Justin Thyme

What do you mean by that - that there is no other possible outcome?

 

What if.......

 

.....after years of profligacy and pointless expensive wars which drove the dollar to all time lows against both other currencies and gold..............the US began to wake up. Military efforts were scaled down and the responsibility spread to other countries, the house market collapsed, massively reducing lending and hence monetary inflation, and making the public 'smell the coffee' of the reality of last few years.

 

i.e. is it utterly inconceivable that the dollar has put in a bottom after years of decline? It wouldn't be the first time the US have turned a situation like this around (e.g. post Reagan/Bush)

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 seriously tempted to sell my BV position while about even, as I'm worried about the talk of $650 where I'd be at a loss. Maybe some physical too. I thought this time of year was positive for gold so I might wait a while and see.

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

Looks like they might be wrong today too. Over $840 ATM.

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

Well I'm finally back after almost 4 weeks away from a computer and as usual gold has gone crazy. Unfortunately it went crazy in completely the wrong direction and it would be fair to say my speculative cash pot has taken something of a pounding.

 

There are saving graces, as once my stops were hit I was unable to re-enter the market. This prevented me from buying even more on the way down ($890, $870, $850, $800, I would have bought them all) and losing a packet more (which I undoubtedly would have done), so it wasn't an absolute wash out for me.

 

It's taken me almost 3 days to read all of the online material I've missed over the last month or so and to be honest it's been heartbreaking to see just how effectively the financial fraudsters have managed to pick the small guys pocket yet again. What particulalry riles me is that they expend so much effort fleecing those who are earnestly trying to protect their wealth while simultaneously propping up fast buck speculators in housing and the stockmarkets. Free markets? I think not.

 

Nonetheless I'm still a total PM bull and like pretty much everyone else on here I can't see any fundamental change in the causes which made me invest in PMs in the first place. Also like everyone else I haven't sold an ounce of my core positions and don't intend to do so until the REAL picture changes. Those who think gold is dead really haven't grasped the severity of this situation. There's a whole flock of black swans moving out of the reeds as we speak and they're hell bent on making sure the market and the central banks get their arms broken.

 

I'm still drip feed buying, but as for short term trading I think I'll give it a rest for a while. If this really is the deflationary scare before the inflationary take off then I have a sneaking suspicion we're going to see falls in the 40% region before reality kicks back into gold and silver (sub $600 sounds crazy, but this market really is that stupid). So as I can't bring myself to short gold, I'll take the easy option and stay out until we have a safer technical picture.

 

I suppose the bottom line is that this gives me even more time to accumulate something with real value. So that's what I'll carry on doing month after month and, if necessary, year after year. That's all for now, I hope no-one on here got too badly burned.

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

As worries swirled anew around Freddie Mac and Fannie Mae, a Citigroup analyst predicted more mortgage-related write-downs from Lehman Brothers, Goldman Sachs and Morgan Stanley, and the firm lowered its third-quarter estimates on the brokerages.

 

"Adding to the buying today were reports that central banks are apparently choosing to hold on to their gold and could bring the lowest amount of gold disposals to the market since 1999," Nadler said.

Oil shooting up, but PMs not following. Disappointing!

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 ?

Has anyone lost their belief in the gold bull and planning to sell out, or are you confident that this is just a temporary drop in price with much higher prices to come?

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.

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.

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.

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.

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

Seconded. I have to let it sink in slowly, then return later & see if my head is around it

 

May I turn this around into a simple, self-centred question?

 

If you had 150,000 lying in a Euro account, (& it is unlikely you would ever need it), would you not be tempted to stuff the lot in PMs right now?

.... because I am so tempted. All else (apart from Dr Bubb's, too much for my brain, investing) looks a disaster zone.

 

If I ask myself the question will Gold fall in relation to the Euro over 3-5 yrs, then it seems madness not to proceed?

 

If I go any deeper than this the clarity vanishes

 

All comments welcome please............ even 'shut up woman!'

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.

If it breaks $850 - $845 wheres the next big support $825 ??

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 !

What are peoples thoughts on the short term price of gold ?

 

Are we going to see a further smack down today / tommorrow ahead of the ECB rate decission ??

 

I read that there is strong support at $860. Is this going to be tested ?? Is it going to be broken though ??

The so called " Angels " @ 875 was punctured yesterday, although we have seen a small recovery this morning.

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 !

Thanks for the hugs Steve.

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 . . .

I'm glad most of you seem to be enjoying this dip in G & S. No, really! Personally I prefer not to lose money in something I've already invested in so that I can buy at a lower price. But hey, at least some of you are happy, even if I'm pretty miserable!

 

Roll on September!

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.

Joe Public is still pretty well oblivious to gold IMO.

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.