GOLD

[notanewmember]

It might be quite a lot different. They were on the road to Damascus just yesterday...

 

 

Ok, maybe not that different...

 

 

http://www.fool.co.uk/news/investing/2008/...t-this-bad.aspx

 

Revealing. Thanks - good laugh it was.

[CIGA]

I've got this - highly recommended!

 

love the fireworks when folds up big and storm clouds for the opposite - lol

 

really, i juat use a kitco bookmark via safari.. what are the advantages to igold?

 

 

[qwerty]

The other day I read a good post at goldismoney about how to hide stuff at home from burglars. It was a longish post which was an accumulation of research, some from conversations with an ex-burglar. I'll see if I can find the thread again and post it here.

 

Some main points which I remember: burglars want to get in and out quickly. He said on average they are in the premises for 8 minutes. So they want something of value quickly. So if they find something good in the more obvious places and suspect on the style of place that there's probably not much more to be found, they would likely be content and leave.

 

Failing that, they work through (and mess up) the less likely places. So split it and maybe leave a couple of hundred in a more obvious place (desk drawer or something, but not too openly obvious as these guys know what they're doing.)

 

I was thinking about posting about this the other day and regret that I did not.

 

 

Dont forget to put these on your Christmas list!.

 

http://spyville.com/brief-safe-underwear.html

 

 

 

The "Brief Safe" Underwear Hidden Safe

 

The "Brief Safe" is an innovative diversion safe that can secure your cash, documents, and other small valuables from inquisitive eyes and thieving hands, both at home and when you're traveling. Items can be hidden right under their noses with these specially-designed briefs which contain a fly-accessed 4" x 10" secret compartment with Velcro closure and "special markings" on the lower rear portion. Leave the "Brief Safe" in plain view in your laundry basket or washing machine at home, or in your suitcase in a hotel room - even the most hardened burgler or most curious snoop will "skid" to a screeching halt as soon as they see them. (Wouldn't you?) Made in USA. One size. Color: white (and brown).

 

 

 

[HPCsoYESTERDAY]

If you're like me and generally out and about most days, you may be keen to keep up-to-speed on how G&S are doing using your mobile.

 

I tend to have a load of different bookmarks on my BlackBerry and iPhone to achieve this, but it's quite messy.

 

For a while I've wanted to move away from this and just have a SINGLE "dashboard" type URL that I could use to see what's going on with the price of Gold and Silver.

 

I couldn't find anything out there that worked, so I've hacked together a page that displays images from Kitco and Silverprice/Goldprice - I've put it here: http://bobsta.com/pm/

 

It renders nicely on my BlackBerry and iPhone and at least some of the charts should work well on most phones - so I thought I might as well let you folk know so that you can use it if you want.

 

I've placed a link at the bottom of the page to this thread in "Lo-Fi" and "Full Fat" modes. Each month when the thread changes I'll make an effort to change the link.

 

If anyone knows of any better portal-like sites please let me know... or if you'd like me to customize the page to add in charts for other PMs then I'd be happy to (or put together other custom ones).

 

Feel free to use and abuse (or not). All input/suggestions welcomed.

 

 

cheers for that - i use an N95 when I'm out and about and use this site for forex: http://www.ukforex.co.uk/mob/sr.asp

 

 

 

 

 

 

 

[Pixel8r]

really, i juat use a kitco bookmark via safari.. what are the advantages to igold?

 

iGold is just quicker and has all the info you need. Has metal prices in US, Euro, Pound, Yen & Aus Dollar.

 

Shows the live price, as well as the percentage increase/decrease.

 

You can access kitco or INO charts for 1 day, 3 day , 1 month , 6 month & 1 year.

 

Well worth the price I think, £4.99 or $7.99.

[scruffian]

The other day I read a good post at goldismoney about how to hide stuff at home from burglars. It was a longish post which was an accumulation of research, some from conversations with an ex-burglar. I'll see if I can find the thread again and post it here.

 

Some main points which I remember: burglars want to get in and out quickly. He said on average they are in the premises for 8 minutes. So they want something of value quickly. So if they find something good in the more obvious places and suspect on the style of place that there's probably not much more to be found, they would likely be content and leave.

