Justin Thyme

I mean that, in the context of medium-to long term gold investment, US monetary policy has yet to demonstrate the level of prudence required to prevent it retesting lows set earlier this year. As James Turk suggested recently, the inexplicable resurgence of the dollar against the euro was likely the result of unofficial central bank intervention and I, like many contributors to this board, are betting that the Fed can't keep the plates spinning indefinitely. The change of direction you allude is entirely possible but unlikely to manifest itself for many years to come. The US psyche is geared toward the acquisition of wealth and that relies in in no small part on the US's continued profligacy. Whether or not the emergence of China and Russia's economic ambitions leaves enough meat on the superpower bone, the US isn't going to give up its top dog status without a fight.

I'm not selling a single gram. The dollar's dead - Period !

Yeah but the Americans haven't had a go yet . . .

Welcome back, Marceau ! You've got cajones if you had trades running for so long without access to a computer but, as you say, you'd probably have been going long all the way down. Instead of trading, I've revisited the junior miners which took an absolute pounding on the drop to the high sevens. Guys like Capital Gold, Jinshan and GBS have been obliterated . . . Jinshan went to C$1.08 then bounced back to C$1.50 - nice ! Guess it's still leveraged play but, then again, you never get stopped out

From Dow Jones Newswire

The tie WILL be cut soon.

OMG Freddie and Fannie are simply being HOSED !!!! 20% down . . . Paulson's gonna have to step up

Now that it's beginning to look very unlikely Freddie & Fannie'll be able to raise funds in the market given their lack of credibility it looks like the US Treasury is going to have to dig into its wallet over the GSEs and treasuries are probably going to tank. Does anyone have any suggestions on a play on US Treasuries ? I seem to recall some comments a few years ago concerning the Ishares Lehman 20 yr ETF but does anyone have any other ideas ?

No way, Jose ! This is, I believe, a healthy pull back in what remains a long-term bull market in precious metals. I may not be a dyed-in-the-wool goldbug like some others on here but considering what it costs to get gold out of the ground and the inability of the financial engineering which got the global economy into this mess in the first place to extract us from it, Overall I'd say that, within the next few months, we'll probably be looking back on last week and laughing. Despite the dollar's "recovery", the credit markets were in complete disarray on Thursday and Friday . . . . and that's with the DJIA rallying like the cops had brought the decks back to the party. There's something coming - something BIG ! I dunno what it is but I'm happy to be this side of GoldMoney when it gets here. All the CB 3-month dollar auctions were over-subscribed last week pointing to no end in sight for this cock-up.

Hmm . . . It is true that the general consensus among goldbugs is that ANY pullback in price is an opportunity to buy in and I'm sure that those who took that advice at or around the $975 or $875 marks will be feeling somewhat disillusioned by now. Personally, I don't give a monkey's how many laughing smileys someone places after their post, this was never going to be a straight, toe-to-toe fight. I never bought more gold because the risk vs reward in the short-term made it no more than a punt and I binned margin trading after $950 went down. Now, however, with silver pulling back like it has, there is some tangible potential even if I'm not a true believer in the $50 an ounce figure I've seen bandied about. The CBs are fighting to save their very civilization and will, naturally, use every dirty trick and lowblow to achieve their aim. Having said that, I don't necessarily think the PPT forced this.

and I'd be joining you . . . Ta hell with it - I'm in pure physical and I know this party ain't over ! At these prices, I might be tempted to have another look at racking up some more silver

I'd go for some junior mining stock. Jinshan [JIN] fell to a low of C$1.30 this week. I picked some up at 1.35. Maybe even some oil service stock - Petrofac [PFC] recently fell back to £5.20-ish. I've got enough physical exposure and despite some of the comments from the more dedicated gold bugs, personally, I think another test of $800 may be on the cards.

Nice to see a positive day for gold but can't help wishing gold would untie the rope to crude. If the fortunes of gold can hinge on a coupla guys in Nigeria with balaclavas and ageing rifles or a possible attack on Iran, we're in for a far more uncomfortable ride than most of us would like.

Liked what I read in Evans-Pritchard's blog although I've disagreed with some of what he's written in the past. Oil's bubble springs to mind . . . Not much sign of the NY smackdown this session.

Commiserations to those who lost on leveraged positions and those who bought at $900+ !! Interesting reading comments from contributors who may have taken some of the opinions aired here as the basis upon which to enter markets as volatile as those built around gold and silver. This drop has surprised most of us - even, I think, Dr Bubb ! I was going to investigate the possibility of buying some calls but decided against it cos I was too darned lazy to get more info on how to buy, how much to pay but NOW . . . The fundies remain firmly, irrefutably in place and doubters - including myself, from time-to-time - must always bear that in mind . . . Do NOT sell

$822 Ah well, we were warned ! Hope we don't see the $650 that's been bandied about.

Not sure if any of these are really going to apply for the immediate short-term but I reckon when the reversal comes, it'll be with startling ferocity. I'm not selling one gram ! We shall prevail !

As far as short-term is concerned, if I had a good enough idea, I'd probably be trading on it. Dunno that support levels mean as much in this kind of volatility. Gold is simply tracking oil so as as oil falls, gold does too. Only geo-politics or a hurricane will turn things around short-term. Until decoupling occurs, gold is a puppydog - Regardless of what we think on GEI, the rest of the market simply doesn't see gold as currency - yet !

Ditto that, Steve ! I elected to sit out the choppiness and stop trading once we broke down through $950 so I guess this drop hasn't bothered me as much as some of the brethren insofar as my physical holdings are concerned but, as I said, nothing's changed fundamentally. Still plenty of landmines waiting to go off . . .

Kind of in agreement with you there, Bobsta. Ok I haven't lost money having bought in a lot lower than this but I always try to remember that I can only set so much store by what I read on the internet even if the sources of information are particularly knowledgeable. I still believe in the long-term bull market in PMs and at times like this, I ask myself some fairly simple questions like: Is the US banking system REALLY out of the woods ? Did or did NOT gold hit $1032-ish in March while oil was at far lower levels ? Is there likely to be less or more investment demand for gold going forward ? I don't wanna sound patronising so forgive me if i do but I take comfort in simplicity. I ain't backin' up no truck to load up when the path ain't clear but even though I might end up kicking myself by year end with gold at $1200, I'm happy to look elsewhere for opportunities. Uranium and water come to mind.

I'm still, naturally, bullish on gold but I'm concerned at its apparent inability to decouple from the fortunes of crude oil. The dollar's toast and yet the efforts of a PPT with the burdens of an extended discount window and Freddie/Fannie to bear are able to depress the price of the de facto inflation hedge almost at will. I'm hoping that Autumn will see gold resume its ascent towards the much-vaunted $1000 mark buthave to the admit, the PPT's done a hell of a job making us wait.

No argument there and I think it's likely to remain that way for some time. Not like property where a punt got you an asset you could chuck in some floorboards and a nice kitchen where the sofa should be or like the dotcom boom where the ramp benefitted the equity market with the establishment's full blessing. The PPT's influence may well wane as the dollar crumbles but there's enough clout left to keep Joe off the gold trail.

Smackdown resumes in earnest $951 achieved - time for a long

Can't believe crude oil down by $10 ! Gold bitchslapped but wasn't a surprise . . . Gotta time . . . this . . . just . . . right . . .

What's happening with gold these last few days ? It just seems very feeble - I mean, the dollar's got a big fat bullseye right over its heart today and yet gold falls away in sympathy with the mildest sell-off in crude.