Jake

Yes you have! By suggesting there are other gold bull websites, you are asking people to leave if that is their investment profile. You want gold to be primarily discussed within your paper boundaries, limiting the spectrum of debate is stifling. The problem is, your gold investment strategy will not stand the test of time when this all comes crashing down. This has been pointed out to you many times and so far I haven't heard a good explanation as to why you think you'll end up with all the paper profits you think you've earned. Your strategy depends on a system that is hanging by a string. If you want to further discussion and provide a balanced and constructive debate, perhaps you could explain why the system won't collapse, why you think you won't be presented by a MF Global style HTTP 404 error in your trading account and that when/if you can extract your profit from a failing/failed bank, that it won't have been debased in to oblivion. Whilst nothing is risk free, that is the argument for buying physical gold and holding it, there is no counter party risk. Being content with the continuous rise in the price of metal given current negative real interest rates, is a sound investment choice for those that don't have 8 hours a day to dedicate to this. If you can answer this critical point, the discussion will move forward.

 

 

A most excellent post, IMHO.

Latest from Detlev Schlichter -

 

I guess LTRO is to our time what LSD was in the 1960s. As they used to say back then, “I don’t have a problem with drugs, I have a problem with reality.”

Silver – Is the Party Over?

 

Mar 01, 2012 - 06:03 AM

 

A couple of weeks ago, we compared the Bull market of Silver to the Nasdaq Bubble…

We wrote that Silver could go as high as $38, but that that might be an inflection point.

Silver reached a high of $37.22 last night and $37.62 today, and has thus reached its goal.

 

http://www.marketoracle.co.uk/Article33377.html

If the pattern doesn’t hold, and silver blasts through $40, it’s probably on it’s way to the all-time high. In that case, the next big move would be to the upside, with potential targets of $70 and potentially triple digit silver prices.

As long as the pattern holds, I would be careful if silver hits $38.

Well, so far, the pattern holds.

At the moment, Silver is falling 5%, adding more weight to the Nasdaq comparison, even though many people will blame me for not looking at fundamentals. I do not write this post to trash silver. I like Silver. I like Gold. But I also like my own analyses and comparisons.

Do your own Due Diligence.

WTF just happened? Gold down 61 dollars

Iran to accept payments in gold. Potentially very significant.

 

http://www.reuters.com/article/2012/02/29/us-iran-oil-payment-idUSTRE81S0GU20120229

Bahmani was quoted as saying. "If a country should so choose, it can pay in gold and we would accept that without any reservation."

Obviously not a Buffett follower. Imagine if gold for oil really caught on with other producers...

Nick Barisheff's book, 'Gold 10,000' is out soon. And he had a couple of podcasts on FS with Jim Puplava.

I think a lot of reasonably minded people think official CPI is a load of....

So what we are saying is that gold will appreciate with respect to houses and fiat, and that houses will depreciate relative to fiat, such that we get a nominal fall. Therefore houses will do the worst of the three.

 

Exactly right. And the currency will be printed and printed (325bill?) and thus the currency is depreciated/weakened so in real terms (esp Gold terms) house prices will fall. Gold goes up say 30%, house prices fall 30% provided you own/have bought gold. That is what the graph is telling you since 2000.

I hate the thought of having to pay a 'luxury ' tax to buy silver, and paying CGT, fuggetaboutit.

 

I've bought my physical abroad and kept it in a bank safe. I'm also not into the buying of small denominations for barter etc. It ain't gonna happen, so why pay an extra?

How do you know 'it ain't gonna happen'?

''When they fail because they are essentially credit money systems then credit must fail too. It almost did in 2008. When credit fails the economy ceases to function. What that means is that food doesn’t get delivered to grocery stores; petrol isn’t transported to the gas stations;

even water and natural gas are cut off by the companies responsible for their delivery; the banking system collapses; governments cease to function and anarchy prevails.'' Sound like fun?

Ian Gordon-Longwave.

I understand with your feelings towards VAT and CGT on silver though. However if you foresee, for eg, Alf Fields' target of 158 (USD) for silver, then what's a little tax now on a bit of silver?

