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Money, Business & Finance Ground >> Lets talk about gold


9/10/11 5:22 PM
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jaywill
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  the fiat currencies are going insolvent and the only safe haven is ... you guessed it gold.  we arent even seeing the actual real value of it yet. London alone papers the value down by about 100 to 1  and the Chinese coming online with their own exchange is a game changer. that and the chinese havent announced their reserves since 98 i think?
i think its still a good investment because these increases in value arent a result of speculative bubbles as much as they are a slowly dismantling of the artificial mechanisms that have suppressed it for decades.
the unlimited paper wealth of Fiat currency has waged war on gold historically , but thanks to its unravelling gold is going to go nowhere but up , and theres not enough gold in the world to even give every citizen one ounce.
9/11/11 4:54 AM
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RoidsGracie
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 Just to be a bit of a contratarian:

online.wsj.com/article/SB10001424053111904103404576556633057148922.html

Btw, I'm actually invested in silver but I going between thinking I should get out of it and thinking I should keep my physical silver as an insurance against hyper inflation. From what I read though, the fears that are being expressed today seem to be similar to what happened in the 80s when gold rapidly increased in price like it is today. What makes the present era different from just a few decades ago? I'm sure people back then thought they were entering a new era too.
9/12/11 2:14 AM
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jaywill
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 here we go, it begins.

Banks, Governments Move To Restrict Personal Gold Bullion Purchases


A new trend in Austrian (and perhaps the rest of Europe’s) banking policies suggests that certain interested parties are attempting to control the sale and personal acquisition of gold/silver as safe haven assets. What we experienced first hand should be a wake up call for not just Europeans, but Americans as well.

The policy change was quiet, has not been reported by any media outlets that we’re aware of, and no mention of the new policies is made on the web sites of Austria’s largest banking institutions (though it is clear they vehemently comply with U.S. anti-money laundering measures and the Patriot Act)

According to the bank representatives and manager we spoke with, Austrian banks have now been ordered to restrict the sale of gold and silver bullion purchases and are limiting personal acquisitions of precious metals to 15,000€ (approximately $20,700 USD) at a time, or 11 ounces of gold at today’s prices.

The noose is tightening. Governments, large financial institutions and political chess players know exactly where real value exists. And it’s certainly not in the currencies that are being printed with reckless abandon.
9/12/11 10:06 AM
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cagepedia
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jaywill -   the fiat currencies are going insolvent and the only safe haven is ... you guessed it gold.  we arent even seeing the actual real value of it yet. London alone papers the value down by about 100 to 1  and the Chinese coming online with their own exchange is a game changer. that and the chinese havent announced their reserves since 98 i think?
i think its still a good investment because these increases in value arent a result of speculative bubbles as much as they are a slowly dismantling of the artificial mechanisms that have suppressed it for decades.
the unlimited paper wealth of Fiat currency has waged war on gold historically , but thanks to its unravelling gold is going to go nowhere but up , and theres not enough gold in the world to even give every citizen one ounce.


first - you dont have to say "fiat" currency... just currency is fine.

so gold's huge jump in price is not speculative? and you attribute it to the "slowly deteriorating artificial mechanisms"? could you show me the correlation between these two? The fact that you mention it means you have numbers to back it up right? slowly deteriorating means we are talking 30- years? 40 years?

As for artificial, can you tell me what the intrinsic value of gold is? Who sets that value?
9/12/11 12:29 PM
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jaywill
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Edited: 09/12/11 12:29 PM
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 correllations? lets look at the most recent with silver, Hsbc and Jp morgan were sued a few years back for market manipulation and it started getting attention so they backed off slightly. suddenly 6 dollar silver became 40 dollars. then when it was hitting 50$ the banksters pulled an unprecedented triple margin increase to halt it just like they are still doing with gold.  85% of the short positions are held by the same banks.
 
