Scrap Gold Buyers Signal Bull Market Phase

Jan 18 2012

All abstract sciences are nothing but the study of relations between signs.

--Denis Diderot

One of the most critical challenges for cycles investors is recognizing the signs that the market is turning. One sign that we probably are somewhere in the second phase of both the gold and silver bull markets is the ubiquitous “cash for gold” and “cash for silver” advertisements. When those ads become “We Sell Gold” and “We Sell Silver” that will be a sign that the bull market has taken a turn into its next—and final—phase.

Rarely a day passes without at least one full-page “We Buy Old Jewelry” ad in the local newspaper, or “Jewelry for Cash” commercials sandwiched between daytime soaps and talk shows. YouTube videos explain how you can generate cash for cars and vacations just by emptying out your jewelry box, and Google is plastered with “sell old jewelry” pay-per-click ads. Even luxury jewelers display tasteful “We Buy Estate Jewelry” placards, and new “Cash for Gold” storefronts and pawn shops spring up daily. One gold buyer sprang for a Super Bowl ad; spokespersons from talk show hosts to Mr. T signed onto lucrative promotional deals.

Gold and silver prices have been on an upward trajectory since 2002, with some peaks and valleys along

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testiomials One trick our old friend “Snakes” used was to buy costume jewelry by the pound. For every 20 pounds, there were inevitably gold and silver pieces that made it worth his while.”

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