I'm with you, Bug.CT: I've been listening to you describe this...

I'm with you, Bug.

CT: I've been listening to you describe this scenario for awhile - can see alot of what you say makes sense - but one has to look at risk from both sides. Everything may collapse or it may not.

Why should I sell out of goldies highly leveraged to the gold price? I understand in a sell off they will not be spared (witness this week/2008) as investors liquidate - but are you suggesting everything will be worth nothing?

If I'm not leveraged and bought at firesale early 2009 prices why wouldn't I take the risk that gold stocks follow the POG or are the first to rebound as the product they produce soars in price (or at least maintains its value)?

I understand that you think gold stocks might be cheaper later on but what if they're not? No one knows 100% what is going to happen. Why wouldn't you manage the other side of the risk you talked about by maintaining some exposure should the world not collapse as you describe?

Not too long ago you were saying gold would get to $700. If you had sold everything then (as you suggested) to wait out the crash and bought gold now (as you suggest) you would have done yourself out of 200 bucks an oz.

I'm not trying to call you out; simply suggesting that the same scenario might unfold with goldies. Either way, it's risk management: sure, hold gold, have some cash - but I think a strong goldie with no debt and strong upside is more than worth a decent punt - IMO.

Cheers,

C12