Gold

[airedale]

Hi Hoop, nice clear chart on Wednesday. The phrase "coiled spring" comes to mind. Skol would probably say "death spiral".

[Skol]

Hi Hoop, nice clear chart on Wednesday. The phrase "coiled spring" comes to mind. Skol would probably say "death spiral".

Not sure about the 'coiled spring' but the XGD's down another 4% today. Maybe the 'coiled spring' is working inversely.

[elZorro]

A life spent making mistakes is not only more honorable, but more useful than a life spent doing nothing.

~ George Bernard Shaw

At least we're trying to figure it out..which side will be right in the next months, it'll be interesting.

[Skol]

Gold Is Not Money

Posted on April 1, 2012 by Athan • 1 Comment


The case against Gold.

How long would it take you to produce a house if you could not borrow the money to pay for it?

How long would it take you to buy a car if you could not get a loan to pay for it?

Living in a debtless society would be like living in a pond… or living in a small village where you would trade a chicken for a visit from the doctor. If you have never lived in a village and have some romantic notion of what it is like ask any of your immigrant friends to describe what they were willing to endure to escape from it.

How could an employer hire you and pay you without delay? A delay in payment even as little as an hour is a loan is it not? A company hires you and pays you every 2 weeks which means at best you have to wait 2 weeks to get paid after delivering your services. Companies pay off this labour debt every 2 weeks. Without debt you could not have any employment. Any delay in the transfer of the bartered services or goods whether it is by using paper money or gold to facilitate the transaction is debt. The recalcitrant gold bugs would have you think that somehow paper money is debt and gold is not. Silliness has no limits. Gold is not money because it is a commodity; a precious metal that is mined. Mining costs a great deal not only in labour and machinery but even more importantly the harm it does to our environment. They tell you owning gold is a must in times of crisis, but if you have gold and need food, you would have to find someone to exchange it for food and the specific food that you need from someone who is willing to part with their food… good luck! In times of crisis who needs gold? You need food, warm clothing, clean water, shelter and guns and ammunition. Gold’s value in a barter system becomes diminished. It is a commodity like any other that is traded. The question is: Who needs it in times of crisis? After the WWII in France, one ounce of gold bought you one ounce of chocolate. Perhaps it would be historically wiser to hoard some Mars bars instead of Gold.

If it is labeled as money and used as the medium of exchange or to back up the paper money as in a gold standard the holy grail of the unscrupulous miners and their minions, the value of gold would increase and would lead to greater mining activity around the world. With the price of gold at $1500 per ounce they can already profitably mine gold at half a gram per ton. What would happen when gold goes up to $5,000 or 10,000 or even 50,000 as some would have you believe? Mining gold at one tenth or one hundredth of a gram per ton? Might as well clear cut all of the rainforest in South America, Africa and anywhere else where tiny specks of gold are found or indicated! Drill baby drill or open pit open pit never had more fervent followers! Have you seen the state of the Brazilian rain forest lately? The gold bugs need to get a grip on their blatant hypocrisy and greed. They are lying to the masses they are worse than the wall street crooks these junior miners and their PR departments are more like a criminal enterprise than a business in my opinion. They consistently misinform and even the brightest and the most educated get sucked in to their campaign of lies regarding the need for gold beyond decoration. They use the banking crisis as proof to back up their claims while hiding under the “monetary responsibility” banner they call for much higher prices for gold and silver and for the reinstituting of the gold standard. Drivel based economics.

They spew out their hyped up drivel at every opportunity. Debt is good! Debt is the basis of our capitalist system. These goldbugs and anti feds or anti central banks smell like closet socialists. Or even worse closet anti-semites since they believe Jewish money lenders were dispersed from the holy temple by Jesus himself… These gold bugs get on their soap boxes and scream bloody murder at the Fed and the Central Banks by criticizing our monetary system as debt based as if it’s a bad thing, it may simply be thinly veiled anti-semitic rants.

Debt exists whether you like it or not. It is useful and plays an important part in our society.

It is not possible to live in a modern monetary system regardless if you use paper money or gold for bartering or clearing debts without going into debt for a period of time. Essentially gold as a tradable commodity represents debt; a debt that is collected when the transaction is complete. Gold has only an intrinsic value that we place on it. Just like paper money. The good thing about paper money is it uses way less of our precious resources to produce… we trade currencies and we trade gold and everything else. Putting so much effort in trying to convince people Gold is somehow magical and will somehow resolve the financial problems of the world is an outright lie!

Gold in itself is useless. Until you trade it for something useful it can be considered a symbol of an unpaid debt. This is where the notion of paper money and gold backed money merge. Gold can be considered debt backed as much as fiat money can be considered to be debt based. They are the means of exchange of productivity whether manual or intellectual as well as property whether building or land, goods, or commodities. Unless you are trading for gold to use as a personal adornment or to eat it as some do for some esoteric healing powers… then gold is a promise to pay at a later time. You hold it until you decide to trade it for something more useful. What a waste to use gold in this way. What a waste of resources!

In the Age of information and electronic transactions to use even paper money or worse metal based coins and worse use gold instead of electronic transactions is like going back to the age of the horse and buggy for transportation. Giddy up GoldBuggies!

[peat]

gold is not a debt tho Skol - its an asset.
To that extent it is not better or worse than cash. you would never call a mortgage free house a symbol of an unpaid debt.

To me thats where silver operates as an even better version of gold as it has genuine use demand. It's more divisible as well.

But a good article for sure.

[lakedaemonian]

That's funny.

The government USED to say gold is money.

http://www.zerohedge.com/news/65-year-old-video-says-gold-good-money

[Skol]

Yep, gold used to be money, but not anymore. Now it's plastic or iPhone.

[lakedaemonian]

Yep, gold used to be money, but not anymore. Now it's plastic or iPhone.

Let's just save that comment and come back to it in the period ahead, shall we?

Catch you later.

[Skol]

Let's just save that comment and come back to it in the period ahead, shall we?

Catch you later.

What kind of time frame are we looking at?

[elZorro]

Gold back over US$1600 overnight, a determined climb. The US$, not so good.

Lots of reasons in this article about why gold behaved as it did in the last few hours, most to do with exchange rates and short covering. Silver also ramped up.


http://www.kitco.com/reports/KitcoNews20120725AS_update.html

[airedale]

What kind of time frame are we looking at?

In any time frame from one minute to eternity it still looks flippant.

[Skol]

In any time frame from one minute to eternity it still looks flippant.

Gold's been one of the worst investments on the planet for the last year, I doubt it's going to change.

[Skol]

For those of you with some time on your hands, google 'The Golden Dilemma', a paper by Erb and Harvey, PDF format.

Gold should be $780.

[airedale]

For those of you with some time on your hands, google 'The Golden Dilemma', a paper by Erb and Harvey, PDF format.

Gold should be $780.

Yes, strange isn't it how the markets can remain irrational.

[Skol]

For those of you that haven't got the patience:


One more reason to avoid gold


DAVID BERMAN

The Globe and Mail


Published Friday, Jun. 08 2012, 2:22 PM EDT


Is gold really a good hedge against inflation?

That’s the popular impression, or at least one that is drummed into our heads by gold enthusiasts. But gold’ s track record tells a very different story.

Claude Erb and Campbell Harvey, an international business professor at Duke University and a research associate of the National Bureau of Economic Research, have examined gold’s track record in great detail in a new research paper (via Abnormal Returns) entitled “The Golden Dilemma.”

The title is actually a bit misleading, because there isn’t much of a dilemma here at all: They argue that gold offers little value to investors, other than as a speculative play.

As a hedge against inflation, gold’s record certainly appears distorted. The authors found that the price of gold has swung wildly around the U.S. consumer price index since 1975 – and the current level of the CPI index is so far below the price of gold that it implies gold should trade at about $780 (U.S.) an ounce, or about half today’s price.

Another way to look at it is to divide the price of gold by U.S. CPI. Since gold futures trading began, this ratio has averaged 3.2, with a low of 1.46 in 2001. Today, the ratio is a sky-high 7.3, which implies that something is out of whack.

“Since the start of gold futures trading the only other time the real price of gold has been roughly as high as it is today was in 1980,” the authors said in their paper. “Following the real price high in 1980, the real price of gold, as well as the nominal price of gold, fell significantly.”

Gold enthusiasts would respond, “Duh! Gold is telling us that a big spike in inflation is coming.”

Well, Mr. Erb and Mr. Harvey have looked at that too, and have discovered that there has been no correlation between moves in the price of gold and changes in the annual inflation rate, going back to 1975.

Is this time different? The price of gold is already implying an inflation rate of at least 8 per cent a year over the next 10 years, based on the price-to-CPI ratio. That’s at odds with the bond market, which is implying an inflation rate of just 2 per cent a year.

Even if inflation does indeed rise well above the Federal Reserve’s comfort zone, averaging an appalling 5 per cent a year over the next decade, the price of gold would have to slide more than 3 per cent a year to get back in line with the average price-to-CPI ratio.

No doubt about it, gold is a scarce resource – and Mr. Erb and Mr. Harvey note that if everyone devoted, say, 2 per cent of their assets to it, the price would march considerably higher as demand outpaced supply.

But this argument can apply to any asset. If everyone loaded up on shares in Wal-Mart Stores Inc. or baseball cards or Australian shiraz, prices would also soar.

Okay, those assets aren’t going to do you much good if society falls apart – and gold bugs love the fact that gold is gold, no matter what happens.

But Mr. Erb and Mr. Harvey have some bad news for survivalists too: Throughout history, gold owners don’t always get to hold onto their gold when their cities are sacked.

“Gold is viewed as being durable and largely imperishable, characteristics which make gold its own safe haven against the ravages of the world,” they said. “It is not necessarily a safe haven for the owner of gold.”


Exactly, who was it posted a while back whose father died suddenly? The father had buried gold in the garden and they dug up the entire yard looking for it, to no avail.

[skid]

Aw man this all makes me feel terrible cause I bought some gold about the time this thread started-but hang on-turns out its worth alot more than when I bought it--now thats not so bad after all----put that in your pipe and smoke it,Mr Erb--which is probably what he has been doing

[elZorro]

The start of a technical breakout from the triangle formation, and thanks to a sentence or two from the ECB, it's in the positive direction for US$gold.

http://www.ino.com/blog/2012/07/chart-to-watch-9/

When you see a sharp spike or drop in gold over an hour or two, it's usually because of some comment made to the media that affects the moneyprinting scenario, currently the likelihood of QE3 or other bailout events.

By Wednesday, a picture emerging..

http://beforeitsnews.com/gold-and-precious-metals/2012/07/gold-price-climbs-to-1600-on-talk-of-further-easing-from-fed-ecb-2430524.html

And by Friday..

http://www.financialsense.com/contributors/adrian-ash/gold-and-silver-jump-to-three-week-highs

The Moneychanger's thoughts on all this. (http://silver-and-gold-prices.goldprice.org/2012/07/the-gold-price-broke-out-gaining-22.html)

Gold likely to break out soon, Equedia. (http://campaign.r20.constantcontact.com/render?llr=orkbnrcab&v=001xdqoBdbuEqDFOmorzu9ddHZRFwHk-33g059nV2yulRhUA1e3qMxrjIBJi4dtA1ANFP0kxA2KoBWO0YO _kwXaotiBClqMwqwXwFZ4iX9S2nk%3D)

[elZorro]

A chart showing the gold price breakout. The commentator thinks QE3 is highly unlikely, the FED can set deposit rates lower to stimulate lending.

http://www.ino.com/blog/2012/07/chart-of-the-week-gold-8/

Silver also racing away overnight, up to $28.

Options for the ECB in Europe. (http://www.ino.com/blog/2012/07/all-eyes-on-ecbs-draghi-to-fight-crisis/)They could print money too.

[Skol]

Hey JB,

You backin' the truck up at these 'low' prices?

The consensus of opinion seems to be that the Fed will do nothing.

Will that set off the 'big one'?

[JBmurc]

Hey JB,

You backin' the truck up at these 'low' prices?

The consensus of opinion seems to be that the Fed will do nothing.

Will that set off the 'big one'?

will be buying some more later in the year quite time of year for my income....Stoked with my gold producer CVR only @ 50% production ramp up in their first project and already cash-flow positive with low overheads looking good for my second 10 bagger

[elZorro]

OK, the FED didn't do anything, but did note the economy is still slowing. US$ went up, US$gold went down, but held near $1600.

Interesting chart on the volume of 1oz coins being sold. (http://finance.yahoo.com/news/gold-rush-over-175820898.html)

[Skol]

OK, the FED didn't do anything, but did note the economy is still slowing. US$ went up, US$gold went down, but held near $1600.

Interesting chart on the volume of 1oz coins being sold. (http://finance.yahoo.com/news/gold-rush-over-175820898.html)

I was correct, the Fed didn't do anything, there's a school of thought that if QE's announced, that will set off the 'big one'.

[biker]

WTFs the 'big one'??

[airedale]

I think that Skol means if there is further QE then the POG will increase "exponentially". But I am surprised that Skol is now even thinking like that.

[Skol]

I think that Skol means if there is further QE then the POG will increase "exponentially". But I am surprised that Skol is now even thinking like that.

By 'the big one', I mean a crash, a 'sell the fact' sequel.

[Skol]

will be buying some more later in the year quite time of year for my income....Stoked with my gold producer CVR only @ 50% production ramp up in their first project and already cash-flow positive with low overheads looking good for my second 10 bagger

CVR? What?

Down by about 50% in the last year. You've got a strange reason for being 'stoked', unless you like losing money, like your NAV.

[skid]

I think QE3 will be more an attempt to put off ''the big one'' but most likely that ship has already sailed.
Its really a matter more of when it arrives,rather than if.
Ive been overseas for the last month and I can tell you there are some Greek and Spanish that are telling about some very real problems that are happening over there right now.

[Skol]

Hey JB,

Do you read the Herald? Last Saturday's paper, an article by Diana Clement on 20 ways to blow your retirement savings.


# 16. Being an amateur market analyst. There are some DIY investors who are as good as the professionals. There are many more, however, who think they are instant experts until the financial cycle flushes them out. They can be found day-trading in shares, dealing in derivatives, stockpiling precious metals or, until recently, borrowing to the hilt to buy far too many properties.

"stockpiling precious metals" LOL

[airedale]

Hi Skol, I have never heard of Diana Clement, but what next.....financial advice from Mary Holm along the lines of "always consult a financial adviser" or "buy index linked funds".....even when the index is going down. Did Diana mention airline shares?

[JBmurc]

Some other good points


4. Investing too conservatively. People who invest all of their money in the most conservative of investments may not see it grow ahead of inflation at all. Professional retirement plans assume that people hold a proportion of growth assets.

5. Trusting simple projections. All too often investment projections look rosy because they don't take into account tax and inflation. Neither can be avoided. (BULLION growth is tax free and is well known to be a Inflation/fiat hedge)

6. Not diversifying. This one is so obvious I wanted to leave it out. Yet every year there are people who lose their life savings because they didn't diversify.

(bullion is yet another diverse investment only haters like yourself have a problem with it)

[JBmurc]

CVR? What?

Down by about 50% in the last year. You've got a strange reason for being 'stoked', unless you like losing money, like your NAV.

I didn't lose money on NAV sparky made round 50% as I paid low teens sold 18.5c

My CVR average is 2.9c which I'm happy with as the position is a large one i.e just out of the top 20....

[Skol]

Hi Skol, I have never heard of Diana Clement, but what next.....financial advice from Mary Holm along the lines of "always consult a financial adviser" or "buy index linked funds".....even when the index is going down. Did Diana mention airline shares?

No but maybe she should have mentioned airline shares, especially the ones I own, VAH.

In the last year VAH +78%, gold -7%.

