GOLD

[romans holiday]

Gold Market Update By: Clive Maund - http://news.goldseek.com/CliveMaund/1248674940.php

 

 

 

Hmmm. I've tried to hedge some in recent months but frankly, - F knows... I don't really like holding the $ I set aside at GM though - so I can see me sticking it back in to G before too long.

The thing is the doolally markets will not move in one way but go up then down, and up and down again. So even if the dollar slides to 70, have you lost anything if it spikes later to 90 or 100? Why not just wait for the market to come to you? Buy on weakness and sell on strength.

[jamesspeed]

Gold Market Update By: Clive Maund - http://news.goldseek.com/CliveMaund/1248674940.php

 

 

 

Hmmm. I've tried to hedge some in recent months but frankly, - F knows... I don't really like holding the $ I set aside at GM though - so I can see me sticking it back in to G before too long.

 

One day and maybe it is now these people will be wrong - that is when gold will shoot .

[Mr Pipples]

The thing is the doolally markets will not move in one way but go up then down, and up and down again. So even if the dollar slides to 70, have you lost anything if it spikes later to 90 or 100? Why not just wait for the market to come to you? Buy on weakness and sell on strength.

 

But what do you call weakness and what do you call strength? Often hard to know with these levels of volatility (combined with that of other currencies) and lack of much consensus between those that many of us on here (well me, anyway) seem to listen to. Eg. was the recent dip down to near 900 the last weakness before 1000 becomes resistance on the downside or is <800 on its way?

 

Hay ho. That's the way it goes.

[bitbigt]

Yes. It's like the paper currencies are little ducks in the bathtub all bobbing up and down relative to each other.

 

Meanwhile the plug has been pulled and they are all going down together but if you only look at the ducks and how they bob up and down you may not notice that.

 

Gold is the bathtub.

Lovely analogy - but gold is also a currency, and so also a duck!

 

So my advice, GOM, is to concentrate separately on only three ducks:

 

1. the duck your wealth is in (GBP in your and my case I believe) - which I feel will not sink substantially further as the conservatives will get in power and start some serious medicine

 

2. the duck your thinking of buying [and only bother with this at all if you think the first duck is about to sink, or you're confident this second duck is going to float significantly higher, as you'll loose on the exchange transaction] - in my view, EURO will keep strengthenning, as the Eastern European financial problem is way overstated, and the EURO will start to be used as a second reserve currency

 

3. the golden duck - which I'm watching very carefully, with an aim of buying, though not yet

 

In short, ignore all the other birds - they're just an expensive distraction (as every red blooded male knows)

[romans holiday]

But what do you call weakness and what do you call strength? Often hard to know with these levels of volatility (combined with that of other currencies) and lack of much consensus between those that many of us on here (well me, anyway) seem to listen to. Eg. was the recent dip down to near 900 the last weakness before 1000 becomes resistance on the downside or is <800 on its way?

 

Hay ho. That's the way it goes.

Well, I am not looking for weakness in gold here. I think gold will become one of the most stable currencies here [comparatively over a longer period of time] with a solid base above 900 though at the same time I do not think it will be going parabolic anytime soon.

 

With already a good position in gold, I am looking for weakness and strength in the dollar. On dollar weakness I will buy. On dollar strength, by which I mean a spike which would involve most probably a deflation scare, I will sell dollars for silver [silver will dip more than gold]. On the inflation trade/mode which will see the markets move up, I would be selling silver for gold and profits will be considered taken. The ratio has returned to the trend as I thought it would and hopefully if we get a good inflation scare and the Dow to 10000 on this next wave up, the ratio at 50 could be in our sights.

 

[romans holiday]

Lovely analogy - but gold is also a currency, and so also a duck!

 

So my advice, GOM, is to concentrate separately on only three ducks:

What's all this talk about ducks? How about plastic decoys and golden geese instead?

[grumpy-old-man]

So my advice, GOM, is to concentrate separately on only three ducks:

 

1. the duck your wealth is in (GBP in your and my case I believe) - which I feel will not sink substantially further as the conservatives will get in power and start some serious medicine

 

2. the duck your thinking of buying [and only bother with this at all if you think the first duck is about to sink, or you're confident this second duck is going to float significantly higher, as you'll loose on the exchange transaction] - in my view, EURO will keep strengthenning, as the Eastern European financial problem is way overstated, and the EURO will start to be used as a second reserve currency

 

3. the golden duck - which I'm watching very carefully, with an aim of buying, though not yet

 

In short, ignore all the other birds - they're just an expensive distraction (as every red blooded male knows)

 

 

no, it's in Euros at the moment. Not a nice feeling having cash in the bank right now at least it's in a French bank, so a better quality of worry ?

