chazza

here are two interpretations of the 15-month monthly trend (close of month price only)

 

The first one. The second ones trendline isnt drawn correctly

Interesting.... very very interesting. I may have to go on a dollar spending spree in the next few weeks......

 

Faber suggesting a correction of gold between 950-1000. One thing I agree with him on.

Tom O'Brien mentioning $1000 on yesterdays show. I would like to see us test $1033, I'm all in at that level.

 

The ratio is finally back below 60. Interesting that the ratio is improving when bullion prices are in decline. No doubt this is due to gold's recent "parabolic" rise from which it is now consolidating.

 

As a long term trader of silver, and an accumulater of gold, I put more importance on the ratio than the momentary prices. The only certainty with prices is they will be volatile... that and prices will rise in the aggregate of course.

I see it at around 62.5 this am after potentially bouncing of a MT support level. Would make sense if the market is about to turn

It's not just an housing prop i'm angry about and it's been said on other threads, but the whole friggin benefit system needs looking at!

 

Today I watched Mr Invalid running up and down a hill in our village with his 4 kids, he could have practically entered the winter olympics with his performances. Must be all the free drugs he gets that enhanced his performance. Who knows he might even come off benefits and go back to work, then again.

Can't you grass them up for a couple of hundred quid now?

EDIT: I actually thought before that not many poeple would go down that route, but given the problems we are in financially I can see many more porple going down this route. Maybe leading to more social disturbances

Notice that the stories are also about immigrants receiving the benefit rather than those who were born here.

 

There are a few things at work here such as the slow increase in public perception that there has now been too much immigration and the system is weighed too heavily in the immigrants favour. Before it was only the red top newspapers that would bring up the race of the people involved, now it is the broadsheets. As the Telegraph has stated the race of those involved then immigration is now a subject that those in the UK will soon be politically allowed to discuss in public again whereas it was not politically correct to do so under Labour.

 

....

 

First society has to change, then the elected, then the body of laws, guidelines, rules and regulations. Consider the gap from Maggie being elected to No: 10 and Brown’s hopeful ejection next year, 30 years!

Like the financial crash, it takes time and in our high speed society we think it will all be over in a few weeks, there might be quick shocks such as the collapse of Lehman’s but it is going to take years to get to the bottom or for the political pendulum to swing.

I do find these stories amazing but try and take them with a pinch of salt when nationalities are also quoted. I think I try to forget them as really, who in there right mind would authorise those sort of rents when you could move them 1 mile out and pay rent a third lower.

Buying some gold in GBP here. Tough decision, would have liked it to be lower (wouldnt we all), though the Sep-March cycle could play out again and sitting in GBP otherwise and looks oversold on a ST basis at least....

Any further current thoughts on £GOLD out there?

Gold Buying by Central Banks May Send Signal to Sell (Update1)

 

By Claudia Carpenter and Pham-Duy Nguyen

Dec. 16 (Bloomberg) -- Some of the biggest buyers of gold

may be sending the strongest signal to sell it, if past

performance is indicative of future results.

Central banks, holding about 18 percent of all gold ever

mined, are expanding their reserves for the first time in a

generation as a nine-year bull market drives prices to a record.

The banks will buy 13.8 million ounces (429 metric tons)

this year, worth $15.5 billion, for the first net expansion in

reserves since 1988, New York-based researcher CPM Group

estimates. Gold fell 15 percent that year and took another 15

years to trade again at the same price as central banks from

Switzerland to the U.K. cut their holdings.

India, China and Russia are now adding to reserves as gold

nears its longest winning streak since at least 1948. They’re

joining a rush as investors in exchange-traded funds amass

holdings to rival the biggest central banks. Clive Capital LLC,

manager of the biggest commodities hedge fund, had its best

return since May last month, led by gains in precious metals.

“This is late in the game to be buying gold,” said Peter

Morici, a professor of business at the University of Maryland in

College Park and former economic adviser to the U.S. government.

“Central banks are not known for their investment acumen. What

it reflects is a lack of confidence in the U.S. economy and the

long-term durability of the dollar as a store of value.”

Countries were also increasing their holdings in 1980 when

gold peaked at $850 an ounce, data compiled by the London-based

World Gold Council show. The record was exceeded 28 years later.

 

 

20-Year Low

 

 

 

They sold a net 4,880 tons since 1999, as prices tumbled to

a 20-year low of $251.95 an ounce, according to estimates from

London-based researcher GFMS Ltd. Prices began to recover in

2001, reaching a record $1,226.56 on Dec. 3 and trading today at

$1,124.44 at 2:00 p.m. in Singapore.

This year’s 5.4 percent slump in the U.S. Dollar Index, a

measure against six counterparts, is increasing the appetite for

bullion. While gold and the dollar are traditional stores of.......

BBG article, saying CB's showing the top...

Maybe people don't hang around investment forums like this, but quite a few of my colleagues are talking about gold (not through my prompting). They're not buying gold because they don't really know how to or they believe it is not something the average saver invests in. I find it strange that most people in this country are conditioned to believe that their savings are better handled by advisors and experts. There appears to be some kind of comfort in letting other people take risk with their money.

