# The Gold and Silver Thread



## Toro (Nov 23, 2010)

Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.

I bought back much of my gold and silver exposure yesterday and added a bit today.  There is a bid underneath gold, and though silver is extended, there is support at ~$25-$26.  A few weeks of consolidation for silver would do it a world of good.


----------



## Madeline (Nov 23, 2010)

This thread ain't about the ladies' preferences in precious metals?  Well damn....

Toro, when you buy gold and silver, do you actually take delivery?


----------



## Toro (Nov 23, 2010)

I do not take delivery.


----------



## Valerie (Nov 23, 2010)

[ame]http://www.youtube.com/watch?v=oMlqn_Hjyi8[/ame]


----------



## Valerie (Nov 23, 2010)

> Stocks sank, dragging the MSCI Emerging Markets Index down the most in five months, while the dollar and the Swiss franc rallied as fighting broke out between North and South Korea and concern grew Europes debt crisis will spread. Metals slid as Chinas banks approached lending limits.



Stocks Drop, Dollar Gains on Korea Clash, Europe Debt - Bloomberg


----------



## Madeline (Nov 23, 2010)

Toro said:


> I do not take delivery.



May I hold onto it for you then?


----------



## LordBrownTrout (Nov 23, 2010)

Toro, what types of purchases do you make on precious metals?  I bought some more junk 90 percent coins a week ago when silver fell to high 25's.  I always take possession of it.


----------



## william the wie (Nov 23, 2010)

I think it is important to keep in mind that precious metals as a contra-asset obscures their use in electronics and other forms of high tech. More importantly in these uses silver and gold are not economically recoverable at current prices. The shortage of silver is particularly critical so the upside is not really knowable.


----------



## Toro (Nov 23, 2010)

LordBrownTrout said:


> Toro, what types of purchases do you make on precious metals?  I bought some more junk 90 percent coins a week ago when silver fell to high 25's.  I always take possession of it.



I buy ETFs and options on ETFs. 

I have thought about buying physical - and storing it in Canada - but have yet to do so.


----------



## Toro (Nov 23, 2010)

The euro is getting hammered. It is down 2.3 cents as I write this. Gold is significantly higher while silver is off a bit. Right now, my exposure is primarily gold but I do have options on silver. I will quickly sell my position if I think I am wrong in the short term.


----------



## Toro (Nov 23, 2010)

Madeline said:


> Toro said:
> 
> 
> > I do not take delivery.
> ...



Expect a Brink's truck outside your house tomorrow.


----------



## Madeline (Nov 23, 2010)

Wait, wait.....I had in mind a UPS guys and a Tiffany's catalogue......


----------



## loosecannon (Nov 23, 2010)

Valerie said:


> > Stocks sank, dragging the MSCI Emerging Markets Index down the most in five months, while the dollar and the Swiss franc rallied as fighting broke out between North and South Korea and concern grew Europes debt crisis will spread. Metals slid as Chinas banks approached lending limits.
> 
> 
> 
> Stocks Drop, Dollar Gains on Korea Clash, Europe Debt - Bloomberg



That's funny, yeah just a little wee international instability event IS enough to strengthen the dollar and bonds and pull folks away from equities and metals. The dollar gained 1% in a day.

But Hang tough Toro, it'll come back around.


----------



## Toro (Nov 23, 2010)

Gold is considered more of a currency than silver, given that roughly half of all silver production is used in industrial production whereas less than 10% of gold is used for industrial uses.  However, silver has a higher beta, meaning that it will rise and fall more than gold.

GFMS estimates that there is 168,000 tons of gold in existence today, or 5.376 billion ounces.  Gold is currently trading at $1350 an ounce.  Thus, the total value of gold outstanding is $7.25 trillion.

It is estimated that there are 1 billion ounces of silver above the ground currently.  Silver has been depleted.  In 1950, there was an estimated 4 billion ounces.  At $27 an ounce, the total value of silver in existence is $27 billion.  There are 100 companies in the S&P 500 with an equity market capitalization greater than $27 billion.  The total value of gold above the earth's crust is 270x that of silver.

Thus, it takes less to move the price of silver than it does the price of gold.


----------



## Baruch Menachem (Nov 23, 2010)

Buying metals assumes there is always a greater idiot.    The kind of thinking that got us into the mortgage meltdown two years ago.

There are greater idiots out there, (Right, Rdean?)   but one can't always rely on them to bail you out of a bad investment.


----------



## Toro (Nov 23, 2010)

Baruch Menachem said:


> Buying metals assumes there is always a greater idiot.    The kind of thinking that got us into the mortgage meltdown two years ago.
> 
> There are greater idiots out there, (Right, Rdean?)   but one can't always rely on them to bail you out of a bad investment.



Well, not entirely.  Metals are based on marginal supply and demand from speculators AND producers.  Copper is getting squeezed because of building in China, not because of speculators.

However, I'm sure we are going to the really great part of the Greater Fool phase for gold and silver sometime in the future.  Serious money is made during that phase.


----------



## Toro (Nov 26, 2010)

Gold and silver are getting whacked this morning.  Gold is down $20 and silver down $1.  Markets are worried about contagion in the euro zone as reports this morning are that Portugal was asked to ask for a bailout package.  This is causing a rush into the dollar and hare-trigger selling of precious metals.  Support for gold is around $1335 and $26 for silver.


----------



## Paulie (Nov 26, 2010)

Baruch Menachem said:


> Buying metals assumes there is always a greater idiot.    The kind of thinking that got us into the mortgage meltdown two years ago.
> 
> There are greater idiots out there, (Right, Rdean?)   but one can't always rely on them to bail you out of a bad investment.



That's basically any bubble.  And of course, like our other bubbles, this precious metals one is being fueled by Federal Reserve policy.


----------



## Trajan (Nov 26, 2010)

Toro said:


> Gold and silver are getting whacked this morning.  Gold is down $20 and silver down $1.  Markets are worried about contagion in the euro zone as reports this morning are that Portugal was asked to ask for a bailout package.  This is causing a rush into the dollar and hare-trigger selling of precious metals.  Support for gold is around $1335 and $26 for silver.



yea I saw that too. meh......


