BlackPepper

You're a half-full type of guy aren't you?!

speculation is the mother of all stuff ups

it is without shame a total dump and I can say spending some time there......

UK is generally just a bleak over rated dump no matter how you look at it

 

The sheeple are being stampeded into speculation.

 

I think this and the other story today about Buffett positioning for inflation ,are indicating to me that money velocity is about to take off.

Speculation; speculators market is usually fueled by cheap credit; USA is no longer the market dude!

Primarily property.

Deflation, is real and the velocity of deflation is gathering pace, but Weimer world wide?

no! - it only went down in GBP because the UK economy is 'recovering': UK consumer spending (and yesterday GDP) and therefore GBP has gone up. I don't see it getting any better for GBP than it is now. We'll see, but I think gold is bottoming in GBP here.

the UK is not the world, and the UK will never recover! Let me sell you bananas hehehhehe

Anyone got an idea why gold bombed down 1.4% today in GBP terms?

 

I have a support at 770, which is it's current level and it doesn't look good if it goes through.

Yes its called "deflationary" and some cannot see the value..............

Below is an article suggesting that Gold is in bubble territory. I agree

http://www.smh.com.au/business/gold-price-...00628-zca1.html

Gold price a bubble waiting to pop

June 28, 2010 - 6:25AM

Want a bubble to worry about? According to Macquarie Bank interest rate strategist Rory Robertson, forget Australian house prices and US Treasuries, it's gold that looks due for a pop.

Fresh from winning his bet on Australian housing prices, Robertson is taking on a much more rabid bunch in the gold bug faithful - a broad church that ranges from the inflation-fearful to the Armageddon brigade forecasting the end of civilisation as we know it.

But Robertson argues that most people now betting on gold going up are doing so just because gold has gone up - the very stuff of bubbles. Rather than worrying about US Treasuries or Australian house prices (he doesn't see a bubble in either of those assets for fundamental reasons), punters should be sceptical of gold around US$1,250 per ounce, almost quintuple its early 2001 price of US$260.

Have you read Bron Suchecki's blog. Loads of interesting articles

 

http://goldchat.blogspot.com/

 

Perth mint employee and latest on coin shortages rather good.

Panick buying..........

no it wont.

It has happened before, so why will it not happen again?

If I wasn't worried about the monetary system, which I've been labouring - largely unconsciously- some years for, then I also wouldn't be concerned about the price of gold. Once you start thinking about capital preservation [and the value of your labour] though, I reckon gold soon becomes quite predominant in your thoughts.

Yes so true........but real value comes those who can produce and put back into society.

Hi guys,

This is a MUST LISTEN IMO.

 

World Gold Council (WGC) President Shishmanian says "gold will never go below $1,000 again"

http://neuralnetwriter.cylo42.com/node/2915

 

I've typed up a transcript of most of it (I'm not a fast typer!)

There are lots of very good points IMO

 

If you like gold you'll love this, if you hate it.....read it and weep

This price of gold is something I have no real concern with. If gold does return as a standard in which legal tender shall be valued against, I can see gold once again being confiscated and capped in major continents. Reap it whilst you can.

They are just trying to shift old stock @ spot.

 

They have had these in stock for ages and bought them well below the spot price today.

That's quite funny, being gold loses value being "old stock". I think the old bite test maybe in order

I changed the word to standardized. I think the governments will have no choice and it will be a perfectly natural thing for them to do. They aren't simply going to sit back and watch economies blow up. The old western "market fundamentalist" ideology has had its day, and we'll see a more proactive government from here. I'm a pragmatist and don't see a problem with it per se. Neither does most of the rest of the world.

 

I doubt there will be much ado about "hoarders". Gold and dollars would be interchangeable once currencies are standardized.

So then for debate sake for example the US could just say oh we have done away with the old regime, remove the Fed, all debts are forgiven and here's your new currency and we will 100:1 swap value for the old ones.

You could say gold would have to be stabilized... as institutional money is swallowed up by it... but then you could also say that currencies would have to be stabilized at this point. By capping the price of gold, international monetary authorities would also be stabilzing/ fixing the currency. It depends on which way you look at it. Existing currencies would be stabilized as they once again revert to their original function as a representation of gold. This would also entail the end of a free-floating market system for currencies.

 

When you think of gold as a competing currency, the fact that it is well above $1000 here compared to where it was just a few years ago has to be alarming for central banks. Keeping in mind it is a currency here, this reflects the equal and opposite deterioration of existing currencies. Small wonder CBs are buying. Asset prices are doubly deflating against gold, as the well-know charts of the ratios, posted often by gf show.