And lets face it, the general standard of the advisers is pretty piss poor. The blind leading the blind.

Hi Guys and Gals

At the risk of irritating some of you, I'd like to say that my take on all the recent action (global politics, economics, gold news, UK/sterling news, chart patterns...) leads me to a fairly strong suspicion that now would be a good time to lighten up on GBP gold holdings (not sell it all, just ease off a little) - IF you want to play that game at the edges whilst keeping a substantial core holding.

Replies with more that 5 swear words will be ignored :-)

Where do you think a pullback will take us to?

Depending on the time of the pullback, I would be looking for £590-odd. Unsure as to wether we can break the uptrend line given the fundamentals of Turdling,

Let's watch it closely. http://gold.approximity.com/gold-silver_watch.html

 

 

Ho ho, my money was on yourself or Pixel8r. I couldnt agree more GF. I'm more hoping it goes to 100 in the ST for the house deposit.

Sitting in Hong Kong, I am less aware of such (dangerous) policies.

Do you agree with my assessment of the possible moral hazard, and chances for cheating?

I think the basic rules will be, similar to the greater job seeers allowance amount, that if you have no savings and no other income than you have more chance of getting the subsidy.

So if you have spent and not saved basically

G/S ratio through 62, which Hoye saw as key, if it hangs on above this level - next stop 100?

Must admit I have had conflicting emotions about it recently.

Must contrast the uber-bullish house headlines with anecdotals from neighbours trying to sell their places. They have been on the market for 3 months, a handful of viewings and no bids. "Wrong price" is the first thing I think of. The places are the newer double height conversions - very nice, but not cheap and 3 or 4 on sale from the same development.

And interestingly, the place we should be moving into is now owned by a bank.... a sign of the times

EDIT: Forgot to say, one of the sellers in the block needs to sell their place soon within the next few months as they have already bought a new place. I said at the time (a couple of months ago) that that was quiet a ballsy strategy given the macro situation. Tho think the missus didnt mention anything to them as we aren't that close. They couple both work in finance so you'd imagine they shold know its all about price....

With you on that - we complete in a couple of weeks too and I'm still undecided on what to do with the equity that I pull out.

 

All my savings (circa £50k) have been in Gold for over 12 months so I've done fairly well out of that. This sale will give me another £50k in cash, don't want to go all into Gold though. My priority is obviously to preserve the buying power of the money that comes from this - but other than going 100% Gold, which has already seen some quick moves and is probably due a pullback, I'm unsure of the best move.

 

What are you thinking Chazza?

I'm hoping for the next leg of this debt deflation cycle, allowing me to get into gold, and eventually silver at better prices. We shall have to see how this pans out.

The Ave house price/Silver graph speaks volumes to me.

Just be patient.

Amongst the many BTL collectors will be many forced sellers within 2-3 years

 

 

 

Sensible chap !

Some people think I am mad to be a seller now.

But it sure felt good to go into the bank today, and payoff our biggest remaining mortgage

with the proceeds of our two last flat sales. It will be great to see the rental income rolling in,

with no mortgage payments rolling out

We complete in a couple of weeks. People at work have conflicting opinions of my sale (though most are market savvy). I'm sure nearly all of my friends and fanily will have a few wisecracks for me when it goes through and if these house price increase headlines keep on appearing....

Must admit I have had conflicting emotions about it recently.

I am making a call for the end of the Dead Cat Bounce in UK resi property.

I have been watching BDEV for a month and it topped in Sept. IMO.

I work in property development and activity is definitely tailing off.

Darker sentiment is returning.

I have been on several seminars recently where talk is definitely of a W shape and we are embarking on a return to harder times.

I could provide more evidence but have lack of time.

I will be intrigued to see Spline's updated Oct bellweather Index (last updated in Sept). Bubb do you have this?

I have been waiting for 2-3 months to post this and have finally made a call based on my own experiences and what is happening in the resi land market too.

 

(I don't think confidence will return until after the election, if at all. The only possible argument the property bulls can have is that supply will dry up in the usual fashion as owners delay marketing their property until after the results.)

BDEV looks interesting against the FTSE, failing miserably to make new highs as the FTSE has. Instead stuck against ST resistance in maybe a bearish wedge.

Went to someones house recently whose partner has been/is involved in property development. What you can do with leverage and a bull market is amazing. Had to be a £10mio pad.*

very interesting to hear your thoughts as, to me the rental market seems to be 'recovering' with the sales market.

*I have actually no idea how much it costs, but in a very nice area and very impressive

Gold pieces in the Sunday Times, Evening standard and The telegraph over the past day or two. All 3 seem to have the same spin of burying goldbugs (why only goldbugs and not equitybugs or bondbugs?). Actually the Telegraph piece is slightly more constructive than the title suggests (tho not worth the effort of reading...).

