“All around him there is just one opinion. He never hears the contrary view. He does not know that there is a contrary view. Soon the vast majority of the country is of this one opinion.”

The issue of investment versus speculation is much more important than you realize. Almost everyone, except for me, will tell you that you are an investor. But an investor is someone who wants to put his money to work (meaning either earning real interest or a return on capital such as dividends on stocks or rent on real estate). The speculator wants to make a profit by buying low and selling high.

Of the various technical theories on the markets, my criteria for deciding which ones to use is based on what works. And I have found the best results with the chart patterns described in Technical Analysis of Stock Trends by Edwards and Magee. These are simple, geometric patterns with forecasting implications.

Most market trends are caused by large-scale forces too big for most traders to comprehend. They wind up assuming that current prices are near the fair price, and they are reluctant to pay more. This reluctance slows down the bull trend, but the fundamental, large scale force keeps tilting the balance to the upside. In effect, the idea of a fair price keeps the market undervalued for a long, long time.

The importance of this [budget deficit] for the price of gold lies in the fact that any deficit of any size in any democratic country is not financed by borrowing the money. It is financed by printing the money.

Then what was this all about? Why were markets rushing up and down? Why were the newspaper headlines screaming? Why was there violence in the streets, with people being killed? Everybody wanted to borrow, and nobody had any money to lend. That, of course, is the way of the world. If you don’t like this fact, then I suggest you take it up with the Creator of the world.

The important technical accomplishment of this week is the break of the Dec. 3, 2009 high at $1,225. On a long term chart, this reaffirms the long term gold bull market. A bull market is defined by a pattern of higher highs and higher lows, and the new high is now in place.

Either Ben Bernanke will choose to follow Rome and destroy his society, or he will stop the currency debasement before it gets to that point. Here your guess is as good as mine. If he stops it, the stock market will probably return (in real terms) to its 1982 level.

The coming short term market period should be very exciting. Gold should now mount its assault on its Dec. high. If this can be breached, then the pattern of higher highs and higher lows will be reaffirmed.

Many a weekend since the beginning of the year has been occupied by a “crisis” in the euro. But this weekend’s “crisis” seems to be the mother of them all. As such, it will probably put an end to them, and the gold market will pull out of its funk and resume its bull trend.

Well, what is it? Is gold moving sideways, or is it moving up? And this is not just a matter of semantics. The question is being asked from the very practical viewpoint of how do I make the most money?

The explosive move in gold which I have been predicting for some months is now under way. He who hesitates is not lost, but he does make smaller profits. You have undoubtedly heard of the death of a thousand cuts. You now face the death (of your profit) by a thousand decisions to do nothing.

The vast majority of people do not understand what is happening. The printing of money is a counterfeiting racket run against them by their own government. To avoid being robbed, they must be in gold. This is why every organ of establishment opinion denounces gold and tries to scare you away from it. If you value your hard earned wealth, do not listen to them

…now the problem has mushroomed far beyond this simple scenario. Formerly, we faced a government which wanted to violate our property rights. But now we face a government which wants to violate our right to life.

This is directed toward those readers who have heeded the siren song of the establishment and have put their assets into the stock market. I say to you: NO STOCKS, NO STOCKS, NO STOCKS, not at this time.

Unemployment has become the central issue of our day and perfectly illustrates the genius of Ayn Rand in putting the spotlight on altruism as the central concept which is destroying our society.

The subject of unemployment is the centerpiece of our modern economy. Let us imagine an economic discussion between a “liberal” and a conservative.

Part of the explanation for the Dec.-Jan. decline in gold is the attack on the euro which is now going on in the media. Indeed, the euro topped out very close to the exact day of the top in gold.

There has been a sense in the gold market through the month of February that gold is going down, a sense of negativity and discouragement. Gold bugs are giving up and pulling out. The U.S. dollar index hit 81 on Friday. The Fed is tightening. “What more,” say the bears, “is there to say?”

This is the problem with our age. So much data is being shoveled out at us that the human mind cannot comprehend it. The human mind is overwhelmed. Back in the days before the computer the need for understanding the data was much greater than the need for more data.

Gold’s action was scary last week – for all those who focus only on the short term. But these are precisely the people who cannot see the big picture. And because they cannot see the big picture they cannot predict the big move. And the big money, I remind you, is made in the big move.

When the short term is a puzzle, I take refuge by studying the long term, and so I thought that this week might be a good time to review the long term situation.

This week the One-handed Economist features a giant double top in the U.S. dollar index, a chart pattern which completed on Aug. 1, 2009 and has been dominating both the currency markets and the commodity markets ever since.

This evidence is good enough to play and the One-handed Economist is back in a bullish position with regard to gold and gold stocks. We will soon know if this is correct because gold will rise and break above the Dec. 3 peak of $1,229.

Everybody in economics who had some kind of a title was a blithering idiot. None of them had any knowledge at all.