romans holiday

Couldn't have been a very quick get away!

Peter Schiff getting more air-time these days and not having to yell over others. With a political twist. http://www.cnbc.com/id/15840232?video=916889554&play=1

Yes, I think Petrov makes a crucial point that we should focus on the relative ratio between the DOW and gold [elsewhere he refers to HOCG, high order capital goods and LOCG, low order capital goods] and NOT prices. Rising and falling prices can be extremely confusing and represent nothing real in the sense that they are arbitrary and relative to the value of other things. Fiat money 101 teaches well that it is difficult for prices to reflect true value especially in turbulent times. The DOW/gold ratio on the other hand is very clear and gives a better long range signal than the day to day noise we get from dollar prices. Of course, this all very well in theory but in practice it takes the breaking of a life-time's habit which tends to be money centric.

Or a currency collapse. I am betting the dollar wil buckle as the Fed gets increasingly desperate and pushes dollar debt to unsustainable levels. China, Russia and the Petro-states will lose the faith. Bye bye dollar. But as you suggest JT it may take a while. I am in no hurry. I remember getting anxious a while back worried that POG might take off and leave me behind. Now, feeling a lot more comfortable. Always look on the bright ..... http://kr.youtube.com/watch?v=jHPOzQzk9Qo&...feature=related Edit: Keep in mind a strong US dollar is a further nail in the coffin of the US economy; it will kill exports. I see a strong dollar as being unsustainable and a purely temporary phenomenon... like the Titanic... straight up in the air before sinking... though it may stay up a while.

Yeah, I reckon he follows the market too closely. Also, no point in trying to be too clever. No telling what the madhouse market is going to do next week... though we have a good idea what it will be constrained to do in the end once reason prevails. Best to keep diversified. And that calls for more than a pitiful 10% in PMs IMO.

The only thing that bothers me about POG falling at the moment is the thought that I could have bought more if I had waited. But then I remind myself that I am not omniscient and will never be able to see all the bumps in the road ahead. If a mini black swan shortly comes flying my way I will be able to sell a few ounces and buy again on the dip. Not that I would sell much mind. With another sell off in the DOW this month we may see some strength go into POG. Yet, this liquidation phase, which I do not think is over by a long shot, will also keep POG relatively weak.

Forget the furniture... sell the house... fully furnished!

I think we might see POG go through $700 this month. More deleveraging and liquidation across the board with the dollar index back up towards 90. I wonder what the next black swan event will be that will see gold spike to $900.

Latest news on CNN: gun sales up 10%. Fed is not omniscient or omnipotent so we will get a good bout of deflation. Govt is not ominscient or omnipotent so there is only so much they can do before it also deflates. Bring it on.

Speaking of deflation... seems a lot of gold bulls are feeling a bit deflated these days. Have just been reading round a few gold forums and the general atmosphere is frankly depressed. I speculate that we are in for a good bout of deflation for a decent period of time. Gold may spike at times leading to false hopes only to slump again afterwards. Repeat this so many times and even the most fervent gold bull will get worn out. The very real possibility/likelihood remains for high/chronic inflation with currency devaluation which could indeed lead to hyper-inflation. Also, the reflationary efforts of the Fed may find traction with new money looking for a new home in commodities and all manner of things. Yet, many are also arguing that Fed efforts are merely pushing on a string... a trillion dollars here.. a trillion dollars there... are no match for the trillions upon trillions of dollars which were created in all sorts of exotic instruments which are slowly deflating... with massive amounts of money slowly being destroyed. My strategy: hedge, hedge and hedge. I will remain hedged in my opinions. I feel i am relatively cognizant of both the arguments for inflation and deflation. They both make sense and I have never thought them to be mutually exclusive propostions. I recognize the claims of both by keeping a time line in mind. The idea here is we could have an extended period of deflation followed by inflation sparked of by some currency crisis due to increasingly massive US debt levels. Yet, I also remain hedged in my opinions insofar that the world of economics is likely to continually surprise me and that I may not know what I am talking about. For example, who saw this period of dollar strength even though we can explain it in hindsight? I will remain hedged in my holdings. I plan to keep 50% in PMs [both silver and gold] and 50% in cash... [preferably a couple of currencies] with the possibilityof buying good dividend yielding stocks in the commodity field once they have completely bottomed out [i think it is likely we will see a resurgent Asia in the near future]. If we see spikes in POG, I will sell 25% of my gold with the aim of buying again on the slump. I think we live in an interesting time where we will no doubt see a lot of hardship... yet i think we will also see a lot of opportunity. Good luck.