However David Smiths piece is genius as only he can, he dimisses gold within about 200 words. Not bad for a supposedly high-brow paper. What happened to reasoned analysis in the supposed quality newspapers?

http://www.telegraph.co.uk/finance/currenc...our-breath.html

 

Gold at $1500, don't hold your breath.

http://business.timesonline.co.uk/tol/busi...icle6869383.ece

PS: The only time most of us notice the gold price is when it hits a record, as last week. What does a gold price of more than $1,050 an ounce tell us? The answer, as always, is a mix of sensible argument and daft rumour.

 

One sensible argument for buying gold for investment is that when interest rates are near zero, the cost of doing so is very low. But when the Reserve Bank of Australia raised interest rates last week, the first in the G20 to do so, the price of gold surged.

 

This is because of the other big argument about gold, that it is a great hedge against inflation. Gold’s usefulness as an inflation hedge has been exaggerated, as anybody buying it in 1980 (until recently the peak) found to their cost. With many countries suffering deflation, inflation worries look misplaced. World recessions are not followed by galloping inflation.

 

That leaves the dollar. A report by journalist and Middle East expert Robert Fisk suggested it could be abandoned as the currency for pricing oil. He pointed out, however, that talks on this subject had been taking place for a couple of years and, if there is a shift, the target date is 2018. Gold will rise and fall. The dollar is going to be around as the world’s reserve currency for a long time

Intersting from my point of view in that mainstream are quick to bash gold without analyising the reasons why its actually gaining in price and may be a good investment.

No gold bubble yet.

+1. Too many people taking themselves too seriously.

+1

Then maybe we need three threads...... another for the hedgers.

 

But, I think some kind of distinction along these lines would be useful and would facilitate a more constructive discussion of what is after all a very complex issue.

Would be too many threads.

Just call this one "Gold thread" and theres no problem

Maybe this forum really needs a better investors/traders divide?

i dont think so, I think its good to know mesh the long term with the short term. Im holding my stash of gold, but I think the ST signals of gold are important for the rest of the markets.

I wasnt going to post this but the uber bullish comments continue right until the last paragraph.

http://www.telegraph.co.uk/finance/persona...more-to-go.html

The analysis, by Cazenove, brings out what an astonishing turnaround there has been.

 

As the broker comments, the line of questioning on house-building companies has moved from “which ones are going bust?” and “by how much will house prices fall?” to “which house builder will be the first to get back to peak margins?” and “what are your assumptions about house price growth?”

 

This change has happened in a matter of months. The transformation has been justified by the way house prices seem to be rising, according to the Nationwide and Halifax surveys.

 

Much more spectacular is the chart on the year-on-year change in the number of mortgage approvals. This chart went down ungracefully starting as early as May 2007 and then lurched upwards from October last year, crossed into positive territory last May and has continued soaring. It augurs well for house prices.

 

Further encouragement comes from Cazenove’s index of housing affordability, which has improved 34pc in the past year. And then perhaps the most interesting remark in the report: “it is our assessment that house prices are effectively set by the lending institutions”.

 

At first it sounds extraordinary, but there is a lot of truth in it. Cazenove means that the banks and building societies decide whether to lend people up to two or three times their salary and whether to demand a 30pc deposit or none at all.

 

In this way, lenders decide how much people can borrow and that, in turn, strongly influences the level of house prices. The consequence is that house prices in future will depend significantly on how bold banks become in lending again.

 

Cazenove thinks that in the medium term they won’t become much more forthcoming than now, but in the long term, “we do not expect to see the current restraint maintained”. In other words, the banks will lend with gusto again, one day. I suspect the broker is underestimating how soon the banks are going to get back to lending freely.

 

It is unfortunately true that shares of house builders have already recovered as astonishingly as mortgage approvals. One is bound to worry, “have I missed the boat?”

 

But I have gone ahead for three reasons: once a trend gets going, it often goes a lot further than seems likely at the time; the shares are about the net asset values; if house prices continue to recover, the net asset values of these geared companies could rise dramatically over the next few years.

 

Cazenove likes Barratt least among the builders. It foresees the company having a £500m rights issue and a write-down in the value of its sites. It may be right, but I comfort myself with the thought that Barratt is quite heavily borrowed so the ultimate upside in its net asset value is substantial

Wow

I especially like the way he reasons that banks decide on how much we can borrow - genius!

And that kicker in the last line of buying the most heavily indebted because it has the most leverage......

Dead cat has bounced IMO

 

http://www.home.co.uk/asking_price_index/HAPIndex_AUG09.pdf

Colleague got his house valued recently, 22% higher than his 07 purchase. This was the sell tomorrow price not the marektable price.

He apparently did get a good purchae price, but it seems the bull is back.

I exchanged at the start of the week.....(to sell)

Love the avatar, by the way! - I grew up playing "Leisure Suit Larry in the Land of the Lounge Lizards"! - I even memorised the answers to the adult verification check at the start of the game.. Needless to say, I was about 12 at the time.

Hah, likewise!

Although I had to be the worst player, couldnt get anywhere on it....

Velly intellesting.

 

My goldprice.org page is a problem since they added the new banner ads -- have you a chart?

nothing I can link (Bloomberg), not sure how it would look on Stockcharts right now

Double bottom G/S ratio. If it breaks or holds could tell us a lot