 

am I to gather that you don't think the pound will become the euro then ?

also, I agree with the eastern europe thing & quite possibly the euro becoming the second reserve currency.

 

I do fancy a shot at silver though as well, that chart that GF (I think) put up showing the historical price of silver makes it look very cheap.

 

 

cheers for the advice.

[grumpy-old-man]

How do GOM. Take a look over at this thread: http://www.greenenergyinvestors.com/index....mp;hl=goldmoney Would be classed as a chattel I think. (£6k & 5/3 rule).

 

I'm in the middle of investigating all this but it looks like there might be a chance the CGT chattel thing could apply to proceeds from sales of bullion at Goldmoney too. Will update the thread when I know the score.

 

P.S. Re. GIM - think quite a few of the GEI lot visit GIM but it's a massive pain to get registered. They only open for registration for a couple of days every 4 months or so... Took me bloody ages but finally got in there. I just loiter in the gold stocks section.

 

Hi Mr P,

 

cheers for the link.

 

I registered in march 2007 on goldismoney as grumpy-old-man, after GF recommended it, I just haven't posted yet.

[warpig]

Silver will have to go through price discovery in the next 5-10 years or so to justify recycling it, it is one of the elements that's due to become extinct at current consumption. Silver is a good bet IMO.

 

no, it's in Euros at the moment. Not a nice feeling having cash in the bank right now at least it's in a French bank, so a better quality of worry ?

 

am I to gather that you don't think the pound will become the euro then ?

also, I agree with the eastern europe thing & quite possibly the euro becoming the second reserve currency.

 

I do fancy a shot at silver though as well, that chart that GF (I think) put up showing the historical price of silver makes it look very cheap.

 

 

cheers for the advice.

[bitbigt]

no, it's in Euros at the moment. Not a nice feeling having cash in the bank right now at least it's in a French bank, so a better quality of worry ?

I dunno... since I don't fear high-inflation for a year or 3 yet, and since I am planning to buy a UK (GBP) house, then having my cash in Sterling is not such a bad thing as it puts me in a strong bargaining position. This cash, BTW, is in a very safe bank in Switzerland and in Northern Rock (where accounts are 100% guaranteed, regardless of amount)

 

am I to gather that you don't think the pound will become the euro then ?

No. Conservatives will get in, and they have no interest in joining the Euro. So I don't see this as an issue over the next several years.

 

But if you are implying parity in GBP:EUR exchange rate, I think that's certainly possible (or even likely) over next few years, as I expect the Euro to continue strengthenning in and of itself and as USD and GBP loose their attraction. Also, for a long time now, EUR and CHF have tracked each other closely, as both are seen as safe havens - but I think the Swissie will start to loose out to the EUR over next few years (...and yes, I have about 1 years living costs in EUR, because of these expectations)

 

I do fancy a shot at silver though as well, that chart that GF (I think) put up showing the historical price of silver makes it look very cheap.

 

I'm currently heavily in oil, and have some gold and plan to buy more. But really not sure about silver. It might be a really good idea, I just don't know. My oil purchase is designed to make money over next few months-years, as oil will start running out! My gold purchase is to preserve wealth over years to decades. Not sure why I'd buy silver - other than to try to make a packet in short time frame. But I don't know if I want the stress that its volatility brings.

[romans holiday]

I'm currently heavily in oil, and have some gold and plan to buy more. But really not sure about silver. It might be a really good idea, I just don't know. My oil purchase is designed to make money over next few months-years, as oil will start running out! My gold purchase is to preserve wealth over years to decades. Not sure why I'd buy silver - other than to try to make a packet in short time frame. But I don't know if I want the stress that its volatility brings.

What's your rationale for being in oil bt? How does that square with your current deflation views? The price now is getting high... it might get to the high 70s but it's not being driven by demand but by investor speculation. Looks very vulnerable to another sell off soon, don't you think?

[bitbigt]

What's your rationale for being in oil bt? How does that square with your current deflation views? The price now is getting high... it might get to the high 70s but it is not being driven by demand but rather by investor speculation. Looks very vulnerable to another sell off soon, don't you think?

I don't think we'll have massive deflation, nor massive inflation in the UK for the next year or so (in terms of cost of living). Looking 2-4 years ahead, we will have a big inflation problem. But that's not the key consideration wrt oil

 

Oil's price depends upon what is happenning globally. And by next year much of the world will start firing on all cylinders again. So I can easily imagine USD 100 oil again over next 1-2 years. That will represent a 60% profit for me, at current exchange rates.