 

My guess is gold will go to 1500 and then 2000 over the course of the next few years. These kinds of moves would no doubt co-incide with havoc in currency markets, and further deterioration of asset prices relative to gold. Though we are accustomed to thinking of inflationary nominal figures, this lower figure, within the context of crashing asset prices, is very much as real in terms of purchasing power.

So you then may say gold will be capped if this scenario were to play out? Sounds like this scenario has been played before. Hence the public hoarding gold may become once again a no no.

If gold is remonetized, you might expect something like this.. value of external USD debt valued to all gold held at the treasury. This means gold must rise in terms of fiat, otherwise there isn't enough gold to go around. Gold is LUDICROUSLY cheap relative to all the paper sloshing around.

From: http://www.youtube.com/watch?v=ckFfzoplC-I

 

EDIT here is BASE money:

Sir if that be the case, you are truly delusional. Goldbug fever is becoming rampant

I think clean drinking water will have higher demand/value.

Well, with CBs net buyers of gold, it should make gold more expensive in the market... more demand from the big boys and less available for investors. I think investors should copy what the CBs are doing. imo the CBs are buying gold in order to recapitalize economies/ currencies in the future. The problem with CBs having supported the weight of private and corporate debt that should deflate, is they have transferred systemic risk to currencies themselves. I think the manouvre towards gold reflects this super systemic risk. Gold is being remonetized.

To support your theory, if gold does become a measure for a new standard reserve currency, the price of gold would be stablized and may indeed may come down in value depending on currency and same vice-versa.

Have to say I'm on the China bears side such as Rickards and Chanos on this one. The whole issue of decoupling is an interesting one. I think we'll eventually see decoupling, but in the short/ medium term China's fate looks tied to the project of globalism. What we are seeing now is an asset inflation/ bubble... yet is might take a while for it to pop. Still, the future of gold looks tied to depreciating currencies, and the demise of "market fundamentalism" where it was assumed currencies could themselves trade freely on the market. China is now showing this model to be defunct. The future with gold is one of remonetization imo, not one where it is just another investment vehicle. A completely revamped monetary system may be required to see economies emerge from K winter to spring.

 

South Korean CB today stated they are starting to buy gold. Previously, they had dissed it.

Now this is interesting, if the CB's start cornering the gold market, it may force the price of gold down.

The Who at their best

delusioanal thread hahhahahahahahhahahahahahahahhhahaah

capital BS

david bowie..............we can be heroes...............

5 Reasons Gold Is Going to Rise: A Response to Nouriel Roubini

Scary times indeed.................. I think the US is going to fail and never will get better in the coming years

http://seekingalpha.com/article/178111-5-r...nouriel-roubini

by: Daryl Montgomery

December 14, 2009 | about: GLD / IAU / UDN / UUP

The U.S. Senate passed a $1.1 trillion spending bill this Sunday, December 13th. Five other appropriation bills for fiscal year 2010 were previously passed earlier this year and one more still remains, a $626 defense appropriation. The defense appropriation bill will contain a clause to raise the national debt ceiling. The national debt ceiling is currently $12.1 trillion and the U.S. is tapped out once again. As of now, it looks like congress will raise the debt ceiling by $1.8 trillion to $13.9 trillion. The last increase was only $0.8 trillion, but that would only last months at this point. Even with a $1.8 trillion increase, the U.S. congress will be fortunate if it doesn't have to raise the ceiling again before 2010 runs out.

The increase in the U.S. national debt is now so great that the monthly rise can be as high as the entire debt load in the 1960s (before the U.S. went off the gold standard). The U.S. is also by no means unique. The spending spree taking place is global and includes all major economies. In the midst of this spending and money printing orgy, there are a number of economists who claim it will not hurt the U.S. dollar and will be a negative for gold. In order to come to this conclusion, they have had to ignore a greater than 2000 year history that indicates otherwise. The Romans engaged in long-term debasement of their coinage and paid for it with out of control inflation. Since then, the use of paper money has made currency debasement much easier and quicker. Nowadays, central banks can create any amount of currency they want through a simple computer entry. What they can't create out of thin air is actual money.

History is littered with fiat currencies (currencies not backed by hard assets) that have failed. There is no fiat currency that has survived over time. There is also no case of currency creation that significantly exceeds economic growth that hasn't led to inflation. This idea is by no means new. Copernicus the famous astronomer was one of the first to articulate it in the 1500s. It is based on simple arithmetic. If you double the amount of currency in circulation, but the economy doesn't change in size, goods and services will approximately double in price. This does not happen instantly, however. There is a delay from when a government increases money supply and when consumer prices rise. In the 1970s, money supply in the U.S. increased by the largest amount in 1971, inflation peaked 9 years later, as did the price of gold. So don't expect to see the full impact of today's monetary policy actions until late in the next decade.