----------



## william the wie (Nov 26, 2010)

Gold and silver could do anything in the shortrun.


----------



## Toro (Nov 26, 2010)

william the wie said:


> Gold and silver could do anything in the shortrun.



They are both trading in fairly tight ranges.  I think the bias is still up in the short-term, but we'll see.

What was promising was that gold and silver sold off pretty hard in the pre-market, but both rose into the close, although gold did better than silver.  Also on a positive note, Canada sold off hard on the open then rose into the close before selling off in the final minute.


----------



## william the wie (Nov 26, 2010)

Toro said:


> william the wie said:
> 
> 
> > Gold and silver could do anything in the shortrun.
> ...


Bummer for your relatives isn't it? Why do you consider it positive?


----------



## Toro (Nov 26, 2010)

william the wie said:


> Toro said:
> 
> 
> > william the wie said:
> ...



Generally, it is bullish when market sell off in the morning then rise into the afternoon close.  It shows that investors are buying the dips.  It follows the maxim that the dumb money opens the market and smart money closes the market.  Think of it as a poker game.  The sucker at the table rushes to place his bets first and shows his hand right away.  The pros wait until the end before revealing their hand.  Trading is similar.  Of course, simply because the close is strong doesn't mean that the market will always go up but its a pretty good rule of thumb IMHO.

But like I said, there is a lot of indecision in the market.  Europe appears to be rolling over and the banks have been acting poorly but the small cap stocks may be poised to break out.


----------



## FireFly (Nov 26, 2010)

IMHO - Gold & Silver have been due for a 10% correction because of the recent big steep run-up. On the flip-side other currencies have weakened forcing gold up along with the dollar during its correction. This has caused a turbulent sideways correction that has it range bound at the moment.

Short term is choppy sideways. Long term is bullish. I will be buying if it gets into the low $1300s.


----------



## william the wie (Nov 26, 2010)

Toro, you might want to check on the expected decision of the German Constitutional Court in regards to the Euro bailouts due in February. I have yet to hear a possible outcome that does not lead to Euro meltdown from ECB Quantitative easing.


----------



## Toro (Nov 26, 2010)

william the wie said:


> Toro, you might want to check on the expected decision of the German Constitutional Court in regards to the Euro bailouts due in February. I have yet to hear a possible outcome that does not lead to Euro meltdown from ECB Quantitative easing.



If so, that's good for gold and silver long-term.  It might whack precious metals in the short-term, however, as there is knee-jerk selling in response to a flight to the dollar.


----------



## william the wie (Nov 26, 2010)

Toro said:


> william the wie said:
> 
> 
> > Toro, you might want to check on the expected decision of the German Constitutional Court in regards to the Euro bailouts due in February. I have yet to hear a possible outcome that does not lead to Euro meltdown from ECB Quantitative easing.
> ...


What is really frightening is that increased buying by Europe might be covered up by devaluation and expanded QEII. Do you have a clue as to how much QE is going to finance putback settlements? My count got upto around 2T before I realized that the firms handling the suits might be part of the same legal consortia is there some sort of clearinghouse on that data or not?


----------



## Toro (Nov 27, 2010)

I don't know.


----------



## william the wie (Nov 27, 2010)

Toro said:


> I don't know.


I haven't run across anyone else who even claims to do so but making whole the senior tranches may also apply to the mezzanine tranches, which could get nasty.


----------



## LordBrownTrout (Nov 29, 2010)

News Headlines

Predicts slower growth for silver in 2011.  50, 60 an ounce perhaps by end of next year?


----------



## Toro (Nov 29, 2010)

LordBrownTrout said:


> News Headlines
> 
> Predicts slower growth for silver in 2011.  50, 60 an ounce perhaps by end of next year?



Damn, I hope so!  I want that beach house!


----------



## Jos (Nov 30, 2010)

Toro said:


> I do not take delivery.



If you can't hold it, you don't own it


----------



## william the wie (Nov 30, 2010)

Toro said:


> LordBrownTrout said:
> 
> 
> > News Headlines
> ...


I live 12 blocks from the beach. Not wishing to be part of the future dune system that is close enough for me. This house cost 10K in the 70s and is purportedly worth 250K now. With my expectation of 40K FMV in 10 years I don't need to up the volatility of my housing by 10x.


----------



## Bern80 (Dec 1, 2010)

Anyone no reputable places to buy from? Most of the places I see advertised you would buy the stuff in coin form. Also, how do you sell it once you have it?


----------



## Toro (Dec 1, 2010)

Today, the world's central banks continued to support the price of precious metals. The ECB said it will prop up the bond markets of the PIIGS while there is talk of the US increasing it's IMF commitment for Europe. 

Yesterday, the government of China said it's citizens can now start buying gold ETFs.


----------



## Trajan (Dec 1, 2010)

Toro said:


> Today, the world's central banks continued to support the price of precious metals. The ECB said it will prop up the bond markets of the PIIGS while there is talk of the US increasing it's IMF commitment for Europe.
> 
> Yesterday, the government of China said it's citizens can now start buying gold ETFs.





> US increasing it's IMF commitment for Europe.





give me a minute to ponder that irony....unbelievable. 



> ECB said it will prop up the bond markets of the PIIGS



and off set this how? do they say? they can absorb only so much .

you know, why do I get the feeling they really really, I mean really are scrambling here?


----------



## Toro (Dec 1, 2010)

Everyone is debasing their currencies. The euro is like the gold standard to the PIIGS. The only way this can be offset while keeping the eurozone intact is wealth transfers from the core to the periphery. This is what the ECB is doing.


----------



## Jos (Dec 1, 2010)

Bern80 said:


> Anyone no reputable places to buy from? Most of the places I see advertised you would buy the stuff in coin form. Also, how do you sell it once you have it?



https://online.kitco.com/


----------



## william the wie (Dec 1, 2010)

Toro said:


> Everyone is debasing their currencies. The euro is like the gold standard to the PIIGS. The only way this can be offset while keeping the eurozone intact is wealth transfers from the core to the periphery. This is what the ECB is doing.


