8/12/03
Unless and until the Dow breaks through its (channel) trading range of 9000+/- to 9300+/- we won't really know where we're headed. But once there is a decisive breakout or breakdown the market is going to go in a vengance in that direction.

Gold continues to stay in a trading range. The Gold stocks are still very strong. We should see new highs in both the metal and the stocks in the 4th quarter, 2003. BGO incidentally was up as high over 2 or up 100% for the year. BGO Should be well over 3 - 4 before 12/31/03.*

The economy is showing some signs of life, but to experience a 5% rise in GDP, we need to see major signs of life, not just some signs of life.

This week's big story, my namesake, Arnold Schwarzenegger running for Governor of California. Since he can't be President (he was born outside the U.S.), why become Governor of California, where their defecit represents almost 40% of income? It is a no-win job - and unlike me, Arnold is a Democrat wearing Republican labels. He is essentially a Rockefeller Republican or a Bloomberg Republican (as in Michael Bloomberg, Mayor of New York City, who changed parties to run for Mayor).

What we really need in Calfornia is the ticket of Arnold vs. Rob (Reiner). No one including Meryl Streep or Dustin Hoffman is a good enough actor to pull this off.

* If you have been following our trading strategy, now might be an interesting time to look at the results.
As of 8/11/03:
Annualized
CDs for 80% of the portfolio 4% 3.2%
Gold stocks 20% - increase ranging from 30 - 110%
66% x 20 13.2
Current return thru 8/11/03 16.4%

Between 15 - 25% depending upon the weighting of BGO (from 1/3 to 1/2 of the invested 20% of your portfolio.

--- For those of you unfamilliar with our trading strategy:
We have just developed a portfolio which is largely risk averse (maximum exposure 10% of portfolio) with a combined yield of approx. 8%.

For any of you who are interested in this "model portfolio," please send us an email at:

modelportfolio@arnoldsramblings.com

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- posted by Arnold @ Tuesday, August 12, 2003