Gold Up, Miners Down ...

Large cap mining shares (GDX) made their high on December 7 at $64.62 when gold traded at $1420. Now, 5 months later, gold trades at 1540, but GDX only fetches $61.50.

Commodity Boom: Short Term Hiccup Possible ?

I've decided to become a little cautious here and took off my leveraged gold positions. Silver recently went almost parabolic on extremely heavy volume and so I sense that the market could take a breather.
Economic activity around the world seems to cool down a little and interest rates are rising everywhere but in the USA. Key commodity prices like those of copper and grains are beginning to show weakness.
Sugar went from 35 Cents per pound in February to 22 Cents now and that could be a rewarding entry point.

As Gold Makes New Record Highs...

just about every day, stocks of gold miners continue to disappoint. It appears that their cost of producing the metal is increasing at a similar rate leading to almost no margin expansion.
Fed officials keep harping that there's no inflation.

Stocks: On Thin Ice

Bernanke's commodity boom is starting to really hurt business and Ben's claim that these price pressures are transitory becomes ever more ludicrous. Interest rates have no way to go but up and now investor sentiment has left no-one in the bearish camp.
Inflation is NOT good for business. Sure, profits and profit margins are apt to rise as historical costs are lower than price paid currently, but that is a temporary phenomenon. As interest rates must eventually rise, earnings will be pressured further and price earnings ratios will contract.
In the 1970's for instance, prices rose by 10% p.a. as stocks as measured by the Dow Jones Index stayed flat for 13 years.
Once we enter hyper-inflation, stocks will be of course better than Dollars, but Gold will be even better.
I know, I've been bearish and wrong for too long, but owning stocks here just doesn't compute.