bitbigt

READ THIS!

http://www.moneyandmarkets.com/the-g-20s-s...-solution-27996

WOW!!

Now if only they would stop using the $ and instead use a basket of 'strong' currencies to price gold in...

Great find - and not at all a far fetched scenario.

Lets face facts: The global economic system is broken (due to our greed and debt over last 20+ years). Current 'fixes' are little more than tinkering, and may be doing as much harm as good.

So if now is not the time for a radical new structure, when would be?

3 thoughts in 1 post:

1) We know the dollar ralied from low 70 on USDX because of orchestrated and desperate CB buying, and that pleased the PPT. But since then dollar repatriation and the save-haven mentalioty has pushed the USDX far higher. I suspect the PPT is not please by that, as i) exports will now be suffering, and ii) they'll perhaps need to start worrying about deflation [which is the biggest threat of all]. So I wouldn't be surprised to see interventions to weaken the dollar in the near future. But they'll to do that very carefully, for risk of causing a run on the dollar and sending PMs through the roof

2) Sterling's international index price has dropped 20% in last 3 months, and the fall is nearly 30% against the dollar. So that 30% inflation to swallow - all other things being equal. Then add in the Keynsian fiscal giveaway being planned, plus the major bailout funds being borrowed and printed by the gov, and I really think we'll be looking at a major inflation problem in late 2009 (if nothing else major changes). ...and yes I know the current talk is all about inflation returning to trend, but these same people said 2 years ago there was virtually jno chance of enterring recession. - don't believe the hype!

3) You might like to go to http://www.kitco.com/ and click the link at the bottom "Live currency charts and charts comparing $USD gold to all major currencies" - whereby you can easily look at the price of gold in each major currency. It is striking that, over recent months, gold has been on an uptrend in just about every currency (except USD and YEN). So basically, gold is rising in price, it is signalling inflation and monetary devaluation (despite PPTs efforts to the contrary), and yet everyone seems to only focus on the USD fall in PoG - which is just mirroring an artificial rise in USDX

Poor form. Ker is as entitled to his opinion as your are to yours.

No matter how right you may have been lately, throwing stones is

simply throwing stones.

ABB

I think cgnao's point is that short term thie moves are a lottery, and so charting is just a lot of lines

Longer term, the price direction is very much up, since all the CBs and govs are throwing unlimited amounts of new money at the global economic problems

If this is true then surely none of our predictions for Gold will ever happen as the powers that be will manipulate the life our of us.

 

In any case, I don't disagree that market manipulation may well be rife but doubt that forum manipulation is quite as popular.

Talking of manipulation - am I the only one that thinks todays PoG moves look kinda suspicious?

I am trying to get my head around this.

 

Interest rates are cut by 1.5%, with more cuts on the table, deflation scare is citied as the reason, yadda yadda

 

But we all know that inflation is on the cards.

 

Should I be adding to the gold stack today or waiting.

 

Surely gold paper price has to be seen to be deflating to keep up the show ?????? Maybe now is the time to hold cash for 3 - 4 months and await early 2009 purchases ??

 

What do you all think ?????

 

( As already stated, I am only adding to stack, insurance and 10% net wealth stuff already covered )

What they tell us (vs) the truth:

- "inflation currently a problem in early 2008" (vs) inflation (food, oil etc) is obviously a problem, so they can't deny it but do massage the figure to make CPI 4-5% rather than its true 10-14%

- "inflation will subside next year due to global slowdown" (vs) a slowdown will occur and they desperately *hope* that this will bring inflation down, but they must sound certain in their rhetoric so as to prevent high wage demands [if they were certain they'd have cut interest rate way before now]

- "inflation has now peaked, so we can afford to stimulate the economy with rate cuts" (vs) everyone has accepted a slowdown will occur and this plus their rhetoric has successfully taken commodities lower, but they know this is temporary and they're still very scared of inflation. Nevertheless, they dare no longer wait to try restimulating the economy, and so are trying to make up for lost time by this 1.5% rate cut

In short, a recession has always been unavoidable. The governments and CBs fully understand that this was most likely to involve severe stagflation (because of the excessive money supply of the the last 2 decades, and now the absolutely massive priniting of new money to bail out the banks, and also in new borrowing to stimulate the economy). So they've done all they can to spin the situation and keep inflation expectation low and deflation expectations high (e.g., by pretending asset price falls lead to deflationary pressures - which they do not!). Their true concerns on inflation, however, are revealed by their keeping interest rates so high for so very long. Now, however, they're pannicking (they're more concerned about severe recession than severe inflation) and so they'll be cutting down to 1% and throwing newly borrowed barrow loads of cash into the system.

Should you buy gold now or wait... your call!

http://www.moneyweek.com/investments/preci...n=Money+Morning

"...when the Fed inflates, the banking system does soon after. The Fed has never inflated in one month as much as it did in September. So the odds are against deflationists. Indeed, the money supply could grow 25-50% in less than a year if that liquidity isn't taken back."