Buy in lots of 100.

Thats only 27k or so.

 

 

While inflation does not reduce gold's real value, it has no yield or income flow and the precious metal has given a far lower long-term return than equities.

 

 

..and no counter party risk, either

No yield or income flow...far lower long term return than equities. But since 2000 gold has gone from 250 odd to 1750 odd.

I wish to have a few other investments like that. And equities since 2000 have done fairly [.....]

http://www.moneyweek.com/investments/property/uk/money-morning-dominic-frisby-buying-property-20600

 

I'd be inclined to give it one more rental contract chance. Gold has come off her highs and London property has gone ape. Is this an early April fools from Dom? And does it mean there'll be no more 'Houses in gold' articles? If Dom really believes that average house prices will fall to 50-100oz/house, I have trouble seeing the logic of the sums. Mind you I dont suppose he is going to use too much gold as a deposit.

This is worth a read ...

 

How the PM blogosphere behaves like a cult

 

I first started seriously browsing the PM blog sites at the end of 2010. I'd traded for years (stocks mostly), but was a relative newcomer to the world of investing in gold and silver. I was struck by the huge amount of apparently helpful online advice, charts, and discussion, all dedicated to gold and silver. I'd never had such a resource to draw from when trading the FTSE, so I became something of an avid reader of these sites. A whole new world was opened up to me: one of Turds and talking bears and Keisers and KWNs and Zero Hedges; not to mention Harvey's Organ [sic] and too many others to name.

 

http://screwtapefiles.blogspot.com/2012/02/how-pm-blogosphere-behaves-like-cult.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+ScrewtapeFiles+%28Screwtape+files%29

Some good comments by 'swampfox' there.

The writer coming late to the party 'at the end of 2010' will have run into loads of people devoted to the 'cult' but not half as so many that are unaware they are living in the cult of another sort: fiat money. Maybe 'ignorance is bliss', for a long while, at least.

Look how gold was treated on HPC (banned) and to a lesser extent on GEI recently (B&H are losers compared to my strategy etc). Any polarising group will attract the extremes but the original message remains the same and reflects best the situation we are in.

I can't properly download the latest FSN shows. They always stop downloading after a few MB. Anyone the same problem?

This happens with me now and again but only when I am using wifi ipod in the garden. After 2 or 3 re-starts the show runs ok. It is very annoying when a show cuts out and the paranoia kicks in but I think it is just a technical glitch. nb this only happens on recently added interviews-maybe it takes a bit of time to get through the 'airwaves'?

ps. Like to put a rough guesstimate date on the G:S ratio forecast? 1yr/3yr/5yr?? Thanks GF.

 

Baring a serious crisis, like Van mentions, I would be wary of hoping for an overshoot to the previous low.

http://theautomaticearth.blogspot.com/2012/01/january-16-2012-quo-vadis-britannia.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+blogspot%2FlRTBR+%28The+Automatic+Earth%29

''Still, what makes it striking is the sheer number of people affected. One million people need emergency loans to keep their families in their homes, while six million households have nothing whatsoever saved for a rainy day.

If we put the average household size at 2.5 people, that means that, out of 60 million living in Britain, 2.5 million are on the verge of losing their homes, and 15 million, or 25% of the population, risk having to cut on their basic needs, food and heating, if they hit even the slightest speedbump.

And what are the chances this situation will improve any time soon? It doesn't look good; in fact it looks set to worsen. While there's no lack of denial, an increasing number of voices admit that the British economy has already slipped back into recession.''

Jake, I don't think you get my idea...

 

The sort of place we are looking for is not one you can just "buy your way into."

 

It would be a place where we can make a contribution to improve the life of those in the community. And find a place like that where we can contribute, and which also meets our other major requirements is not an trivial challenge.

 

Whether the tsunamis come or not, the move must make sense. I don't want to feel like I am betting on a tsunami. I want to live in a place that we are drawn to for other reason.

 

We will not be running away if we leave HK. We will be running to (a new destination.) In fact, one thing we are exploring now, is whether we can contribute to building the sort of community we seek where we are, here in HK.

