Montreal Analyst

Michael Lewis’s best seller “Flash Boys” describes the underhandedness and deception that exists in the stock market when customers’ orders are being processed due to the interloping High Frequency Traders (HFT). My opinion is slightly different than his but not by much. I have suggested on the Montreal Analyst site that the HFT should not be allowed. In a television interview, Michael referred to the High Frequency Trading as “rigging” the market. But in my view, it is not truly “rigging”, rather it is front running and causes the legitimate stock buying customer to pay more. It is unfair and dishonest to the investing public. And yes, it can cause the legitimate investors (funds, institutions, pensions, private investor) to “pay more” for the stocks they are investing in.

$16,717,000,000,000 ! Be aware that the dollar value the Standard and Poor’s 500 which represents approximately 74% of the value of all the United States publicly traded stocks is currently at $16,717,000,000,000 ($16.7 Trillion). We also estimate the dollar value of the non-Standard and Poor’s 500 stocks to have a value of approximately $4 Trillion. (By the way, at its 2001 high, NASDAQ carried a value of $6.7 trillion which was a ludicrous overvaluation.)

1-Gold representation as a percentage of total assets held by large institutions and by various investment funds is still quite low. That could change as we feel that they will soon have to invest in gold and gold mining stocks. As you are aware, it is not easy to purchase gold bullion, have it delivered and stored safely; you may want to ask the Germans about that subject! The bottom line is that we will soon see more investment institutions investing in the gold mining stocks so that they can participate in a bull market in gold. That method will be their proxy for gold investments. 2-Required! yes required…For a strong bull market in gold and gold mining stocks, our analysis(and others too)suggests that at the same time, we would have to see a bear market in the large industrial stock market such as the Dow Jones Industrials and the S&P 500.