Fifty Dollars Is Fifty Dollars
Brief discussion on GOLD, a couple charts on DEBT, and my new favorite JOKE
Welcome back to The Tobin Report. For new subscribers, welcome. The Tobin Report is all things money, markets, and charts.
I recently had lunch with an old retired cop friend who told me he reads every Tobin Report. Awesome. At least somebody reads it!
Much appreciated, my friend. Good hanging out.
In this report:
Poll
Couple charts on debt
Revisiting gold
Addition to the portfolio
Hilarious joke
✔ QUICK POLL
🔷 DEBT
The U.S. now spends more money on servicing its debt than national defense.
Do you think the Fed will keep raising rates? Something to consider.
🔷 MORE DEBT
Look at the chart below.
These are projections…and I’m not an economist, but at our current spending, this does not surprise me. Even if these projections are off a bit…I see no scenario where debt DECREASES. Just something to consider.
Inflationary.
🔷 DEBT CEILING
Debt Ceiling - “A deal by the end of the week.” Really? We’ll see.
Default - 140 top executives signed a letter urging political leaders to act swiftly to avoid defaulting on our debt.
🥇 GOLD
GOLD 0.00%↑
Let’s review gold again. For those who follow gold, you probably noticed that gold has corrected off its all time high. A couple thoughts on that:
It’s normal
It’s healthy
It creates another opportunity before it’s inevitable launch 🚀
As I warned previously, gold was due for a pullback. The beautiful thing is that it’s pulling back to an area that 3 months ago would have been an intermediate high!
Two steps forward. One step back. Patience.
The all time high reached earlier this month was gold’s 3rd attempt to break out. It failed.
So is that it? Have the highs for the year been set and will price now trade downward, setting off a new wave of despair and hopelessness for gold investors?
NO.
This recent price action is absolutely normal in gold. All we've witnessed is the typical pattern of flush outs…and this price action is what happens with bull market moves in gold. It’s the price of admission for the reward of what will come.
True breakouts take time. They take energy. They require moving averages to catch up to price. New levels must become boring and act as a basing pattern. This IS market psychology.
One area I’d like to point out is the 100 day moving average on the chart of gold below, yellow line. Price runs up and gets stretched above it’s moving average…then through both price and time, pulls back to its 100 day moving average. It respects it on the way down…and on the way up.
Two steps forward. One step back.
Perfect execution.
What’s great is recent gold sentiment. Sentiment has shifted negatively as a result of the recent price action. Negative sentiment marks a low and always precedes the next leg up. This does not mean sentiment can’t go lower…it can. But we are NOT at a top is where I’m going with this. Lower prices still appear likely in the short term before the next "higher low" is made. Something near $1,950 or $1,930 and the 100-day moving average looks like a possible/probable downside target. It could go even lower. That still does not change the outlook.
Ultimately, none of these price drops will matter much once the Fed inevitably begins to cut rates as the U.S. economy deteriorates.
In the meantime, though, it may not be a bad idea to add to your portfolio by buying the dip.
📈📊 CHART - ADDING TO THE PORTFOLIO
One company, among others, I’m adding to the portfolio is Fortuna Silver Mines, FSM.
Chart going back almost a decade. See the cycle?
2016 peak (blue circle). 2021 peak (blue circle). 2025 peak?
If so…now is the time to buy.
Same company, zoomed in. Shorter timeframe. 👇
Bearish to bullish reversal. It’s turning. You can see it. Price testing 200 day moving average.
I’m adding.
😂🤣 SOMETHING FUNNY
I recently came across this joke and HAD to share! This one is my new favorite, lol.
👉 Morris and his wife Esther went to the state fair every year, and every year Morris would say, 'Esther, I'd like to ride in that helicopter.' Esther always replied, 'I know Morris, but that Helicopter ride is fifty dollars, and fifty dollars is fifty dollars.'
One year Esther and Morris went to the fair, and Morris said, 'Esther, I'm 85 years old. If I don't ride that helicopter, I might never get another chance.' To this, Esther replied, 'Morris that helicopter ride is fifty dollars, and fifty dollars is fifty dollars.'
The pilot overheard the couple and said, 'Folks I'll make you a deal. I'll take both of you for a ride, and if you can stay quiet for the entire ride and not say a word, I won't charge you. But if you say one word, it's fifty dollars.'
Morris and Esther agreed and up they went. The pilot did all kinds of fancy maneuvers, but not a word was heard. He did his daredevil tricks over and over again, but still not a word.
When they landed, the pilot turned to Morris and said, 'By golly, I did everything I could to get you to yell out, but you didn't. I'm impressed!'
Morris replied, 'Well, to tell you the truth, I almost said something when Esther fell out, but you know, fifty dollars is fifty dollars.’
LOLOLOLOLOLOL…..
Have a great week everyone and hope this helps,
Eric
While the manipulators play with their paper markets, it's a good time to stock up on physical metals :)
Nice post, Eric!