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One for the Books

So you end up with a day that has some gold and energy stocks up as much as 10%+ while the Dow and S&P sink almost 4%.  Huh?  I haven’t seen a day like this before.  And I mean that definitively – I don’t think there has been a day like this before.  I really think that today represented something unique.  Its like the correlations that have held strong for years have gone out the window today.

First of all, when stocks go down hard oil ALWAYS goes down.  Always.  Today it didn’t.

Second, when stocks go down, gold stocks go down.  Especially speculative gold stocks.  Speculative gold stocks are liquidity trackers first, gold price trackers second.  Not today.

On the one hand I don’t want to read too much into one day. Its one day.  On the other hand, it really did seem like something very different was emerging today.

What?  I can only guess.  But if I were to guess I would speculate that someone thinks that the stagflation trade is emerging, and someone else is realizing that the ECB really will begin to print money to get the EU out of debt, and maybe a bunch of others are starting to worry that the gold bugs are right and that paper currency really is nothing but paper.

Or maybe it was just a one day fluke.

What I do know is that this was quite a day for the stocks I own.  My bet on gold stocks earlier this week (I bought AR.to, OGC.to, and added to JAG.to and LYD.to) started to look quite right today.  And the oils didn’t do too bad either.

  • Coastal Energy +11%
  • Arcan +8%
  • Lydian International +14%
  • Argonaut Gold +10%
  • Jaguar +5% and up another 11% after releasing some very good cash flow and earnings numbers after the bell

These are 5 of my top 6 holdings.  The only one that didn’t react strongly was Equal Energy.  Some day the investment world will realize that Equal is in the Mississippian in Oklahoma too. But not today.

5 out of 6 isn’t bad.

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