Economist Nouriel Roubini has just released an article on why the price of gold will fall. It should be kept in mind that Professor Roubini is an economist and not a professional investor. Unlike myself and a number of other bloggers, he does not publish when he buys and sells assets, but tends to make broad sweeping generalized comments. This approach is rarely helpful to investors who are trying to make money in the market and usually works to accomplish the opposite. Let's look at Roubini's five reasons gold will fall and deal with them point by point:

Point 1: The U.S. dollar carry trade will unravel.

Indeed this will happen eventually. I heard similar arguments made about the Japanese yen carry trade unraveling for about 15 years. It was finally replaced by the U.S. dollar carry trade. So if you are are investing now based on how the world might look in the 2020s, pay attention to this point and just hope you don't go broke while waiting.

Point 2: Central banks will have to exit their quantitative easing strategies and jettison their effectively zero rate interest rate policies.

For governments to keep spending, they will have to continue to print money. National debts are now so huge that a significant increase in interest rates will cause the interest payments on the debt to skyrocket. Even assuming Credit Crisis bailouts and related economic damage no longer necessitate massive government budget deficits after a few more years, rising payments for government retirement and health programs will. There will be no respite. If

http://seekingalpha.com/article/178111-5-r...-response-to-... 15/12/2009

5 Reasons Gold Is Going to Rise: A Response to Nouriel Roubini --Seeking Alpha Page 2 of 2

unfunded liabilities for social security and medicaid are taking into account (which is required when using GAAP ¬generally accepted accounting principals), the U.S national debt is not $12 trillion, but somewhere between $60 trillion and $100 trillion. The official GDP is approximately $14 trillion.

As for interest rates, real interest rates are not zero, they are negative. Only highly massaged government statistics which understate the inflation rate make it look otherwise.

Point 3: Global risk aversion indicates that the U.S. dollar will rise and drive down the price of gold in dollar terms.

There are a number of problems with this assertion. First of all there are periods when both the U.S. dollar and gold rise, as happened at the end of the 1970s. Secondly, there is an implication that gold will be rising in non-dollar currencies (gold has been hitting new all-time highs in dollars, pounds, euros and Swiss francs lately). Thirdly, the statement essentially means that gold will not go straight up in price and the U.S. dollar will not go straight down, like every other major asset in history. So what else is new?

Point 4: The carry trade and the wall of liquidity from central banks is causing a global asset bubble and all bubbles eventually crash.

Indeed we are in the early stages of an asset bubble, with early being the operative word. People said the same things about stocks for years throughout the 1990s and eventually the bubble did peak. You, of course, make the most money by investing in bubbles. How can you tell when they are ending? This happens when there is a meteoric rise after many years of strong rallying. We know the history (or at least some of us do) of how the 1970s gold bubble ended. Gold went up 400% in the last year. Silver rose almost 1000%. Double digit annual price rises like we are currently witnessing are simply ordinary bull markets. While there may be a peak in gold prices in ten years, we are not anywhere near that point yet.

Point 5: The price of gold could be pushed up if there are expectations that central banks will monetize their countries' debts, but this increases investors risk aversion and will lead them to sell gold.

There is no way that most major economies can pay off their government debts. Monetizing them by creating inflation is the only alternative that will avoid default. One only needs to employ elementary school arithmetic to figure this out. The price of gold goes up with inflation. Yet Roubini contends the investor risk aversion will trump this factor. This could also be restated as theory will be more important than reality in the markets -the essence of all of Roubini's arguments in a nutshell. Investors and traders know better since they have to put real money on the line every day.

Roubini's current missive on gold prices is not a new view. Only a couple of months ago he made some highly negative comments on gold just as it started to rally 20%. He was wrong then, but being wrong in the economics profession has never damaged anyone's career. Roubini is not unique in his views, but is one of a group of economic alchemists who repeatedly tell the public that government can create more and more of a currency and this is going to lead to an increase in the currencies value (also stated as deflation). In other words, actual money and value can be created out of thin air and by implication there is a free lunch. Considering the amount of inflation that history tells us is about to take place, there had better be a free lunch because few people will be able to pay for the real one.

Correct!

 

Next stop $1300?

Friday was not a correction, just a shake of the tree to see what falls.....