The latest development worthy of “decade extreme” or “record extreme” within the Precious Metals sector, comes to us thanks to Mark Hulbert Financial Digest. According to Mark’s latest WSJ column, there has been a huge plunge in exposure of various Gold newsletter advisors. Currently, the Hulbert Gold Newsletter Sentiment index (HGNSI) is at -31% net short, a historical record low since the inception of the survey in 1997.
Articles written by: Guest
Today’s chart refocuses on the precious metal sector and in particular investor positioning towards Silver. Hedge funds and other speculators are now so negative on the metal, that the short positions have reached the highest level in the last 17 years (possibly even longer).
I believe the market at current levels presents an attractive asymetric short opportunity for the following reasons:
It has been awhile since I discussed equity market sentiment and that is because not much has changed. Bulls continue to get more bullish, the sun is shining and everyone is singing “Kumbaya my lord”. It is worth noting that overly optimistic readings we saw earlier in the year have put a stop to a rally in variety of risk assets, including:
Ideas about ‘printing money’ and ‘helicopter money’ are in vogue. This column unpacks these misleading terms and explores what quantitative easing and Overt Monetary Finance might mean for the deficit. The case for Overt Monetary Finance needs to be balanced by considering the distortions which quantitative easing – and, in fact, potentially Overt Monetary Finance itself – might have on bank balance sheets, as well as their potential to damage central-bank independence.
Over the last few decades, banking regulators and supervisors have failed to do their job. This column argues that a failure of political will enabled stakeholders to pursue bad practices, and suggests a roadmap for reform. Enforcing a reform agenda marked by simplicity is plausible, and would avoid much of the collateral damage that comes from many hundreds of pages of complex, costly and misguided mandates that typically act as substitutes for credible reform. Overcoming the challenge of political will, however, remains a challenge.
This objective report concisely summarizes important macro events over the past week. It is not geared to push an agenda. Impartiality is necessary to avoid costly psychological traps, which all investors are prone to, such as confirmation, conservatism, and endowment biases.