 

Failing that, they work through (and mess up) the less likely places. So split it and maybe leave a couple of hundred in a more obvious place (desk drawer or something, but not too openly obvious as these guys know what they're doing.)

 

I was thinking about posting about this the other day and regret that I did not.

 

http://goldismoney.info/forums/showthread.php?t=306516

[bitbigt]

The other day I read a good post at goldismoney about how to hide stuff at home from burglars. It was a longish post which was an accumulation of research, some from conversations with an ex-burglar. I'll see if I can find the thread again and post it here.

 

Some main points which I remember: burglars want to get in and out quickly. He said on average they are in the premises for 8 minutes. So they want something of value quickly. So if they find something good in the more obvious places and suspect on the style of place that there's probably not much more to be found, they would likely be content and leave.

 

Failing that, they work through (and mess up) the less likely places. So split it and maybe leave a couple of hundred in a more obvious place (desk drawer or something, but not too openly obvious as these guys know what they're doing.)

 

I was thinking about posting about this the other day and regret that I did not.

Or just don't keep it at home

[romans holiday]

If ever a situation was made for gold, this is it. Even I can't believe it hasn't taken off. I wish it would. I sometimes think that until we get this last little firework out of the way, people have an excuse for maintaining that "get rich quick" mentality, rather than finally, for the first time in about 80 years, looking reality in the eye again.

 

 

 

(Not aimed at any individual here, or elsewhere, just at the late 20th century mindset, which really should have moved on a decade ago, and now finally may)

 

Speaking of reality, many people are going to gold not because of a "get rich quick" metality as you put it but because of an "avoid poverty" mentality.

 

POG does not surprise me. It will "take off" when the US dollar does a Krona.

 

Also, consider what a "take off" in POG might really mean. Say the dollar collapses and POG goes to $8000. Keep in mind that this is 8000 devalued dollars and is in reality just a preservation of purchasing power. The real power of gold will be found in its ability to buy the basic necessities of life such as shelter. Asset prices will have also come rightly down and the owner of gold will be able to afford something such as a house and no longer need a life time of debt just to have a roof over his/her head. This is not a get rich scheme.... just the just and natural desire to afford the basics of life which have been commodified and ridiculously priced in an unsound society.

[headmelter]

Right folks, that's seven pages on this thread alone today.

 

Do you not think I have anything better to do after I get the kids to bed?

[Steve Netwriter]

Right folks, that's seven pages on this thread alone today.

 

Do you not think I have anything better to do after I get the kids to bed?

 

Just what I was thinking. You're ahead of me though knowing how many new pages there are

 

[wren]

useful - look forward to original if you can find it

I searched my cache and could not find the page unfortunately. I'm not signed up there to ask. Maybe I will, unless GF, say, knows of it?

 

[wren]

http://goldismoney.info/forums/showthread.php?t=306516

The man! Thanks very much.

 

(I've still to read the rest the rest of the thread, so sorry if this is a bit repetitive.)

 

[jinbal]

Speaking of reality, many people are going to gold not because of a "get rich quick" metality as you put it but because of an "avoid poverty" mentality.

 

POG does not surprise me. It will "take off" when the US dollar does a Krona.

 

Also, consider what a "take off" in POG might really mean. Say the dollar collapses and POG goes to $8000. Keep in mind that this is 8000 devalued dollars and is in reality just a preservation of purchasing power. The real power of gold will be found in its ability to buy the basic necessities of life such as shelter. Asset prices will have also come rightly down and the owner of gold will be able to afford something such as a house and no longer need a life time of debt just to have a roof over his/her head. This is not a get rich scheme.... just the just and natural desire to afford the basics of life which have been commodified and ridiculously priced in an unsound society.

 

agree - esp with $8000 bit - what what $8k actually buy you if that happened?

 

there's nothing "get rich quick" about wishing to preserve purchasing power of savings and wanting a decent home without insane personal debt levels. It's a desire for normality IMO.

[ologhai]

Yes that's my opinion. The rate at which this is accelerating is now ferocious, bordering exponential. Of course there will be turbulence on the way up, that was always going to be the case, but I do believe we have seen the last of the big corrections.

 

In my experience, never underestimate the volatility of gold.