[JBmurc]

So Skol when gold going crash again .....?

[Skol]

Probably September. Looks about the time when the big descending triangle hypotenuse reaches the opposite side.

Not sure which will go first, gold or silver or both at the same time, either way, glad I don't own any.

VAH up 96% in the last year now.

[JBmurc]

Wells Fargo Complicates Ally's Independence Plan
Merriam-Webster Gives Business Words New Meanings
Packard Motor Makes a Comeback (Sort Of)
Go Consumer! The Mixed Picture for Retail Spending
Let Them Fly at 350 Feet

Billionaire John Paulson raised his stake in an exchange-traded fund tracking the price of gold while selling other stocks during the second quarter, leaving his $21 billion hedge fund with more than 44 percent of its U.S. traded equities tied to bullion.

Paulson & Co. purchased an additional 4.53 million shares of the SPDR Gold Trust, the firm’s largest position, and bought more shares of NovaGold Resources Inc. (NG), according to a Form 13F filed yesterday with the U.S. Securities and Exchange Commission. Gold prices posted their biggest declines since 2008 last quarter.

While Paulson trimmed his stake in AngloGold Ashanti Ltd. (ANG) and Gold Fields Ltd. (GFI), sales of energy, financial and auto-parts stocks boosted the relative weighting of gold-related securities in his U.S. stock portfolio to the highest in three years. That’s making the fund more vulnerable to declines in the price of bullion as the hedge-fund manager struggles to reverse record losses last year.

Paulson, 56, has lost 23 percent so far this year in his Gold Fund and 18 percent in the Advantage Plus Fund, in part because of wrong-way bets on mining companies. Advantage Plus, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, declined 51 percent last year.
Concentrated Holdings

Armel Leslie, a spokesman for New York-based Paulson & Co., declined to comment on the filing.

Paulson’s U.S.-listed holdings peaked at $34.3 billion at the end of March 2011, with about $7.7 billion of that amount, or 23 percent, invested in gold related stocks. Since then, the firm’s overall assets have declined more sharply than its investments in the SPDR Gold ETF and gold miners, leaving the funds increasingly exposed to the precious metal.

Paulson had 33 percent of his U.S. stock holdings in gold- related securities at the end of the first quarter and 25 percent a year ago.

The last time his stock portfolio had a bigger concentration in gold-related equities than last quarter was March 2009, when U.S. equities hit bottom. At that time, gold stocks equaled about 46 percent of Paulson’s $9.36 billion in reported U.S. stock holdings.
Best Bet

Gold slumped 4 percent in the second quarter, the biggest quarterly loss since Sept. 30, 2008. Prices fell as European Central Bank President Mario Draghi and Federal Reserve Chairman Ben S. Bernanke failed to increase stimulus measures, damping the outlook for global growth and demand for the metal as a hedge against inflation. The price is down 0.1 percent since June 30.
************************************************** *********
Paulson, who became a billionaire in 2007 by wagering against the subprime mortgage market, told clients in February that gold is his best long-term bet, serving as protection against currency debasement, rising inflation and a possible breakup of the euro. Gold miners are historically inexpensive, he said at a meeting with investors in April.
************************************************** **********
His hedge fund has been buying mining companies as part of the bet on rising gold prices, though losses by the stocks have hurt returns. Paulson added 4 million NovaGold shares, which slumped the most in more than three years last month after Barrick Gold Corp., the world’s biggest producer of the metal, said their Donlin Gold joint venture didn’t meet its investment criteria.
Selling AngloGold

Paulson sold 400,540 American depositary receipts of AngloGold, its second-largest position, and 819,000 ADRs of Gold Fields in the second quarter. The fund disposed of stakes in Anadarko Petroleum Corp., Motorola Mobility Holdings Inc., Medco Health Solutions Inc., El Paso LLC and SunTrust Banks Inc.

Paulson said during a conference call with investors last month that his firm has reduced risk at some of its funds, according to a client, who asked not to be named because the call was private. So-called net exposure in its Advantage funds, which seek to profit from corporate events such as takeovers and bankruptcies, was 11 percent; at the Credit funds it was minus 9 percent; and at the Recovery funds, which bet on assets Paulson believes will benefit from a long-term economic advance, it was 31 percent, the investor said.

The Advantage funds had net exposure of 32 percent as of the end of January, the Credit funds were at 27 percent and the Recovery funds were at 55 percent, according to an annual letter sent to clients in February.

Net exposure is calculated by subtracting the percentage of a hedge fund’s short positions, or bets on falling securities, from its long holdings, or wagers on rising stocks and bonds.

Money managers who oversee more than $100 million in equities must file a Form 13F within 45 days of each quarter’s end to list their U.S.-traded stocks, options and convertible bonds. The filings don’t show non-U.S. securities or how much cash the firms hold.

To contact the reporters on this story: Miles Weiss in Washington at mweiss@bloomberg.net; Kelly Bit in New York at kbit@bloomberg.net

To contact the editor responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net

[Skol]

If John Paulson's buying I'd be selling, if I had any.

A good contrarian signal.

[JBmurc]

If John Paulson's buying I'd be selling, if I had any.

A good contrarian signal.

right shall we make this more interesting I reckon Gold will be above 1600 by the years end ,,you go on daily about it crashing so if your right I double my payment to $200 to you thats if also silver stays below $50 but if Gold closes the year out higher than 1600 I win and pay you nothing if Silver isn't above $50(very unlikely at this stage)_ but in a major loss of trust in fiat I could well end up with another $200 from you..

[Skol]

right shall we make this more interesting I reckon Gold will be above 1600 by the years end ,,you go on daily about it crashing so if your right I double my payment to $200 to you thats if also silver stays below $50 but if Gold closes the year out higher than 1600 I win and pay you nothing if Silver isn't above $50(very unlikely at this stage)_ but in a major loss of trust in fiat I could well end up with another $200 from you..

No thanks, the original deal stands. Goldbugs don't have any common sense, anything's likely to happen.

[JBmurc]

No thanks, the original deal stands. Goldbugs don't have any common sense, anything's likely to happen.

LOL I guess after losing to me twice your to scared to back up you convictions against PM as to why I gave you such a huge advantage 5:1 in the Silver bet .....maybe next year we'll set a fairer bet

[Skol]

LOL I guess after losing to me twice your to scared to back up you convictions against PM as to why I gave you such a huge advantage 5:1 in the Silver bet .....maybe next year we'll set a fairer bet

Don't complain about the 'fairer bet', it was your idea.

Silver only has to increase 80% for you to win, don't fret!

Hahahaha

[skid]

If your wondering about some of the advice on this thread-heres a little test--go back to the first post,its dec 2009--then go to the kitco 5 year gold chart and find approx dec 2009 and have a look at the chart from that point up until now--If you really have nothing to do you could also go through all the posts and count the number of times the word ''crash'' is used--Meanwhile, in the present day I think it all boils down to the likelyhood of inflation.
Are the economic powers willing to put up with inflation to avoid unemployment and the other economic woes that are facing them?
Europe is using some watered down versions but will the US play the QE3 card--watch this space.

[elZorro]

Gold looks like it's heading for the moon at the moment Skol..and silver even more so.

http://economictimes.indiatimes.com/markets/commodities/gold-prices-near-3-1/2-month-high-on-ecb-hopes/articleshow/15597316.cms

JB, unlike yourself I don't need silver to get to $50 by Christmas, although that would be great, for a couple of reasons. I have only $7 to go to get my silver investment at breakeven point..

[JBmurc]

Gold looks like it's heading for the moon at the moment Skol..and silver even more so.

http://economictimes.indiatimes.com/markets/commodities/gold-prices-near-3-1/2-month-high-on-ecb-hopes/articleshow/15597316.cms

JB, unlike yourself I don't need silver to get to $50 by Christmas, although that would be great, for a couple of reasons. I have only $7 to go to get my silver investment at breakeven point..

I won't be complaining if Silver doesn't make $50 till early next year the growth of my investments will keep me happy as long as the PM prices continue their trend

[elZorro]

Some other news has caused the US$ to drop into 0.81 territory and gold to spike another $20.

Not sure if it's something about Greece.

http://economictimes.indiatimes.com/news/international-business/eurogroup-chief-jean-claude-juncker-backs-greece-pushes-for-reforms/articleshow/15608341.cms

[airedale]

So "coiled spring" it is.

4094
Hi Hoop, nice clear chart on Wednesday. The phrase "coiled spring" comes to mind. Skol would probably say "death spiral".

[Skol]

EZ,

It's called 'hope'.

[JBmurc]

EZ,

It's called 'hope'.

Yes we know you hope gold would crash but it's not it's breaking out

[Skol]

You've got a bit of catching up to do with your silver JB, S&P500 up 21% for the last year, silver down 30%.

The get-rich-quick-scheme not working?

[JBmurc]

You've got a bit of catching up to do with your silver JB, S&P500 up 21% for the last year, silver down 30%.

The get-rich-quick-scheme not working?

no quick get rich scheme's here just solid investments of good value

[Skol]

no quick get rich scheme's here just solid investments of good value

Break-out or bull trap?

[elZorro]

Break-out or bull trap?

Definitely a breakout: this is what triggered the dollar drop and gold/silver spike: three weeks after the FED meet, they publish their minutes. That date was overnight, 22nd August. The FED is seriously considering something like QEIII, and they promise it will be economically, not politically, related. They're gathering data on whether there is enough improvement to hold off.

http://online.wsj.com/article/SB10000872396390444358404577605451567479764.html?m od=djemalertMARKET

[JBmurc]

Definitely a breakout: this is what triggered the dollar drop and gold/silver spike: three weeks after the FED meet, they publish their minutes. That date was overnight, 22nd August. The FED is seriously considering something like QEIII, and they promise it will be economically, not politically, related. They're gathering data on whether there is enough improvement to hold off.

http://online.wsj.com/article/SB10000872396390444358404577605451567479764.html?m od=djemalertMARKET


A big boost to the markets smart move by the obama team before the elections as to why there've prob held off ....sad fact is they'll like many countries will have to continue till inflation can devalue the massive growing unfunded liabilities....either that or major depression of their economy

[Skol]

It's all speculation, demand for gold worldwide is plummeting and demand in India is a big fat zero. What's that mean to the trained mind JB?

[CAM]

http://www.interest.co.nz/news/60723/world-gold-council-has-updated-international-demand-and-supply-data-q2-2012-central-bank-

[STRAT]

Break-out or bull trap?
Hi Skol
A bit like asking if its a car or transport. Anyway, it depends on the time frame you are lookin at and it looks like a breakout to me:eek2:

The chart looks ok in Oz money too.

Bit of a double bottom
Uptrend has been excellerating
Blown through resistance that held over the last 3 months
Close to passing through the trend line down from the previous high a year ago
Has risen 7 days in a row.

If it was a stock I would have slapped it in the Breakout thread

[JBmurc]

4105

IMHO I think we'll see Gold make another move on the 1800 resistance before the years out

[Skol]

JB,

Draw a straight line, doesn't look like a breakout to me. A big, descending triangle, probably will breakout to the downside.

[elZorro]

No, that's a breakout all right Skol, and the Republicans are openly considering a return to the gold standard..

http://www.mineweb.com/mineweb/view/mineweb/en/page34?oid=157680&sn=Detail

[Skol]

No, that's a breakout all right Skol, and the Republicans are openly considering a return to the gold standard..

http://www.mineweb.com/mineweb/view/mineweb/en/page34?oid=157680&sn=Detail

Yes, I was waiting for that EZ. It's all poppycock, a sop to the Ron Paul fans, a Tea Party vote buy. It'll all come to nought, it's all been done before, in 1985 I believe.

[JBmurc]

Yes, I was waiting for that EZ. It's all poppycock, a sop to the Ron Paul fans, a Tea Party vote buy. It'll all come to nought, it's all been done before, in 1985 I believe.

SKOL- "the king of delusional views on Gold's ever imminent crash" ...fact is for once I agree no way can the US uphold a gold standard just too much debt too little gold in the coffers ...for one a full backing of USD to Gold would either mean the US would have to buy over 6 times more gold that it's believed to be held(no audits in recent times) or have the Gold re-priced to $10,000 and that would only be for the current US debt position at present ....then.include all unfunded liabilities --- times that amount by another 6-7 times !!! so yes in no way can the failed 40yr fiat reserve currency plan go back to be backed by gold etc ....maybe cattle ...wheat ..corn etc

[elZorro]

Ok, I'll admit it, I was just stirring..:)

[Skol]

JB,

Please make sure got enough 'failed, worthless fiat money' to pay me at the end of the year.

(Hint: Sell silver while it's at an astronomically high price to make sure)

[elZorro]

Morning Skol..

http://www.marketwatch.com/story/gold-rises-ahead-of-bernanke-speech-2012-08-31

About a $40 increase in the gold price after one speech by Bernanke. QE3 or something like it, probably to be announced in September.

[skid]

Not surprising as the US has a much greater tolerance to inflation than to increasing unemployment and bad economic data..ie another stimulus is looking more likely..They are running low in their arsenal of weapons though[unless we are talking literally,which is of course their ace in the hole if things get really ugly economically...go out,occupy,and take.

And for todays dig....the opposite of crash is S O A R LOL

[elZorro]

Not surprising as the US has a much greater tolerance to inflation than to increasing unemployment and bad economic data..ie another stimulus is looking more likely..They are running low in their arsenal of weapons though[unless we are talking literally,which is of course their ace in the hole if things get really ugly economically...go out,occupy,and take.

And for todays dig....the opposite of crash is S O A R LOL

No reply from Skol, he must be away..

Found this, about why September-November is good for the gold price.

http://business.financialpost.com/2012/06/27/why-september-and-november-are-the-best-months-for-gold/

The next big meeting is on Sept 13th. QE3 could be announced there.

[Skol]

I was watching a TV programme this afternoon about Jackson Hole. One analyst (not that I trust them) reckons there will be no QE, another reckoned there are better ways of stimulating the economy, and another when asked how he thought investors would react if there was no QE replied, "not very favourably I would imagine".

You can read into that what you like.

I hardly think that Bernanke has handed out a free lunch, because there isn't one.

[elZorro]

Interesting read for you here, Skol. Two reasons for the FED to bring in QE3. It's partly about a currency war. The most likely benefactors: people holding gold, or goldie shares.

http://campaign.r20.constantcontact.com/render?llr=orkbnrcab&v=001qGZo6GH_pRScWLxKXf_r3ObEIcaIepUL5KkyB5899JmLj 4aXuKBuJOuLu4hmPOSsTx90akXD3KbFsNnQwV2uJ4lu58MmEnp UevDzKj5bbv8%3D

[JBmurc]

Aug 16, 2012 6:00am

Billionaires Soros, Paulson Bet Big on Gold

Once again John Paulson is choosing to heavily invest in gold and fellow billionaire George Soros is making a similar bet.

According to Bloomberg News, Paulson & Co. and Soros Fund Management bumped up exposure to SPDR Gold Trust to 21.8 million shares and 884,000 shares, respectively. Paulson & Co. now has 44 percent of its $24 billion fund exposed to bullion.

On Wednesday, according to Reuters, gold began to rebound after two straight losing days with spot gold climbing to $1,604.35 an ounce, up 0.4 percent. According to CNBC, in the previous four months gold has had a difficult time moving beyond a $1,525 and $1,680 range.

Known for making big bets, between 2007 and early 2009, Paulson invested heavily in the housing market garnering $20 billion in profits, according to the Wall Street Journal.

A spokesperson for Paulson & Co. did not return our request for comment. Soros Fund Management did not return our request for comment.

The decision by Soros is an interesting one. In 2010, Soros called gold “the ultimate bubble” during an appearance on Reuters television. “It may be going higher but it’s certainly not safe and it’s not going to last forever,” he stated.