The Irish and/or German courts will purportedly throw out the bailouts by Feb. What that means for precious metals I have no idea.


----------



## LordBrownTrout (Dec 1, 2010)

Cheers, boys!  We're bailing Europe out now.  Time to buy some more coins.


----------



## william the wie (Dec 1, 2010)

LordBrownTrout said:


> Cheers, boys!  We're bailing Europe out now.  Time to buy some more coins.


 Hopefully that bailout will be aborted and soon.


----------



## Toro (Dec 2, 2010)

william the wie said:


> LordBrownTrout said:
> 
> 
> > Cheers, boys!  We're bailing Europe out now.  Time to buy some more coins.
> ...



No way!  

I'm up to my eyeballs in precious metals.

You go, Ben!  Bail 'em all out!


----------



## Jos (Dec 2, 2010)

Toro said:


> I'm up to my eyeballs in precious metals.
> 
> You go, Ben!  Bail 'em all out!


Are you now taking delivery, or just ETF's


----------



## LordBrownTrout (Dec 2, 2010)

william the wie said:


> LordBrownTrout said:
> 
> 
> > Cheers, boys!  We're bailing Europe out now.  Time to buy some more coins.
> ...



Well, one would think but according to our superiors, money just grows like weeds.  Plus, I think Toro is manipulating since he showed us his cards with that beach house, lol!!!


----------



## Toro (Dec 2, 2010)

Mwahahahahaha!


----------



## Toro (Dec 2, 2010)

Don't be surprised if there is a pullback over the next few days. Support for gold is around $1365, and $27-$27.25 for silver.


----------



## LordBrownTrout (Dec 3, 2010)

Zippity do da zippity ay my oh my what a wonderful day.


----------



## dilloduck (Dec 3, 2010)

LordBrownTrout said:


> Zippity do da zippity ay my oh my what a wonderful day.



Is this a good day for gamblers ?


----------



## RallyxPoint (Dec 3, 2010)

lol funny how theres gonna be a gold mining show on discovery now lol


----------



## Toro (Dec 3, 2010)

Silver hit a multi-decade high today.  Gold was close.


----------



## LordBrownTrout (Dec 3, 2010)

Toro said:


> Silver hit a multi-decade high today.  Gold was close.



Ding, ding, ding.


----------



## Toro (Dec 3, 2010)

China, which is the world's largest gold producer, announced that it has imported 200 tons of gold this year, five times the amount last year.

News Headlines

Total gold production is about 2000 tons per year. Total supply, which includes scrap, is about 3000 tons.


----------



## Jos (Dec 3, 2010)

RallyxPoint said:


> lol funny how theres gonna be a gold mining show on discovery now lol



im in the US army, with the 10th mountain division, as a froward observer.
Welcome, I hope your spotting skills are better than your spelling


----------



## william the wie (Dec 3, 2010)

Toro said:


> China, which is the world's largest gold producer, announced that it has imported 200 tons of gold this year, five times the amount last year.
> 
> News Headlines
> 
> Total gold production is about 2000 tons per year. Total supply, which includes scrap, is about 3000 tons.


 Toro I thought there was more than 1.5 year's supply being held by speculators, did you do a typo?


----------



## Toro (Dec 3, 2010)

william the wie said:


> Toro said:
> 
> 
> > China, which is the world's largest gold producer, announced that it has imported 200 tons of gold this year, five times the amount last year.
> ...



No typo.  Not sure what the total held amount is by speculators.


----------



## william the wie (Dec 3, 2010)

Toro said:


> william the wie said:
> 
> 
> > Toro said:
> ...


 That is a very tight supply with the potential for huge moves on the upside.


----------



## KissMy (Dec 4, 2010)

Here is even more good fodder for gold & silver.

Senate to vote on Democratic tax cut plans


> ...neither Democratic proposal was likely to get the 60 votes needed to advance.
> 
> Democrats said that wasn't the point. "This is going to be a winning argument, not just for this week, but for the next two years," said Sen. Chuck Schumer, D-N.Y., looking ahead to 2012.
> 
> ...


----------



## KissMy (Dec 4, 2010)

The Telegraph: EU rescue costs start to threaten Germany itself


> Credit default swaps (CDS) measuring risk on German, French and Dutch bonds have surged over recent days, rising significantly above the levels of non-EMU states in Scandinavia.
> 
> "Germany cannot keep paying for bail-outs without going bankrupt itself," said Professor Wilhelm Hankel, of Frankfurt University. "This is frightening people. *You cannot find a bank safe deposit box in Germany because every single one has already been taken and stuffed with gold and silver. It is like an underground Switzerland within our borders.* People have terrible memories of 1948 and 1923 when they lost their savings."


----------



## william the wie (Dec 4, 2010)

The US is no longer in control of any outcome.


----------



## LordBrownTrout (Dec 4, 2010)

KissMy said:


> The Telegraph: EU rescue costs start to threaten Germany itself
> 
> 
> > Credit default swaps (CDS) measuring risk on German, French and Dutch bonds have surged over recent days, rising significantly above the levels of non-EMU states in Scandinavia.
> ...



Scary


----------



## LordBrownTrout (Dec 4, 2010)

william the wie said:


> The US is no longer in control of any outcome.



And scary.


----------



## Jos (Dec 4, 2010)

LordBrownTrout said:


> william the wie said:
> 
> 
> > The US is no longer in control of any outcome.
> ...



Prepared, years ago, gold, 20 oz, silver 8 kilos, copper 1000+kilos bring it on


----------



## LordBrownTrout (Dec 4, 2010)

Jos said:


> LordBrownTrout said:
> 
> 
> > william the wie said:
> ...


 
Wow!! That's good.  I missed the boat on gold but started hoarding silver bags about 5 years ago, 750 oz of pre-65 silver quarters.


----------



## KissMy (Dec 4, 2010)

LordBrownTrout said:


> KissMy said:
> 
> 
> > The Telegraph: EU rescue costs start to threaten Germany itself
> ...



This same scenario is playing out in the USA only just a year or two later. The debt burdened states of California, New Jersey, Illinois, Ohio, Michigan, Georgia, New York & Florida will take down the credit rating of the strongest states in the USA such as Texas, Virginia, Washington & North Carolina along with the entire country.