 

That was my gut response, too.

 

I have a feeling that we'll see a mini-correction today and that markets generally will show some strength today.

 

I've considered dabbling in a little gold trading today, but I doubt I'll have the courage...

 

Anyway, maybe gold will continue to rise, and I'll be glad of my cowardice!

[Bobsta]

agree - esp with $8000 bit - what what $8k actually buy you if that happened?

 

there's nothing "get rich quick" about wishing to preserve purchasing power of savings and wanting a decent home without insane personal debt levels. It's a desire for normality IMO.

If Sterling and the USD devalue to that extent, many people who sold their house (or chose not to buy one) and went with the "10% in PMs" advice will lose out massively. 10% just isn't enough to combat that sort of hyperinflation. And, whilst it pains me to say it, property will fare much better than paper in such a scenario.

[warpig]

 

The US government's debts have ballooned so badly the National Debt Clock in New York has run out of digits to record the spiralling figure.

 

http://news.bbc.co.uk/1/hi/business/7660409.stm

[tinecu]

If Sterling and the USD devalue to that extent, many people who sold their house (or chose not to buy one) and went with the "10% in PMs" advice will lose out massively. 10% just isn't enough to combat that sort of hyperinflation. And, whilst it pains me to say it, property will fare much better than paper in such a scenario.

 

That's what worries me too (20% in PMs). Hence I'm beginning to feel a sense of urgency in buying a property (ideally with some agri land) with my remaining cash or if I can't find something that seems OK value....physical it must be .

[rgleeson]

Why is spot not at $1,500 already? It’s SO unfair, the financial world is ending as expected and i'm impatient for my payout.

 

The TA chartists are ruining this bull market for me.

 

 

To answer my own petulant cry:

 

http://www.gold-eagle.com/editorials_08/hathaway100808.html

 

 

John Hathaway

Portfolio Manager and Senior Managing Director ©

 

Since the Bear Stearns bailout at the end of the first quarter, the backdrop for gold has unfolded in a more positive way than almost any of its proponents could have imagined. The government takeover of the GSEs, the Lehman Bankruptcy, the disappearance of blue chip investment banks, and continuing intense credit market stress despite the Paulson bailout of the financial system have generated successive new highs in the climate of fear overhanging the financial markets. These successive highs in stress can be measured objectively in the shrinking yields of short dated government securities and escalating credit spreads of all descriptions.

 

In light of all of this, why hasn’t gold done better? Year over year, gold bullion is up 25.9%, but is well below its peak price above $1000/ounce six months ago. Gold shares have not participated in the flight to safety and have in fact provided disappointing returns over the past six months, during one of the most intense financial market panics of recent history.

 

Is gold still in a bull market? On the face of it, the question seems absurd. It is tantamount to saying that paper currencies have bottomed out and that the coast is now clear for financial assets. Still, a quick look at gold’s chart shows why the question is pertinent. From viewing this chart, one could argue that when gold traded briefly above $1000/ounce around the timing of the Bear Stearns rescue, it had already fully discounted subsequent, albeit even more dramatic events in the financial markets. At the very least, according to this hypothesis, even though gold might remain in a very long term bull market, for the time being it is not a “good trade”. Asking this question another way, if these horrific financial market developments have been insufficient to drive gold to new highs, what will it take?

 

 

 

As we dissect the internal market developments since the Bear Stearns demise, we can discern (with 20-20 hindsight) a confluence of unusual factors leading to the breakdown in gold’s multi year advance. Our hypothesis is one of mistaken identity. Gold was caught in the cross fire of the unwinding of faux safe haven anti-dollar trades, namely the euro and commodities. The various iterations of anti-U.S. dollar trades leading up to Bear Stearns were undeniably overcrowded. Market Vane sentiment in favor of commodities and the euro and against the dollar were at extreme levels, an accident waiting to happen. On March 17, Market Vane’s bullish consensus was 93 for gold, 73 for copper, 96 for the euro, 82 for light crude oil and 17 for the U.S. dollar index.