 

That increasing oil price will be the harbinger of the following high UK inflation - and that will be what causes gold to take off.

 

I would argue that gold has risen significantly over last few years only at times of major economic panick (autumn 2007 as credit crunch first hit, then early 2009 as the 2nd wave occured). The fear of a major economic collapse has now largely passed, and so gold will struggle to take off from here without either a 3rd wave major credit crunch panick (not gonna happen) or the actual occurance of inflation (2+ years away).

 

Finally, I agree that there is a lot of speculation in the current price of oil, but a lot of that is due to larger players seeing things as I explained them above. So oil will not fall dramaticaly from here. Instead, its best to make sure you're in oil now, and in gold a little while later.

[ziknik]

...

The added problem I have is when to change my euros to sterling & buy pm's ?? I am hoping mr parity makes an appearance very soon (or below would be fantastic, but I don't fancy F5 every 20 seconds )

...

 

Select GBPEUR from the ‘Instruments’ list and save yourself from the F5 button

 

http://www.netdania.com/Products/live-stre...artStation.aspx

 

well yes, I understand that BUT remember I am expecting to get parity, now that's a hefty percentage to make up from pound vs euro surely ?

15% atm. surely gold priced in Euros won't be cheaper by that much......

 

edited - I will take a look though obviously & check the charts.

Wren is correct. You aren’t going to make anything by waiting for a good GBPEUR rate if you buy gold with the GBP as soon as you receive it. Hedge funds and the like will close these gaps long before you get a look in.

 

You are better off buying gold with your EUR. This way you save yourself from one set of exchange fees.

 

I wasn't aware of that warpig, thanks.

 

so you pay cgt on anything gold (& silver?) that isn't British then ?

...

Yep, Sovereigns and Britannia’s are CGT exempt. Any other gold isn’t.

 

 

[romans holiday]

I would argue that gold has risen significantly over last few years only at times of major economic panick (autumn 2007 as credit crunch first hit, then early 2009 as the 2nd wave occured). The fear of a major economic collapse has now largely passed, and so gold will struggle to take off from here without either a 3rd wave major credit crunch panick (not gonna happen) or the actual occurance of inflation (2+ years away).

 

Finally, I agree that there is a lot of speculation in the current price of oil, but a lot of that is due to larger players seeing things as I explained them above. So oil will not fall dramaticaly from here. Instead, its best to make sure you're in oil now, and in gold a little while later.

Interesting take on oil.

 

The volatility of gold has reduced quite a bit, yet the price remains high even though supposedly the major economic panic is over. My theory is QE has put a floor under it at 900 with gold effectively "monetized" in the minds of investors. People are approaching it as a currency now and not as a commodity/inflation hedge. It might require another round of panicked forced lquidation for it to go lower but even then I doubt gold will go down much compared to stocks and commodities, and then only briefly.

 

As a strengthening currency, I do not expect the price of gold to go parabolic. This would entail other major currencies to [hyper] inflate and devalue which does not look likely anytime soon. Rather, I reckon gold will steadily strengthen in price against other currencies as investors become increasingly wary of public debt levels, stagnant economies, and deleveraging consumers... and the potential of devaluing currencies in the future.

[warpig]

I'm curious why you think this is the case?

 

I would argue that gold has risen significantly over last few years only at times of major economic panick (autumn 2007 as credit crunch first hit, then early 2009 as the 2nd wave occured). The fear of a major economic collapse has now largely passed, and so gold will struggle to take off from here without either a 3rd wave major credit crunch panick (not gonna happen) or the actual occurance of inflation (2+ years away).

[bitbigt]

I'm curious why you think this is the case?

When CC first hit, it took most investors by surprise (though some of us had been predicting for a long time!!!!). Hence the panick

 

Then things rather calmed down until the end of last year when the stock market crumbled (after-shock from the CC). Hence more panick

 

But the response from governments was to bail out everything of economic importance, and make it clear that they'll not let the system go under. So, future squeezes on bank capitalisations (e.g., due to under-performing prime mortgages, credit card defaults, business collapses) will be painful but they are now expected, and everyone knows the governments will step in. Hence, no major 3rd wave panick. ...just a grinding and painfully slow recovery [which will suppress UK inflation].

 

...IMHO!

 

EDIT: or just look at it this way... major legs down in stock markets (and peaks in VIX) came precisely before each recent run up in price of gold, but stock markets are now more reassured and VIX has fallen dramatically. Everyone now knows that economic armageddon has actually been avoided!