And, some portfolio managers aren’t so sure gold is a smart bet in 2012.

“I’m not sure gold as an outsized bet is the place to be right now unless you believe in hedging against greater unrest or a deepening credit crisis in Europe, ” said Kevin Starkey, a partner at Capstone Investment Financial Group.

” We currently believe that 3 to 5 percent of gold exposure is the right exposure for most of our clients. We are big believers in gold as defensive play. To make it an offensive play, or make a big bet on gold, means [Paulson] sees something we do not see,” Starkey added.

Peter Sorrentino, a senior portfolio manager at Huntington Funds, which manages more than $13 billion in assets, said consumers should not rush out and buy gold.

“Historically these moves span roughly a decade and while the last phase is typically the most explosive, the risk is getting out before it rolls over. For individual investors buying physical gold involves paying sales tax both in and out as well as considerations for storage, insurance, transportation and assay fees. These can be considerable expenses,” Sorrentino said in statement to ABC News.

Sorrentino said gold has been in a “consolidation phase since the end of February and has traditionally moved higher after such periods.”

He continued, “the fundamentals behind gold such as available supply coming to market and end demand have not changed in any material way. In fact, gold purchase by central banks in the pacific rim, India and Russia have reached new highs. So from an investor psychology and supply/demand perspective, this looks like every cycle before it during the last decade.”

“The big question is whether or not this time it’s different. Every commodity-driven cycle ultimately comes to an end, and ten years is generally the average duration for these market moves,” said Sorrentino.

But, despite big bets by two of the nation’s billionaires, he continued, “…There is an old saying among Wall Street trader; ’It’s said with a whisper and not with a shout, when the widows and orphans get in, it’s time to get out.’”

Gold exchange-traded fund holdings topped 77.7 million troy ounces this week to another record high. ETFs are investment funds traded on stock exchanges, much like stocks. Many of them have low management costs and there is not the need to take physical possession of the gold.


http://abcnews.go.com/blogs/business/2012/08/billionaires-soros-paulson-bet-big-on-gold/

[elZorro]

Interesting JB, thanks for that. The guy who said "don't jump into gold" is wanting to sell share investments.

An older article with a very interesting chart on the relationship of oil prices to gold prices.

http://goldratefortoday.org/explaining-gold-rate/

[Skol]

No QE3 = Paulson goes broke.

[lakedaemonian]

http://www.youtube.com/watch?v=9o30gNfPq_k&feature=player_embedded


We had the opportunity to sit down with Frank Giustra last week, the lion behind Lionsgate Films, and an early architect of countless resource companies—most notably Wheaton River Minerals (now known as the $33B Goldcorp, which spun out the $12B Silver Wheaton), Petro Rubiales (now the $7B Pacific Rubiales), and Urasia Energy.

By all accounts Giustra is brilliant, connected and wealthy. He made headlines in 2007 by pledging over $100 million and half of his future earnings to establish a charitable foundation with President Clinton. Outside of philanthropy however, Giustra has been reluctant to draw attention to himself, and rarely speaks publicly about investing.

In 2002 however, he moved heavily into gold and published, “A Tarnished Dollar Will Put the Shine on Gold”, when it was trading under $300 an ounce. Ten years later and with gold now priced over $1600/oz., it still occupies the largest percentage of his investment portfolio, and his views remain the same.

In discussing gold during the interview he said, “I believe it’s going a lot higher…it’s going to have a parabolic spike, caused by some event or some loss of confidence…a US dollar crisis would be a perfect example. That will cause gold to go through the roof, and then everybody will want to own it…I don’t think we’re even close to that yet…Gold will probably have a much greater run than some of the other hard assets–because it’s also a currency.” (19:16)

He IS talking his own book.....but...

Gold's looking pretty good.....sitting just shy of $1700 an ounce at the moment.

Looking at DJIA, S+P, and Gold, they're all up YTD in the high single digits

Looking at DJIA & S+P over 5 years....it's almost exactly flatline

Looking at Gold over 5 years, up 150% safe as houses(safer even).

Catch you at the end of the year Skol for that humble pie you have on order :)

[Skol]

JB,

Just taken delvery of my new book.

GOLD BUBBLE. - Profiting from Gold's Impending Collapse.


The author's got it right already, one chapter on betting against Facebook.

Maybe Bernanke's gonna solve the GFC in one fell swoop. Everyone should buy gold because there's gonna be QE3, so everyone in the world will be rich.

GFC problem solved. LOL

Gold - the worst investment on the planet for the last year (apart from silver).

[Skol]

There's an article on CNBC.

'Gold set for dramatic fall if Central Bankers disappoint.'

Gold & silver 1980 - crash
Stock market 1987 - crash
Tech Wreck 2000 - crash
Oil bubble 2008 - crash
Real Estate 2009 - crash

Gold 2012 - ?????

[JBmurc]

Central bankers can only disappoint for so long ...everyone know more QE will happen....without free credit the real debt crushes growth drives unemployment

Billionaire's bet on inflation

http://www.kitco.com/ind/Tommy/20120905.html

[Skol]

Hey JB,

I'm only 39 pages into my book on the gold bubble and I'm already kissing the earth that I don't own any gold or silver.

The exact peak in the housing bubble was the exact same time as a new TV programme, "Flip this House", and the author surmises that the peak in the gold bubble last year was the same time as the launch of "Gold Rush Alaska".

[lakedaemonian]

There's an article on CNBC.




CNBC?


Hahahahahahahahahaha!

[lakedaemonian]

http://www.marketwatch.com/story/why-is-putin-stockpiling-gold-2012-09-05


I can’t imagine it means anything cheerful that Vladimir Putin, the Russian czar, is stockpiling gold as fast as he can get his hands on it.
According to the World Gold Council, Russia has more than doubled its gold reserves in the past five years. Putin has taken advantage of the financial crisis to build the world’s fifth-biggest gold pile in a handful of years, and is buying about half a billion dollars’ worth every month.

"Nothing to see here folks, move along!"

[elZorro]

And gold breaks US$1700 again, in a determined way.

It must already be at an all-time record in euros.

At the rate it's going now, it might be at US$1750 by morning. And we still have Sept 13th to get through.

JB might collect on his silver bet with Skol..

[Skol]

And gold breaks US$1700 again, in a determined way.

It must already be at an all-time record in euros.

At the rate it's going now, it might be at US$1750 by morning. And we still have Sept 13th to get through.

JB might collect on his silver bet with Skol..

Doubt it, gold $1703 ($8 - LOL) and the Dow's up 237, everyone knows gold's going nowhere, the S&P500 is 24% ahead of gold for the last year.

QE3's built in and if it doesn't turn up there'll be a massacre. CNBC will be right.

[airedale]

Hi Skol and a good morning, you have always said that POG is going down, now you are saying that POG is"going nowhere". Reading between the lines that sounds like a 180 degree change in your thinking. :)

[Skol]

Hi Skol and a good morning, you have always said that POG is going down, now you are saying that POG is"going nowhere". Reading between the lines that sounds like a 180 degree change in your thinking. :)

Hi airedale,

Relative to almost everything else in the world it is going down.

Even boring cash in the bank, the safest most liquid asset there is at the moment, is better than gold.

Gold could be on the brink of a devastating 'correction'.

S&P500 up over 2% and gold showing down at $1702 on Yahoo Finance, what's happened to the 'moonshot'?

[skid]

Skol,you crack me up.
Lets face it,a person is judged on their past performance.
When you started this thread[post#1]Gold was under $1000.
In all that time[with your constant predictions of a crash]it has not dipped below that point,in fact, it is now at $1700.
Do you really expect us to take you seriously?
I think at the moment that the smart money is probably on gold as there is a good likelyhood that there will be a QE3 in some form.
That may not be the right thing to do,but at the moment it seems likely.
There are certainly things that could turn the tide in the opposite direction and if that happens then we will have to reassess the situation rather than blindly follow what we hope will happen.
But its a long way down to under $1000 an ounce

[skid]

Having said that,it wouldnt be as much fun without you Skol:p

[Skol]

Thank you for your kind words there skid, but you're conveniently forgetting that I've been correct for more than a year now.

Had a look at the POG in the last hour or two?

[STRAT]

Thank you for your kind words there skid, but you're conveniently forgetting that I've been correct for more than a year now.

Had a look at the POG in the last hour or two?Gold has been looking good in US dollars for two months and still does.

What is more interesting is its close to a breakout in Aussie dollars. A more reliable value measure IMO.
Looking for a break above the 1670 to 1675 mark

[ELYOB]

Gold has done well enough today to catch my eye . There are goldies that are down and showing signs of moving ,some up 3-7% as I speak .... they are going to move now .... gold may move 5% over time but , our goldies could easy do 20%

[JBmurc]

Thank you for your kind words there skid, but you're conveniently forgetting that I've been correct for more than a year now.

Had a look at the POG in the last hour or two?


That Gold would consulate 1500 levels before moving back on bull trend ? Can't remember that

[elZorro]

I know exactly what you mean, JB. But still, this is another fine example of a malapropism...:)

USD$ not happy. Thursday next week, it'll be a big night.

http://goldstocksforex.com/2012/09/06/dollar-weak-gold-bugs-double-bottom/

[tricha]

Thank you for your kind words there skid, but you're conveniently forgetting that I've been correct for more than a year now.

Had a look at the POG in the last hour or two?

Yeah, its looking great!

Daily Gold ChartsJanFebMarAprMayJunJulAugSepOctNovDec12345678 91011121314151617181920212223242526272829303112111 00908070605040302010099
http://www.kitco.com/images/live/t24_au_en_usoz_home.gif?random=0.31475830078125 (javascript:NewWindow('/charts/popup/au24hr3day.html','Au30Days','top=50,left=200,width =800,height=760');)Click to enlarge (javascript:NewWindow('/charts/popup/au24hr3day.html','Au30Days','top=50,left=200,width =800,height=760');)

[Skol]

On the bubble chart the area we're in now is the "return to normal".

"whew thank goodness that's over, now we can get on with the moonshot".

Yeah, right.

As far as gold's concerned India's dead, China's dying, resources, materials and commodities are at death's door.

The S&P500 now 29% ahead of gold for the last year, great 'investment' guys. I'll be reading about you in the Public Notices if this keeps going.

[skid]

Yep,i guess it all depends on when you decide to enter on the gold market,if at all.
There was certainly a pullback earlier, so for those who entered at that point,its probably been difficult--but my point was that you have been slamming gold consistently from the start, so those who followed your advice would have lost an excellent opportunity--by the time the pullback came i doubt most would have found your advice credible.Theres a time to be bearish and a time to be bullish.
Those who choose one, and follow it blindly do so at their own peril

[denpal]

Fed To Ease As Fears Continue To Propel Gold & Silver Surge

Today acclaimed money manager Stephen Leeb told King World News, “Right now you are seeing fear ... This is why you are getting this kind of surge in the gold and silver markets because investors are realizing that policymakers are in trouble.” Leeb also reiterated what he predicted in his last KWN interview, which is that the Fed will ease at its September meeting. It is now looking like he was correct on that prediction.


Here is what Leeb had to say: “Today a rally in gold and silver was sparked when the US reported terrible jobs numbers, and no gains in wages. But we’ve seen lots of gains in energy prices lately, and this move in gold comes on top of a great deal of stimulus. Europe, this week, announced unlimited bond purchases, whatever that means. We do know that means they are going to be buying a lot of bonds.”

Stephen Leeb continues:


“We are going to have to inflate. We are going to have to stimulate, and this means paper currencies are going to be worth less. It means people are going to be in a desperate search to buy things such as gold. This breakout in gold and silver is a big deal because it is further acknowledgement that whatever we are trying to do is not working.


This means we are going to have to pump more and more money into the system. So as I said, the money will become worth less....


“That’s the bottom line when it comes to the paper money.


So if you are China, as an example, and you know you are going to have to buy resources, you know you are not going to be able to buy as many resources going forward by sitting on the $3 trillion you have because those dollars are becoming worth less and less as we print more and more.


The same thing is true for the euro. So if you are China, you are going to be looking for something that people will accept, and that’s gold. It’s that simple. I would also add silver to that list as well because silver is a monetary metal. Not only is silver a monetary metal, and it’s accepted as being a monetary metal, but it’s also a critical industrial metal.”


Leeb also added: “Right now you are seeing fear. People want something they can count on because they are losing faith in our leaders. That is why you are seeing this move in the metals. People know that the words these politicians are speaking are having no effect on our economy.


So investors are taking matters into their own hands. The more these politicians talk, whether they be Democrat or Republican, the more people realize they have no solutions. How can you have a convention, in times like this, when you are looking at record droughts for the past 70 years, record corn prices, the marginal cost of oil at $100, where you are not hearing any of these words mentioned even once by these politicians?


It doesn’t even make sense. It’s like they are living on another planet. Who’s speaking for the people? I watched both conventions, and I don’t think I can remember one person using the words food, water or energy. They weren’t in anyone’s speeches.


If you move over to Europe, we are seeing a dramatic rise in suicide rates and mental health disorders. People can’t feed themselves, and many people are showing signs of a good deal of mental stress and difficulties. And I should add that in the US, 25% of the population is spending 50% of their income on food and energy. Well, it is also true that in Europe that middle-class is going through these same struggles and in many instances it’s worse.


This is what no one is talking about and I don’t get it. There’s a lot of talk about same sex/different sex marriages, but what difference does it make what sex your partner is if you can’t serve he or she dinner? What if there is no dinner and no food in the cupboard?


This is why you are getting this kind of surge in the gold and silver markets because investors are realizing that policymakers are in trouble. They have to stimulate. They have to see to it that as many people as possible are employed. So the gold and silver markets have much further to run.


One day gold will be part of any major currency basket. And people have to remember that outside of the majors, the only meaningful supplies of gold are contained in the juniors. Those quality stocks will go up at least ten fold in price, Eric. But regardless, everybody has to have something in precious metals.”

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/9/7_Fed_To_Ease_As_Fears_Continue_To_Propel_Gold_%26 _Silver_Surge.html

[STRAT]

As far as gold's concerned India's dead, China's dying, resources, materials and commodities are at death's door.
Are you serious Skol or just blowing your whistle to see how many dogs will bark? I suspect your toungue must almost be ready to push right through your cheek. :D

[skid]

the Stephen Leeb article is the second Ive seen today basically saying the same thing--check out the Frank Giustra interview on u tube. [ Losing faith in the politicians] the link is on the depression in the usa link[he is predicting major inflation though]

[Skol]

Are you serious Skol or just blowing your whistle to see how many dogs will bark? I suspect your toungue must almost be ready to push right through your cheek. :D

Of course I'm serious, gold sales in India are at a net zero after scrap gold is taken into account.

Gold sales are plummeting worldwide, yet gold's going up, probably ETF based, and you know what happens when supply exceeds demand, or shall I spell it out?

[elZorro]

Interesting reading here, about the currency war under way.

http://campaign.r20.constantcontact.com/render?llr=orkbnrcab&v=001w9ieBxA0tWtmx3SvozG3kG_VrlaN2B98hTLfQEl70GTPw pIB59IGrcZ4DHpIDONSI3FDs3ShXeK3AhVNfaqTNQQdl0ivNHZ JRf1Dng5wFaQ%3D

[airedale]

"and you know what happens when supply exceeds demand, or shall I spell it out?"

That is OK, Skol, you have already spelt it out about a year ago and every year since you started this entertaining thread. The spelling a year ago was p a r a b o l i c :cool:

[Skol]

"and you know what happens when supply exceeds demand, or shall I spell it out?"