----------



## william the wie (Dec 5, 2010)

IL, NY and MI will default, CA may default but as to the rest I would expect a work out of some sort.


----------



## Toro (Dec 5, 2010)

Bernanke says more QE may be coming!  

Bernanke Says Further U.S. Monetary Stimulus Possible (Update1) - Bloomberg.com


----------



## william the wie (Dec 5, 2010)

Toro said:


> Bernanke says more QE may be coming!
> 
> Bernanke Says Further U.S. Monetary Stimulus Possible (Update1) - Bloomberg.com


QE III and QE VI are on the way making default survivable. Hmm!


----------



## LordBrownTrout (Dec 6, 2010)

*Sweet Mama*  I can smell the pine cones in the montana mountains.  That log house compound by the trout stream may be more than a dream, lol!!!  Silver closes above 30.  Yeeehaawwww!!!!


----------



## Toro (Dec 6, 2010)

LordBrownTrout said:


> *Sweet Mama*  I can smell the pine cones in the montana mountains.  That log house compound by the trout stream may be more than a dream, lol!!!  Silver closes above 30.  Yeeehaawwww!!!!



Hey!  

Banish those thoughts!

No cheerleading!

Mr. Market punishes cheerleading!

That's rule #1 of The Gold and Silver Thread!

Now go ask Mr. Market for forgiveness!


----------



## LordBrownTrout (Dec 6, 2010)

Toro said:


> LordBrownTrout said:
> 
> 
> > *Sweet Mama*  I can smell the pine cones in the montana mountains.  That log house compound by the trout stream may be more than a dream, lol!!!  Silver closes above 30.  Yeeehaawwww!!!!
> ...




My bad.  Repenting to QE 7-15 as we speak.


----------



## Toro (Dec 6, 2010)

LordBrownTrout said:


> Toro said:
> 
> 
> > LordBrownTrout said:
> ...


----------



## william the wie (Dec 6, 2010)

The problem is a nominal return of 1B to 1 in PM could mean standing still in real terms. You might need those silver coins to buy enough trout to eat.


----------



## KissMy (Dec 7, 2010)

Check out the US Debt Clock's new feature called "On This Day In 2015 at Current Rates" Workforce & Jobs numbers are horrible, a serious fiscal train wreck is coming & Obama & the Repubs just worked out a deal to extend all tax cuts, jobless benefits for the long-term unemployed and grant a one-year reduction in Social Security taxes. As a bonus we have Bernanke ready to pull the trigger on QEIII. It just doesn't get any better for Gold & Silver.

The big problem I have is my big ass SLV buy order on Ameritrade did not fill last week at the low point I had my bid limit price at while I was away. The price did hit my limit but there were not enough ask sellers at that level to fill my order. Now I am $4 behind the ball & still not in on SLV. My big GLD order did fill so I am only partially bummed. After that big screw-up I just broke down & decided to get a Windows Mobile Phone so I can keep a better eye on things while I am away. I am just now figuring the thing out. Now I just need to figure out how to put on Think or Swim & set up some market alerts on the thing so I don't have to be glued to my PC. At least for now now I can check to see if my order filled instead of just thinking it did when the price dipped to a certain level.

More advice to precious metals investors. Take Delivery!!! These coins take up very little space. Gold, Platinum & Palladium Less space than $100 bills in paper currency. Get yourself a good quality pocket scale & a nice Dial Caliper. Then go to a website like Monex to get the diameter, thickness & weight of the coins you are buying so you cant go wrong. Taking delivery leaves the market less metals to leverage causing the price to rise. You can short the ETF's like GLD & SLV to hedge the physical coins you have against market price drops to prevent ever needing to sell your coins. Many people are holding paper saying they own gold but they do not clearly understand the "Golden Rule". He who has the gold makes the rules. This rule is older than Jesus, the Roman Empire & likely older than the Bible & the written word. It is most certainly more stable than the US dollar or any paper contract you possess. If the SHTF would you rather have gold or a piece of paper or numbers on the computer screen?


----------



## editec (Dec 7, 2010)

LordBrownTrout said:


> Toro, what types of purchases do you make on precious metals? I bought some more junk 90 percent coins a week ago when silver fell to high 25's. I always take possession of it.


 
Wise decision.

The percentage of your cash you keep in this form depends, I suppose, on your confidence levels.

What percent over spot price are you paying for this junk coin?


----------



## Toro (Dec 7, 2010)

Of course, the budget-busting tax cutting/unemployment insurance extending budget compromise between the GOP and the Democrats, which may add as much as $500 billion to the deficit, is bullish for gold and silver.


----------



## KissMy (Dec 7, 2010)

KissMy said:


> Check out the US Debt Clock's new feature called "On This Day In 2015 at Current Rates" Workforce & Jobs numbers are horrible, a serious fiscal train wreck is coming & Obama & the Repubs just worked out a deal to extend all tax cuts, jobless benefits for the long-term unemployed and grant a one-year reduction in Social Security taxes. As a bonus we have Bernanke ready to pull the trigger on QEIII. It just doesn't get any better for Gold & Silver.
> 
> The big problem I have is my big ass SLV buy order on Ameritrade did not fill last week at the low point I had my bid limit price at while I was away. The price did hit my limit but there were not enough ask sellers at that level to fill my order. Now I am $4 behind the ball & still not in on SLV. My big GLD order did fill so I am only partially bummed. After that big screw-up I just broke down & decided to get a Windows Mobile Phone so I can keep a better eye on things while I am away. I am just now figuring the thing out. Now I just need to figure out how to put on Think or Swim & set up some market alerts on the thing so I don't have to be glued to my PC. At least for now now I can check to see if my order filled instead of just thinking it did when the price dipped to a certain level.
> 
> More advice to precious metals investors. Take Delivery!!! These coins take up very little space. Gold, Platinum & Palladium Less space than $100 bills in paper currency. Get yourself a good quality pocket scale & a nice Dial Caliper. Then go to a website like Monex to get the diameter, thickness & weight of the coins you are buying so you cant go wrong. Taking delivery leaves the market less metals to leverage causing the price to rise. You can short the ETF's like GLD & SLV to hedge the physical coins you have against market price drops to prevent ever needing to sell your coins. Many people are holding paper saying they own gold but they do not clearly understand the "Golden Rule". He who has the gold makes the rules. This rule is older than Jesus, the Roman Empire & likely older than the Bible & the written word. It is most certainly more stable than the US dollar or any paper contract you possess. If the SHTF would you rather have gold or a piece of paper or numbers on the computer screen?