9/12/11 12:47 PM
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jaywill
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JustHappy2SeeU - how is that gold working for ya?

 i love these old gold threads haa
9/12/11 1:31 PM
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cagepedia
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Edited: 09/13/11 10:41 AM
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jaywill -  correllations? lets look at the most recent with silver, Hsbc and Jp morgan were sued a few years back for market manipulation and it started getting attention so they backed off slightly. suddenly 6 dollar silver became 40 dollars. then when it was hitting 50$ the banksters pulled an unprecedented triple margin increase to halt it just like they are still doing with gold.  85% of the short positions are held by the same banks.
 


why are you talking about silver? Isn't his conversation about gold?
You said gold is a good investment because of "slowly deteriorating artificial mechanisms", right? I have two questions about this.
a) What do you mean by "slowly deteriorating artificial mechanisms"?
b) Can you show me any correlation in the returns between the so called "slowly deteriorating artificial mechanisms" and gold on a long term basis.
9/13/11 2:24 PM
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kanotoa
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Central banks and countries like China, India are buying up gold and silver by he tons.

Gold and silver have been money for thousands of years and no fiat currency has lasted more than 50 years, most only last about 30 i believe.

Gold and silver are valuable because they are rare and cannot be created with a computer entry. They are durable and fungible (an ounce or gold is an ounce of gold).

The money supply in the US has increased by 4X in Obamas term in office the amount of gold has not, many say the amount of silver has been going DOWN year after year.
9/13/11 2:27 PM
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kanotoa
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I looked into TIPS but i doubt they will pay if we hit high/hyper inflation. If they do i think the dollars will be worthless anyway.
9/14/11 5:30 PM
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cagepedia
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kanotoa - Central banks and countries like China, India are buying up gold and silver by he tons.

Gold and silver have been money for thousands of years and no fiat currency has lasted more than 50 years, most only last about 30 i believe.

Gold and silver are valuable because they are rare and cannot be created with a computer entry. They are durable and fungible (an ounce or gold is an ounce of gold).

The money supply in the US has increased by 4X in Obamas term in office the amount of gold has not, many say the amount of silver has been going DOWN year after year.


so how would you price gold? Who prices it?

oil is fungible too, and useful. Gold on the other hand has no major industrial use.

And just coz India and China are buying - both "newly open" economies btw and both not that open if you look at them. China manipulates their numbers and still their growth is slowing, and inflation is going up, which means wages are going up. India is a little different (though it's economy was based on a socialist system) - their capital markets are a sham, repatriating money is a huge problem, try buying stock there. Or try buying a chinese stock (I do hold some names in my portfolio). You do not get direct ownership in the company, and most of the times it is an offshore company, with a loose agreement with the real chinese company - for e.g. Renren, the facebook of China, trades on the NASDAQ, is incorporated in the Cayman Islands, and is not a majority shareholder in Renren (the social networking site operator). Turns out the CEO's wife owns the CI based company. Also look at Yahoo's relationship with Alibaba.

India and China's economy looks impressive but it is not what it seems.

And I was not comparing TIPs to gold. Someone said there is no safe investment and I said TIPs was safe. Returns are positively correlated to risk. Higher returns for higher risk. TIPS is very very low risk, hence low returns, but at least you can model those returns because you know what the cash flows are with certainty. Gold has no cash flows, can't model returns for it.
9/14/11 6:51 PM
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jaywill
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 arg, mines are getting bought up like crazy, i went small 1000 shares in a penny stock that got bought up and jumped by a buck!  oh shart.

heres another one for you cagepedia, the Swiss recently created an arificial floor on the eu/swiss exchange rate basically eliminating themselves from safe haven status, leaving only gold. but the gold price went down oddly enough. turns out in the span of one minute there were 4,000 contracts piling in totalling almost a billion dollars shorting the metal. The timing was obvious that someone had previous knowledge of the decision (banksters) and they immediately piled on the paper. with gold its essentially the tail (futures) wagging the dog(spot price)
9/15/11 1:43 PM
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jaywill
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 for the bears, china is building or has already built a fort knox and has declared their intentions to increase reserves by 900% to 10,000 tonnes by the end of the decade. if they move even 5% of their foreign holdings to gold they will have to purchase all the gold mined on the planet for the next 12 months.
they also accellerated the 5 year plan for the internationalization of the yuan. originally it was to be 2017 that Imf forecasted China to overtake the US economy, now they are trying to open shop up by 2015.
On top of that the new exchange is going to make it much more difficult to short the metals as 600,000,000 ag bank of china citizens will have access to gold contracts that arent leveraged 100-1 like the western banks.

