Compounded

:lol: :lol:

 

I think that deserves a little more prominence

 

 

:lol:

Fundamentals will out

Fundamentals will out

Fundamentals will out.

I am guessing gold is a bit odd, very very volatile, but christ look at a chart of the 70's gold price.

FFS you lot gold has 25% corrections in bull markets regularly, all you have to do is be sure you understand the fundamentals.

Forget gold, to decide the fundamental of gold all you need to know - is the dollar crap?

Had a few beers so will post anyway.

Here is a naive thought:

 

1970-1974: gold goes x6 and then /2. --> Result at interim bottom: x6/2 = x3

 

1999-2008: gold goes x4 and then x3/4. --> Result at interim bottom: x4x3/4 = x3.

 

The bottom could therefore be $250x3 = $750.

Possible, though this is more extreme than the 70's don't you think?

Supression though covert is continuing into to upswing.

I suspect the cartel have got pretty competent men doing the supression.

They know about charts and all that stuff better than most of us.

JS and cgnao both say gold on margin is madness, you are up against experts who will empty your wallet; physical and wait is my strategy.

This is ugly, ugly, ugly. My sympathies to anyone who has silver on margin. Virtually every intermediate support level has gone. If we do not hold here, I believe we will see 730 very quickly. If it wasn't August I would be declaring the bull market over.

I am surprised you are worried, Krassimir in one of his talks said 25% corrections are common in a gold bull market "everyone gets a heart attack but dont worry it's normal for gold", I looked at the graphs and its very easy to see the crashes in the 70's and recently (perhaps the volitility is a confirmation of the bull - as it certainly was volatile in the 70's)

There was a 50% correction in the 70's bull IIRC - think of that £450 kruger being devalued to £225

That's the spirit! I only buy physical and I'll bet that, come morning in New York, I will not be able to buy at these levels.

 

 

Great forum, think I will settle in here quite nicely!

Welcome, I like it here too.

This is going to be interesting to watch.

 

If this really is the end of the bull, this thread could be a study in cognitive dissonance as denial as people downgrade their previous lowest expectations and keep predicting an upswing.

 

However as a relatively dispassionate observer, my observation would be this. What we are seeing is a reminder of how shockingly turbulent gold can be (maybe because of interventions, but more likely because of the size of the market and the degree to which sentiment swings it). I've seen a graph here where an upswing in gold through the autumn is extremely common. And I believe there is going to be plenty more scary financial and international news this autumn. So an upswing still feels more likely to me than not.

 

My worry would be the degree to which deflationary forces are starting to drag money available for all investment down. Gold may turn out to be some kind of insurance simply because its value doesn't collapse to quite the same degree as other popular options such as shares and property. People are going to lose a lot of money from bad property investments and companies are going to collapse*. Gold might just bumble along in this region, not doing quite what you'd hoped but still protecting your wealth better than some alternatives.

 

Good luck to those of you holding anyhow. Must be a slightly unnerving period, but hopefully you like rollercoasters, and the next uphill stretch might be close.

 

* FWIW - I don't have huge amounts of money and most of mine is in my property - right now that isn't working out so great either as I haven't been able to remortgage and that is making life a little tough, so I hope I won't be showing any schadenfraude if gold has its own problems.

I cannot often follow the convoluted arguements on currency - but believe a financial crisis of mega proportions is possible.

Still bloody glad i have been frugal and have no debt - I am 49 so mortgage free is no big acheivement

I am very worried about deflation too. Unfortunately, I have not so much time to spend on it, since I am busy working more so that I can keep up with the price increase by 35% from British Gas and the increased food prices, lunch has gotten 15-20% more expensive too recently. But yes, other than that, extremely worried about deflation.

I have just done my books - costs well up - guess I will have to increase prices.

think from memory FP said Gold was going to $750 a few months ago - good call

FP quite pro gold IIRC, though never flaunted it on the gold thread.

I find that sulking helps. Whaddaya gonna do? Sell PM holdings? And buy what exactly? Cash is gash. Stocks have the pox. Bonds are, uh, erm... one minute, for blondes. Mortar 'n' bricks are for <censored>. Fudge it all, might as well hold for the inevitable bounce. And then hold some more. And until then, I'm gonna keep sulk sulking and write a very stiff letter to the Mogambo Guru. 100% Guaranteed.

Exactly - WTF else do you use as a savings vehicle now?

Nice graph.

Indeed. He did say this and he also said that gold would go much higher ($2000+ I think he said)

 

Are we confident the gold bull is still going or is that the end of it?

If you could convince me it was the end of it, it would follow that our economy is sound - I think I would like that especially as I have children.

I more and more think that what we see is the psychological preparation of the markets (carried out by the PPT and global central bank collusion) for the strike on Iran.

I have read the French are in it too - very significant IMO.

