romans holiday

"This article first appeared in two parts in Investment Insights for August and September 1984."

How about a triangle instead? http://www.financialsense.com/editorials/m.../2009/0508.html

Well, that has to be progress! The old program "Upstairs, Downstairs" comes to mind though I was a bit young to remember much of it.

It depends on how much you trust the currency. My brother-in-law bought gold at NZ$2000 and then the price went down to $1500 not because gold fell but because the currency first fell against the dollar [$2000 gold] then came back again [$1500 gold]. It would not take much for the NZ dollar to fall again and gold priced in NZ dollars would again shoot through $2000. How much do you trust another "periphery" currency the pound? It is at the mercy of the fx market. It may be that only the US dollar and Yen will do well in this deflation and even then they may weaken at the end.

Yep, read signature. Not a very good theory if it played out that way... hyper-inflation that is.

James Turk calling for XAU to go up first, then silver to $15, before gold goes through $1000. 14 minutes in. http://www.radio.goldseek.com/players/turk...etpagejuly8.php

More like "property snakes and ladders"

The mass of investors might be "bi-polar". But surely this only refers to the confused perceptions of investors. The question remains about reality. Is deflation or inflation taking hold in the real economy? And accordingly which will eventually win out in the minds of investors? Perceptions eventually conform to reality. I agree. The date by Larry P is interesting. I think we could see another inflation scare soonish. Perhaps there is not much legs in the present deflation swing and it would not take a lot for the previous inflation scare to re-ignite. Prechter and others are also looking for a further swing to the upside before we get a real deflation scare after the summer.

The fact that so many are calling for hyper-inflation, financial gurus and the mass media alike, makes the market susceptible to an inflation scare in the near future. Whereas psychology, perceptions and ideology will drive inflation scares, reality will drive the countering deflation scares.

They are all hyper-inflationists. How long will it take before the theory of hyper-inflation is considered falsified/discredited? We should be buying gold/silver as a currency not a commodity/ [hyper] inflation hedge.

Good point. Which is also saying not many here are too concerned about the short term moves in gold/silver.

http://news.goldseek.com/RickAckerman/1246943106.php Rick is always a good read. I have a large bonus coming through in near 2 weeks... am hoping to buy at around $12 [now $13]. Then that might be it for a while as feel I will have a decent enough position by then. Will then save income in dollars and only buy further bullion if/when it scraps the bottom. Still waiting for the ratio to reverse. Come on Bernanke... buy some more treasuries!...... but not just yet.

Sssshhhhh....

And what will there be without government? A peaceful paradise?

Good stuff! Like the historical approach. btw what happened to the third function of money, that of a measure of value? I notice this function is being neglected these days by a lot of commentators and wonder why that is. Also stated was "Golds only use is money as a means to store wealth". Don't you think that the value that has been put on gold by humanity has transcended a mere monetary one? It has often been considered by many cultures as a symbol of power, wealth and status and has accordingly been used to much effect in the political, religious and artistic spheres. Kublai Khan, for example, kept all the kingdom's gold in-house and issued paper currency to be used as mere money. This also provides an insight as to the reason why gold did not flow back to the west from the orient when used for trading. The earlier rational economists thought this could not happen and that trade imbalances would be restored when those nations with much gold would spend freely while those with little would tighten their belts. The false assumption was that all nations would consider gold mere money.... and not as more than a mere means to another end.... which money is. I wonder if it is a peculiarly western and modern idea that "gold is money". Of course, the "primordial" value [as mentioned above] that was placed on gold has also made it the strongest symbol of money and possibly the best currency. Perhaps a perfect currency does not exist. I would hazard a guess the modernity of the west, in the tradition of the frenchified philosophy of Rousseau, is uncomfortable with the idea of power... having polarized it to freedom. Yet, gold is powerful and has a power over our minds. I woud also add the observation of an ancient Greek; "Gold is tried with a touchstone, and men by gold". Just some thoughts. Edit: gold bugs seem to lean towards the orient rather than the occident in regard to gold.

Gold staying strong. Investors are being motivated by more than inflationary concerns here.