That is OK, Skol, you have already spelt it out about a year ago and every year since you started this entertaining thread. The spelling a year ago was p a r a b o l i c :cool:

I was correct, it went parabolic and it's been a lame duck ever since.

http://online.barrons.com/public/page/9_0204-lippermfperformance.html

[STRAT]

or shall I spell it out?Settle down mate. No offence intended. I always assumed this thread was always more intended to wind up Goldbugs than a debate on the merrit of Gold but if the merrit of gold it is then what do you reckon about this wee picture.

[JBmurc]

I was correct, it went parabolic and it's been a lame duck ever since.

http://online.barrons.com/public/page/9_0204-lippermfperformance.html

Its called "consolidation"

[Skol]

Strat,

Here's a quote from Paul Krugman:

'Unsustainable situations usually go on longer than most economists think possible. But they always end, and when they do, it's often painful'.

[JBmurc]

Gold -$1739 ......

[elZorro]

Bubble, schmubble, 60% chance that QE3 will be announced this week..

http://www.indianexpress.com/news/gold-price-retains-gains-on-us-fed-hope/1000423/

[Skol]

Bubble, schmubble, 60% chance that QE3 will be announced this week..

http://www.indianexpress.com/news/gold-price-retains-gains-on-us-fed-hope/1000423/

I was watching a TV programme in the US last week and one commentator warned of a serious correction for gold depending on what Bernanke says.

[elZorro]

I was watching a TV programme in the US last week and one commentator warned of a serious correction for gold depending on what Bernanke says.

But energy and labour costs in the western world are making even well established, but maturing, gold mines unprofitable, despite record prices for gold. This would be because gold is a rare element. Look at Auckland's closest big mine.


But Newmont Waihi Gold spokesman Sefton Darby said the Correnso mine, likely to be operational by late 2015, would ensure the 120-odd underground jobs plus dozens of spin-off jobs in the small mining community would continue. Mr Darby said in the past four or five years, extraction costs had far exceeded gold costs, and this year Newmont would post "a very large loss", but they were pushing on with planned Correnso developments.
"Otherwise there will be no mine here."


Average extraction costs for bigger miners are generally in the range of US$600 to over US$1,000 per ounce.

More important, will China look to continue buying up gold for a long time yet, in a sensible insurance policy considering their massive holdings of US currency, which is tending to devalue?

Yesterday we saw increasing proof that China is in the box seat. It wasn't an American or European firm that made noises to buy FPA.

[Skol]

The cost of extraction is around $600, mines should be making record profits, the big difference between the cost of extraction and the current price points to overspeculation.

Things are looking very grim for China, the Shanghai Index is at its lowest for years.

On the TV the other day:

Interviewer: "How will investors view gold if there's no QE?"

Commentator: "Not very favourably I would imagine."

[Skol]

BTW EZ, here's an interesting piece of info.

Since 1969, September has been the strongest month for gold in terms of average price and October is the weakest.

Looking pretty weak at the moment, dropping by about $3/hour, what's happening?

Does someone know something we don't?

HUI -1.73%
XAU -1.57%
GDX -1.94%
GDXJ -2.1%

"A crash does not come knocking at the front door by appointment"

British business executive.

[Skol]

Hey EZ, I bought a new book the other day - 'Gold Bubble - Profiting from gold's impending collapse.'

He's already got one thing right, the author wrote a chapter on betting against Facebook - before it was floated, now down 52%.

The books says diamond prices have flatlined for years while gold has appreciated an absurd 600%. Says sell gold miners and buy diamond miners.

Also says lots of other stuff, if you're nice to me I'll drop the occasional hint. It's 256 pages.

[skid]

I think he was talking about the $US LOL
--in all seriousness ,there is nothing the US would like more than to get the $US to a lower level to help boost their economy[those unemployment figures were a shocker] that, in my opinion is more important to them than a bit of inflation and the resulting increase in Gold.
They are on wobbly legs ATM-Gold will just reflect what they try to do to remedy the fix they are in.

[elZorro]

Hey EZ, I bought a new book the other day - 'Gold Bubble - Profiting from gold's impending collapse.'

He's already got one thing right, the author wrote a chapter on betting against Facebook - before it was floated, now down 52%.

The books says diamond prices have flatlined for years while gold has appreciated an absurd 600%. Says sell gold miners and buy diamond miners.

Also says lots of other stuff, if you're nice to me I'll drop the occasional hint. It's 256 pages.

Skol, I am being nice to you, I'm posting on this thread to help keep it going aren't I? :)

I bought a new book too:

"How to Profit from the Impending Collapse of Western Economies -Why Gold was the Best Investment in 2012" by JB Murc esq.

[airedale]

An amazing 15 posts on this thread between breakfast yeterday and morning smoko today. I think that I will tune out for a while. Call it a TKO, Skol.

[gv1]

Whether Q3 or not Gold will always be in demand. Among indians and chinese(asians) they always give their children and families gold. I always wondered why? Now I realised ....That's the only thing that will retain its value. No matter how poor they are, they will always try to buy gold, knowing very well the value of it. So if the price does not rise these are the group of people who will benefit from it.... they stock pile more..

[Skol]

Whether Q3 or not Gold will always be in demand. Among indians and chinese(asians) they always give their children and families gold. I always wondered why? Now I realised ....That's the only thing that will retain its value. No matter how poor they are, they will always try to buy gold, knowing very well the value of it. So if the price does not rise these are the group of people who will benefit from it.... they stock pile more..

Untrue.

Read my post above, the sales of gold in India are at a net zero (0) when scrap gold is taken into account. Sales in China are falling as well, in fact even the World Gold Council, ( if you can trust them) have admitted that worldwide sales of gold are down.

In India, down about 50% in the last year, 18% in the last quarter.

[Skol]

Hey EZ, Hope you haven't got too much riding on gold or silver.


'Veteran market analyst Ned Schmidt’s latest Gold Thoughts (Sept. 6) encapsulates the current market paradigm quite neatly. First, Mr. Schmidt cautions that “the recent Gold rally, and the purely speculative run in Silver, have [both] been built on the expectation that an all-in, massive monetization of US government debt would occur. If that is not the case and the stealth approach is chosen (whereby the Fed sets small, open-ended regular bond purchases as the preferred course to an all-out QE3), part of the rally, perhaps a significant part, will be given up.”

So, what about the day after the Fed? Mr. Schmidt advises that “without an immediate 'collapse' of the dollar on 13 September, the current rally of Gold will be extremely vulnerable. As most of the Gold 'bought' in the past few months has been really Gold derivatives, not physical metal, the vulnerability is high. Buyers of those futures are not going to take delivery. Now is not the time to be chasing the fantasies of the Street. Was not Facebook enough of a lesson on that? Gold has been the 'game of the month', and Silver has been the speculators’ play toy. Do not confuse a short-term game of fantasy speculation in the derivatives markets with investment.”

[gv1]

Gold zooms above Rs 32,000-levelIndiaTimes (http://www.indiatimes.com/source/IndiaTimes) , posted ON 06 Sep 2012 AT 18:16:24 Economy (http://www.indiatimes.com/economy/) omg (http://www.indiatimes.com/omg)



















2http://media.indiatimes.in/images/email.gifGOLD PRICE IN INDIA (http://www.indiatimes.com/topic/gold_price_in_india)

http://media.indiatimes.in/media/content/2012/Aug/a_1336154899_1336154906_1346251675_1346251677_120x 90.jpg (http://www.indiatimes.com/economy/gold-to-hit-high-of-rs-32000-by-diwali-37999.html)'Gold to hit high of Rs 32,000 by Diwali' (http://www.indiatimes.com/economy/gold-to-hit-high-of-rs-32000-by-diwali-37999.html) IndiaTimes (http://www.indiatimes.com/source/IndiaTimes) - 12 days ago
http://media.indiatimes.in/media/content/2012/Aug/indiatimes5_1338463044_1345904677_1345904680_120x9 0.jpg (http://www.indiatimes.com/economy/gold-hits-new-record-at-rs-31k-on-strong-global-cues-37485.html)Gold hits new record at Rs 31k on strong global cues (http://www.indiatimes.com/economy/gold-hits-new-record-at-rs-31k-on-strong-global-cues-37485.html) IndiaTimes (http://www.indiatimes.com/source/IndiaTimes) - 16 days ago



NEW DELHI: Gold today crossed the coveted Rs 32,000-mark for the first time in the national capital, driven by increased buying by stockists ahead of the marriage season amid a firming global trend.
http://media.indiatimes.in/media/content/2012/Sep/a_1346935549_1346935562_460x460.jpg
The precious metal gained Rs 320 to Rs 32,300 per 10 grams. It has gained by Rs 1,555 per 10 grams in the last two weeks.

Bullion merchants said the trading sentiment also bolstered as gold climbed in international markets on speculation the European Central Bank will announce unlimited purchases of government bonds to defuse the euro-zone debt crisis, increasing demand for bullion as an alternate investment.

Gold is likely to scale new heights in the coming days for the marriage season, they added.

"Gold is on upward march and likely to touch new peaks in the coming days for festivals...," All India Sarafa Association General Secretary Surender Jain said, adding that a firming global trend and weak rupee will make imports of the metal costlier.

India is mainly dependent on imports for the precious metal, thus the global bullion trend sets the price trend in the country.

In London, gold rose by 0.96 per cent to USD 1,709.70 an ounce and silver by 1.8 per cent to USD 32.85 an ounce, the highest level since April 4 this year.

Following the general firming trend, silver gained Rs 1,100 to Rs 61,100 per kg on rising demand among industrial units and coin-makers.

On the domestic front, gold of 99.9 and 99.5 per cent purity spurted by Rs 320 each to Rs 32,300 and Rs 32,100 per 10 grams, respectively. Sovereigns followed suit and shot up by Rs 200 to Rs 25,250 per piece of eight grams.

Silver ready spurted by Rs 1,100 to Rs 61,100 per kg and weekly-based delivery by Rs 1395 to Rs 63,345 per kg. Silver coins shot up by Rs 1,000 to Rs 77,000 for buying and Rs 78,000 for selling of 100 pieces

[elZorro]

Hey EZ, Hope you haven't got too much riding on gold or silver.

Hi Skol. Note my greeting: "Hey xx " seems to be reserved by current youth and uni students, of which I'm probably not a member. I doubt whether you are in that camp either, but good on you for trying..

Now we'll have to wait patiently for the 13th, and I'd like to have a bet with you about what will happen, but as you've already screwed JB down, I'd probably not get a good deal:D. I don't have a lot riding on the gold price, but should my explorer GEL do well, maybe I'll be in a good position to buy a wider spread of shares. That would be safer, I agree.

Gold has a long way to go yet, it's going to reach US$1800 again, it's not a great jump to US$2000, even looking at the linear trend it has returned to. Thanks Strat.

Where are the fixes for this jam we're in? What super profits are the western world going to find? It's not as simple as drilling for oil anymore.

[Skol]

Bob Jones doesn't agree with the doomsayers that the world is ending. It's not.

The goldbugs have been promising economic hell for years and it hasn't happened, nor will it, and when the general population come to that conclusion as well gold and silver will completely implode.


Commentary on issues of the day from the property tycoon, author and former politician



Why the dismal science so often gets it wrong
By Bob Jones


9:30 AM Tuesday Sep 11, 2012


The oddity of economic forecasting is not only consistently wrong but often diametrically 100% wrong.

Some years ago in Britain, a chap advertised copies of The Times published on one's date of birth as a novelty gift idea. I drove to his Welsh village and bought the lot, his collection going back to 1850. Here's the point. Reading copies at random, whether 1863, 1927 or 1973, the commentary was always the same, namely Britain's buggered and all is lost.

It's no different anywhere else and it's certainly true of New Zealand's economic commentary. The current hue and cry about debt levels reminds me of the early Reagan years when American bookshops had whole sections containing dozens of books on the coming debt-driven economic collapse, just like today. Subsequent booming prosperity made these apocalyptic claims risible. Economic commentators seemingly specialise in glass half empty outlooks, doubtless sincerely but nevertheless perpetually pessimistic.

New Zealand's best-known economic doomsdayists are the articulate Rod Oram and Bernard Hickey, both serious Mintoitus sufferers. Life for them must be a living hell, always only seeing the dark side and blind to the overwhelming positives everywhere. Once Bernard and Rod would have received prefrontal lobotomies to brighten them up but those procedures became discredited.


Now it's Prozac although a bottle or two of red each day would also do the trick and they would henceforth see the world in its happier, more positive side.

Certainly they can be cured, unlike the screaming skull John Minto, for whom the only salvation is a beheading. Minto owes it to himself to end the awful misery of his misanthropic existence. If he wakes to a sunny day then it's grab the megaphone and bellow about global warming. Should $50 bank notes rain down on him, out would come the megaphone to complain that they weren't $100. If he answered the door to a naked beauty queen crying, "take me John", (for plausibility assume she's drunk) he'd and bawl her out for not bringing lunch. Thank God he's not an economist or we'd all be suicidal.

Another current doomsdayists cry is intergenerational debt, this fearmongering usually accompanied by photos of babies, innocent to the terrible burden lying ahead. It's unadulterated garbage. The intergenerational debt certainly exists, only the reverse of the economist gloomsters' sky-is-falling falsehoods.

Babies born today inherit a going concern amounting to trillions of dollars of infrastructure; of roads, sewerage, dams, towns and cities, bridges, libraries, institutions and so on, in replacement cost equalling thousands of times the total central and local government debt, all paid for by past generations. So yes, there's intergenerational debt although it can never be repaid, its cost having been incurred by generations now dead.

In recent years the Economist has written about the oddity of economic forecasting not only being consistently wrong but often diametrically 100% wrong. If for example, economists agree in January that the pound will depreciate over the coming year against the dollar, the record inevitably shows the opposite happens.

Periodically the Economist reports on theories from academics as to why this should be. No one suggests the economists are stupid because they're not, but the puzzle remains. My own suspicion is that they tend towards gloom in focusing on the always present negative elements constantly arising in any complex modern economy, through failing to view these concerns in the context of the total picture, which for most folk amounts to life bowling along happily regardless of isolated problems.

When the financial crisis arose six years ago I received a call from TV One's Good Morning programme. They were planning a show on the numerous economists' claims that Auckland house prices were about to halve. They couldn't find a counterview so I stepped up to the mark. I pointed out that all prices are set by supply and demand, that there was a shortage of housing in Auckland and as Australasia's fastest growing city, this situation would compound in the coming years, which duly happened. All of that was elementary common sense, lost on the economist gloomsters.

Their innate negativity was ludicrously illustrated by the then Westpac chief economist back in the 1990s when dairy prices suddenly soared. He drew headlines by wringing his hands despairingly over the possible inflationary effects from farmers' huge income boosts. It's unbelievable.

Aside from lacking perspective, what economists consistently overlook is the extraordinary ability of people to pick themselves off the canvas when things go wrong and bounce back. Countries devastated by warfare or natural disasters quickly rebuild and are soon bubbling along again. Specific economic problems will always arise but are simply that, namely problems, and much like a leaky roof or broken arm, are soon fixed and then it's back to normality, normality being a new problem arising to be dealt with. Meanwhile life goes on and the indisputable fact is, it consistently gets better.
By Bob Jones

[Skol]

Hi Skol. Note my greeting: "Hey xx " seems to be reserved by current youth and uni students, of which I'm probably not a member. I doubt whether you are in that camp either, but good on you for trying..

Really? I didn't know and I mean that, I'm not on Facebook, Twitter, Bebo, LinkedIn, MySpace or any other of that brain-stupefying nonsense.

I might be advancing in years but I'm an optimist like Jones, not some down-in-the-mouth Scrooge waiting for the sky to fall and a basement full of silver to survive on as the world reverts to the stone age, like JBMurc.