9/15/11 6:11 PM
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kanotoa
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I heard the US is fighting this really hard and trying to force them to buy treasuries instead.
9/16/11 12:24 PM
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Buddhadev
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cagepedia - TIPS returns compared to gold's returns is pathetic but that was not the question was it? You said there are no safe investments, and I said TIPS is a safe investment.


Only if you use a biased metric (dollars). If you measured your returns on TIPS in sugar, gallons of gas, or ounces of palladium, you lost money over various time periods. Ergo--there is no such thing as a "safe investment."
9/16/11 12:24 PM
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jaywill
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kanotoa - I heard the US is fighting this really hard and trying to force them to buy treasuries instead.

 I bet China uses some of their US holdings to buy the EUro bonds that will come out to bail out EU.  that would be nuts to see China literally have the entire western civilization by the balls.
9/16/11 12:36 PM
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cagepedia
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Buddhadev - 
cagepedia - TIPS returns compared to gold's returns is pathetic but that was not the question was it? You said there are no safe investments, and I said TIPS is a safe investment.


Only if you use a biased metric (dollars). If you measured your returns on TIPS in sugar, gallons of gas, or ounces of palladium, you lost money over various time periods. Ergo--there is no such thing as a "safe investment."


lol, try buying something with sugar, or gas, or palladium... biased metric indeed.
9/16/11 12:38 PM
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cagepedia
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Buddhadev - 
cagepedia - TIPS returns compared to gold's returns is pathetic but that was not the question was it? You said there are no safe investments, and I said TIPS is a safe investment.


Only if you use a biased metric (dollars). If you measured your returns on TIPS in sugar, gallons of gas, or ounces of palladium, you lost money over various time periods. Ergo--there is no such thing as a "safe investment."



however had you said TIPS is not a safe investment in a deflationary environment I would have given you props.
9/16/11 5:12 PM
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Buddhadev
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cagepedia - 
Buddhadev - 
cagepedia - TIPS returns compared to gold's returns is pathetic but that was not the question was it? You said there are no safe investments, and I said TIPS is a safe investment.


Only if you use a biased metric (dollars). If you measured your returns on TIPS in sugar, gallons of gas, or ounces of palladium, you lost money over various time periods. Ergo--there is no such thing as a "safe investment."



however had you said TIPS is not a safe investment in a deflationary environment I would have given you props.


The point is that the decision to do *anything* with your money contains some risk. In fact, the choice to do *nothing* requires you to accept risk as well. Again, no such thing as "safe."
9/22/11 4:15 PM
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mikehh
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gold is down $200 an ounce since its peak-


rough

might be a buying opp in the next few months.
9/23/11 12:24 PM
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jaywill
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 yup , theyve been hammering it down like mad, when you consider the inflation and the devaluation, and fact that asian demand is sucking up every ounce mined and then some , there is no "real" reason for it to go down. I look at it as a spring getting pushed harder and harder.
9/23/11 12:54 PM
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Buddhadev
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mikehh - gold is down $200 an ounce since its peak-


rough

might be a buying opp in the next few months.


This is what bull markets are like--they're volatile.
9/23/11 2:33 PM
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mikehh
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Buddhadev - 
mikehh - gold is down $200 an ounce since its peak-


rough

might be a buying opp in the next few months.


This is what bull markets are like--they're volatile.




i still dont like the fact rates are near 0 that is the death clutch in the long run
10/3/11 4:01 PM
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cagepedia
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Buddhadev - 
mikehh - gold is down $200 an ounce since its peak-


rough

might be a buying opp in the next few months.


This is what bull markets are like--they're volatile.


and bear markets are not? In any case we are in a bear market, and gold is volatile.
10/3/11 9:08 PM
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Buddhadev
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^^^You probably would have been calling the end for gold when it got dinged from 1000 down to 700 or so in the runup to the financial crisis. People of your ilk were saying that it was at an insane, unsustainable bubble high when it was at 1000! But people who ignored them made out like bandits!

Want to make a bet about gold's price in USD one year from now? We can be as famous as Paul Ehrlich and Julian Simon. I'm 100% serious about this. It could be as simple as picking today's price and me paying you the amount that it's lost if it loses and you paying me the amount that it's gained if it gains.
10/3/11 10:24 PM
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jaywill
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 not surprising it got hammered down. sept 30 they were going to have to pay the piper on an assload of short contracts, what a convenient turn of events that the pms plummetted just at the same time. its just another buying oppurtunity though.

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