halcyon

Yes, we've covered that. I was critical of the Approximity mode, but was now quite taken aback to find such a strong correlation with US M2 vs world M2 (vs gold cap global). I think this is a worldwide phenomenon and gold cap (global) should be compared to worldwide M2 - looking at US only is too simplistic, and might only indicate if gold goes up in nominal USD (and not in most OECD currencies). But alas, Tudor shop stat is global and it agrees fairly well with the US only data. Wish they'd plotted the raw for each (M2 aggregate and gold) and not the ratio - that would have been even more indicative and one could have always done the ratio oneself. But yeah, evidence is piling up, even from non-gold bug (ie. non-nutter gold-expert) sources. Probably time to pile up some in a dip. I wash hoping for a bit longer USD rally than just these past days, but it looks like it might have ended.

Tudor's shop whole analysis is here at Scribd. Couple of graphs worth noting from the Tudor report: Inflation adjusted gold price - last peak $1600-$2400, depending on inflation metric Global mkt cap of gold / global M2 BTW, monetary base chart looks scary, but it is not the money supply until unleashed. Look at the money supply for clues. It's in there.

Heh, like I have said on numerous occasions, my position is NOT dichotomous. It's not either "GOLD, YEAH!! GIVE ME UNDERPANTS OF GOLD!" or "Excuse me, gold will never mount up to anything." I'm agnostic, but willing to overweight on either side, depending on situation and how things are developing. If it goes up, I try to ride it. If it goes down, I try to exit it. Just like ANY other asset. No special status given over the long term, but only in certain contexts. No 'once and future money' or any silly mythologies about it. Just a ticket with a price and market to resell it. That's my stance, I don't claim it's 100% true or best for everybody else or that I won't change my opinion in the future, if information changes. As for when to exit gold, there seem to be several camps about it (not exhaustive): 1) sound fiscal/monetary policy is reinstated (in most OECD countries), meaning: drawing back liquidity succesfully, hiking up rates, letting overlevered/over-indebted players go bankrupt, basing gdp growth on real economy growth and not funny money, deflating asset bubbles. I give this a fairly high probability to *start* in the next 2-5 years (it's a process, not an event). Not guaranteed and we can go in the opposite direction as well. 2) when gold-standard is re-instated. Personally I give this a very very very low probability, something in the order of 10E-3%. Also, if it happens, I think it might be through such a hardship (war, breakdown of nations, multi-decade chaos) that it might be the least of my problems. If this was to happen, I hope I'd still own some physical at the right moment, which I can then transfer to other more mundane property (like cultivated land, clean water source, forest, etc). 3) after gold as an asset/store-of-value/whatever hits the final mania phase and starts to go through the roof and it's relative price becomes so obnoxiously overpriced that all the seasoned investors start exiting. I.e. a pure relative-price based crash. 4) if a real economic growth starts in other investment classes that gives better risk adjusted annual returns - after correcting for inflation and costs. I cannot know what this could be, perhaps theoretically an OECD-wide Apollo-style green tech program to wean us off oil/goal/GHG and into renewables/electricity with very hefty tax breaks and other incentives (i.e. transfer of wealth from one place to another). Never underestimate the power of governments to make (distort) markets, if enough profit potential is cleverly attached. 5) something else I can't even dream of - i.e. a black swan. It just starts to drop precipitously and I have no idea of the reason at all. That's what worries me the most with any asset I own. Because I will be unprepared at least for a while. Personally I try to keep my eyes open to different contingencies. Hope I'll catch some of them before they unravel completely.

Considering the review was done at the Value investing congress in October, I assume it has to be one of these: * Julian Robertson, Tiger Management * Joel Greenblatt, Gotham Capital * Bill Ackman, Pershing Square, L.P. * David Einhorn, Greenlight Capital * Alexander Roepers, Atlantic Investment Management * Eric Sprott, Sprott Asset Management * Sean Dobson, Amherst Securities * Lloyd Khaner, Khaner Capital * David Nierenberg, The D3 Family Funds * Paul Isaac, Cadogan Management * Candace King Weir & Amelia F. Weir, Paradigm Capital Management * Jason A. Stock & William C. Waller, M3 Funds * Zeke Ashton, Centaur Capital Partners * Kian Ghazi, Hawkshaw Capital Management * Whitney Tilson & Glenn Tongue, T2 Partners My bet is David Einhorn of Greenlight. They have had a strong Gold ETF position, but have transferred that to physical gold due to efficiency. They also have largish (4%) position on Gold miners ETF. Einhorn's position on gold in his VIC 09 speech. In short, he believes gold is a good hedge against bad monetary/fiscal policies and will probably do well in future, esp. if there is a sovereign default. Better than holding cash - both at zero interest currently. If sound policies are reinstated, he will exit gold. He also has a twist on Robertson's CMS bond trick - buying higher yield options on JAP/US bonds. That may prove to be a very clever me and me thinks it should be copied

