Mish adds to basket of losing positions in miners.

Back in June of 2013, Mike Shedlock (who I have nothing but respect for from an economics perspective), bought a basket of miners because they were supposed to be a bargain.  So far, he has gotten creamed on that deal.  Today, he is out saying he bought more.  Maybe he will be right about that but I do not like his reasoning for doing it.  In short, he presents no reason for doing it now.  I am totally against buying anything without having some sort of model reason to back it up.  Even if the model is wrong it will soon tell you that it is wrong.  But if you buy based on gut feeling (as I believe Shedlock's first basket was bought) then you get to sit on a bunch of paper losses, tying up that capital and exposing you to more risk instead of the expected reward. 

Again, these guys will tell you they are not market timers but at the end of the day, anyone who buys something not with the intent to consume it but rather with the intent to sell it to someone else for more money later on is by definition a market timer or a fool.  Of course, if you have limitless resources then you can just continue to average down because at some point, yes, it will bottom and the percentage gains of your later purchases will quickly erase the paper losses of your initial basket.  I just hope Mish's second basket doesn't turn out to be an economic casket.  In order for that not to be the case, we really need GLD to break out of the falling wedge that it appears to be in and we need it to happen soon.