r. December 23, 2015

retired jim sinclair sticking with forcast of 50000 oz gold. right on!!!!!!.

Will December 23, 2015

The problem with shotgun predictions is when they form a donut hole pattern.

Lester Parker December 24, 2015

What are the marijuana stocks? Buffet. Theil, and others are stockpiling it.