"The financial crisis explained"

http://www.moneyweek.com/news-and-charts/e...Money%2BMorning

bigbigt - what vehicle are you using to buy oil?

 

SafeBetter

OILB - a GBP denominated oil ETF, backed by Shell (so safe) and the underlying asset (oil) actually belongs to the investor, so no counterparty risk.

I put one toe in at USD 101 (OILB £47), several toes more at USD 92 (OILB £42), and a big foot at USD 72 (OILB £33). I'm now only about 10% down on this overall investment, and plan to double up if oil falls to USD 50 anytime in the next 3-12 months (which is possible, though not very likely). I will hold for 5-10 years if necessary, and xepect to see oil hit several hundred dollars in that time frame (i.e., 3-4 fold return)

I've also got one toe in BP, at 470p, and plan to triple this investment if it get back into the 350p region in the next 3-12 months, which is quite possible I think

A prediction for October...

- 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.

- 50% chance of a bank holiday week

- dramatic emergency base rate cuts happen globally (BoE may even announce 0.5% today, 1 day earlier than expected)

- Sterling will fall further, reaching the 1.65 vs USD level I predicted for September. After this month, the dollar will tank.

- As I predicted, oil did not fall below 90 is Sept. But I think we'll see 75-80 this month, and over the next 6 months it may even touch 65-70 [and if so, load up!!!!!].

- 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%]

- 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)

5/7 predictions correct, with still one week to go.

For the other 2 predictions, the first was only given a 50% chance anyway (and we sure did come very close), whereas the other one will just have to wait for a while. But not that long I suspect

Anyone who bought before middle of 2005 is still up 100% (in Sterling). Anyone having bought before middle of 2007 should still be up some 30% (exception the peak in 2006). Anyone who has bought recently possibly needs to wait a couple of years in order to get a clearer picture. As Jim Sinclair said, volatility in gold will reach spiritual levels. I think we're still in the beginning of all this.

 

I can see no change in the fundamentals so far....

Hi G0ldfinger - I couldn't agree more.

I remain 25% up on my PM purchases, all in GBP. And with all this new money created to bail out the banks and soften the recession, and realising that far more yet still will be 'invested' (i.e. printed) by the govs, then there is no way gold and silver will be worth less in a few years time than they are now.

In fact, with stock markets now starting another big leg down (I estimate 20% further to fall in next several months) we might well get another phase of panick buying in gold very soon now.

I am so confident about all this that I'm barely checking the PoG recently, or checking into this bb (sorry all!). I'm certainly not loosing any sleep - and hope that others may take heart from the informed confidence shown by me, you, CGNAO, and several others. Furthermore, I even just topped up in oil, and still have some powder dry for to double my oil and silver purchases over the next 6 months as the slowdown reaches its peak.

A prediction for October...

- ...by months end DOW and FTSE will be no higher than today, and perhaps as low as (or will have touched) 950 and 400 respectively.

Wow - in my fearful post, it seems I was actually being optmistic

The other day I read a good post at goldismoney about how to hide stuff at home from burglars. It was a longish post which was an accumulation of research, some from conversations with an ex-burglar. I'll see if I can find the thread again and post it here.

 

Some main points which I remember: burglars want to get in and out quickly. He said on average they are in the premises for 8 minutes. So they want something of value quickly. So if they find something good in the more obvious places and suspect on the style of place that there's probably not much more to be found, they would likely be content and leave.

 

Failing that, they work through (and mess up) the less likely places. So split it and maybe leave a couple of hundred in a more obvious place (desk drawer or something, but not too openly obvious as these guys know what they're doing.)

 

I was thinking about posting about this the other day and regret that I did not.

Or just don't keep it at home

I did it ...I just accessed 2 months cash and hid it in an envelope somewhere safe.

Even my wife said (as I handed her the envelope) - "that might not be such a bad idea just now"

Better safe than sorry.

Momentum traders will now be getting on board this train, now that the bull trend has reasserted. That will be very positive for PoG

A prediction for October...

- dramatic emergency base rate cuts happen globally (BoE may even announce 0.5% today, 1 day earlier than expected)

Nailed that one

http://business.timesonline.co.uk/tol/busi...icle4906518.ece

And I hear this is, indeed, part of an globally coordinated 'race to the bottom' for interest rates due to the chaos in everyones' economies.

[EDIT: now even I might need to start posting rocket pictures!!!]

Thanks for your views, BigT.

Does anyone know of a good place to see the current oil price and oil price charts? (Apologies for polluting The Gold One with oil talk! )

Here's some free live charts, all in USD:

http://www.livecharts.co.uk/MarketCharts/crude.php

I'm still looking for some real or near-real time oil charts in Sterling. Anyone know of anything?

Thxs bigt. One wonders if anyone else would have asked

Nah.... they all know I'm full of $£%t

Some of us do ........

please ....

...oh alright then, since you said please

A prediction for October...

- 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) 950 and 400 respectively. These numbers are still 10-20% above the absolute bottoms that will be reached briefly during the next 6-12 months.