Gold & Silver have done a huge early morning reversal against all currencies. That is a very bad sign for the metals. This will sting a bit but hopefully It will set-up another entry point for me to get back into Silver after my screw-up in the above post.


----------



## Toro (Dec 7, 2010)

The Trading Gods heard us gloating yesterday and they were angry!  Gold and silver saw intraday reversals, with gold down 2.33% from the morning peak, and silver off 7.25%!  The Trading Gods punish us who cheer!  I liquidated all my positions and am stepping aside for the moment. I expect to re-establish my positions in the future. Support for gold is at $1380 and $1335. Support for silver is at $27.50 and ?.


----------



## william the wie (Dec 7, 2010)

Toro said:


> The Trading Gods heard us gloating yesterday and they were angry!  Gold and silver saw intraday reversals, with gold down 2.33% from the morning peak, and silver off 7.25%!  The Trading Gods punish us who cheer!  I liquidated all my positions and am stepping aside for the moment. I expect to re-establish my positions in the future. Support for gold is at $1380 and $1335. Support for silver is at $27.50 and ?.


It's also turnaround Tuesday.


----------



## Toro (Dec 11, 2010)

Debunking the "Bankrupt JP Morgan" campaign.

Kid Dynamite's World: JP Morgan and the Massive Silver Short - The Greatest Story Ever Told


----------



## william the wie (Dec 11, 2010)

I wonder how the attempt to play the non-existent squeeze will work out?


----------



## Mini 14 (Dec 13, 2010)

Silver back over $30 today?


----------



## PLYMCO_PILGRIM (Dec 13, 2010)

Toro said:


> Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> 
> I bought back much of my gold and silver exposure yesterday and added a bit today.  There is a bid underneath gold, and though silver is extended, there is support at ~$25-$26.  A few weeks of consolidation for silver would do it a world of good.



Wait when did you buy gold?

I put 30% of what I had in my savings account into gold 3 years ago 

I was thinking of buying more as an actual investment instead of as a hedge as it looks like gold could crack 2500 in the next few months but I'm very nervous to do so as it is already at unusual highs right now.   I'm afraid of buying it and having a gold market bubble burst.

What do you think toro?


----------



## Jos (Dec 13, 2010)

I Hope you got real Gold and not just paper gold


----------



## PLYMCO_PILGRIM (Dec 13, 2010)

Jos said:


> I Hope you got real Gold and not just paper gold



Gold coins in the mail sir.  Momma didn't raise no fools.


----------



## Terral (Dec 13, 2010)

Hi Toro:



Toro said:


> Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> 
> I bought back much of my gold and silver exposure yesterday and added a bit today.  There is a bid underneath gold, and though silver is extended, there is support at ~$25-$26.  A few weeks of consolidation for silver would do it a world of good.



The value of the Fed-produced fiat dollar is imploding, which means you need more dollars to buy the same gold/silver commodities. That does not mean that the value of gold and silver is going up, but the value of your dollar is imploding into nothing. The only reason that the dollar has the appearance of having value is because the other currencies are imploding at the same time; because everyone is printing up worthless fiat currency at record pace ...

[ame=http://www.youtube.com/watch?v=DpAbDtl_t1Y]This Guy Knows What Is Coming[/ame]

GL,

Terral


----------



## Toro (Dec 13, 2010)

I re-established my gold and silver positions today.  They tried to bang the precious metals down last week but couldn't, and they moved to the upside.  There was weakness into the close but there seems to be a fair amount of support not too much lower.


----------



## william the wie (Dec 13, 2010)

The Aden sisters are short term bearish, long term bullish at the moment.


----------



## liebuster (Dec 13, 2010)

Glad to see this thread. I don't know much about investing but I just started buying up silver coins. Been hitting the pawn shops and antique shops because most of those places especially the antique shops don't update their prices. 

I ended up buying a bunch of silver dimes and half dollars below spot price, and some of them at about 75% of spot price. 

Wish I had more money.


----------



## william the wie (Dec 13, 2010)

liebuster said:


> Glad to see this thread. I don't know much about investing but I just started buying up silver coins. Been hitting the pawn shops and antique shops because most of those places especially the antique shops don't update their prices.
> 
> I ended up buying a bunch of silver dimes and half dollars below spot price, and some of them at about 75% of spot price.
> 
> Wish I had more money.


Since silver is in physical short supply it should appreciate to at least a $200 in real terms to reflect the greater difficulty of recovery of scrap silver in modern usage. Smart move on your part.


----------



## liebuster (Dec 13, 2010)

william the wie said:


> liebuster said:
> 
> 
> > Glad to see this thread. I don't know much about investing but I just started buying up silver coins. Been hitting the pawn shops and antique shops because most of those places especially the antique shops don't update their prices.
> ...



The way I figured was if inflation got really really bad then what little free market there still is would most likely move back to the silver/gold standard. People would pretty much ditch the dollar and silve coin would be in short supply. 

I also figured that more and more people would start getting on the band wagon and realize that they need to do something. The problem for most of those people is they probably don't have alot of money to spend. What are they going to do? Buy 1oz or 2oz of gold? Most likely not. I think the lower cost of silver will be more appealing thus driving up the demand of silver. Thats what prompted me to get into silver. I have very little money after bills and living expenses. 

I'm just going to keep looking for small little deals here and there and build my hoard up slowly.


----------



## william the wie (Dec 13, 2010)

liebuster said:


> william the wie said:
> 
> 
> > liebuster said:
> ...


Google the terms DRIP and DSP those are ways to build portfolios on little money but stick with widow and orphan stocks such as utilities until you are sure you understand the market. At that point you can try to cash in on discounts to market price if you have built up to more than say $2000 spread over 10-30 stocks.