 

The first step in that process is seeking to join or develop a community of like-miden individuals. We will begin the first steps in testing this community building this weekend.

 

I want to encourage others here to think the same way. Look for ways to invest in the community of people arouind you. In the long run, that may be a far better investment than plowing your money into B&H Gold investments. And, sure, time is money. So much of your investment might be time, rather than money.

Sorry, I had no idea you were in the process of building community-in HK or elsewhere. I agree with you re better investments than B&H btw. Believe me I have spent much of the NY doing just that in many practical ways and it takes time and perserverance.

I wasn't looking for a fight.

Surely, that is not the point.

I am a professional investor, and BBH is only a small part* of what I do.

My point is about whether it is possible to Beat B&H consistently. Over many months, I have demonstrated that it is possible.

 

If what you are saying is: "It isn't easy to beat B&H. It requires time, discipline, and dedication."

Then, I would say that I agree completely.

==== ====

 

*Right now, I am researching investments Junior miners and explorers, analysizing the technical situation of the overall market, and developing a market neutral trading strategy, while pondering various big picture scenarios in our world involving future developments. The effort of Beat B&H is only a small part of my research activities. On some days I do nothing, or very little. So I consider that effort a sideshow, not the main show. But I know many posting here are interested in it, so I keep the trading and posting alive. And by doing it, I have learned some useful things about how to trade with such an objective.

Being a successful investor/speculator by trade gives you an edge, doesn't it? Most people are something other than that. I suspect you would make a very poor farmer, doctor or teacher/social worker. 'Haves' cannot stand the 'have nots'-yet fail to realize how much they need each other/are dependant on one another.

B&H also implies that you have bought and are holding (yes!) If anything happens so that it is no longer lawfully possible to B&H, you will have nothing more than a fistful of paper promises, and the simple B&Her will have a pocket full of coins to pass on to his family? Or you think you'll be able to time the event to wrap up there in HK, board a plane to take you to the -as yet-undecided-Shangri La where you can cash in your chips and live happily ever after in some market town above 700m awaiting a tsunami to wipe out the less fortunate...

I mean no ill feelings but have you ever read the one about the Hare and the Tortoise?

 

Bix Weir's $6000 silver call looks even more ridiculous today, never mind at the top, if we take another excursion to the downside how long are the "Silver Liberation Army" going to wait for $50 again?

 

Have we seen a 31 year double top in Silver?

I think Bix Weir always sounded a bit of a lunatic, still I dont think we will have to wait another 30 years for silver to 50 dollars either.

Is this the double top?

http://gold.approximity.com/since1885/Silver_USD.html

or this,

http://www.sharelynx.com/chartstemp/free/freelongtermCPIAG1700log.php

or this one which needs updating by the looks of things,

http://bp2.blogger.com/_nSTO-vZpSgc/RpPk53Zy8lI/AAAAAAAAA7U/Lat33OsaPWA/s1600-h/ss-cpi-silver.png

The DJIA:silver looks ok,

http://gold.approximity.com/since1885/DJIA-Silver-Ratio.html

''if we take another excursion to the downside how long are the "Silver Liberation Army" going to wait for $50 again?

Have we seen a 31 year double top in Silver?''

What do you think PD? How long will we have to wait for 50 dollar silver again?

 

There are those who like to hoard gold as a protection against possible wealth errosion on the assumption or belief of a hyper-inflationary outcome where fiat/paper currency will become almost worthless. But I am sitting in the deflation camp unless otherwise convinced.

Ian Gordon is a deflationist and a gold bull. I don't think it is one or the other. You can be a gold bull and or deflationist/hyperinflationist. He sees global fiat going to zero.

Yes, always entertain the possibility of being completely deceived/ self-deluded... hence hedge.

 

In 2008, silver corrected from 20 to 10. Wouldn't the equivalent this time round be 25... down form 50?

Didn't it recently correct to 26, very briefly?

I would relish the 20 figure...and wouldn't you relish the 17.90 or so figure?

Larry Edelson thinks it might...

''Gold has plunged through many of the support levels I’ve previously provided you. It’s dropped through the $1,730 level … the $1,610 level … and has thus far reached as low as $1,564.