 

The catalyst for a reversal of the anti-dollar trade was news of high level meetings between the U.S., European and Japanese monetary officials to draw up plans to defend the dollar should it crater in response to the Bear Stearns news. These meetings were reported in the press by William Pesek of Bloomberg on August 29, 2008: “Many were equally attentive to how the dollar’s drop was helping to boost oil prices…..The quickest solution is to stop the dollar from falling, a dynamic that might reverse the increase in oil prices.” It would not be surprising if word of these discussions was disseminated to selected financial institutions and their clients well before the press coverage of a dollar defense strategy, originally reported by of Nikkei News.

 

The prospect of a possible line in the sand translated into a brick wall for the euro. The exchange rate has declined from 1.60 to 1.35 or 15.6% in the space of a few months. Unwinding of the long euro-short $US began in earnest in mid July ’08 and reached panic proportions by early September. Related trades including commodities and especially oil were also collapsed. Covering dollar shorts created the illusion of a strong dollar. Given the tight correlation in recent years between the euro and gold, long gold positions held by hedge funds were dumped. The swings in Comex positions depicted by the Ned Davis chart are consistent with interpretation of a panic liquidation. The one month swing from July to August for gold was the fifth largest four week drop in net speculative positions over the last twenty-five years.

 

 

 

Comex futures are paper contracts typically settled for cash. Little physical gold changes hands. For example, Tocqueville holds nearly 100,000 ounces of physical gold at a Comex warehouse. While our gold is counted as part of the underlying physical metal to support the trading of paper contracts on Comex, it is not for sale and cannot be hypothecated. During the recent meltdown, bullion dealers inquired whether Tocqueville wished to sell its gold to take advantage of record premiums for converting Comex good delivery bars into coins. The U.S., Austrian, and South African mints report that they have had to ration or suspend sales of gold coins due to shortages of metal. Accounts of shortages in physical gold trading centers are numerous: “Wealthy Investors Hoard Bullion (Financial Times 9/30/08).” Jeremy Charles, chairman of the London Bullion Market Association, is quoted in the article as saying “There is an enormous pick-up in investment demand. I have never seen a market like this in my 33 year career.” To add to the conundrum, physical holdings of gold ETFs have climbed to all time record levels.

 

Over the past few months, the price of gold has not been set by the physical markets, however. It is set on the Comex platform where gold can be shorted naked. Unlike the process of shorting a stock, requiring a borrow prior to the execution of a short sale, funds trading on the Comex can short paper contracts that typically settle in cash and do not require possession of physical gold. According to one bullion trader we spoke with recently, there is only very light volume trading at the London fixes, where physical metal changes hands. All of the action has been on the Comex, and even there the volumes are light. Most of the recent trading appears to be linked to movements in the euro by relatively small players in a thin market.

 

It seems that the likely source of the glut of paper gold was momentum driven hedge funds that had been massively wrong footed in an overcrowded trade. The 2008 summer gold panic was a liquidation of paper that never translated into the physical deliveries to satisfy record demand. At the end of the day, the paper shorts represented by hedge funds, banks and their clients fell into a bear trap of their own making. There was no physical with which to cover. This explains the unprecedented 17% short covering rally in the space of only two days (September 17 and 18). The only similar episode in recent memory was the short covering rally in 1999 triggered by the Central Bank agreement to limit gold sales. Chart patterns back then were less favorable than today. At the very least, it is premature to declare an end to the bull market in gold and the bear market in paper. It is more likely that this massive shakeout has set the stage for a dynamic advance.

 

What will drive a further advance in gold? Let’s start with the implausible assumption that the worst of the credit crunch had been already discounted when gold scaled $1000. Let’s also assume, an even greater stretch, that the Paulson bailout succeeds in restarting the wheels of lending and commerce. Finally, let’s toss in an end to the decline of asset prices and the commencement of a bull market in equities. The unequivocal precondition for these felicitous events would be the transformation of the dollar and other paper currencies as we know them. The socialization of credit in the U.S. may well work the miracles as its proponents claim, but not without stiff costs. We suspect that two inescapable costs will be inflation and negative real interest rates as far as the eye can see. Both of these outcomes are friendly to gold. Neither is likely to improve the credit rating of the dollar or increase the desire of non U.S. investors to increase their holdings of U.S. treasuries.