----------



## KissMy (Dec 14, 2010)

Toro said:


> Debunking the "Bankrupt JP Morgan" campaign.
> 
> Kid Dynamite's World: JP Morgan and the Massive Silver Short - The Greatest Story Ever Told



I had not heard that "Bankrupt JP Morgan" campaign but I did see this article today from the London Financial Times. JPMorgan cuts back on US silver futures



> JPMorgan has quietly reduced a large position in the US silver futures market which had been at the centre of a controversy about its impact on global prices for the precious metal.
> 
> The decision by JPMorgan was an attempt to deflect public criticism of the banks dealings in silver, a person familiar with the matter said. The person added that the banks position in silver would from now on be materially smaller than in the past.
> 
> ...


----------



## william the wie (Dec 14, 2010)

A lot of silver upside remains but the naked short myth will keep on keeping on.


----------



## KissMy (Dec 15, 2010)

Credit Default Swap Spreads&#8230;..5 U.S. States Make The Top Ten List

This tells us that the rise in bond prices is not due to an expanding economy but due to fear of default on bonds.


----------



## Toro (Dec 15, 2010)

Both gold and silver pulled back today.  Both are sitting on support, with gold at $1380 and silver at $28.75 at the 4pm stock market close.  Next support levels for gold are $1370 and $1355.  For silver, support is at $28 and $27.50.  Breaks below those levels could signal a significant decline.

Weakness was attributed to dollar strength, as currency traders bought dollars in part due to a potential downgrade of Spain and spiking US interest rates.  The 10 year Treasury bond is yielding 3.53% compared to 2.80% at the end of November, a violent move in the bond market.  The precious metals also sold off in sympathy with a general sell-off in risk assets.  Stocks are extended and are due for a rest but momentum remains strong.


----------



## william the wie (Dec 15, 2010)

Toro said:


> Both gold and silver pulled back today.  Both are sitting on support, with gold at $1380 and silver at $28.75 at the 4pm stock market close.  Next support levels for gold are $1370 and $1355.  For silver, support is at $28 and $27.50.  Breaks below those levels could signal a significant decline.
> 
> Weakness was attributed to dollar strength, as currency traders bought dollars in part due to a potential downgrade of Spain and spiking US interest rates.  The 10 year Treasury bond is yielding 3.53% compared to 2.80% at the end of November, a violent move in the bond market.  The precious metals also sold off in sympathy with a general sell-off in risk assets.  Stocks are extended and are due for a rest but momentum remains strong.


The ten year treasury dropped close to 20% in less than a month and the MSM generally ignores it? That is really strange.


----------



## Toro (Dec 15, 2010)

william the wie said:


> Toro said:
> 
> 
> > Both gold and silver pulled back today.  Both are sitting on support, with gold at $1380 and silver at $28.75 at the 4pm stock market close.  Next support levels for gold are $1370 and $1355.  For silver, support is at $28 and $27.50.  Breaks below those levels could signal a significant decline.
> ...



Meh.

As a bond trader once told me "Nobody gives a shit about the bond market."


----------



## william the wie (Dec 15, 2010)

That is flat-out crazy.


----------



## Toro (Dec 16, 2010)

I liquidated my long positions in both gold and silver that I re-established earlier in the week today.  I hate trading in and out of positions so quickly, but gold broke through its first and second levels of support at $1380 and $1370, while silver broke through its first level of support at $29.  There is support for gold at $1355 and for silver at $27.50.  I want to see more strength before re-establishing positions.  I see silver as being clearer technically.  Ideally, I would like to see some backing and filling going on, with silver holding support at $27.50 and $28 while approaching new highs.


----------



## william the wie (Dec 16, 2010)

I still think gold belong in an asset allocation portfolio but to each their own.


----------



## Toro (Dec 16, 2010)

william the wie said:


> I still think gold belong in an asset allocation portfolio but to each their own.



I trade it with big positions, so I have to protect myself.  I think it will eventually go higher.  If it hits my criteria, I will buy it back.


----------



## william the wie (Dec 16, 2010)

Toro said:


> william the wie said:
> 
> 
> > I still think gold belong in an asset allocation portfolio but to each their own.
> ...


Just a question not a judgment but why do so few hedge funds simply hedge their positions and instead try to outsmart people with Math Ph.D.s from MIT by trading? I mean even if you are a math ph.d. do you really make a profit after anguish and aggravation by trading?


----------



## Toro (Dec 16, 2010)

william the wie said:


> Toro said:
> 
> 
> > william the wie said:
> ...



Hubris and money.

Plus, I'm not convinced the math PhDs are necessarily better than the traders.


----------



## william the wie (Dec 16, 2010)

OK, I asked you answered.


----------



## Toro (Dec 17, 2010)

Interesting action today.  Gold bounced off the 50 day moving average while silver is forming a noticeable triangle pattern.  There is still deterioration in the technicals, as MACD and RSI are forming lower highs, and gold is sitting off the hard sell-off over the past two days.

However, the ETFs are seeing selling in the morning and strength into the close, which is often a good sign.


----------



## FireFly (Dec 17, 2010)

US Bonds are nearing a downgrade, rates are climbing & US Bond CDS are widening.

[ame="http://www.youtube.com/watch?v=hTWLEhlq1cQ"]Sure - It Will Never Happen Here[/ame]

The only question here is who can possibly bail out the USA?


----------



## william the wie (Dec 17, 2010)

FireFly said:


> US Bonds are nearing a downgrade, rates are climbing & US Bond CDS are widening.
> 
> Sure - It Will Never Happen Here
> 
> The only question here is who can possibly bail out the USA?


The short answer is nobody.


----------



## liebuster (Dec 17, 2010)

FireFly said:


> The only question here is who can possibly bail out the USA?



I would bet that it would be a new global order with a new monetary system created by the IMF. I would presume that the new currency would be partially backed by gold or silver so they can say , "Don't worry everyone, *this* currency is partially backed by gold, so it must be safe.  Just sign right here on the dotted line and we can get past this awful experience."

Sorry for the thread drift......