Once it closes below $1,610 on a Friday, which it will likely have done before you even read this column — the stage will be set for gold to collapse to at least $1,435 and, very possibly, as low as the $1,100 mark.

And silver, precisely as I’ve been warning you, has started to crash again — losing more than $4 last week and shattering support at the $30 level … then the $29.16 level — and is now ready to make a beeline down to $25 and, very possibly, much lower to $22 to $23 an ounce.''

http://www.uncommonwisdomdaily.com/important-update-on-gold-and-silver-13437?FIELD9=2

You have made some good calls too.

But staying in Gold for the long term may or may not be the best move.

 

Here's a guy with a good track record who would doubt that, Mike Stathis:

 

The BEST use for gold is to capture price volatility via short-term trading.

Its poorest use is as a long-term hold.

 

Now that the gold bubble has (likely) been established, you need to be very careful about buying gold here, unless you plan to trade it. Otherwise, you face the risk of being stuck with it when the bubble pops. The previous down cycle in gold lasted some 23 years. And some investors are still waiting to break even (after adjusting for inflation).

 

/see: http://www.avaresearch.com/avanew/articles/299/Fools-Gold-Part-3.html

That article was from 2009, wasn't it?

Been re-reading my Alf Fields..

Projected Future Price for Gold

If gold retraces the exact gain achieved during the explosive advance from $1478 to $1913, which occurred in just seven weeks, it will represent a decline of 22.8%. That is nicely within the above anticipated range of 21% to 26% for the current decline in gold.

There is a possibility that the spike drop to $1531 on 26 September marked the low point of the correction in gold. The midpoint of the correction from $1576 to $1478 is $1527, close to $1531. If $1531 was the low, it was a decline of 20%. This is slightly below expectations, but it still qualifies as one degree larger than 13%.

At the date of writing (7 Nov 2011), gold has recovered to $1767, which is a 61.8% retracement of the loss from $1913 to $1531 (-$382), a typical size for this type of recovery. That leaves open the possibility (40% probability?) that gold will have another dip to test the target areas mentioned. The higher the price goes above $1767, the greater the probability that the low was in at $1531.Once this correction has been completed, Intermediate Wave III of Major THREE will be underway. This should be the largest and strongest wave in the entire gold bull market.

The target for the Intermediate Wave III of Major THREE should be around $4,500 with only two 13% corrections on the way.

As I'm sure you know it's only the Britannias and Sovereigns that are CGT exempt, which is why they're recommended. If you don't mind paying CGT on your gold coins when you sell them, then Chinese pandas and US buffalos are nice.

Couldn't they simply change the CGT rules when it suits them though? I always consider the cheapest, in best quality, coins as well as the sov/brits. You will always find a buyer who wont charge you CGT, imho...should you want to trade them.

http://www.telegraph.co.uk/news/picturegalleries/uknews/8784306/Cardiff-after-dark-Maciej-Dakowicz-photographs-the-nightlife-of-the-Welsh-capital.html'>http://www.telegraph.co.uk/news/picturegalleries/uknews/8784306/Cardiff-after-dark-Maciej-Dakowicz-photographs-the-nightlife-of-the-Welsh-capital.html

But the UK might not be worth a punt at that price. ?.

 

 

Is this the UK these days? Has it come to this?

http://www.telegraph.co.uk/news/picturegalleries/uknews/8784306/Cardiff-after-dark-Maciej-Dakowicz-photographs-the-nightlife-of-the-Welsh-capital.html

Perhaps not such a good destination anymore.

You are very correct. What is your target for oz?

 

Mine is 1 oz or less for a average British House.

When?

And what will be the 'price' in pounds I wonder. 50-100K/oz, /Av house.

I' be happy with that scenario in theory. But the UK might not be worth a punt at that price. ?.

What sort of world is GBP 50K gold? First of all I'd like to see USD 5 or 10k/oz. Then we might know more of where we are going.

Mr Gold Buy&Hold.

I am voting against him on the Beating B&H thread. Keep watching to see who is ahead...

Bubb, Where do you suspect gold and silver will fall to?