I see good things all the time, bustling cities, full hotels, overflowing restaurants, thousands of tourists, new cars on the road, huge aircraft load factors, increased spending, skyrocketing property prices, and to top it all off there's a 385 acre mall being built not far from here.

The world's ending. LOL

[elZorro]

Really? I didn't know and I mean that, I'm not on Facebook, Twitter, Bebo, LinkedIn, MySpace or any other of that brain-stupefying nonsense.

I might be advancing in years but I'm an optimist like Jones, not some down-in-the-mouth pessimist waiting for the sky to fall and a basement full of silver to survive on as the world reverts to the stone age, like JBMurc.

I see good things all the time, bustling cities, full hotels, overflowing restaurants, new cars on the road, huge aircraft load factors, increased spending, and to top it all off there's a 385 acre mall being built not far from here.

The world's ending. LOL

Skol, I'm not all down in the mouth either, but there are signs the western world will have to speedily move away from heavy industry for export, regear for more technical and niche markets, and above all find cheaper long-term energy sources. Rod Oram is correct in that at least.

This fabulous infrastructure that previous generations have built, is aging, and the repair costs are staggering. With a bigger proportion of many economies unemployed, and many others struggling with energy costs, who is going to pay the taxes to do it?

Gold and energy prices move in tandem quite often. If the gold price doesn't drift along horizontally, then higher fuel prices are around the corner, and/or we're in for another crash.

[Skol]

What did I say the other day? September is the strongest month for gold and October is the weakest, expect a pullback soon.

| TUESDAY, SEPTEMBER 11, 2012
What's Next for Gold?

By MARK HULBERT | MORE ARTICLES BY AUTHOR

The metal's summer rally has washed away the proverbial wall of worry that can help keep the rally going.


Finally, gold is showing signs of life again.

I argued in this space three months ago that gold traders should "take heart," despite gold's disappointing behavior over the several weeks prior to then, since contrarian analysis confidently predicted that higher prices were on their way. (See Hulbert on Markets, "Gold Can Finally Redeem Itself," June 8, 2012)

And though it took the market longer than I had imagined to do so, in recent weeks it finally did respond: Gold is now $140 an ounce higher than it was then.

Unfortunately, contrarian analysis is not nearly as positive today about gold's prospects as it was three months ago. That's because, in the wake of the recent rally, gold timers have jumped on the bullish bandwagon, all but destroying the veritable wall of worry that would otherwise support a continuation of gold's recent rally.

Consider the average recommended gold market exposure among a subset of short-term gold timers tracked by my Hulbert Financial Digest (as measured by the Hulbert Gold Newsletter Sentiment Index, or HGNSI). It currently is 54%.

To put this current level in context, consider that as recently as the last week of July, the HGNSI stood at minus 14.8%, which meant that at that time the average short-term gold timer was recommending that his clients allocate 14.8% of their gold trading portfolios to shorting the market -- an aggressive bet that the market would decline. Furthermore, the HGNSI was still in negative territory on August 22.

In classic contrarian fashion, the market responded to the strong wall of worry that those negative readings represented by rallying strongly. But that wall of worry has all crumbled.

Another revealing comparison with the HGNSI's current level comes with where this sentiment index stood in February, when gold bullion rose to the nearly the $1,800 level. The HGNSI that month never got as high as it is now, and its average level for the full month was 40.8%.

That the sentiment index is higher today than then, even though bullion itself is lower, is yet another indication of the bullish enthusiasm that now permeates the gold trading arena.

These various data points, taken together, suggest that the gold market has gotten ahead of itself. That's why contrarian analysis now concludes that a short term pullback is now more likely.

How much of a pullback? Contrarian analysis typically does not try to answer this question, since the key to answering it is the speed with which the bulls throw in the towel in response to whatever weakness that materializes.

For example, if the gold traders stubbornly hold on to their new-found bullishness in the wake of any pullback, that would suggest the gold market will have to undergo a more severe correction in order to wring the excessive bullishness out of the marketplace.

If the bulls quickly run for the exits, in contrast, a shallower correction becomes more likely.

Since 1985, however, according to an analysis of the HGNSI, the average correction in the wake of high readings lasts between one and three months.

That means that, if the gold market behaves in "average" fashion, we should expect bullion to be lower than it is today between early October and early December.

[skid]

http://expectedreturnsblog.com/the-u-s-government-bond-bubble/
Note the section on the psychology of Cognitive Dissonance

Quote
I see good things all the time, bustling cities, full hotels, overflowing restaurants, thousands of tourists, new cars on the road, huge aircraft load factors, increased spending, skyrocketing property prices, and to top it all off there's a 385 acre mall being built not far from here.

The world's ending. LOL

[Skol]

http://expectedreturnsblog.com/the-u-s-government-bond-bubble/
Note the section on the psychology of Cognitive Dissonance

Quote
I see good things all the time, bustling cities, full hotels, overflowing restaurants, thousands of tourists, new cars on the road, huge aircraft load factors, increased spending, skyrocketing property prices, and to top it all off there's a 385 acre mall being built not far from here.

The world's ending. LOL


There were 2 major wars in Europe in the last century that resulted in catastrophic destruction and within a few years the world rebuilt itself after both of them. You can hunker down, I'm not, and if you listen to the likes of JBMurc you'll be awaiting the final cataclysm, the death of the USD and crippling hyperinflation.

Which have been predicted for ages and haven't happened. Nor will it.

BTW skid, I'm not imagining the above I actually see it.

[skid]

Your missing my point--I could go out and borrow a bunch of money,buy a bunch of flash clothes,a flash car,a bimbo under each arm,and you would see that too,but......well you get my drift.

Bye the way,..Im not promoting all this quantitative easing,I think its irresponsible.
But I agree with those who say that the [us]political system is a write off and no one who campaigned for the hard options would get elected.
Therefore I cant really see to many other options than for them to throw more money at this problem,and if[or when]they do,the obvious result is an increase in the gold price.
They may postpone it,in which case the gold price will drop,but I think it will happen.[those unemployment figures were pretty ugly] those full hotels were most likely not those poor folks.

Quite frankly,if you won this debate,Id be happy,but.....I dont think so

[elZorro]

Fake it 'til you make it..as one youngish accountant told me once. That's what Skol is seeing sometimes.

[JBmurc]

There were 2 major wars in Europe in the last century that resulted in catastrophic destruction and within a few years the world rebuilt itself after both of them. You can hunker down, I'm not, and if you listen to the likes of JBMurc you'll be awaiting the final cataclysm, the death of the USD and crippling hyperinflation.

Which have been predicted for ages and haven't happened. Nor will it.

BTW skid, I'm not imagining the above I actually see it.

As usual skol talking me up as some dooms dayer......fact is I'm nothing like it ...I'm a Sharetrader/investor that says way I see it so far I've been more right than wrong and my bullish outlook on the likes of the PM for the last several years has been be proved right.... had many listen to your talk of gloom for PM back sub 1000oz and shorted the metals etc they would be far worse off...your've been wrong for so long it's become a joke and when you do finally wake up I'll be the one selling you some silver bullion LOL because thats when I know it's near it's end of it's bull trend

[Skol]

You won't be selling me any silver, it was bolstered by speculators who got creamed last year, the bull run's over, and the return to the mean maybe sooner than you think.

[JBmurc]

You won't be selling me any silver, it was bolstered by speculators who got creamed last year, the bull run's over, and the return to the mean maybe sooner than you think.

What the wise man does in the beginning, the fool does in the end.

[Skol]

Ez,
Remember my post about selling gold and buying diamonds or diamond miners?

RIO Tinto has forecast a rise in prices for diamonds over the next decade as demand from China and India continues to surge but supply remains subdued by a lack of major new discoveries.

[elZorro]

Ez,
Remember my post about selling gold and buying diamonds or diamond miners?

RIO Tinto has forecast a rise in prices for diamonds over the next decade as demand from China and India continues to surge but supply remains subdued by a lack of major new discoveries.

That's probably not bad advice, just not something I've researched much on. I have heard that some diamonds are extracted off the sea floor on ships, then there's blood diamonds, so I like supporting a local gold explorer.

[elZorro]

Overnight, the FED released this report, and gold bumped up $40 to US$1770 an ounce.

http://www.reuters.com/article/2012/09/13/us-fomc-interest-idUSBRE88C15620120913

I'm not sure what previous QE steps were, but this one is for $40 billion a month, plus they'll continue to extend the terms of other debt instruments. Some measures are likely to remain in place until mid 2015. Three more years.

The USD, not doing so well, has dropped 5.7% from its recent high. Big picture time.

[Skol]

Gold is supposed to go up if there's inflation on the horizon, but there isn't any, and higher interest rates are even further away.

How does that work? A bigger gold bubble.

[STRAT]

Gold in Aussie Dollars shows a clear failure to breakout above previous resistance levels.
The next week will be very telling as to where this is going. Last nights movement excluded from the chart.

[skid]

The $Aus is really motoring along ATM I guess its no surprise gold is not rising the same against it.
[$us is really tanking though]

[Pumice]

Gold in Aussie Dollars shows a clear failure to breakout above previous resistance levels.
The next week will be very telling as to where this is going. Last nights movement excluded from the chart.

Could be time to borrow interest free gold in buy AUD?

[JBmurc]

Gold is supposed to go up if there's inflation on the horizon, but there isn't any, and higher interest rates are even further away.

How does that work? A bigger gold bubble.

Well the market believes there will be continuing increasing inflation....I know here in NZ prices aren't coming down our rates just increased another 9% this year ...I don't see much coming down in price outside tech LED TV's etc

[CAM]

Well the market believes there will be continuing increasing inflation....I know here in NZ prices aren't coming down our rates just increased another 9% this year ...I don't see much coming down in price outside tech LED TV's etc

Yes I think I see the same thing.
Look at rates or rent, the power bill, the cost of fuel and food....all up and arguably necessities (Maslows hierarchy?)
Perhaps the only one down is mortgage repayments due to lower interest rates.
Then look at consumer goods such as TV's etc....prices down on imported goods
(reflection of the strong NZ $?...imagine the fuel costs if the dollar was lower!)
Where else in NZ is deflation happening???
Nationally pay rates are not increasing at a great rate of knots coupled with job losses in some industries.

[Skol]

The rates on a factory I own went down $2500 p.a.

[JBmurc]

The rates on a factory I own went down $2500 p.a.

In Auckland I find that hard to believe....our house G.V went down 80,000 yet are rates went up 9%

[Skol]

True,

Total rates payable p.a. 3 months ago $9,099.11 ($2274 x 4)

Total rates payable p.a. now $6453 ($1613 x 4)

Down 30% - nice.

[JBmurc]

Did you have major move down in valuation of it's capital value ??

[lakedaemonian]

I know what's up....gold!

$1775 at the moment.

The jump in gold last week was in ALL currencies......funny that.

I know what's eventually coming down......bonds....there will be a US Treasury Bond crisis in the period ahead....and the recent move by the Fed is only going to compress the timeframe in which it occurs.

[JBmurc]

FED Bernake ---we will create money and keep buying till riskier assets move much higher .....

[Skol]

Did you have major move down in valuation of it's capital value ??

New Valuation in July, I've just been having a look at it. CV down 11%.

When we bought them there was paddocks and vineyards, now there's a Countdown going directly opposite, land value should have gone up a lot but it hasn't.

The wastewater rate has been reduced which might have something to do with it.

[STRAT]

True,

Total rates payable p.a. 3 months ago $9,099.11 ($2274 x 4)

Total rates payable p.a. now $6453 ($1613 x 4)

Down 30% - nice.Hi Skol
That would be an exception I think. Im guessing a West Auckland Address. Many West Auckland Rate demands have dropped since the Merger. Of course they will get it back + with new Water and sewage charges.

[CAM]

True,

Total rates payable p.a. 3 months ago $9,099.11 ($2274 x 4)

Total rates payable p.a. now $6453 ($1613 x 4)

Down 30% - nice.

Thats all to do with the merger and the new super city isn't it ??
A one off restructure to realign everything. The location and nature of the land use falls in your favour in this case.
But I bet Auckland Cities overall rates take is up!
Peter might be paying less but Paul is paying more.
I doubt there is a council in the country that is decreasing rates!!

[skid]

Gold $1600-$1770 in 30 days and all ,for the most part,due to quantitative easing-more dollars pumped into the system. No Inflation--mate,ya gotta be joking..

[JBmurc]

Great day for the PM bugs my portfolio's under control smashed up some 70k in value in the last 6hrs of trading
now all I need is another 20 days like today....and I'll get close to my target p.a return

[denpal]

I see HC got sick of our perma-bear and suspended him..........

[elZorro]

I see HC got sick of our perma-bear and suspended him..........

Who? Skol is only bearish on PGMs.

The lastest FED announcement is being called the start of QE3. I thought the money involved didn't sound a lot. This helps explain it.

http://goldstocksforex.com/2012/09/13/the-impact-of-qe3/

Another way of looking at it. (http://www.voxxi.com/bernanke-qe3-fed-goes-all/)

[Skol]

On HC, you'll truly see the 'voice of the herd' on the gold forum. Only a few times in your life you'll see that, intolerance of the opposing point of view, an indication that saturation level is near.

Another indication that the end might be in sight are the unreasonable expectations for gold and silver and that this run-up is the 'big one', they're on the road to riches, there's no obstacle in sight, symptomatic of tulipmania.

There's no hint of caution out there, the goldbugs are 'all in', and in manias cash is regarded as a totally unattractive alternative.

It was a bit like this when silver hit $49 last year, and then plunged to $26.

The other thing that strikes me as odd is that gold and silver are almost completely correlated with stocks, when the opposite should be the case.

The herd's stampeding right now, best to get out of the way or you get run over. I've taken a lot of money off the table in the last few weeks, it's too scary for me, stocks up a lot.

Some commentators are guessing that the S&P could end the year around 1100, which is a big drop from here, so I'm having a bet both ways, it could get ugly.

$40 billion a month is nothing in the big picture of the American economy, but it will ensure interest rates stay lower for longer, hardly making precious metals a winner.

http://people.hofstra.edu/jean-paul_rodrigue/images/Manias%20Bubbles.pdf

Where are we now? The return to 'normal'?

[skid]

Your totally right skol--Alot are seeing the $us as a totally unattractive alternative ATM.
The price of gold is just a side issue--its a reflection of peoples loss of faith in the $us dominated system at this point.
To focus on gold prices without looking at the reasons behind it, is not sound logic IMO.

[Skol]

Here's something from Resource Investor about the '5000 year store of value'. LOL


'As Société Générale’s Dylan Grice notes, “A 15th century gold bug who’d stored all his wealth in bullion, bequeathed it to his children and required them to do the same, would be more than a little miffed when gazing down from his celestial place of rest to see the real wealth of his lineage decline by nearly 90% over the next 500 years.” In the “shorter” term, the holder of 1980-vintage gold has not only earned nothing on his investment but requires $2,300 gold just to break even on the invested capital. On the other hand, the peace of mind and the potential shelter that gold may provide in the event of chaos, collapse or all-out war is not substitutable, no matter the number-crunching reality.'

[elZorro]

Yes, Skol, nice one, in the very long term gold has not done that well. But looking over the last 5-10 years or so, it's a different story.

http://www.ino.com/blog/2012/09/the-bottom-line-on-gold-the-dollar-and-the-euro/

This scary item will be interesting for JB. (http://www.financialsense.com/contributors/jim-willie/no-cb-solutions-liquidity-vs-insolvency)

Some interesting charts about the currency war. (http://campaign.r20.constantcontact.com/render?llr=orkbnrcab&v=001VK-ta8v4JpVgHZ-c46mRdGIvUo4ZvAc****eJRmsEnojOcnOE2E_Vlkfi0HhY08Ra t8h4SKa9MDzvVLbi7GDo8XXezxgSQzyhOFWnSclixs%3D)

[Skol]

From Reuters:
"We are starting to get into that heady territory where you need to be on the defensive," said Richard Ross, global technical strategist at Aubach Grayson in New York. "Trying to squeak out the last 5 percent of a move when there is potentially a 15 to 20 percent downside in my opinion is pretty dangerous stuff."