----------



## LordBrownTrout (Dec 18, 2010)

Gold to Go


Photoblog - Coin-op goldmine in Florida

Imagine someone watching you pay for a gold bar in the mall and then carrying it out to your car.


----------



## LordBrownTrout (Dec 18, 2010)

editec said:


> LordBrownTrout said:
> 
> 
> > Toro, what types of purchases do you make on precious metals? I bought some more junk 90 percent coins a week ago when silver fell to high 25's. I always take possession of it.
> ...



I do this because I'm just afraid of silver certificate paper receipts.  I've read of shortages and derivatives in the silver market along with supposed writers of these receipts unable to produce the tangible metal.  That scares the hell out me so I always take possession.  I don't mind junk coins too much.  My two bags, 715 oz, I paid about a 1.50 over spot.  That was back at about 8.50 trading.  I paid 10 dollars an ounce.  Last week, I checked out five dealers in the area and most were paying between 2-4 dollars under trade value.  One dealer offered me 27 an ounce when it was trading at 29 an ounce.


----------



## FireFly (Dec 18, 2010)

I am in Florida for the holidays & will be heading to Boca Raton to buy gold from the first gold vending ATM in the USA that was just installes a couple of days ago.


----------



## Toro (Dec 21, 2010)

I've started scaling back into my silver positions in anticipation of a break-out above $30.  However, it is a small position and I will dump it if I'm wrong.  I will add to the position on strength.


----------



## Paulie (Dec 21, 2010)

LordBrownTrout said:


> Gold to Go
> 
> 
> Photoblog - Coin-op goldmine in Florida
> ...



Imagine someone getting my .45 pointed back in their face if they tried to get cute.


----------



## Paulie (Dec 21, 2010)

LordBrownTrout said:


> editec said:
> 
> 
> > LordBrownTrout said:
> ...



Don't sell your metals back to dealers.  With that much money invested in it, YOU be the dealer.

People will pay YOU the premium.


----------



## LordBrownTrout (Dec 21, 2010)

Paulie said:


> LordBrownTrout said:
> 
> 
> > Gold to Go
> ...



I like your thinking.


----------



## miller (Dec 27, 2010)

Now what do we do?  Screwed Again


----------



## LordBrownTrout (Dec 27, 2010)

miller said:


> Now what do we do?  Screwed Again



That blog has no mention on how I can make more money on silver.  I'm just trying to cut a little sliver of the pie so I can get away from politicians and society.


----------



## Toro (Dec 27, 2010)

Gold and silver are tracing out remarkably clear flag patterns.  However, the internals for both are awful, with both MACD and RSI making lower highs and lower lows.  The trend for gold is still in tact but silver has broken its uptrend.  The next few weeks are going to be interesting.


----------



## Toro (Dec 29, 2010)

Silver closed at a multi-decade high, and above the technically important $30 level.  Silver did not close at an intra-day high, however, but was not far away.  Both gold and silver have broken out of near-term ranges and a large flag pattern is clearly in place.  Ideally, we would like to see some backing and filling for the next few months.  Gold&#8217;s flag pattern extends to March with resistance at the $1425 level.  Resistance for silver is $30.75, the old high, with the range lasting until mid-February.  A break above both levels would be bullish.  The caveats are that the internals of the precious metals look horrible.  MACD is seeing lower highs and lower lows.  This does not mean both can&#8217;t go higher but momentum has definitely slowed.  Also, there has been heavy selling on down days, implying that both gold and silver are under distribution.

There is a melt-up in general occurring in commodities.  Copper hit an all-time high today.  Corn and soybeans hit a multi-year high. Sugar hit a multi-decade high.   This has the feel of a move that will ultimately end badly.  It feels very frothy, as if hedge funds are pushing the contracts higher on thin volume into the end of the year.  The dollar has held in, reversing strongly intra-day, which is ultimately bullish for the dollar.  Also, China appears to be rolling over.

I have taken a position in oil.  Oil has also hit a multi-year high but the move had been more measured and contained.  If I think I&#8217;m wrong, I will blow my position out quickly.


----------



## LordBrownTrout (Dec 29, 2010)

Thanks for the report, Toro.  When you mention internals of metals, what specifically are you referring to and does that include silver?  I can't move quickly like you can mainly because I'm ignorant of subject matter when it comes to trading and I'm working on two private companies.  Just now got my head into the game on the social networking internet business type company.  I read where the groupon founder, started his little social foray two years ago, turned down a 6Billion dollar offer from Google.

I'm considering buying more junk silver if it comes down in the 22 dollar range however, I'm looking more at long term investment and selling at much higher levels.  That may be a couple of more years down the road though.


----------



## william the wie (Dec 29, 2010)

LordBrownTrout said:


> Thanks for the report, Toro.  When you mention internals of metals, what specifically are you referring to and does that include silver?  I can't move quickly like you can mainly because I'm ignorant of subject matter when it comes to trading and I'm working on two private companies.  Just now got my head into the game on the social networking internet business type company.  I read where the groupon founder, started his little social foray two years ago, turned down a 6Billion dollar offer from Google.
> 
> I'm considering buying more junk silver if it comes down in the 22 dollar range however, I'm looking more at long term investment and selling at much higher levels.  That may be a couple of more years down the road though.


Right now I would not invest for gain. My wife has spent about as much on our vegetable garden and fruit trees as I have made in my accounts this past year mainly finding out what she can grow easily in case of bad times ahead.  We paid off our mortgage in 92 so that bill is out of the way and we don't mind spending money but having a secure food and water supply is very important. More important than making a little money in the precious metals market.


----------



## Mini 14 (Dec 30, 2010)

$31 silver today? 

My guess is no, it will climb but retreat before the $31 mark, but I think the days of $22/ounce are gone forever. I have been waiting on a fairly big retreat, possibly a collapse, but I am more and more convinced it isn't coming.

Less than 4 months ago, I was laughing/wishing at those who said silver would hit $25 before 2011. Now I'm holding all of mine because I don't think we're anywhere near the peak.

Silver may hit $50 next year.

And I still won't sell.


----------



## Toro (Dec 30, 2010)

Silver will one day be below $10 again.


