4/11/03
In our euphoria regarding our impending victory in Iraq, the U.S. Stock Markets have not shown much excitement. This does not appear to be good news. The markets must be focusing on the real economy - and the real costs to maintain U.S. dominance in Iraq.

With the realization of a U.S. victory in Iraq, there may be a momentary (1 - 3 month) economic improvement, but it is doubtful it will be of any major significance. Once reality sets in the economy will return to "UGH."

Major layoffs are announced daily - Stanley Works: 1000, Nokia: 1800, etc. Profits are still falling - earnings warnings are at record levels and some companies, even after warning, are still missing lowered expectations. And this is still with present day GAAP, once FASB actually tightens up accoutinng standards, watch out! Many formerly profitable companies will no longer be so.

Gold remains the buy of a lifetime - Buy gold stocks NEM, ABX, AU, HM and BGO. Prices of both Gold and Gold stocks should rise dramatically from these levels - never to be seen (present levels) again!

The dollar, after some recent stability should resume its downward spiral, taking Gold up and bond prices down (yields up). Short term interest rates should stay low even with expanding long term rates.

In summary, nothing has really changed in Arnold's Ramblings Forecast - Stocks are going lower, Gold is going higher, the dollar is going lower, long term bond yields are going higher and the economy is going nowhere!

As a reminder: For all of you who are passing Arnold's Ramblings on to friends, family members, enemies - whoever, now you can provide them a fresh copy, direct from the source! Ask them to go to http://www.arnoldsramblings.com/NavLinks/Subscribe.html.

Copyright 2003 Arnold's Ramblings Inc., All Rights Reserved.

- posted by Arnold @ Friday, April 11, 2003