romans holiday

It sure makes sense to put everything in context, and it sounds like this trade in gold has suited your purpose well in payig down debt. That has to be one of the highest priorites. I guess my point is [and here I go again] is that building a solid core position in gold has to be another priority for investors. Gold bugs tend to have 100% in gold [or silver]... with one foot in the gold bug camp [and the other in deflation] I have 50% of my worth in gold. I get the impression that the percentage you have in gold is quite a bit lower, even though you've been quite focussed on gold and desirous to buy. Perhaps I'm mistaken. Do you have any target on what that core percentage, at this stage of the game, should ideally be?. Or would you agree with the money managers that 5% is fine? Or is it more a case of waiting for a possible deleveraging in gold where you would pile in with most of your reserves? Or has a more deflationary outlook put you off gold? What seems an "anomaly" with non-confirmation in commodities and stocks, could actually be confirming gold's status as a currency. This has been discussed in other gold threads.

Yes, but at what point are you hoping to buy back in? And are you not concerned at all that that price might be a higher one, at 1260 which would wipe out your profits..... or even higher where you would be buying back in at a loss? I'm also looking at large profits in gold, but do not want to sell as would be concerned about "losing my position". The risk/ reward of the trade just doesn't look worth it. Besides measuring wealth, how do we measure profits? I mean, what currency do you take profits in? Have you "enhanced your position" by swapping gold for a currency. Maybe it would enhance your position to sell gold to pay down debt... but even this is arguable. Due to viewing gold as a strengthening currency, I find it problematic to take profits in other currencies which may be weakening... even the US dollar. Given these concerns about trading gold, I only accumulate it. As for the volatile queen of silver.... I'm not concerned at all about trading her against dollar. Could it be that the very measure of wealth you're looking for, is what you've just sold.

Wow, you got the exact top. Gold now at 1237. When will you buy back in? Will you report your buying in "real time".... at the time your decision/ trade is made? I'd be interested in seeing what kind of profit in gold terms you could make. I mean, first you have to time the selling right, which lets face it, is a 50% chance of getting it right... then the buying needs to be timed right again, another 50% chance of getting it right. So all up one chance in four of a successful trade. Odds look stacked against you here... unless you are just taking temporal profits in another currency of course.

Nice little slide show here on gold reserves: http://www.cnbc.com/id/33242464?slide=1 Only 20% of the world's gold in CBs.

Sadly, I don't have an attic.... living a transitory existence for now. But you're right... I was amazed at how small a kilo bar is.... size of a chocolate bar.

Wow... then that does start to make sense. The US holding is massive compared to the Saudi's... even though the Saudi holding is the 4th largest [i suspect I misheard this]. A ton of gold? Have to find somewhere to park it first. Italy 2,700 tons Edit

Here's a question.... how much is a tonne of gold worth in current terms? apparently the total gold market is only around 500 billion, according to Meredith Whitney.... Correct me if I'm wrong... in a metric tonne you have a 1000 kilos. 30 ounces in a kilo... 30,000 times 1250 = USD 37,500,000 Apparently the Saudis have the fourth largest holding now: 350 tonnes at 37,500,000 = 13,125,000,000 13/ 14 billion dollars worth.... out of a market of 500 billion odd. You'd expect the 4th largest holding to be bigger than that.....

What amazes me is that they 'fessed up to having 350 odd tonnes... double the previously stated 120 odd. How do they manage to acquire so much gold on the quiet? And then it makes you wonder how much other CBs are quietly accumulating.

Perhaps preferences won't come into it, and practicalities will rule the day. A return to gold could see it become the [politically instituted... desperate measures/ desperate times] super-currency to which modern existing currencies will once again become representations at the appropriate level. Coins/ bars of gold wouldn't be currencies but denominations of gold which you could happily sell for paper if you so wished.

Yes, those various things may have functioned at the same time as money [inefficient/ self-sufficient barter]. But for efficient markets to emerge... and the division of labour, a currency needs to be established so the value of stuff can be standardized... Perhaps you prefer the noble savage ideal to civilization?

Well, I think the idea of money is fundamentally grounded in human nature/ culture... as opposed to just nature [obviously, all value is anthropocentric, so too monetary value]. That said, I reject the slide into relativism where anything is as good as anything else as money [or should I say currency]. I think the classic functional definitions of money hold up pretty well. But I would emphasis the role of culture here. For example, the Incas were surrounded by gold yet never thought of it as money and never developed a monetary culture. There needs to be first some cultural development [hence the reference to German idealism], from which a need for money emerges. Historically, gold has satisfied that need at the practical, and social, level providing the bedrock for economic development. Due to the functional and social nature of money, our modern currencies [essentially gold derivatives] can continue their momentum for some time.... edit

The real stuff is used as money [anything can be used in barter]. Money itself is an idea. For stuff which is used as money to become a currency [which leads to efficient markets] then social/ political organisation is involved. Currencies are social institutions. German idealism is superior to Anglo-saxon realism in these matters. I'd add that the real/ ideal distinction is a bit of a false dichotomy promulgated by realism.

Friday nite fireworks.

Didn't the French issue their Assignats against land [confiscated Church land?]? I believe it turned into another disaster. So I doubt that will work. Maybe it has something to do with the nature of money... it's basis is not real but ideal, and thus all things such as land, oil etc will be a poor substitute. In my mind, gold is the strongest symbol of money [and money being an idea] and therefore will work best.

But are we seeing this? If we were, the price would be massively bid upwards with no-one selling, and many more wanting to buy. As it is, there seems plenty of supply as well as demand, and for now the gold price looks to have found a relatively stable point. If the price did one day explode upwards in a parabolic rise, this would represent capital flight from assets and currencies into gold. Don't you think that governments would have no choice but to cap the price/ fix the currencies/ introduce a standard? Their hand would be forced by the market.... and gold.

The price of gold is infinite = gold can not be priced = currencies have failed. Before this happens gold will be pricing currencies.... gold + government = gold standard. And before you object, it is what is, and what will be that counts.... not what you think ought to be.

Insofar as the market price of gold concerns us, it is quite significant that the gold price is stable/ to the upside when the fickle market swings between risk and risk aversion. imo this goes to show gold consolidating as a prime form of liquidity..... or its [informal] monetization.

Dollar down, and gold up. Gold just seems to be wanting to stay up no matter whether risk is on or off. Looks about to go north of 1250.

You mean those that are thinking of going Sterling Gold long here right? Those that are already long don't have a lot to be cautious about, do they?

Thanks Steve, very interesting. I've just started a 10 week holiday... so will have plenty of time to look into that site.

Stocks up. Euro up. Dollar and gold down. How's that for correlation. Bernanke the master manipulator back at it again: Gold drops on steadier markets, Bernanke comments http://www.reuters.com/article/ousivMolt/i...E64R5OH20100609

I'll see your "you shouldn't trade gold".... and raise it with "you should therefore trade silver".

funny how people see different things.... maybe all observations are "theory-laden", which essentially determines how we interpret things. Anyway, if silver is your investment vehicle of choice, good luck to you [sincerely... I do think it will break out at some point]. For me, gold is my investment of choice.... leaving me free to trade silver in the short/ medium term. So it's the latter rounding movement in that chart that I'm focusing on. Diff'rent strokes for different folks.

Silver looks to be rolling over here with lower highs and lower lows. All it would take is for gold to sell off below 1200 a little, and silver could dip to 15 once again.