In the short/medium term I see a similiar scenario unfolding. Market psychology is the prime mover short term and deflationary psychology is firmly in the driving seat here. Yet I can see things playing out quite differently in the medium/long term. The actions of an increasingly desperate Fed [and CBs all working in conjunction] may lead to a “breaking” of the currencies. When to buy/sell will all be about timing. Prices may be pushed low in the short/medium term creating good opportunities to buy. However when the currency breaks in the medium/long term it will not matter what price gold will become but rather how much gold you already have. I plan to trade on the ocassional spike/dip with 25% of my holding in the short term. Up to 25% because I already have most of my worth in gold. Only 25% because my fundamental instinct to hold gold always trumps my speculations on where its price may go. Edit: In an effort to combine the short term with the long term into one theory, I coined the phrase hyper-"deflation" a few months back. http://www.greenenergyinvestors.com/index....t=0&start=0

Also, some investors are no doubt starting to think about the fundamentals of the economy... what earnings for the next few quarters might be... With a recession, why buy equities... better to park some money in metal.

Sorry... only got a few thoughts... which I hope are down to earth.

POG... good as gold.. going through 750 and 760... holding up pretty well in this environment IMO. Edit: Feels like the environment could change quickly. Wonder when.. and wonder what will spark it off. Post election there may be a mood swing... then tarp money could break out into the economy.... it is not hard to imagine the pendulum swinging back quickly to an inflationary scare. Then again we may just be in for an extended period of deflation punctuated at times by false hopes. How long for the tweedle dee and tweedle dum market to exhaust the players before they finally capitulate to PMs?

This statement is just plain odd. The standard explanation for the fall in POG has been as follows; Repatriation of capital to the states and massive liquidation of assets, by leveraged hedge funds and other institutions, has led to a spike/rally on the US dollar. Many "goldbugs" see this as a purely temporary phenomena within a larger macro-economic view; that either the dollar will depreciate or inflation will kick in at a later stage. Also, you seem fixated on the price of gold in US dollars. Most people on this forum have used different currencies to buy gold and are still sitting rather nicely given the unwinding of many asset prices at the moment. I bought gold with the Korean Won and the NZ dollar which are both absolutely tanking against the Yen and US dollar at the moment. Just as well I bought gold a.

I saw it a while back. Poor Nassim looked just about ready to pull his hair out with the fact that they didn't get how potentially dire it all was.

Yep, was my first buy of silver. Plan to average in over the next few months. Also, I am tempted to swap a few gold coins for platinum ones soon.

Bought 8 k of silver today. Aussie down 5 cents today. Dow could go through 8000 tonight. Oil continuing to tank. Is the world shutting up shop?

Like the world shutting up shop for a year?

EVERYTHING tanking against YEN and US dollar. Scary looking.

Not the 8 k's I just bought.

I am keeping my eye on platinum at the mo. Need to diversify out of gold and silver. Would love to pick up a coin or two.... but in no hurry... this deflationary period could continue for a while. Will consider swapping a few gold coins for platinum when/if they get to the same price.

Greenspan speaks... gold and silver up. Couple of heavyweights here on CNBC, Schiff and Rick Santelli. http://www.cnbc.com/id/15840232?video=901271420&play=1

Yes, this a significant point. Most of us buy in other currencies so POG in a US dollar on steroids can be a distraction. Wonder when the heart attack will come.

Yes, I was thinking we may be in for quite a time horizon here... but then again, the macro situation seems so much more dire than the seventies. I could see things coming to a head next year.