You aren't the only one. I agree all the fundamentals are behind gold, but I've been buying since January and am quite a lot down right now. I guess its just holding in there and waiting for the fundamentals to prevail. Not sure how low gold would have to go before I conclude I've made a stupid costly mistake and sell the lot.

edit: but Im sure we wont get there

It's a mind game, all of it.

If you think financial strive is ahead buy PM and hold.

25% corrections are normal. 50% crashes happen.

Few make money with PM's, they are not an investment.

They are a preserver of wealth when the financial world goes wrong.

We have the biggest, the first ever global credit bubble bursting, now.

Maybe it's quite important to note that in the last three years we have not seen more than five consecutive weeks of falling gold prices. We are currently in the fifth week, and this current drop is only the second time this is happening. The last time this happened was the big correction in spring 06.

 

http://stockcharts.com/h-sc/ui?s=$GOL...id=p26646984441

 

Edit: link again...

 

Edited again for you, Steve

I was not into gold then, so it passed me by.

I do wonder how much is due to cartel suppression and how much due to other factors.

I have physical mostly in a pension, I am surprised myself how unworried I am.

If it's supression - they are worried which means things are bad which means gold is the thing to have.

If it's not suppression.

Oil - it's peaking soon prices will rise higher than ever in the next few years - I am certain of that.

War in the middle east - hmm.

Consumer spending has collapsed in the UK, we are in freefall.

 

Gold looks the only sensible bet .

 

Nick

The Pound is now below $1.90, so the gold drop is not so bad in for sterling holders like myself.

I thought 25% corrections in the gold price are normal and nothing to worry about at all.

I bought over $500,000 worth of Gold yesterday (thru calls on GLD).

That's my most ever, at least in one day.

You are big, calling the oil price decline really impressed me too.

Thanks again for this wonderful site

I also believe in the law of unintended consequences, the failure of man to recognise that his actions are contributing to problems rather than mitgating them is a widespread problem, I believe.

 

What are your thoughts?

These efforts are doomed to failure. They will only succeed in making the situation worse.

Everyting the government does is a boondoggle (american term I believe) All government solutions to problems seem to cause more new problems and make the overall situation worse.

Issac Newton also said someting like, "I can calculate the motions of the planets but the folly of men is a mystery to me"

Newton liked gold he had an obsession with it and spent most of his life's creative energy on alchemy, as master of the mint in 1717 he was responcible for sterling moving to a gold standard (from a silver standard hence "sterling silver"), and created a currency that begat the UK as the centre of a great trading empire.

WW1 ended it and that was the start for this unfolding catastrophy.

Well, my wealth has not been preserved particularly well going down the route of PM's (But that is more to do with my terrible timing, for which I slowly learning to improve!) The thing is I understand the arguments, I know what challenges they face and there only route out but they have bouncers on the fire exits!

Volatility in everything including the gold price should increase as high finance becomes more overstreched and unstable.

Also like the Ottoman Empire the untenable can exist for much longer than you expect just through sheer inertia, though surely it cannot last that long!!!

2 years ago I knew we were in for a very rough ride and a year ago I did not quite get it (I was hoping for a standard crash with the accompanying deflation and stock market collapse and general asset reset) but in the last 6 months I finally got it (that this mess is too big for deflation to be allowed to take control) and bought into PM’s. I have chosen to buy 2 out the 3 times where I felt the need for gold most, each of those times gold rather coincidently then took a spanking. This recent time I even waited for a correction expecting them to take it down but have still managed to make a significant paper loss.

 

It is remarkable that the stock markets have only had one day of true panic (27th Feb 07 when the DOW fell 600 points before the PPT stepped in) from then on the stock market has been heavily managed, initially up on take over and warren buffet rumours to gain as much ground as possible before the inevitable sh!t hit the fan and then down without any big falls and crucial days being heavily protected with them often ending up. The commodities were starting to put too much pressure on the DOW and have now temporarily been dealt with.

 

I have now read enough to know what the outcome is likely to be and articles like this just confirm it http://www.atimes.com/atimes/Global_Economy/JH08Dj02.html. But their control over the markets is making me doubt there is anything an individual can do to protect themselves from their master plan to resolve this mess.

 

It is such a strange world that they monetize F&F debt and gold falls over 10%. With this control and with the general public very unlikely to realise they are being brought to the boil on the pot is there really scope for PM’s to be our saviour?

Welcome, Dr bubb used to welcome everyone personally but I think such a large number of posters from HPC are arriving here now he does not always manage it.

As for PM's a year or so ago i felt they might make me lots of money, now i think that is still possible but it's more likely they will preserve some wealth when all about are losing most if not all theirs.

OK, so my package with coins that I ordered from CoinInvestDirect Monday afternoon has arrived. I ordered gold and silver coins. The silver coins (1oz Maples/Eagles/Philharmonikers, all from 2008) have all arrived, no problem. They are very beautiful - I had no idea. Silver is good stuff, not only gold, I have to say. Man, I feel rich now. Forget $15 or $20 for silver. This stuff is worth much more. You can tell from just looking at it.

