Hi BlacksFirst. Paper gold has been sold down but physical gold...

Hi Blacks

First. Paper gold has been sold down but physical gold is in shorter supply. Basically, the USA and global banks have sold more gold than actually exists.
Second. As the hedge fund sell off slows, the downward pressure on the USD will come back as less US dollars are purchased to cover the repatriation of funds back to the USA.
Third. As quoted before. --Either way, you see how a new low on the markets is entirely possible. Our prediction? Stock markets are going to get a hefty global bounce in November. There are at least three events on the horizon that could provide the boost.

--First, if Obama is elected, you have the end of uncertainty about the U.S. election (and some highly irrational optimism that things will now be different, better, and nicer). Second, you'll get a new stimulus plan from the Democratic Congress in the U.S., which should give stocks a bit of a kick. And third, the big G20 meeting in Washington Kevin Rudd is headed too. Something that looks and feels good should come from that.

--Those three factors may conspire to produce a convincing looking bear-market rally into Christmas. That would be the sucker's rally of 1929-1930. Or, we could be dead wrong and deleveraging may simply overwhelm everything else. It's also possible, of course, that the bulk of the hedge fund deleveraging has already taken place. But we're not counting on it.