bitbigt

If he did have some devious mission to undermine gold on such boards, you'd probably expect him to use a different handle at each site in order to cover his tracks. Like many of us, he's probably just not got a life

no - that would be rude !

correct - but I can't give you your reward as my mate GB sold it all several years ago

And I apologise for lying about WMD in Iraq BigT

PPT smackdown at 830 precisely ...just like yesterday! Seems to me the PPT have reset their 'automated reactionary smackdown' (ARS) system to 830, from the value of 740 that it was set to until last Thursday. This would make sense if they want gold to start scaring people a little, so as to weaken the dollar to a more comfortable level.

LOL

If so, its sure taken them long enough to wake up and smell the coffee!!

Thanks! I am not aware of all that history, and can see why you're peeved! Then again, I suspect each of you will have your own versions of that history. ...I'm just asking everyone to chill out, and enjoy a good debate (colorful yes, insulting no) BTW: The Dog and Aardvark doesn't exist does it - at least not according to the web - so I can't buy you a drink unless you choose another venue

I check in each day or two and enjoy this site immensely ...until today, thanks to the bad tone set by various frictional posts. cdswamp - you know your stuff, and are a very valuable poster. ...but I think you'd be doing yourself, and all of us, a favor if you just ignored those posts and didn't react so rudely. If you're pis5ed off for some other reason, then have another beer (on me - I'll meet you down the Dog and AArdvark) and don't take it out on the rest of us.

Gold and silver have risen strongly last friday and today, and yet the PPT has NOT smacked them down ...why? I suspect the US government may be getting worried about how strong the dollar has become, as this [a] destroys their chance of boosting exports, and pushes them towards the big scary deflation monster! So they've probably decide to let gold tell its story for a while, which will tend to lower confidence in the USD and weaken it down to more acceptable levels. It's kinda like drilling a little hole in the dam to reduce the water pressure. But the fools obviously haven't watched enough disaster movies - since they'd then know that their small hole soon becomes a big hole, then a total collapse of the dam! ...all good for PoG, of course

Adding this very recent price fall to the long term chart would show it is a very unusual fall - exceptionaly rapid and large. So I wonder if the pattern from recent decades can be trusted to apply to the next decade?

Price of Gold in inflationary times: Its generally agreed, that people swap their cash for gold, and so PoG goes up. Price of Gold in deflationary times: Simplistically, many people argue the oposite to the above, and suggest people will swap their gold for cash, and so PoG goes down. However, in the real world, people also have 'assets' (houses, stocks, art,...) - and in deflationary periods these will drop in price. If you then allow for the fact that people often like to 'own assets' as well as cash, then there's every chance they will sell their other assets and buy gold, and so PoG will go up. Then, as it becomes clear that PMs are the only asset class increasing in price, more will swap their other assets for gold - i.e., a self fulfilling prophecy. I think we're now enterring that period. Finally, inflation will kick in again in 6-12 months time, due to all the Western money printing (now, and in the past), and thats when gold goes to the stratosphere. ...IMHO! EDIT: I see the recent heated buying of real gold by the public, and the CB buying spree that's now started, as just a reflection of people realising the above (as 'romans holiday' stated "...even to the sceptics"). And that's a massively important development - because once this realisation is established and widespread, there will be a mad pannick to buy into gold! ...and that widespread realisation is coming about right now !!!

One can never be 100% sure - but I asked about all this and was told it is 100% certainly in their safe, and I could have it delivered the next day if I wished

Don't see (m)any 1kg bars on there, only far smaller amounts

My gold (bars) is held in a Swiss bank The price I will get if I sell it, with the sale managed by the bank that is holding it for me, matches the spot price. Can I, and how can I, sell this as the real gold it is, to get the far higher price that real gold is currently trading at? Thanks in advance for any advice

The KGX index gives a far better picture of the true trend in PoG. However, the dollar's effect is still very apparent - for example, the dip in mid-2004 was due to US base interest rates being raised at that time, and the hump in mid-2007 was due to the temporary weakening of the dollar as they lowered interest rates. Extrapolating to the future, as the USDX falls (as the dollar collapses) then gold will shoot up in USD, and in KGX (i.e., all other currencies) as well. Or to put it another way - if the KGX indicates the true trend, and so we believe its extension into the future, then a rapid increase in PoG in USD terms is due quite soon.

wahey... look what these last few postings have done to the PoG

'cos I've got nothing better to do just now... Exponential functions are LogN(X) [N = logarithmic base, X = value] This is usually plotted with N = 2, though that is not a requirement as an exponential growth would be a straight line using any value of N "Exp-squared" would then be (LogN(X)) x (LogN(X)) [which is the same as (LogN(X))^2] That would indeed be an increasing curve on a standard exponential plot of X If that is what is going to happen to PM prices, then we just won't have enough rocket pictures between us

Thanks for your thanks, and great weekend to all.

