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By Andrew Vaughey
June 2008 was the second worst June market in the history of the Dow Jones. The only June that was worse was in 1930, at the beginning of the Great Depression. That’s not exactly encouraging to the average American Consumer, Nicholas B Vaughey.
Why was June so Bad? The dollar fell. “The Federal Reserve talks a game fo defending the national currency, but can’t defend that position, because it would hit the economy in the gut like a Mike Tyson power knockout punch,” said Drew Barrett.
If the dollar stabilized, oil should level off. And, we might begin to recover from the current recession. So, watch the dollar for a signal into when that might occur.
Meanwhile, Gold and Precious Metal Stocks continue to benefit from the declining dollar, and reeling economy.
You can’t really time these kinds of moves over the short term. But, over the long term, the US Dollar has been declining for in value for some time. And, precious metals have been climbing. Many experts see Gold at $1200 per ounce, by early 2009. And, Silver at $26 per ounce. If this happens, mining stocks will soar.
And, oil and gas companys will continue to benefit from the trend and the reliance of consumer and businesses on this fuel. We need that fuel to drive our cars, power our plants, and heat or cool our houses.
Posted by Andrew B Vaughey, Andrew Barrett, & Nick Vaughey of Diamond Investments, a Private Equity Consulting Firm in Seattle Washington.