Gold looks like it wants to bump along at around 920 here. Will be interesting to see how low it can go. I think a lot will be lining up to buy around 900 which should put a solid floor under it.

How is this for a housing idea. Say economies first go japanese with deflation across the board. Buy a property [once prices have deflated of course in a couple of years] with only a 50% deposit and keep a reserve. A slightly speculative option with the rationale being that if things did develop later into a high inflationary environment, the mortgage would potentially/ theoretically be easily paid. If things played out differently and the mortgage did become a real burden, whatever the environment, whether inflationary or deflationary, you would have the further option to use your reserve capital to pay the 50% mortgage off if you so wished.

Not sure about the parabolic bit, but it seems perfectly sensible to me that house prices could half while gold doubles in the next few years. Due primarily to credit contraction replacing credit expansion [we have already seen inflation; credit is most definitely a monetary phenomenon]. Reflationary policies to counteract deflation in asset prices will only serve to weaken the currency... a depreciated currency will be the cause of rising gold prices not inflation. Gold remains comfortably above 900 because in the eyes of the biggest and savviest investors, post QE, it has been monetized.

Just bought some. Have a large bonus coming through soon... so if it goes a little lower that is fine. I am not too concerned about buying here [though I doubt it will go too much lower and always best to buy on the dip] as intend to stop buying metal shortly and build up a dollar reserve.

Don’t Be Fooled By Gold’s Tired Look By: Rick Ackerman http://news.goldseek.com/RickAckerman/1246428000.php I like Rick, another gold-buying deflationist.

http://www.greenenergyinvestors.com/index....ost&p=92510

http://www.moneyweek.com/investments/why-i...llar-14924.aspx Just read the article you were referring to [above]. I think too much is being made of the previous spike in gold and the supposed present down trend as measured by the pound. Gold did not first spike so much against the pound as the pound first weakened against gold... and then bounced back to its former strength. This happened concurrently in many other currencies. I remember finally convincing my brother in law to buy gold with kiwi dollars. Unfortunately, he bought when the kiwi was at 50 [against the US, now it has bounced back to 65]. He bought for $2000 an ounce and now it is at around $1500 an ounce.... oh well, he is wealthy without debt and it is his "insurance". My point is that the spike and subsequent decline should be considered a currency anomaly that was caused by the period of forced liquidation [though we could see another such "anomaly" if we see the safety trade again]. There is no trend down, rather the anomaly has returned to normal. Such volatile currencies can not provide a proper frame of reference. It is best perhaps to look at the dollar price of gold if you are looking for a trend. And then it would be best to buy dollars now [agree with CC here] if you are planning to buy gold in the future on a dip. Swapping some pounds for dollars looks like a good trade to me. Looking at the dollar price of gold, I think many are being far too bearish here. Gold is performing well and has been above 900 for quite a period of time. Notice the 200mda is moving up. imo QE and currency concerns have put a floor under it at around 900. That said, I do not think we will see it break above 1000 for some time yet and will rather see it remain relatively stable and tracking sideways between 900 and 1000. imo the best policy is to accumulate a good position in gold and consider it a currency. Though we might see no fireworks this year, at some time it could well go parabolic as the dollar finally weakens. This would be the catalyst to set off a self-reinforcing parabolic process where investors may rush into gold in the attempt to preserve capital. Personally, if I did not have a solid position already built, I would be buying gold now. As I do already have a good position, I feel I can afford to wait in dollars for now just in case a bargain buy comes along.

Yeah, and I will probably buy again in the next 15 minutes.

Bought a little here. Rationale being I will not be wanting to buy silver after the summer as will have built a decent enough position by then. After summer, I will instead get some decent dollars together. On the off-chance that the silver price does tank at a later date - possibly on some general liquidation in the markets - I guess I will then just have to "reluctantly" buy at super bargain prices. I consider silver my Queen with gold the King piece and various other currencies the other main pieces. I am convinced that the main action will be in the fx markets. Stocks and commodities - if I get involved - would only be speculative pawn moves as the game is all about trying to preserve capital while it is being destroyed.