To emphasise this point... To the extent that gold is a currency (and I think its principally is), then only USD and YEN are stronger currencies in these last many months. USD is strong because of manipulation and fear-based repatriation of dollars (i.e., all temporary) YEN is strong because the carry trade is closing down (also temporary, as once its shut, its shut) GOLD is strong because... [fill in your own answer, and invest accordingly]

I'm signing off for a few days, so I thoughts I'd review and update my predictions from last month - probably to keep me focussed rather than to tell you wise and wonderful posters anything you don't already know: [so as always, ignore me and DYOR] A prediction for October [herein updated for November]... - DOW and FTSE may have (at best) a small relief rally (due to ramped up bank bale outs, plus many rate cuts globally). But banks are shot as a long term investment theme, and general earnings across many sectors will dissapoint. So by months end DOW and FTSE will be no higher than today, and perhaps as low as (or will have touched) 9500 and 4000 respectively. These numbers are still 10-20% above the absolute bottoms that will be reached briefly during the next 6-12 months. ...that relief rally happened, and has peaked. Watch out below! Probably heading back down most of the way to last months lows again in November. - 50% chance of a bank holiday week ...didn't happen, and was anyway only a 50:50 option. Now probably won't happen, as the govs have made it clear they will bail out regardless. - dramatic emergency base rate cuts happen globally (BoE may even announce 0.5% today, 1 day earlier than expected) ...happened, and still far more to come as they race to the bottom. Expect another 0.5-1.0% off UK rates in November. - Sterling will fall further, reaching 1.65 vs USD. After this month, the dollar will tank. ...I was too optimistic! Looking for 1.40 this month, and the USD then starting to weaken - I think we'll see oil at 75-80 this month, and over the next 6 months it may even touch 65-70 [and if so, load up!!!!!]. ...too optimistic on this one also! Oil now at around 55-60, and I think we'll see 50 before this month ends [bTW: I did load up at 70, and will do so again if/when oil goes below 50] - Western inflation fails to drop significantly this month, and UK CPI may actually exceed 5%. Longer term they're on there way up [and note: real CPI from shadowstats is already >13%] ...OK, I now accept we'll see something of a fall in inflation (only because oil has come down so much more than I expected), but it will be transient! Big inflation problems will be with us by mid/end 2009 - all the above will cause a ramp up in fear, and gold will rally further (950-1000 in USD, >550 in GBP, by months end) ...right about the fear going up, but the PPT and the deflation concerns have held gold back. There's now now (or very little) further downside in PoG, and as soon as dollar starts to turn South, oil and PMs will shoot up (next month or two). And note, gold did hit 550 in GBP, and still hovers around 500! - The leadership on banks (amounts and strategy) shown by Alister Darling today is excellent. It will lead the way for countries out of this current pannick ...sure did. But this has now gone to Brown's head, and he thinks he can coordinate a global wave of tax cuts and fiscal stimulation. He will fail to get sufficient universal support , and problems will follow from that failure

...it won't - they'll dump on it again! Just wait until China (and other) CBs starts to buy - then even I will post a rocket!

Oh yes! Stand back and think of it this way.... - Some are arguing we need a fiscal stimulus (since new cheap money got us into this mess, more cheap new money will get us out!!!) ...but let's ignore logic and accept this is a good idea just now. - This weekend, G20 are going to meet and some will try to get them all to agree to a massive fiscal stimulus. Well that won't work, becuase some nations think its a bad idea. And unless all of them do this together, then the currencies of those that go ahead without the rest will tank! ...but lets again be dreamers and assume they all agree to do it together. - then all currencies will be devalued, equally, together, relative to each other. In other words, no currency exchange rates will change, and so the new new money injection will not be apparent to anyone. Magic Of course, the above is meant to illustrate that there is no easy fix, and that what we're really seeing now is all fiat currenices (at different times, and in different ways) loosing real value. And at the end of the day, governments and CBs know this and will try to look after themselves at the cost of other nations. China is now one of the main players, with shedloads of cash. They will know - as we all should - that all this fiat value destruction is happening and it will show itself, sonner or later, in the price of precious metals and commodities. So they (and others) will buy gold, and that will then be the last step in the process (indeed the mechanism) for pushing the PoG higher. Its all just part of the natural rebalancing as currencies loose value.

Excellent link. Thanks! However, it still leaves me puzzled as to how and why DLR should ever go negative. It means that GOFO (interest you need to pay someone to lend you cash, if you use gold as a collateral) must be greater than libor (interbank lending rate for cash loaned without collateral). ....i.e., a loan with collateral costing more than a loan without collateral ??!! Not only is that fundamentally crazy, but recently libor has been very high anyway. So it looks to me like CBs have been swapping their gold for other people cash and paying massive (commercially unjustifiable) interest rates for the pleasure. That then gets gold out there, and people will use it for the gold carry trade, and hence depress the PoG (bringing even more profit for the people that received the gold, and then 'shorted' it) It stinks!!

The plan would be (as I understand it)... - start from the premise that 1 old dollar = 12 new dollars - BUT, everything (debt, asset prices, cash) gets automatically switched from old dollars to new dollars at a 1:1 exchange rate - thus, all debt of X old dollars becomes a debt of X new dollars, (so everyones debt gets reduced in real value terms by 12 fold) - &, to avoid hurting savers (i.e., those who have got cash in hand), they would be given the missing 11 new dollars - &, likewise, a tax system (or something) would be created to protect creditors from a loss - &, gold would get boosted in new dollar price to 12x its old dollar price Thus - no real wealth difference for savers, creditors, or holders of gold, but a debt reduction of 12x for anyone with debt House prices, stock prices, oil prices, agricultural commodities, etc, would move to whatever people can afford - presumably a new dollar price of 12x old dollar price, plus a bit more since peoples debt will be largely removed. So in short, this amounts to simply wiping out a big slice of everyones debt. ...so why not just do that instead (with equivalent remuneration for creditors), without creating new currencies? In either case its Moral Hazard x 1,000,000,000,000,000 (add as many zeros as you wish) Totally unfair, but a simple way to prevent a debt induced global depression [my own view is it would fail, as it doesn't clean up al the mal-investment of the last 20 years of cheap money] [also, I don't understand why a 12x ratio would only monetize 20% of the outstanding public and private sector debt, instead of 11/12 of it]