[stobar]

Yep, Sovereigns and Britannia’s are CGT exempt. Any other gold isn’t.

 

I heard that any other nominal gold coins with a face value are exempt too. Commemorative proof £5 crowns are my personal favourites (slightly larger than 1 oz coins) and are more desirable / nicer to own IMO than boring bullion. They often offer good value and the following benefits:

 

- very difficult to fake

- likely to be exempt from confiscation laws

- produced in limited numbers (will always be desirable to collectors)

 

 

 

[warpig]

Yep this is correct.

 

I heard that any other nominal gold coins with a face value are exempt too. Commemorative proof £5 crowns are my personal favourites (slightly larger than 1 oz coins) and are more desirable / nicer to own IMO than boring bullion. They often offer good value and the following benefits:

 

- very difficult to fake

- likely to be exempt from confiscation laws

- produced in limited numbers (will always be desirable to collectors)

[InternationalRockSuperstar]

Yep, Sovereigns and Britannia’s are CGT exempt. Any other gold isn’t.

 

anything the gov't doesn't know you have is exempt from tax.

[InSilverWeTrust]

I do fancy a shot at silver though as well, that chart that GF (I think) put up showing the historical price of silver makes it look very cheap.

 

 

It sure is a fine chart GOM

 

EDIT: Right on cue...Ted Butler July 27, 2009 D-I-V-O-R-C-E

 

http://www.investmentrarities.com/ted_butler_comentary.shtml

 

 

[warpig]

There is however a price to pay for QE ad infinitum. Special inspector general Neil Barofsky estimates the potential US exposure to this crisis to be in the region of $24 trillion. IMO and assuming the worst, they can't print this much without the bond market imploding. There will be unintended consequences.

 

When CC first hit, it took most investors by surprise (though some of us had been predicting for a long time!!!!). Hence the panick

 

Then things rather calmed down until the end of last year when the stock market crumbled (after-shock from the CC). Hence more panick

 

But the response from governments was to bail out everything of economic importance, and make it clear that they'll not let the system go under. So, future squeezes on bank capitalisations (e.g., due to under-performing prime mortgages, credit card defaults, business collapses) will be painful but they are now expected, and everyone knows the governments will step in. Hence, no major 3rd wave panick. ...just a grinding and painfully slow recovery [which will suppress UK inflation].

 

...IMHO!

 

EDIT: or just look at it this way... major legs down in stock markets (and peaks in VIX) came precisely before each recent run up in price of gold, but stock markets are now more reassured and VIX has fallen dramatically. Everyone now knows that economic armageddon has actually been avoided!

[ziknik]

I heard that any other nominal gold coins with a face value are exempt too. Commemorative proof £5 crowns are my personal favourites (slightly larger than 1 oz coins) and are more desirable / nicer to own IMO than boring bullion. They often offer good value and the following benefits:

 

- very difficult to fake

- likely to be exempt from confiscation laws

- produced in limited numbers (will always be desirable to collectors)

 

Yes, Any coin with a Sterling Face value is also exempt

 

These coins tend to be expensive though

[drbubb]

GOLD FUTURES WATCH / see: GoldWatch thread

 

Commercials increased their Net shorts last week by about 22,000 cts., as GLD rose to $93.13.

They have likely moved them a bit further, since GLD closed monday at $93.71

 

Week=== : $-GLD- CmLong - CmShort - Pct. = CmNetS / NCLong - Pct. NonC.Net / F-CmSht. - Pct

07/07/09 : 90.71 137,631 - 337,872 69.0% (200,241) / 194,828 - 39.8% +171,061 /

07/14/09 : 90.81 144,631 - 330,874 66.9% (186,243) / 187,333 - 37.9% +160,298 /

07/21/09 : 93.13 142,179 - 355,963 68.0% (213,784) / 203,538 - 38.9% +181,060 /

 

A level which is BULLISH for Gold would be Comm'l Net Short (CmNetS) of 165,000 or less

 

= = =

LINKS:

Gold COT Report, Comb :: http://www.cftc.gov/dea/options/deacmxsof.htm

Gold COT Report, Futs :: http://www.cftc.gov/dea/futures/deacmxsf.htm

[electroweak]

Jesus, Gold just dropped $10 in as many seconds.. it literally gapped down. Will post a pic in a mo..

 

EDIT: I think we just saw "the team" back in action.

 

 

 

 

[romans holiday]

Jesus, Gold just dropped $10 in as many seconds.. it literally gapped down. Will post a pic in a mo..

Patience Timothy.

 

At least the ratio is still around 68.