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gold-eagle.com / By Justin Smyth vi nextbigtrade.com / November 19, 2014
As a follower and participant in the gold bull market from 2002 until now, I can say unequivocally that the two most bearish periods sentiment-wise in the bull market so far are the fall of 2008, and right now. Therefore, by definition, the two most profitable times to buy gold stocks were in the fall of 2008, and right now. This simple concept is incredibly difficult for most people to understand and put into action.
The media will always lead you astray when it comes to these phenomenal buying opportunities. In early-2009 it was an incredible time to pick up just about any asset you could think of: real estate, stocks, commodities, etc. But the overwhelming mood on TV and the Internet back then was bearishness at that epic buying opportunity. My second favorite glaringly wrong example from the media was the end of 2012 when the media was petrified of the fiscal cliff. For a month straight in December 2012 that’s all you heard on CNBC, how the fiscal cliff was going to be terrible for stocks in 2013. But it turns out 2013 was an awesome year for stocks, and the bears in the media were 100% wrong.
What do early 2009 and late 2012 have in common? Both were the ends of periods that were bad for the markets. In 2009 of course it was the end of the epic stock market meltdown, and in 2012 it was a two year period from 2011-2012 where stocks didn’t make a lot of head way. Instead of being bullish at the bottom though the media extrapolated these negative periods out into the future and predicted more bearishness to come. The media is always focused on the short term and in sensationalizing whatever is happening right now. This puts way too much emphasis on the current state of the market and forgets the cyclical nature of the market over the long term. So at the turning point in long term cycles they are always going to be 100% wrong and look foolish.
Thanks to BrotherJohnF