From USA Today:

'Almost two thirds of the of the 40 economists that USA TODAY surveyed after the announcement said that the Fed's actions would help the economy only a little by January.'

From the WSJ:

'Ultimately, many investors remain skeptical that the Fed's move will have a lasting impact on the markets.....'

It's a storm in a teacup.

[skid]

Here's something from Resource Investor about the '5000 year store of value'. LOL


'As Société Générale’s Dylan Grice notes, “A 15th century gold bug who’d stored all his wealth in bullion, bequeathed it to his children and required them to do the same, would be more than a little miffed when gazing down from his celestial place of rest to see the real wealth of his lineage decline by nearly 90% over the next 500 years.” In the “shorter” term, the holder of 1980-vintage gold has not only earned nothing on his investment but requires $2,300 gold just to break even on the invested capital. On the other hand, the peace of mind and the potential shelter that gold may provide in the event of chaos, collapse or all-out war is not substitutable, no matter the number-crunching reality.'

So this guy followed his bullish opinion blindly and lost out in reduced value
You have followed your bearish opinion blindly[it seems]and lost out from missed opportunities.
You cant get away from the elephant in the room that gold was under a $1000oz back when you first posted in 2009
You have got to earn credibility IMHO

You may be right some day--but its what happens in between that counts

[skid]

'Ultimately, many investors remain skeptical that the Fed's move will have a lasting impact on the markets.....'

It's a storm in a teacup.[/QUOTE]

Its not an issue of whether the feds move will fix the economy--we all know it probably wont-
But it can cause Inflation

[Skol]

You have followed your bearish opinion blindly[it seems]and lost out from missed opportunities.
You cant get away from the elephant in the room that gold was under a $1000oz back when you first posted in 2009

No I haven't 'missed out'. I'm not into illiquid punts like gold or silver in the basement. I'm in the diversified BT Natural Resources Fund, up 12% average annually compounding since inception. I can get my money out over the phone, you'll have to go to a dealer to find out what they'll give you, less the premium, and in the event of a crash, the doors will be firmly locked.

I've been in the BT Fund for 15 years, in that time, dividends re-invested, there's 7 times what I put in. That's enough, I'm not greedy.

Goes up, goes down, but overall hard to beat. Down 30% in the year to May, but up 16% since July.

[skid]

Fair enough,you have chosen a fund with mostly mining co's.
Their performance over the last 5 yrs is not looking so flash,but each to their own.
At least you have provided an alternative.
For some ,like me,a small holding in gold is insurance -if it goes up its a bonus-if it goes down ,I look at it as the premium for the insurance.
For those who have bought Gold for speculation [at the time you bought into your fund,15 yrs ago],would have purchased in the $300s-400 oz-[or $700s if 5 yrs ago]-i would think they would be rather happy.
In the end,its all about purchasing power.You keep your money,or you trade it for something you think will be worth more in the future.
Gold is just a reflection of that purchasing power.
If i was sitting on a large amount of $us I would be keeping a close eye on them ATM
Thats because I think it will be inflation rather than deflation at this stage.
If deflation rears its head,then Im sure Gold will head south[along with your mining-energy fund investments]

[elZorro]

I think we're all in agreement, QE3 should boost the mining sector, because commodity and PGM prices will rise in US$ values. In turn, this makes gold and suitable gold miners an easy investment for the next few months at least.

http://www.ino.com/blog/2012/09/gold-chart-of-the-week-6/

Impressive chart here, on the lower boundary, and the FED wants it moving in the other direction.Inflation is the way.

http://www.ino.com/blog/2012/09/its-all-out-the-window-now/

[Skol]

EZ,

If you check a chart of gold or silver for the last 10 years it looks like this:

There's plenty of warning signals.

Parabolic price increase
Publicity - Glenn Beck style
Overspeculation
ETFs
increase in investment demand
Recent collapse of demand in India and China
Gold is 120% ahead of gold miners ETF for 5 years
Huge difference between cost of extraction and gold price
Emerging Markets faltering
Herd-like price targets($5,000, $10,000, $15,000, etc)
Gold way ahead of inflation-adjusted value
It's 'different this time'.
Antagonism to the opposing view
When gold goes up, confirmation all is well and gold's off to the moon
When gold goes down screams of 'manipulation', 'it's JPMorgan's' and the 'elite's' fault.

I'm not sure it's going to be the easy money you reckon.

[Skol]

Here's the gold chart EZ, 2000-2012, look a little similar to the one above?

[elZorro]

EZ,

If you check a chart of gold or silver for the last 10 years it looks like this:

There's plenty of warning signals.

Parabolic price increase
Publicity - Glenn Beck style
Overspeculation
ETFs
increase in investment demand
Recent collapse of demand in India and China
Gold is 120% ahead of gold miners ETF for 5 years
Huge difference between cost of extraction and gold price
Emerging Markets faltering
Herd-like price targets($5,000, $10,000, $15,000, etc)
Gold way ahead of inflation-adjusted value
It's 'different this time'.
Antagonism to the opposing view
When gold goes up, confirmation all is well and gold's off to the moon
When gold goes down screams of 'manipulation', 'it's JPMorgan's' and the 'elite's' fault.

I'm not sure it's going to be the easy money you reckon.

Except that it's possible we're only at the 'media interest and enthusiasm' section of that standard depiction of a bubble.

As it will be driven by American policy, this interview is informative.

http://www.ino.com/blog/2012/09/legalized-plunder/

If the FED is viewed simply as a Banking Cartel, assisted by Government when needed, everything starts to make sense.

[Skol]

If we're at the media attention section, you're expecting a bubble so colossal it will make tulipmania and the NASDAQ 2000 bubble seem insignificant, an unsustainable historical impossibility.

Did you see what happened to oil last night? Oil and gold often move in tandem, the Saudis have offered to pump as much as required.

Another warning signal for gold?

Here's the 2000 - 2012 silver chart, looks exactly the same, up 1088% from 2000 to $49 in 2011.

[skid]

EZ,

If you check a chart of gold or silver for the last 10 years it looks like this:

There's plenty of warning signals.

Parabolic price increase
Publicity - Glenn Beck style
Overspeculation
ETFs
increase in investment demand
Recent collapse of demand in India and China
Gold is 120% ahead of gold miners ETF for 5 years
Huge difference between cost of extraction and gold price
Emerging Markets faltering
Herd-like price targets($5,000, $10,000, $15,000, etc)
Gold way ahead of inflation-adjusted value
It's 'different this time'.
Antagonism to the opposing view
When gold goes up, confirmation all is well and gold's off to the moon
When gold goes down screams of 'manipulation', 'it's JPMorgan's' and the 'elite's' fault.

I'm not sure it's going to be the easy money you reckon.

Easy money? Hell we're just trying to stop the rot.
Do you think gold is getting bought just because its pretty?
Have another look at the $US--US unemployment figures--hell,the whole us economy.and inflation.
When and if theres a change to these fundamental problems [or if it gets so bad deflation sets in]is when you will see this poster having no problem with the opposing view.
Its either the crash you have predicted[for 4 yrs]or a parabolic bubble--sounds to me like you want your cake and to eat it too.
I really dont see how anyone can talk about gold without talking about the way the us[and the world] economy is being run [inflation,unemployment etc]in the same sentence.

[Skol]

Goldbug gets his secret stash confiscated by the Official Assignee, paranoid goldbugs will be frantically searching for better hidey holes.


On the trail of bankrupt's treasure
By David Fisher


5:30 AM Sunday Oct 17, 2010


The house at the centre of the inquiries into Dr Alan Simpson. In total $2.3m of gold, silver and foreign currency has been recovered from the house.

Police have seized a fortune in gold and silver from secret compartments in the suburban home of a retired psychiatrist. Now, the case has pulled in one of the country's most successful and reclusive businessmen.

For a psychiatrist, Dr Alan Geraint Simpson had one of the best addresses in the world. In the medical world, Harley St in London has gold-plated credibility.

But Simpson has seen it all swept away. His professional practice, the prestige that went with it and a small fortune got caught in the greatest financial scandal of the 1990s.

The 68-year-old ended up half a world away in the Waikato - along with $2.3 million in hidden gold, silver and foreign currency.

On their first visit to Simpson's Hamilton home, a specialist police team found $1 million in gold, silver and foreign currency.

But soon, a builder led them to secret compartments he had constructed for the recently discharged English bankrupt. There, they found another $1 million in gold and silver.

Simpson had said he was preparing for the end of the world, police were told.

Eventually, Simpson surrendered another $300,000 in silver - but it is alleged another $1.8 million also exists.

The house was like a Chinese puzzle. And wrapped inside that puzzle is the mystery of Simpson's relationship to one of New Zealand's most successful businessmen, the reclusive Carrick John Clough.

The extraordinary story of the gold and silver is playing out in Hamilton's High Court. Simpson was bankrupted in England last year over a 12-year-old debt.

The lawyer attempting to recoup money for those owed by Simpson has drawn New Zealand authorities into a world-first - using new international agreements to get our authorities to seize property that could be subject to another country's bankruptcy order.

The case has yet to reach the stage of deciding who the gold and silver belongs to - and whether the court will order its confiscation to cover Simpson's debts.

The case has drawn in builder Mike Holloway, who told the Herald on Sunday he had been sworn to silence by New Zealand's bankruptcy administrator, the Official Assignee. But court papers show it was his evidence about work he did for Simpson in December last year that prompted the second police search.

Holloway told officials he was hired to replace flooring at the house Simpson was living in - and while there was asked to build new structures described in court as "bizarre".

Holloway's staff created a compartment under the dining room floor. Examination found that part of the floor could be lifted up if screws holding it in place were removed. Unlike the remainder of the floor, this section was not glued.

According to Holloway, Simpson had said he wanted the cavity because "the world was going to end".

A second compartment was created under the house in the basement furnace room. A concrete block was laid and surrounded by small concrete walls. It was here that searchers later found one of three safes.

Simpson had an explanation for each. He told Holloway the first was to store water and a survival kit. The second, beneath the house, was for suitcases.

Searchers also found bars of precious metal in the vanity unit in the bathroom. More was found in the home office, some under papers in the bottom drawer of the filing cabinet, some underneath that drawer.

The gold and silver seized by police are being held in a secure Westpac vault in Auckland.

The treasure trove stands in stark contrast to the financial information Simpson had supplied the court. He said he rented the $750,000 house in one of Hamilton's best areas for $186 a week with an income of $347 a week from NZ Superannuation and a UK pension. He had not worked for 12 years and his outgoings, he said, were $357 a week.

Simpson said he had three bank accounts - in Scotland, England and New Zealand - and each had meagre balances.

There was no mention of a property company he previously owned, Warkworth Land Ltd, which was wound up in 2005. The voluntary liquidation report stated that $670,000 was left with no debts paid and the proceeds returned to Simpson, the sole shareholder.

Justice Heath said "questions do arise as to the veracity" of information Simpson had supplied about his financial affairs.

It all started in England almost two decades ago with one of the biggest financial scandals of the 1990s. The prestigious insurer - Lloyd's of London - was landed with massive bills for settlements in US courts.

Lloyd's passed the cost to its so-called "names": underwriters including members of the Royal family, landed gentry, judges, politicians - and Alan Simpson.

In the years that have followed, the financial pressure has been blamed for suicides, divorce and sickness. In 1998, Simpson was ordered to pay $344,000. He did not. Instead, he and others pursued Lloyd's through the courts alleging fraud and a failure of duty. The cases all failed. The order to pay was enforced in 2005, when a judge told Simpson he was using "delaying tactics" and enforcement of the debt was "inevitable".

Last year Lloyd's bankrupted Simpson. The debt had grown with interest to $512,000. There are six other creditors, including New Zealand's Inland Revenue Department.

By this point Simpson had moved to New Zealand, where he already had links: he and businessman Carrick Clough had been directors in property development company Otaha Land Ltd, set up in 1988, and had established Warkworth Land Ltd in 1999.

Clough's lawyer David O'Neill said the pair had met in the 1980s but grew apart as his client worked out of Hong Kong while Simpson stayed in England.

In the 1990s, Simpson worked for a while at the University of Hong Kong, a city where Clough had formed successful IT business CSSL in 1983. CSSL now has over 380 staff in dozens of offices across the world, with a turnover in excess of $300 million.

Clough and Simpson were also associated through the Hamilton house's mortgage with Sennex Ltd, a company registered in the British Virgin Islands. The mortgage documents carry Clough's signature. And Justice Paul Heath said there was evidence that Simpson had - through Sennex Ltd - done "significant" dealing in precious metals and foreign currency over the past summer - after he was made bankrupt.

The judge said the bullion deals through Sennex Ltd may have been undertaken by Simpson.

Clough was unavailable to be interviewed. His palatial Hamilton home - with fingerprint-coded security system - was empty last week and he was said to be in San Francisco.

His lawyer said: "John Clough is certainly not happy about what's been going on. He's certainly of the mind that he wants to distance himself from the matter. It's not something that involves him. He's an international businessman.

"He is no longer associated with Sennex Ltd and has not been for some time."

O'Neill said Clough was also preparing to exit the trust arrangement that connected him to the house in which Simpson lived, and had no knowledge of the secret compartments.

"It's all a bit Maxwell Smart."

THE HOARD
The Hamilton house has been visited on three occasions by police of staff from the Official Assignee.

Gold and silver has been found worth $2.3 million in three safes, a hidden compartment, a filing cabinet and a bathroom cabinet.

Office
* A safe in the study was found and opened revealing a stash of gold.
* Searchers found gold bars beneath papers in a compartment in the base of a filing cabinet.

Bathroom
* Gold bars were found in the bathroom vanity.

Dining Room
* A secret compartment beneath the floorboards was revealed. Although no gold was revealed, it was a factor in gaining a new search warrant to further examine the house.

Furnace Room
* A secret compartment accessed from the furnace room revealed a safe.

Stairwell
* A third safe was found hidden beneath the basement stairs.

[elZorro]

Goldbug gets his secret stash confiscated by the Official Assignee, paranoid goldbugs will be frantically searching for better hidey holes.

I think it's more a lesson that when it comes time to pay taxes, or to pay for unexpected losses, it's best to front up. I'm sure Mr Simpson was happy enough to take profits from the LLoyds underwriting earlier on. He could have paid the $334,000, instead it cost him nearly $2mill, and a deposed life in Hamilton half a world away from Harley St (didn't look that flash a house anyway).

[lakedaemonian]

I think it's more a lesson that when it comes time to pay taxes, or to pay for unexpected losses, it's best to front up. I'm sure Mr Simpson was happy enough to take profits from the LLoyds underwriting earlier on. He could have paid the $334,000, instead it cost him nearly $2mill, and a deposed life in Hamilton half a world away from Harley St (didn't look that flash a house anyway).

There's that story, as well as the story of a fell found dead(of natural causes) in his own house.......and found over $7 million in legal precious metals.

The only heirs......a single distant cousin....and the US IRS of course, since gold receives a rather nasty tax treatment over there.

And the story of the Brisbane repository funny business.

The media loves stories that beat up gold.......it's good for financial media advertisors.

Those who advertise in financial media HATE gold, because they can't profit from churning 401K accounts when folks are shifting into gold.

[skid]

Damn!! ...guess ill have to move my gold bars out of my bathroom vanity now!!