Julian Robertson suggests gold miners, who can thrive even on falling gold price. . BTW, he thinks gold bugs are nuts and that gold will not go through the roof. The is also an interesting longer term cycle paper on gold ore prices predicting a potential leg of 35% down (from c. early 9 price levels). There's also a recent paper about the performance of long term TA that argues little historical correlation on return over the long term. There's a bias I urge everybody to look up and internalize what it means to their own thinking.

Roubini on gold price on the short and interim term: Strong words from Roubini. He thinks the system (and sentiment?) is stabilized enough for now, so that gold price moves on the upside will be limited. Interesting.

Rolfe Winkler recommends caution about time of entry to Gold these days: http://blogs.reuters.com/rolfe-winkler/200...the-gold-trade/

I don't think anybody was gloomy about gold. Good wealth preservation move, but not a relatively good trade. Emerging markets are up more than 50%+ in the same time period (dollar adjusted). Duly noted. This is still a trading thread for gold though It's perhaps worth pondering that people have different aims (ie.g. preserve, grow), with different time horizons (6mo, 5yr, 25yr,etc.), and different tactics (e.g. concentrate vs spread the allocation, trade/sit-n-hold, bet vs hedge, etc). With that said... Back to actual gold trading discussion: http://www.futurespros.com/analysis/future...-analysis-10088 P.S. Talking about some sources analysis (pro or con) should not mean that one is aligned to that position or against it. It's about learning.

Thanks, great charts. Look like investing charts (5 year). Not trading. Perhaps they might deserve an even wider audience in the gold investing thread? I have no idea about EWI, I don't subscribe. I do entertain multiple hypothesis though. One of them - on a trading time frame - is that gold price may drop from a short-term resistance soon. If it does, it's a possible buy opportunity on the *trading* horizon. This is a trading thread after all. I don't try to *predict* the future and bet on it now. I try to anticipate what might happen, so I can take advantage of it if it happens. Trading, not investing.

I have no idea. Passing along the information. Regardless of EWI, I think it pays to look at the long term currency basket (sans dollar) price of Gold.

Fixed. Of course it has made new nominal highs in USD, but that matters very little to the argument EWI is trying to make.

More from EWI via Tradersnarrative: Quote: from Trader's narrative: Gold has not made sustained new real highs (only nominal in USD), dollar is making new lows. Watch for a breakout in the resistance line. However, if there's one, it's probably due to some news you're going to be aware of at any rate.

This one from BoA/ML (dated Oct 5th): They also note: 10y T-Note deeply-shorted (maybe too much already). 30yr T-bond getting there in shorts, not there yet. USD Index net short, not overly crowded. Yen net long, very crowded.

BINGO! We have a winner!

Romans, I agree. Won't go into details. Trying now to keep the thread tidy for my part. As for GF, don't agree and I have cited resources as to why. anybody interested can read them. I leave it at that. Now, for some gold trading signal related comments, from RGE Monitor: Gold Outlook - Demand for gold will likely wane after Diwali and if the dollar strengthens on bouts of risk aversion. - BNP: Gold is not expected to stay above the US$1,000/oz level in the coming months, given the likelihood that the U.S. dollar will rebound and headline inflation will stay weak. - # Merrill Lynch (not online): Short-term rates of 0% are bullish for gold, which serves as a store of value but is a useful hedge against deflation as well, since deflation is inherently destabilizing for financial assets. In the 2001-03 deflationary period, gold rose more than 30%, not to mention the prospect of a return to a dollar bear market. "Gold is inversely correlated to global short-term interest rates and there is a race right now towards 0%. Production is down 4.0% y/y while fiat currencies globally are being created at a double digit rate by the world's central banks....As for all the talk of a 'gold bubble,' it would take a nearly 625% surge in gold to over US$6,000/oz and a flat stock market to actually get the ratio of the two asset classes back to where it was three decades ago when bullion was in an unsustainable bubble phase." - Noncommercial net longs rose to an all-time high 239,668 lots in the week ending October 9 Commercial banks price ranges are hard to take seriously, just because their individual stock pickings and commodity recommendations are generally so off the mark. However, their supply/demand analysis is often - regardless of the previous - quite right. The situation looks mixed. Maybe a nominal gold-in-USD correction and then determination of the long term direction. BTW, for EW fans Prechter things USD is bottoming for now.