malvern hills

I'm sorry I don't understand or agree.Fiat is 'by decree',however no -one or government has decreed gold to be valuable .Every person on this planet knows gold to be valuable (even if hey don't know why) ,by reason of its nature , the effort required to win it from the earth and is multi millennial use as money which I'm sure has left a great psychological impact on our brains. You might disagree with the notion that it is valuable but most of the planet does not and that is unlikely to change ,although its worth in terms of fiat may ebb and flow. I don't think you can describe it as fiat ,a 'barbarous relic' maybe. You might also consider that true fiat has no limit to its quantity and a present we cannot produce gold.

Please for the dumb among us ie. me ,could you explain this? Bernanke 'threatens' to monetize the bonds and announced to do so today-why is this threatening to anyone? Is it because doing so will signal the end game of bond price collapse?

QUOTE (malvern hills @ Mar 5 2009, 05:56 PM) * ... I suppose what i'm asking is why do you believe that the idiots in charge will definitely fail? ... oxymorons

Thank you-RH ,Az and Cg RH -50% of long term savings are in pm and I would like to increase to 80% and keep the rest in mining stocks Az-when you put it that way there is only one way to go. Cg- I'm not trying to do ta ,I'm just trying to get and hold with the most bang for my buck.I hold your comments with high regard ,as you have been the most consistent poster ever since my HPC lurking days of 2006 however I just wish I could see where your strongly held conviction comes from.I suppose what i'm asking is why do you believe that the idiots in charge will definitely fail? It's hard keeping your kids inheritance safe in these times and anything which helps makes the decisions is gladly received.

To the more learned among us- I need advise/views What's the consensus with regards to this leg down? Am already holding pm's but would like to load up. From what I can gather au should correct down to $850 ,some say to low $800's by mid year.However with qe beginning now might the low be restricted to just above the rising ma's ie. between here and $870's? Any views appreciated

I think you are right to say that putting 10% of net into physical gold would be a good way to go-If nothing else you can give it to the kids-however talk of 'going all in' just doesn't sound right with respect to investment decisions.I am going to average in over the next 6 months-lets see what happens after the election.

Roman -I am relatively new to all these issues,but it seems to me that while I can intellectually agree with the reasons Faber gives for an ensuing inflationary period it does not follow that it will come to pass-for example I believe (but I may be wrong)that none of the commentators we look to, called this deflation scare (except Shedlock) and the subsequent gold decline. In particular I am coming to the following conclusion.The question I think to ask is what would make the market devalue the dollar, if all that has happened so far(B Stearns,indymac,credit ratings lowered for bond insurers ,F+F etc,etc) has not done so(although its still early days) Leaving manipulation and black swans aside,which we obviously cannot anticipate and position for, I think that the only reasonable answer is that ,for the dollar to devalue the markets must judge that all other currencies or assets are relatively overvalued or lower risk. In a global depression where do you park money such that these conditions are met? I'm not sure, and these are just my thoughts.Any one with more brain power/economic savvy please tear to shreds/comment as appropriate.

What are the reasons given by Faber for the inflation-or link to what he said?

I think exact intra-day high was 1032 sorry but could you spell out the above?

I think springer is talking about buyers of gold above £2000 at one time or more than £10000 from the same supplier in one fin year-hope this helps to clarify-don't know answer to question though sorry