[skid]

I talked to an economist friend today who mentioned that QE3 was a ''game changer''
He was on his way out and didnt have time to elaborate--so I googled it.
I read 5 different articles and they all basically said the same thing--inflation and higher commodities DYOR

[Fudosan]

Sorry if this question has been asked before. I know this is the ASX section but I couldn't find a similar thread in the NZX section. Where is a good source for discussion of gold and gold-related investment in NZ? Thanks.

[elZorro]

Sorry if this question has been asked before. I know this is the ASX section but I couldn't find a similar thread in the NZX section. Where is a good source for discussion of gold and gold-related investment in NZ? Thanks.

Fudosan, you are right, there is no gold thread like this on the NZX side. So we make do over here. You are most welcome here of course, where the company may be familiar and the arguments circular, but we're still learning something and open to new suggestions .;)

The Moneychanger found this:


I came across this crystalline assessment of recent events from Clive Maund at http://tinyurl.com/9plwgwu

"Last week was a momentous one when the financial world passed the point of no return. Right after a German court cleared the way for massive European QE to get underway, steamrollering opposition from German politicians and the German public in the process, the Fed announced not just QE3, which was expected, but open-ended and unlimited QE and suppression of interest rates over a longer timeframe. The Fed has declared open warfare not just against the dollar and savers in general, but against the entire American middle and lower classes, who will be progressively stripped of their assets and impoverished, the better to serve the interests of the banking class and the elites at large."


If the FED is a banking cartel, then this is their agenda, it is not in the best interests of most Americans.

[skid]

fudosan-the best we can do ATM is keep tabs on the performance in general and the reasons why and then apply that to the $kiwi[the exchange rate obviously plays a part]
Gold has risen everywhere due to QE3 but to a greater extent in $US than $AUS or even $KIWI due to both being a bit stronger ATM.
You can check on the buy gold at gold money site. Its shows the spot price and can be done in any currency[just put in $KIWI] There is also a site where you can see charts gold vs any currency[forgot where AM] I think its incredible charts

[Fudosan]

I started recording price of gold in 2008 when it was selling at US$911. Few days ago it hit 1770. I didn't do anything even though I was convinced money printing will eventually push up prices of all real assets/commodities. I found storing gold the biggest issue. Now I'm even more convinced inflation will be in store. Therefore, I'd like to learn how to invest in gold in NZ. Is anyone here investing in gold?

[gonzo56]

I started recording price of gold in 2008 when it was selling at US$911. Few days ago it hit 1770. I didn't do anything even though I was convinced money printing will eventually push up prices of all real assets/commodities. I found storing gold the biggest issue. Now I'm even more convinced inflation will be in store. Therefore, I'd like to learn how to invest in gold in NZ. Is anyone here investing in gold?

Indirectly through gold mining companies such as OGC. https://www.nzx.com/markets/NZSX/securities/OGC

[Fudosan]

That's a good suggestion, gonzo56. I've been listening to FinancialSense.com for years and they say while gold and silver are doing well the mining stocks in the US are under-valued. Is it similar in NZ? Is OGC the only gold/silver mining stock in NZ? Who are the large players here? How do they compete with Newmont etc? Sorry that I'm asking so many questions. There is just a lot about the NZ stock market that I don't know as a newbie.

[bung5]

That's a good suggestion, gonzo56. I've been listening to FinancialSense.com for years and they say while gold and silver are doing well the mining stocks in the US are under-valued. Is it similar in NZ? Is OGC the only gold/silver mining stock in NZ? Who are the large players here? How do they compete with Newmont etc? Sorry that I'm asking so many questions. There is just a lot about the NZ stock market that I don't know as a newbie.

asx gold explorers / neartime producers seem the most undervalued.

[Skol]

If you think gold is headed for higher highs, go for it.

An army of experts assured everyone on a daily basis that the boom leading up to the GFC couldn't possibly crash like other booms because this one was ongoing, whereas all other booms had ended.

[Fudosan]

asx gold explorers / neartime producers seem the most undervalued.What are some of the names?

[elZorro]

What are some of the names?

Hi Fudosan, Newmont and Oceana Gold are the two big players in NZ. OGC in particular is on a steady ramp upwards at the moment, looks a safe bet for the meantime (also ASX listed). Of the small players in NZ, Glass Earth (GEL) and New Talisman (NTL) might be the only ones publicly listed (I stand to be corrected). They are both small, but GEL would be worth more research, and timing here could be very good, as they are keenly mining gold through GRUs, and are about to update on progress there.

Gold poised to move higher..

http://www.moneycontrol.com/news/commodities/gold-hits-6-12-month-high-after-central-bank-stimulus_760512.html

[Fudosan]

Thanks elZorro. Very useful information helping me to know where to start my research. Much appreciated.

[elZorro]

Thanks elZorro. Very useful information helping me to know where to start my research. Much appreciated.

No problem Fudosan.

Gold is linked to the oil price quite well, and in the past I'd found some charts showing the effect of the US oil reserves being depleted over time. Easy profits reduced, as seen in the markets. Oil production in the states hit its peak in 1970, and then the proverbial hit the fan.


In the early 1970s, inflation (http://www.sharetrader.co.nz/wiki/Inflation) caused by rising prices for imported commodities, especially oil (http://www.sharetrader.co.nz/wiki/Oil), and spending on the Vietnam War (http://www.sharetrader.co.nz/wiki/Vietnam_War), which was not counteracted by cuts in other government expenditures, combined with a trade deficit (http://www.sharetrader.co.nz/wiki/Trade_deficit) to create a situation in which the dollar was worth less than the gold used to back it.
In 1971, President Richard Nixon (http://www.sharetrader.co.nz/wiki/Richard_Nixon) unilaterally ordered the cancellation of the direct convertibility of the United States dollar to gold. This act was known as the Nixon Shock (http://www.sharetrader.co.nz/wiki/Nixon_Shock).

U.S. dollar value vs. gold value
The sudden jump in the price of gold after the demise of the Bretton Woods accords was a result of the significant prior debasement of the US dollar due to excessive inflation of the monetary supply via central bank (Federal Reserve) coordinated fractional reserve banking under the Bretton Woods partial gold standard. In the absence of an international mechanism tying the dollar to gold via fixed exchange rates, the dollar became a pure fiat currency and as such fell to its free market exchange price versus gold. Consequently, the price of gold rose from $35 per troy ounce (1.125 $/g) in 1969 to almost $500 (29 $/g) in 1980.
Shortly after the gold price started its ascent in the early 1970s, the price of other commodities such as oil also began to rise. While commodity prices became more volatile, the average exchange rate between oil and gold remained much the same in the 1990s as it had been in the 1960s, 1970s and 1980s.
Fearing the emergence of a specie (http://www.sharetrader.co.nz/wiki/Money) gold-based economy separate from central banking, and with the corresponding threat of the collapse of the U.S. dollar, the U.S. government approved several changes to the trading on the COMEX (http://www.sharetrader.co.nz/wiki/New_York_Mercantile_Exchange). These changes resulted in a steep decline in the traded value of precious metals from the early 1980s onward.
In September 1987 under the Reagan (http://www.sharetrader.co.nz/wiki/Ronald_Reagan) administration the U.S. Secretary of the Treasury (http://www.sharetrader.co.nz/wiki/U.S._Secretary_of_the_Treasury) James Baker (http://www.sharetrader.co.nz/wiki/James_Baker) made a proposal through the International Monetary Fund (http://www.sharetrader.co.nz/wiki/International_Monetary_Fund) to use a commodity basket (which included gold).[citation needed (http://www.sharetrader.co.nz/wiki/Wikipedia:Citation_needed)]


Note that around 1970, unemployment in the USA started rising too. (http://www.incrediblecharts.com/tradingdiary/2012-09-24-markets.php)

[macduffy]

Meanwhile, gold hits a 2012 high.

http://news.smh.com.au/breaking-news-business/gold-hits-2012-high-20120922-26d51.html

[Skol]

An article in Barron's ponders various 'extreme' prices for gold. The maximum 'extreme' price is $2390, the minimum is $1455, so we may already be at the 'extreme' level.

If the bubble chart is anything to go by, gold may be at the edge of the precipice.

HUI down 3.14% , GDXJ down 4.32% and GDX down 3.38%.

[CAM]

No problem Fudosan.

Gold is linked to the oil price quite well, and in the past I'd found some charts showing the effect of the US oil reserves being depleted over time. Easy profits reduced, as seen in the markets. Oil production in the states hit its peak in 1970, and then the proverbial hit the fan.
. (http://www.incrediblecharts.com/tradingdiary/2012-09-24-markets.php)

The Russian economic service update says there is around 1.2mbbl of surplus in the market at present and is budgeting on DEC prices in the mid 90,s
The 2013 forecast has US domestic production both as new build coming onstream and Gulf production back to pre isaac level.
The decrease in european demand (around 400000bbl per day at present) is expected to decrease further. The RES suggests 85 for first portion of 2013.

So if the link between gold and oil stands we could see a drop in gold

[elZorro]

The Russian economic service update says there is around 1.2mbbl of surplus in the market at present and is budgeting on DEC prices in the mid 90,s
The 2013 forecast has US domestic production both as new build coming onstream and Gulf production back to pre isaac level.
The decrease in european demand (around 400000bbl per day at present) is expected to decrease further. The RES suggests 85 for first portion of 2013.

So if the link between gold and oil stands we could see a drop in gold

Yes Cam, I agree that's possible. However the pressure has temporarily come off oil because of the gas production in old fields from fracking, lower productivity and employment in the states, efficiency of motor vehicles, etc. Against that, the currency war rages, and those in the know have decided to increase their gold holdings as security against inflation and the devaluation of currencies.

I've added to the charts 2-3 posts ago: look at unemployment in USA against their oil imports, a strong correlation. All this process started around 1970.

[elZorro]

Expecting to see gold reach new highs soon.

http://www.ino.com/blog/2012/09/gold-will-break-previous-high-in-near-term-brien-lundin/

The Moneychanger gives his take on austerity measures:


Bailing out the banks is not a quiet or an easy business. Some of the "realizers" who see what's coming are raising a ruckus.

In Greece, where an ECB/IMF dictated austerity "reform" has already been put in place, people are desperate. Hundreds of thousands marched today in protest.

In Spain, the moment draweth nigh when the Spanish government must tell the ECB how much it needs to bail out Spanish banks and itself. Whoops -- but first, it must agree to the ECB-dictated austerity "reform." Tens of thousands of Spaniards, nervously eying what's happened in Greece, marched in protest. Head of the northwestern region of Catalonia is calling for a referendum to secede from Spain. (Why isn't he governor of Tennessee?)

Of course, bailing out the banks creates many new jobs, for more policemen are needed to beat up protestors.

Bailing out the banks is not easy, but it must be done. I forget WHY, but it must be done.

I like it better the way we do it in the US, where the Fed just keeps on printing money and sends us all down the drain quietly and without a lot of fuss and fanfare.

Y'all know what I'd like to see? I'd like to see one of those pointy-toed bankers or pointy-headed central bankers forced to put in one single day's real work. I think throwing hay would do it, following a trailer in the field picking up 80 lb. hay bales and throwing em up on the trailer to be stacked. Say, from about 7:30 a.m. till about 11:30 p.m., on a 95 degree day, but with breaks for dinner and supper, of course. I'm not inhuman. They could even wear gloves.

Time they got finished, they'd know better than to call what they do "work."

[Skol]

If www.mahendraprophecy.com is correct then the future for gold isn't that good.


'We see S&P going toward 1600 but oil may hang around $100, we see next S&P moving toward 1900 to
2100 but still we see oil remaining around $100, we would like see oils behavior when S&P move rapidly
from 2100 to 3200. We are not worried about any other commodities. If you ask me where oil would be
after five years, our answer will be around $15 to $30 barrell.'

[elZorro]

If www.mahendraprophecy.com (http://www.mahendraprophecy.com) is correct then the future for gold isn't that good.


'We see S&P going toward 1600 but oil may hang around $100, we see next S&P moving toward 1900 to
2100 but still we see oil remaining around $100, we would like see oils behavior when S&P move rapidly
from 2100 to 3200. We are not worried about any other commodities. If you ask me where oil would be
after five years, our answer will be around $15 to $30 barrell.'

Skol, this must be a new site, I haven't seen it before amongst the quality financial sites we tend to refer to in our posts. I think it's very interesting - from the videos in foreign lanquages, the TV appearances, the self-promotion, the spelling mistakes, the tea-leaf reading, and then the amazing prediction that the world will, within a space of five years, wean itself off oil to the extent that they will only pay $15 to $30 a "barrell" for it, when it costs substantially more to find it and get it out of the ground.

How many more sites can we find like this I wonder. Mahendraprophecy.com is an artistic site, of the BS type.

[Skol]

Well I'm not into astrology myself but he's got a big following in 70 countries. I've noted in my diary his prediction of 1600 for the S&P500 by year's end.


'Mahendra Sharma is known for making several predictions. Some of his predictions include:
Assassination of Rajiv Gandhi in 1991.
Natural disaster in Japan in 1992.
Mortal danger to Diana's Life[7]
He predicted extensive terrorists attacks in USA on KAYA FM and SABC before 9/11 happened in 2001 [3]
He predicted Indian National Congress party coming back to power in 2004 in India
In his first book '2002 World Prophesies' which was launched in 2001, he predicted commodities and oil will rise. He predicted gold to rise to $1000/ounce (when it was $275) and oil to rise to $100 (when it was $17.10).'

He also had a few wrong predictions like the exit of Zimbabwe’s president from office and Pervez Musharraf of Pakistan would lose his job.

[skid]

Well,that settles it-Forget about the state of the US economy,horrible unemployment,and inflation,--Im going to base all my investment decisions on an Indian Prophecy website--Its all so simple!

[Skol]

Well,that settles it-Forget about the state of the US economy,horrible unemployment,and inflation,--Im going to base all my investment decisions on an Indian Prophecy website--Its all so simple!

What inflation? Another goldbug load of bollocks. Goldbugs perpetuate these myths that the financial world is ending, have done for years, and has it?

Of course not!

The PM craze is ending, the USD is still the reserve currency despite goldbug fairytales of its imminent demise and October is historically the worst month for precious metals.

[skid]

Your predicting a crash in Precious metals--Im backing those who predict inflation [from QE3]
Watch this space

[elZorro]

This short article is good, the comments afterwards too. Again they missed the point though, we need cheap energy.

Oops forgot the link didn't I.. (http://goldstocksforex.com/2012/10/01/bernanke-attempts-to-justify-screwing-savers/)

[gonzo56]

Well, I'm backing Gold to rise. If gold is seen as hedge against currency devaluation and the US are devaluing their currency....

Anyway, it should be a bumper day for stocks overseas tonight. It's getting ever so close to $1800 again. Who can resist Gold?

[Skol]

Who can resist gold?

Me. For the last year gold's up 9%, the S&P500's up 27%. Has it ever occurred to you that gold might suddenly and unexpectedly devalue as well?

[gonzo56]

Yes, sure. It will eventually.

[Silverlight]

For the last year gold's up 9%, the S&P500's up 27%.

Your statement contains true facts, here are some more:
4163

[Skol]

Your statement contains true facts, here are some more:
4163

With the S&P500, you've got diversification, with gold you've got none.

[Silverlight]

With the S&P500, you've got diversification, with gold you've got none.

S&P500 is all stocks, thats not diversification.

[skid]

Your statement contains true facts, here are some more:
4163
Thats a very interesting chart SL-- I think our freind Skol would make an excellent Politician:p

[Skol]

XGD down 2.75%, shares mostly lead the gold price, let's see. It's a holiday in the USA.