 

We believe that a future downgrade of U.S. sovereign credit is a strong possibility. It would defrock U.S. treasuries of their safe haven status. In the late 1970’s, they were dubbed “certificates of confiscation”. We fully believe they will once again be referred to in a similar manner as a direct result of current and still to come interventions by the government to shore up financial markets. On September 16, 2008, The People’s Daily, which is the official newspaper of the Chinese Communist Party, commented: “The world urgently needs to create a diversified currency and financial system and fair and just financial order that is not dependent on the United States.” There is similar commentary from other major foreign investors in U.S. treasuries.

 

The experience of the past six months has unmasked other faux safe havens. Paramount among these are the euro and economically sensitive commodities such as base metals and oil. While we view the euro as perfectly capable of rallying to new highs versus the dollar in the coming months, we believe it is even more likely to disintegrate than the U.S. dollar. A euro permanently above 1.60 would be catastrophic for euro land and would be politically intolerable. Finally, we note that there is nothing automatic regarding the correlation between the euro and the U.S. dollar gold price. The last period of prolonged dollar strength versus the euro coincided with strength in both the dollar and euro gold price.

 

 

 

Economically sensitive commodities have multiple shortcomings as safe havens against economic turmoil. First, economic turmoil undermines demand for them. Second, rising prices in real and even in nominal terms are economically disruptive and, by the way, cause economic turmoil. Third, they are impossible for most investors to take physical possession of. As the chart below shows, gold is cheap relative to oil. There is no rule that states that gold must revert to a more normalized relationship. However, gold trending higher against oil would signify that investors had rediscovered its monetary traits and are in the process of revaluing the metal versus economically sensitive commodities.

 

 

 

The remaining “safe haven” to be unmasked is U.S. treasuries which sport yields significantly below nominal rates of inflation. For now, safety seeking investors prefer to lose money slowly in treasuries than in supposedly riskier assets. Should the bailout and whatever other extreme measures the government undertakes meet with success, the safety of treasuries will be exposed as were the euro and economically sensitive commodities as investors rush for the exits. We believe there is pain ahead for those hiding in treasuries. As the table below shows, gold is cheap relative to financial assets and that there is plenty of room for gold to be reassessed even in a more favorable economic climate.

 

 

 

As the table below shows, there is a paucity of physical gold to receive capital flows from failed safe havens. The magnitude of the upside potential is expressed rather eloquently in the proposition that the estimated float of physical gold (45,000 – 50,000 tonnes) is roughly equal to the buying that would be generated by a mere trickle of slightly more than 1% of global pension fund assets in its favor. In our view, gold trading steadily at $2500 is not unthinkable. Gold at $2500 would not be economically disruptive but result instead from disruption itself. Until trust is restored in the mechanisms and instruments of government, namely paper money and, more recently, large swaths of the financial system, we like the metal’s chances to reside comfortably in four digit territory. We believe that gold mining shares, which have provided very disappointing returns over the past six months, are due for a significant revaluation once investors view the $1000/ounce threshold as a floor rather than a ceiling.

 

 

 

The answer as to whether or not gold remains in a bull market should not overly depend on the pessimism currently rampant in the financial markets. While worst case outcomes may still be in the cards, as contrarians, we suspect they are close to being fully priced into the mix, at least for the time being. A better test for investing in gold is on what basis a case can be made in a more favorable climate for financial markets. That scenario might include declining risk spread, a bottom in housing, and some hope for resolution of the credit crisis. The linkage of gold to the euro is a temporary fact of life. We fully expect both the dollar and the euro to lose value against gold. From time to time they will take turns leading the race to the bottom but we have little doubt the gold price expressed in either currency will be significantly higher within a reasonable time frame. In our view, nothing could be better for gold than for European investors to lose faith in the euro in the same way that investors have lost faith in the dollar, the financial system and financial assets in general. If dollar strength against the euro restores some semblance of stability to the financial scene, as ludicrous as the thought might be, gold is not automatically the loser.

 

Long lines of investors buying physical gold, even though they may not have affected the price near term, signify a widespread loss of trust. In our article “The Investment Case for Gold” written 1/22/02, we described three factors that would drive the gold price to all time highs: supply and demand, macroeconomic, and metaphysical. Of these three, the most important is metaphysical because it represents a shift in widespread social and institutional belief structures and thought patterns. The events of the past six months have all but destroyed faith in the competence of political leadership, government and financial institutions and the expectation that expert financial professionals can produce satisfactory returns. Gone too is the belief that housing prices will rise forever and that taking on debt is a good idea.