- 50% chance of a bank holiday week

- dramatic emergency base rate cuts happen globally (BoE may even announce 0.5% today, 1 day earlier than expected)

- Sterling will fall further, reaching the 1.65 vs USD level I predicted for September. After this month, the dollar will tank.

- As I predicted, oil did not fall below 90 is Sept. But I think we'll see 75-80 this month, and over the next 6 months it may even touch 65-70 [and if so, load up!!!!!].

- 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%]

- 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)

...and still awaiting some deliberate 'distraction' in Iran

EDIT: despite my general hatred of this current government leadership, I have to say that 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

I'll also stick my neck out with a prediction for this month...

- DOW and FTSE start to fall precipitously, such that they reach 10000 and 4500 by month end

- emergency base rate cuts happen or are signalled (BoE missed its chance today)

- commercial bank baleouts extended / increased

- Sterling will fall further, reaching 1.65 vs USD, with the fall only minimised by the fact the USDX will peak out and start to slide

- oil does not fall below 90 (and possibly not even or much below 100), and the fact that its refusing to go lower will become a palpable concern to economists/media

- inflation stats rise significantly

- all the above will cause a ramp up in fear, and gold will start to rally (6-8% up in USD, 10-15% in GBP, by months end)

[EDIT: and my bones even sense a black swan approaching ...Russia? major bank collapse? terrorist attack? high-profile Western assasination?] - bundle of fun aren't I

OK - in my post of one month ago I was out by 1 week

...who thought I was mad at the time?

You really don't want to know what I'm expecting for this current month

Very informative Buffet interview

http://www.charlierose.com/shows/2008/10/1...-warren-buffett

At 40'46'' he clearly feels we're setting ourselves up for big inflation problems

This isn't really the place to discuss this, but do you think OILB would be a good place to stick a few quid for the medium term (say, a couple of years or so)?

Hi - I'm not confortable to give 'advice', but would just refer you to my own actions and emphasise that

- I can afford to loose this money

- I am a value investor, not a short term speculator

- I expect to be buying more, bigger aliquots at lower prices (but bought some already in case it doesn't fall further)

- I have a time frame of 5-10 years, and hope to make 50-100% profit on my investment

Sorry but to me it sounds like wild speculation at this point. IMO a version of this may eventually come to fruition, but I sincerely doubt this level of commitment has been given by the alleged supporting countries, it smells of a conspiracy theory to me. Nevertheless, it was interesting to note he didn't mention the UK per se just Sterling, was it just an over sight?

I fully agree

Such earth shattering developments won't happen when still 1/3 of UK citizens haven't even changed their spending habits yet (BBC survey, today)

The real sh$t is only just starting to hit the fan, and its uncertain quite how bad it will or won't get. That said, today was one step further along the road to armageddon.

Exactly... and early this week if things go on as they are today. And while to my mind that's a sign of impending <reverb>Doom!</reverb>, I suspect the markets may see it as a sign of leadership, restoring a bit of confidence to markets and pulling gold/silver down.

 

Of course this may be a distraction. I can't help looking at the price of oil and thinking I should be forgetting PMs and putting every penny I've got into a crude ETF. It's got to be the medium term investment of a lifetime. Assuming PMs aren't. :-)

 

If only I was confident ETFs were as safe as a stash of wealth under my own supervision, under current circumstances.

 

Andrew McP

Indeed - don't miss your chance!

I put one aliquot of my funds into the 'OILB' oil ETF when brent crude was at USD 100, and a further two aliquots when it fell to 92 last Friday. I have retained a further 7 aliquots for further purchases if and when the price falls further. I will allocate 3 of these if price hits 80, and the last 4 if the price hits 70 (though I don't think it will, or if it does it will only be for a brief period)

And don't worry about the safety of this ETF: it is backed by Shell, and all the oil they buy with your invested money belongs to the investors ...whatever happens! (a very different situation to many of the derivative ETFs run by AIG)

From Jim Sinclair:

 

QUOTE

Dear Extend Family,

 

Unless the LIBOR rate drops sharply we are facing a planetary financial crisis next week.

 

For God's sake protect yourself....

Guys and Gals....

Its not the deflationary scare, its not the 700B bale out about to be passed, it's just plain old fear driving all the moves today

The extreme language and scare tactics being used by Paulson and Bernanke are creating a self-fulfilling prohecy: everyone has now got the idea of a global economic catastrophe in their head, and are starting to wonder if the 700B will be enough to save the day. Hence...

- oil falling as speculators withdraw into cash, and as world expects a slowdown

- stock markets tanked today as people rush to cash

- gold sold to service margin calls

- gold juniors being sold off as part of a massive exodus from risky small stocks

- people pulling their overseas investments back home into USD, so strengthening that currency (think of this as the death throws!)

The Paulson Plan was always a desperate and inflationary solution, but it had the advantage of being a proactive move and therefore psychologiaclly reassuring. But that one advantage has been lost by the delay and watering down of the bill (if it even passes).

Now the sh$t really begins

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