[elZorro]

From Equedia, Skol:


For the last 30 years, the two superpowers of the world (China and the US) have endlessly debased their currencies. I have explained this numerous times in past letters. As a result, the rest of the world has joined in order to avoid disaster on their home turfs. It's no longer a two-way street. Debasing is now a globalized phenomenon. The word globalization has now turned into a battle of currency debasement and inflation exportation. I call it a currency war. Politicians call it globalization. But what happens when the world has printed so much debt that countries can no longer export inflation to competitors? The end result of this path is simple: Uncontrollable inflation. This won't happen overnight. And as I said many times before, inflation shouldn't keep you up at night when you're investing in stocks, as a company's earnings and revenue will generally grow to reflect that. Just look at the last few years - we're back to the highs before the 2008 crash. The S&P is back to 1461; just 39 points shy of my 1500 call earlier this year.

Maybe Russell Norman doesn't have such a wacky idea - if we don't join in, we're fighting the trend. Taxes are a way of stabilising the dollar by putting a value on the fiat currency, and most governments are always able to print money to pay some of their bills if they want to.

But all of this external jiggery-pokery makes the prospect of a rising gold price look very safe.

[skid]

http://www.munknee.com/2011/03/21-countries-have-experienced-hyperinflation-in-last-25-years-is-the-u-s-next/

We're not talking about a new phenomenon here folks...

[Skol]

http://www.munknee.com/2011/03/21-countries-have-experienced-hyperinflation-in-last-25-years-is-the-u-s-next/

We're not talking about a new phenomenon here folks...

No, the USA is not next, but you can add Iran to the list. Iran owns 300 tonnes of gold and has it saved them from hyperinflation, a currency devalued 40% last week and financial ruin?

The hyperinflation bogeyman has been pushed by the goldbugs for years and it hasn't happened, nor will it.

Stories in the press are beginning to emerge that punters are reassessing their gold speculations following good news on the economic front in the USA. Will a rockfall turn into a landslide?

[skid]

Who said having 300tons of gold will protect a country from hyperinflation?
And for the good news on the economic front..
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10839383

[skid]

Having said that, Bad news is not necessarily good for gold--but their response to it can be[another injection of good ole $$$$]

[Skol]

looks like a double top for the XGD.

[Silverlight]

looks like a double top for the XGD.

Or is it a double bottom...

[skid]

This is an exert from Kitco gold commentary and is often overlooked on this thread.
I suppose alot of this debate depends on which category you are in if any......
***
Leaving out those who buy gold for numismatic reasons, there are three types of gold buyers. First are those Hug called the “fatalistic” buyers, who believe governments will eventually ban gold ownership or that they may eventually need gold for bartering purposes.

They usually buy gold in small sizes, which is the most expensive way to buy gold.

Second are those who buy gold for portfolio diversification, and third are traders who look to take advantage of fluctuations in the market. *****

There are of course those that are a combination of the groups such as those who buy for portfolio diversification ,but buy coins that can also be bartered if things get rough

[Skol]

You forgot about the conspiracy theorists and other loonies who are obsessed with world governments, the 'elites', the Rothschilds, J P Morgan and every other major bank, and scream blue murder every time gold takes a dive because it's the 'shorters', the manipulators and the Fed. LOL

[skid]

Those would probably be put in the ''fatalistic'' category,and some have some good points.
We have gotten so used to the world as it is today,that many of us cant imagine anything different.
Perhaps a history lesson is in order-at any rate it doesnt hurt to exercise the mind a bit.
http://www.truthdig.com/chris_hedges
Pultzer prize winner and war correspondent--conspiracy theorist? or reality check

[skid]

Republicans considering returning to the gold standard?
I first thought this was some outsider 2 bit news source, but when I googled, it was all over the search page.
Probably still a long shot but its being talked about.

[Skol]

All they're going to do is talk about it, there will be no return to the gold standard, it's all been done before.

No politician would dare, in case it all went wrong and he became the most despised President in history.

[Silverlight]

looks like a double top for the XGD.

Here are more chartists views on gold and the S&P500, which one is it?

[skid]

All they're going to do is talk about it, there will be no return to the gold standard, it's all been done before.

No politician would dare, in case it all went wrong and he became the most despised President in history.

I agree--frankly im amazed that they even brought it up as republicans are particularly keen on big business[interests]and lots of credit is necessary to keep those hungry wolves fed[ie-growth addiction][usually at the expense of the ordinary taxpayer] strange things happen in campaigns

[elZorro]

As gold goes through a small expected correction on its way back up (that's right isn't it Skol?), this article is not a bad summary.


http://www.stuff.co.nz/business/money/7816210/Lure-of-gold-pulls-in-NZ-investors

[Skol]

Looks to me like that article was written by a couple of goldbugs. Glad I haven't got any of my cash in gold or silver atm, could head way south.

[skid]

Trying to second guess gold,or the market in general until after the election is like walking around blindfolded

[elZorro]

Trying to second guess gold,or the market in general until after the election is like walking around blindfolded

Not quite Skid, look at the correlation of US$gold against the money supply.

http://www.ino.com/blog/2012/10/what-will-the-price-of-gold-be-in-january-2014/

This means that there's a good chance that by January 2014, Gold will have trended to about US$2300 an ounce. Give or take a few hundred dollars.

[elZorro]

Gold dropped a bit.

http://www.thestreet.com/story/11742480/1/gold-prices-sink-as-the-dollar-strengthens.html?cm_ven=GOOGLEN

[gonzo56]

Gold dropped a bit.

http://www.thestreet.com/story/11742480/1/gold-prices-sink-as-the-dollar-strengthens.html?cm_ven=GOOGLEN

Could be to do with the US election talk. See these two articles:

(They advocate a very strong rise after the election.)


http://www.dillongage.com/PR-GoldandElections/default.aspx

http://beforeitsnews.com/gold-and-precious-metals/2012/10/are-gold-and-silver-capped-until-after-u-s-election-2453012.html

[skid]

Also the Google debacle has rattled the markets--could see a further drop next week if your a trader--still an uptrend though in general.
Those dips are a time to buy if your looking to get in

[skid]

Not quite Skid, look at the correlation of US$gold against the money supply.

http://www.ino.com/blog/2012/10/what-will-the-price-of-gold-be-in-january-2014/

This means that there's a good chance that by January 2014, Gold will have trended to about US$2300 an ounce. Give or take a few hundred dollars.

Thats a good general guide ,but all bets could be off if Romney gets in -his ''go to'' economic advisor is Hubbard who was a big fan of derivatives and sub prime mortgage idea[and made a fortune off them]
http://www.truthdig.com/report/item/meet_romneys_economic_hit_man_20121018/

These guys will line their pockets at the expense of all the rest of us

[elZorro]

Thats a good general guide ,but all bets could be off if Romney gets in -his ''go to'' economic advisor is Hubbard who was a big fan of derivatives and sub prime mortgage idea[and made a fortune off them]
http://www.truthdig.com/report/item/meet_romneys_economic_hit_man_20121018/

These guys will line their pockets at the expense of all the rest of us

If Romney gets in, it might be a commentary on middle America.

Gold could be in a bubble according to Brian Gaynor.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10841675
Excellent background in this article. Who knew that Michael Wilson was an NBR reporter before the 87 crash. All I know about that, it was not long after someone was bending my ear about why on earth didn't I have some shares. Luckily I had no money or assets to speak of.

The MoneyChanger thinks it's unlikely Romney will get in. And he lives in middle America. Today's comments are in line with his distrust of the central financial system.


Once again European Union leaders have firmly decided to re-decide everything decided shortly before without taking any action, even the sort of goofy action you expect from statists and Keynesians and socialists. They can only make up their minds to consider and re-consider.

This equates to pure strychnine for markets, for all markets hate uncertainty. Thus even US stocks were kneecapped, the euro made no headway for the week, and the dollar begins to look not so bad after all. After all, it's late, and the bar is closing.

Let us stand back and take a long term view -- really long term, about 350 years or since 1650 when the centralizing trend really took hold in creating national states. Yes, there is a "primary trend" in society as well as markets.

That trend has been rolling over since about 1980. Conventional war's cost has made armies like those of the 1940s impossible -- witness the 4th generation guerilla warfare of the last 45 years. Viet Nam, Iraq, Kosovo, Afghanistan -- armor and paratroops won't work. Now the national state's economic system has begun irretrievably faltering. Worse yet, the ultimate centralization -- the empires into which the national states have been fondued -- are stumbling. Soviet Union's gone, USA is overstretched in 130 countries around the world and dead broke, European Union is flying apart of its own volition.

National states and empires have passed their prime. The process of decentralization in human affairs, including the economic, began with the Viet Nam era and is proceeding rapidly. Even if growing popular opinion weren't (was?) on its side, centralization can no longer keeps its promises and will alienate even more. Ask anybody under 30 whether he believes centralized power is better than decentralized. They young have already decided. The future will be decentralized. Power will flow away from centers to the periphery, and not a moment too soon.

We are now in the worst turmoil, that change where the old is fighting not to give way to the new, and the new is not yet strong enough to take control. The future belongs not to empires, but to secession, to affinity tribes, to small nations. The giant national state is dead for another 300 years.

[Skol]

Looks like the XGD's gonna be in for a smacking tomorrow, gold and silver as well.

[elZorro]

Looks like the XGD's gonna be in for a smacking tomorrow, gold and silver as well.

Yes Skol, a great opportunity to buy more on any pullbacks, as the Moneychanger says.. anyway hows the US stockmarket going?

[Skol]

One thing you can definitely bet on EZ, I won't be buying on any pullbacks, I think that this market has a very long way to fall, I converted a large sum of money to cash a few weeks back just in case.

I'll be watching the open tomorrow, punters will be very nervous, the DJIA down over 200, and it's October.

[skid]

Are you talking the folding stuff? How much is alot? Ive often wondered what they would say at the bank if i rocked up and told them i wanted $100000 out in cash--=Im sure they would say it would take a day to arrange and by then everyone at the bank would most likely be talking about it[and maybe to their friends]
It would be a nervous ride home
I suppose you could take out $10-20000 out without to much fuss but what about $3-4oo,ooo?

Things are a bit titchy ATM

[Silverlight]

Here is one for Skol... maybe...

Billionaire investor Frank Giustra calls gold a bubble! (http://www.mining.com/gold-is-the-ultimate-bubble-58076/)

"Gold is the bubble of all bubbles. It's the mother of all bubbles".

[Silverlight]

EU considering backing debt with Gold? (http://www.europarl.europa.eu/document/activities/cont/201210/20121008ATT53122/20121008ATT53122EN.pdf)

[Fudosan]

Billionaire investor Frank Giustra calls gold a bubble!What I get from the article is that the bubble is being formed but has a long way to go. When the general public joins the game, that may be the peak of the bubble. I do like Frank's investment philosophy.

[Skol]

Here is one for Skol... maybe...

Billionaire investor Frank Giustra calls gold a bubble! (http://www.mining.com/gold-is-the-ultimate-bubble-58076/)

"Gold is the bubble of all bubbles. It's the mother of all bubbles".

Silverlight,

Frank Giustra probably owns lots of gold, I'd no more listen to him than I would Bernie Madoff.

[lakedaemonian]

Germany is asking the New York Fed to audit it's considerable gold holdings held in NY.

Much of Germany's very considerable gold holdings are still held outside of Germany as Germany has not shifted away from it's strategy of keeping it's gold safe from a potential Soviet/Warsaw Pact invasion.

Not only is Germany calling for a gold audit of the New York Fed gold storage, but it is going to begin repatriating it's gold starting at 50 tons a year back to Germany.

Not much gold her in Afghanistan, but it certainly holds value and is tradeable, unlike the Afghani currency(which IS wided used) or the slowly depreciating US Dollar.

[Skol]

Bloomberg report that bullish bets on gold have slumped the most in 3 months and:

Money managers added $648.5 million to commodity funds in the week ended Oct. 24, according to Brad Durham, a managing director for Cambridge, Massachusetts-based EPFR Global, which tracks money flows. That includes $620.1 million into gold and precious metal funds, lower than the average weekly inflow of $1.06 billion since Aug. 22, he said.

The boost to prices from quantitative easing “has kind of run its course for the time being,” Durham said.

[Fudosan]

Frank Giustra probably owns lots of gold, I'd no more listen to him than I would Bernie Madoff.Is there any reason why you don't want to listen to him? I've listened to a few of his interviews and quite like his investing approach -- e.g. long term perspective, inflation bet.

[Skol]

Is there any reason why you don't want to listen to him? I've listened to a few of his interviews and quite like his investing approach -- e.g. long term perspective, inflation bet.

Why not listen to billionaire Warren Buffett?

[Fudosan]

Why not listen to billionaire Warren Buffett?I do listen to Warren Buffett, as well as Jim Rogers, Marc Faber, etc.

[gv1]

One of the investment letters stated that all banks are stocking on Gold and soon will be trading on gold. Any advise....
thanks

[Skol]

One of the investment letters stated that all banks are stocking on Gold and soon will be trading on gold. Any advise....
thanks

Yes, it's crap, find a different newsletter.

Read Jon Nadler's newsletter for some real advice, not 'gold 's going to moon and we'll soon be on the gold standard' advice.

[JBmurc]

Jon Nadler = disinformation specialist (Skol's idol LOL)

http://www.tomaveni.com/Commentary/Nadler-01.htm

[Skol]

JB,

I thought that might flush you out. Looking forward to my $100 prize, and salivating at the thought of a couple of bottles of Rabbits Run.

Nadler doesn't subscribe to the conspiracy theory, gold $10,000, gold standard, 'we're running out', financial catastrophe, euro collapse, USD bust, hyperinflation, codswallop.

Only suckers do.

[elZorro]

What about this article, proposing a hard landing Down Under.

http://www.ritholtz.com/blog/2012/10/a-hard-landing-down-under/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+TheBigPicture+%28The+Big+Pict ure%29

[JBmurc]

JB,

I thought that might flush you out. Looking forward to my $100 prize, and salivating at the thought of a couple of bottles of Rabbits Run.

Nadler doesn't subscribe to the conspiracy theory, gold $10,000, gold standard, 'we're running out', financial catastrophe, euro collapse, USD bust, hyperinflation, codswallop.

Only suckers do.

yeah looks likely your win well 100-1 etc ,,maybe next year we got back to a fairer bet(you know the last two I won) i.e --higher or lower from a set time and not the massive advantage I gave you in this years ...

[gv1]

Thanks guys....

[skid]

Boy o boy ,Golds been all over the place in the last week or so--big drop and now a relatively big rise.
Some say an Obama win will be good for gold and a Romney win would be not so good--others say it will not affect PMs much whoever wins--Guess we will find out soon

[Skol]

A technical bounce, huge projections for jobs in the USA over the next four years, between 10 and 12 million.

[skid]

Im sure we would all like to see the economy bounce back to like the good ole days,but there are still major fundamental problems that will have to be sorted first.
One of them is the looming fiscal cliff in the USA.
I thought perhaps Obama would have touched upon this in his acceptance speech.
No getting around the fact that he's a great speaker,but a little more substance in between the ''greatest people in the greatest country with the greatest military'' would have been appreciated [by me at least]...[but thank goodness we were'nt faced with the alternative]

[gonzo56]

See these two articles:

(They advocate a very strong rise after the election.)

http://www.dillongage.com/PR-GoldandElections/default.aspx

http://beforeitsnews.com/gold-and-precious-metals/2012/10/are-gold-and-silver-capped-until-after-u-s-election-2453012.html

It's started.

[Skol]

In the last few days the XGD has closed below its 200 day MA, an indication of the long-term trend.

[gonzo56]

In the last few days the XGD has closed below its 200 day MA, an indication of the long-term trend.

Meanwhile, Gold is well above its 200 day MA... That tells me that you've got to be careful about which Aussie Gold stock you buy into.