 

The bleak climate of opinion that has settled in will not easily be whisked away by new government policies. It will not be dislodged by cheery reports on CNBC, a positive set of government statistics, or encouragement from bullish gurus. A preference for risk avoidance is here to stay for quite a while, even after the markets find their ultimate lows. This was the case in the 1970’s following the bear market bottom in December, 1974. Cultural lag is a powerful force and can influence behavior long after the worst has been seen. Once expectations and beliefs become imbedded and are reinforced by experience, the swing of pendulum back towards a full appetite for risk taking might take half a generation. For this reason, we expect the price of gold to continue its rise against all paper currencies for several years to come.

 

Given gold’s disappointing behavior thus far as the credit crisis unfolds, it is understandable why so many investors appear to remain on the sidelines. The bull market in gold is intact. The dynamics of the ongoing financial crisis can be summed up in the escalating tension between inflation and deflation. The market-induced deflation of asset values and income streams comes at a time when debt relative to GDP is at all time highs. The options for government policy are

 

 

 

stark: either let the burden of debts further crush economic activity, or crank up the printing presses to devalue paper currencies so as to relieve debt burdens. The question for anyone on the sidelines contemplating gold is whether it is possible or necessary to time perfectly a strategic commitment to the one asset class that will survive and most likely benefit under either outcome.

 

 

 

 

John Hathaway

 

 

[LauraB]

Speaking of reality, many people are going to gold not because of a "get rich quick" metality as you put it but because of an "avoid poverty" mentality.

 

 

Also, consider what a "take off" in POG might really mean. Say the dollar collapses and POG goes to $8000. Keep in mind that this is 8000 devalued dollars and is in reality just a preservation of purchasing power.

 

I bet the IRS wont see it that way

 

[romans holiday]

If Sterling and the USD devalue to that extent, many people who sold their house (or chose not to buy one) and went with the "10% in PMs" advice will lose out massively. 10% just isn't enough to combat that sort of hyperinflation. And, whilst it pains me to say it, property will fare much better than paper in such a scenario.

 

A sudden dollar devaluation [with the threat of continued devaluation] may be the catalyst by which hoarded money once again becomes liquid. All this money rushing out in search of a home is likely to push asset prices up again. So we would have pressure on prices from not only a devalued dollar but also an over-supply of money competing for assets. If we do not have a hyper-inflation we would surely see chronic inflation at this time.

 

Agree that the poor STR chap with his fund could find himself priced out.

[romans holiday]

I bet the IRS wont see it that way

 

Excellent point.

 

It could get nasty if the IRS remain blinkered to depreciation and insist on capital gains tax. I believe In NZ there is no tax when selling gold. Also here in Korea, when I enquired out of curiosity at the gold bank, there was no tax to be paid.

 

He was so keen to swap his worthless won for my precious but I was thinking "only out of my cold dead hands".

[wrongmove]

Excellent point.

 

It could get nasty if the IRS remain blinkered to depreciation and insist on capital gains tax.

 

Especially if they set it at 95% as an "emergency measure" with wide support from the gainless population.

 

All in one basket is never a great idea, surely. If you really expect hyperinflation, I would at least put a roof over your head first, if you haven't already.

 

 

 

[romans holiday]

Especially if they set it at 95% as an "emergency measure" with wide support from the gainless population.

 

All in one basket is never a great idea, surely. If you really expect hyperinflation, I would at least put a roof over your head first, if you haven't already.

 

Yep, I worry more about what politicians may do than about a depression. As I posted earlier, am expecting chronic inflation at a later period but who knows it could possibly go hyper. As for a roof over my head, I see in the currency of gold, and these interesting times, an opportunity to achieve the most basic of needs without incurring a life time of debt.

[Dispassion]

The wedge begining on Monday expires very shortly, I'd say 75% bullish.

[warpig]

Is anyone else getting nervous about holding anything else but physical? I'm seriously starting to reconsider my position with bullionvault.