I have ordered some silver philharmonicas from coininvestdirect. The price is sooo good even though I cannot avoid UK Vat.

They are now selling polythene tubes for 20 which is good although you have to order and pay for the tubes separately.

The Philharmonica packaging was absolutely terrible the last time I received some - some had even come out of the packets in transit.

I agree they really are beautiful and so incredibly reflective of light they are dazzling, however, they quite rapidly tarnish if exposed to air so decent packaging is essential IMO.

Sitting just below $870 whats the odds it will test $850 ?

Still £450, this is partly a dollar dead cat bounce.

BUMP

This is an important thread, the coming demographic crisis has to be material to all investment my thoughts are;

The boomer generation exists in most western countries including the US and UK it includes those born in the period 1946-1964; these people represent a huge demographic bulge, which has to some extent dominated society e.g. youth culture was important in the 1960’s. They are now saving for retirement and are buying assets, which they intend to sell during or at retirement. The result is high demand now and low demand in later years for those assets favoured by these people to save for retirement (equities, bonds and property). The result will be high prices now and lower prices later when demand drops – conclusion; if you are a baby boomer these assets are not a good way to save for retirement.

Gold makes sense as an investment because among other reasons it is not a favoured by western boomers, can anyone think of anything else?

TIMING QUESTION:

 

If you were China, and you wanted to strengthen your currency

- by switching some reserves OUT OF DOLLARS and INTO GOLD.

 

When would you do it?:

 

+ Before the Beijing Olympics?

+ After the Beijing Olympics?

 

No prizes for the right answer

 

Benefit: you can lower commodity price inflation

Cost: less exports to the US- but they are fading anyway

Buy as much gold as she can secretly is what I think she is doing.

This will continue as an announcement of intention to accumulate gold will send the price higher.

It's normal for a creditor nation to accumulate gold, Japan has USA dollars - I bet they wish now they had got more gold.

Fundamentals will out in the end.

The USA is bankrupt

The USA is bankrupt

The USA is bankrupt

(Note: Alexa ranking was 297,000)

I noticed that personally I think it cgnao, all a doomlover wants with entertainment too.

Please do not change your site too much- it's good.

I have moved the pension to Goldmoney, it took weeks to do, I initially applied 2 weeks before Bear Stearns weekend, the delays turned out to be fortunate as I eventually transferred near the May 08 bottom.

It does not offer silver which is a shame.

http://www.goldmoney.com/en/gold-sipp.html

That explains the trough in gold price, but I'm still not understanding why such a wide and deep trough in lease rate has coincided with it.

 

I've read in a number of places that gold acts as a hedge against deflation too. I don't pretend to understand the fundamentals of gold under deflation, I've not looked into it because I don't think the central banks will let it happen unless a far greater force crops up than those at play at the moment.

 

Allastair Darling, for example, has pretty much abandoned the MPC's inflation target, though he expects inflation to be back on track by the end of 2009, but I'd guess that these targets are based on an optimistic view of wage restraint rather than negative equity driving up pay settlements.

http://www.hm-treasury.gov.uk/media/9/5/le...ernor170608.pdf

http://www.goldensextant.com/LandisAMA.html

Has some interesting comments about how the purchasing power of gold has changed in periods of inflation and periods of deflation and some figures in the appendix.

This is the part i have a problem with.

What makes US treasuries so attractive over gold?

Am i mistaken in thinking that they are actually returning a negative yield?

Who is carrying that market? Foreign countries?

Gold is good in bad times -- period. (forget inflation/deflation)

IMO bad times are coming.

It's easier to forsee bad times ahead now than in 1929 or 1968.

"Failing that we could go back and retest 850-60."

That's a scary prospect; lots of fear I'd imagine if that happens.

Nice for a steady accumulator like myself though.

I think people don't really understand gold. Like romans holiday said you need to learn about the nature of fiat currency to have a chance of understanding it.

Definately true in my case.

I also found that learning about the nature of fiat currency is not intuitive but takes time energy and effort.

I suspect few will learn in time.

Just my guess, but I think they are in collusion, yes.

 

City of London-Wall Street is the power axis of the Western world, IMO

 

After NY opened I guess they could have been content just to see the minor recovery and nothing special besides.

This gold suppression business is not a game it's deadly serious.

They must make the average man believe gold is a speculative volatile commodity.

If they fail gold will be money and their paper will return to its real value zero.

I wouldn't have the guts to trade... I just keep accumulating, week in week out. It's boring(ish!) but it seems to work

Same here, my attitude has changed too.

It's more about preserving wealth when all about are losing it, than making easy money.

What the similarity between Margaret Thatcher and a pound coin.

It's hard, brassy and thinks it's a sovereign.

That's my reading of it Gatesy. In a word: volatility.

 

I do remember they changed the margin requirements for silver on the Comex around about April 20th, 2006 and we got a horrible nasty sell off

I suppose if they trying to scare the average man away from gold, a volatile price would definately help.