Gary Savage Premium

Sure looks like stocks are in the bubble phase. How far do you let it run before being satisfied and exiting so you don't get caught when the bubble pops? I was way too conservative when I said Nasdaq 10,000 would be a piece of cake and 20,000 wasn't out of the question.

People lose sight of the big picture, and even the medium term picture. Both gold and silver are in uptrends. They will continue to be in uptrends unless the March 23 lows are pierced. We are a long way from that happening at this point.

What socialist politicians want you to believe is that all of their "free" stuff can be paid for by just taxing the hell out of rich people. This isn't true, it never was true, and it never will be true. This is nothing more than a bald faced lie, but one that will get uninformed people to vote for them. If you want to give away a bunch of free stuff someone has to pay. Seriously, there is no free lunch in this world. If you want free health care someone has to pay. If you want free education, someone has to pay. Free busses, someone is paying. You get the picture. If you want free stuff everyone has to pay. There just aren't enough rich people with nearly enough money to fund all this free stuff. Plus if you take everything from the rich people pretty soon there won't be any rich people left and you will have to start taking from the middle class and then the poor. As Margaret Thatcher said, the problem with socialism is you eventually run out of other people's money. When Bernie Sanders points to Scandinavia as an example of Democratic socialism (democratic socialism is just good ole fashion socialism with a more benign name, but still just socialism) he is just lying to your face and hoping you won't take the time to expose his lie. The Scandinavian countries tried socialism back in the 70's. It failed catastrophically. These are free market, capitalist countries. They pay for their "free" healthcare, education, etc. by taxing the hell out of everybody. You make $70,000 you go straight to the highest tax bracket. On top of that everything you purchase has a 25% sales tax. So you work your ass off all year and the government lets you keep less than $35,000. Then they take a big chunk of that every time you buy something. So before you buy into this democratic socialism bulls**t ask yourself if you are prepared to lower your own standard of living significantly so politicians can give everyone a bunch of free stuff. They want to win elections. That's all they really care about and they will lie to your face to do it. That's the only way this works. Everyone has to pay.

I'd say the odds are good that stocks are well into their bubble phase. Where the top is no one knows. But these can last longer than most people expect, and trying to short a bubble is an extremely efficient way to lose a lot of money very fast.

The problem has never been greedy capitalists. The problem is, and has always been greedy corrupt politicians that have no ability to control their spending of other people's money.

Recency bias was causing most analysts to predict another lower low. Consequently they either missed the entry, or they were short and are now losing money on steroids as silver explodes higher. The vast majority of intermediate corrections during the advancing phase of an 8 year cycle unfold as either an ABC scary pullback, or a multi week sideways churn. Almost no intermediate corrections in the advancing phase develop as an ABCDE type pullback. Yet this was what almost everyone was predicting. This is why I could say with a great deal of confidence that the bears were going to be wrong and metals would not drop below the March low. Now we just need these bears to remain stubbornly bearish and short. The longer they remain in denial the more fuel there is to keep pushing the rally higher. At some point they will capitulate and turn bullish. Then they will become convinced price can never go down due to whatever the narrative is at the time. Then we will repeat this process all over again. They will remain stubbornly bullish as the correction gets underway until they buy into the bearish narrative. We've literally watched this happen dozens and dozens of times over the years, but many if not most people are unable to learn and change their behavior. Above all else you must remember this one simple fact. This is a bull market and bull markets make higher highs. So always err on the side of being bullish. Buy dips and don't worry too much if you don't time your entry perfectly. The bull will rescue any long positions, no matter how badly timed.

It's official. Silver has now confirmed a pattern of higher highs and higher lows. The rest of the sector will follow.

How to know when the trend has reversed? Well I use cycles theory to try and spot the actual bottom, but the time honored method is to see lower lows and lower highs reverse and price start making higher highs and higher lows. Often there is a leading stock or commodity that will give advance warning as well. At the moment silver and Barrick have confirmed half the parameter with higher lows and are a whisker away from completing the second half and making a higher high. Once one or both do the rest of the sector should follow. And the recency biased bears will be wrong again like they always are at intermediate bottoms. The only question is how long will they stubbornly remain married to their losing trade? It is a bull market after all, and bull markets make higher highs. On the flip side, the dollar is now making lower highs and only a couple of pennies away from lower lows and confirming the declining phase of its intermediate cycle.

We've been hearing for years about the "everything bubble" or stocks are topping. This is nonsense. I've said many times that stocks were still to early in this bull market and the magnitude gain was still too small. We needed a true bubble phase before a real top. It now may finally be time for the final parabolic move. The character of the market has changed drastically as you can see in the chart. That being said, trying to call tops in a bubble is the most efficient way ever discovered to lose a lot of money fast. Parabolic moves can last a lot longer than many people expect. Sometimes as long as a year or year and a half. And this one is only in the first month, or if you assume the character change began last year then a little over a year. Either way picking a top in a bubble is dangerous.

Socialism only works if the world is inhabited by angels. Unfortunately we are in short supply of those. In a socialist/communist (they end up being the same thing) system the slacker gets rewarded. There is no incentive to over achieve or even achieve in a socialist system. Everyone gets the same allocation so why bust your ass? You're going to get the same number of loaves of bread whether you work or not. In the mind of socialists they envision a world where everyone is equal and happy. But the reality is that eventually you end up with a society of slackers just doing the bare minimum to get by. Everyone ends up equally poor and miserable instead of equally rich and happy. I would rather live in a system where hard work and ingenuity can be rewarded. I don't care one bit that a few people amass great wealth. It doesn't prevent me from trying to achieve great success myself. We used to live in a world were success was admired and motivated people. Somehow that world has been replaced by one where great success (financial) is demonized. BTW, why is Elon Musk bad but Tom Brady, Oprah and Taylor Swift are just fine?