----------



## william the wie (Dec 30, 2010)

Toro said:


> Silver will one day be below $10 again.


Given industrial demand and restricted supply I do not understand that post. Are you expecting better recovery techniques, higher demand for resources in which silver is a by-product or what?


----------



## LordBrownTrout (Dec 30, 2010)

Toro said:


> Silver will one day be below $10 again.



I've been watching silver for 7 years now, mining, demand, debt, and I do not see it falling to that level unless we discover new sources and miracuously pay off all of our debt.   I'm just not seeing that scenario at all.  I'm holding a certain amount until it hits a 100.


----------



## william the wie (Dec 30, 2010)

LordBrownTrout said:


> Toro said:
> 
> 
> > Silver will one day be below $10 again.
> ...


$10 an ounce is possible but based on what I know extremely improbable that's why I asked if he knew something that I don't.


----------



## Toro (Dec 30, 2010)

william the wie said:


> Toro said:
> 
> 
> > Silver will one day be below $10 again.
> ...



Higher prices will bring on more supply as marginal mines are opened and new mining techniques are discovered.

This is how commodities have always worked.  People shouldn't be fooled that "Its different this time."  It wasn't different a decade ago when The Economist predicted that oil would fall to $5 a barrel and stay there, and it isn't different today.


----------



## liebuster (Dec 30, 2010)

Wasn't silver at about $9 ounce after the '08 crash?


----------



## Valerie (Dec 30, 2010)

> *Copper ends at new record; gold down
> Silvers up 82% in 2010, while palladium surges nearly 95% in year*
> 
> 
> ...



Copper settles at new record; gold falls Metals Stocks - MarketWatch


----------



## Valerie (Dec 30, 2010)

liebuster said:


> Wasn't silver at about $9 ounce after the '08 crash?





Yes, at the end of '08 it was in that price range...




Here's a good site for historical graphs in precious metals:


London Fix Historical gold - result


----------



## Toro (Dec 30, 2010)

liebuster said:


> Wasn't silver at about $9 ounce after the '08 crash?



Yes.  It traded at $3 less than a decade ago.


----------



## FireFly (Dec 30, 2010)

Toro said:


> william the wie said:
> 
> 
> > Toro said:
> ...



That all depends on the amount of national debt & currency that are created.


----------



## Mini 14 (Dec 30, 2010)

Toro said:


> Silver will one day be below $10 again.



And on that same day, pigs will fly!


----------



## Toro (Dec 30, 2010)

Mini 14 said:


> Toro said:
> 
> 
> > Silver will one day be below $10 again.
> ...



Your hubris worries me.

Silver was $9 just two years ago.

When I started investing in gold in 2002, people literally laughed in my face.  One guy called me an Old Man.  I loved hearing stuff like that because it represented deep-seated skepticism.  I wound up being the largest shareholder of gold company stocks in my fund in the southeast, or so I was told.  Implying that something can't happen is just the opposite.  

Investing in precious metals is just that, investing.  It is not religion.  I may be wrong, but if one ever thinks that something "can't happen" in investing, especially in commodities, one is likely to lose everything they have.  There is no asset class - not stocks, not real estate - that is more prone to imposing losses on investors than commodities.

Countless people told me that tech stocks were great investments in 1999.  Countless people told me what a great investment housing was in 2006.  One day, we will say the same thing about gold and silver.


----------



## Toro (Dec 30, 2010)

I would beware the Gold Bugs.  Gold Bugs do not look at gold as an investment.  They look at it as religion.  Just as there were false prophets such as George Gilder who lost clients everything after the Tech Bubble collapsed, and just like there were Cassandras of the Housing Bubble such as David Lereah of the National Association of Realtors who wiped out people, the Gold Bugs will hand people their collective heads on a silver (or golden) platter when this is all over.  They will not get people out.  People's savings will be wiped out.


----------



## william the wie (Dec 30, 2010)

Toro said:


> I would beware the Gold Bugs.  Gold Bugs do not look at gold as an investment.  They look at it as religion.  Just as there were false prophets such as George Gilder who lost clients everything after the Tech Bubble collapsed, and just like there were Cassandras of the Housing Bubble such as David Lereah of the National Association of Realtors who wiped out people, the Gold Bugs will hand people their collective heads on a silver (or golden) platter when this is all over.  They will not get people out.  People's savings will be wiped out.


By the way except for my teorwawki (the end of the world as we know it) fund I've been lightening up on my holdings. Just wanted to know why you were saying that.


----------



## FireFly (Dec 30, 2010)

Any drop in gold & silver to prices of years ago will be temporary. If a huge bubble forms & pops we will see a huge decline for a short period as many race for the exit just like crude oil that rose from $10 to $147 before the OCS drilling ban was lifted popping the oil bubble. Even so crude oil did not go back to $10. It briefly dropped to $34 before returning to $92 & climbing to new highs. Gold also corrected at that time from $1050 down to $700. Like crude oil, gold's bottom was 3 times the $250 dollar collapsing starting price.  Any large correction is a buying opportunity. The world wide panic debt pay down & increase savings has caused a dollar bubble, not a commodities bubble.


----------



## Toro (Dec 30, 2010)

william the wie said:


> Toro said:
> 
> 
> > I would beware the Gold Bugs.  Gold Bugs do not look at gold as an investment.  They look at it as religion.  Just as there were false prophets such as George Gilder who lost clients everything after the Tech Bubble collapsed, and just like there were Cassandras of the Housing Bubble such as David Lereah of the National Association of Realtors who wiped out people, the Gold Bugs will hand people their collective heads on a silver (or golden) platter when this is all over.  They will not get people out.  People's savings will be wiped out.
> ...



As a forewarning.

I've been adding to trading positions.


----------



## Toro (Jan 4, 2011)

Gold and silver getting rocked today, with gold down $30 and silver down $1.  Both are selling off in sympathy with other commodities as others such as oil and sugar are also getting hit.

Both are sitting at or near support, with support for gold at $1385 and $29.50 for silver.  Next levels of support are $1360 and $29.10 respectively.  It is at these levels that both can fall and still be in a rising channel.  A fall below could signal the end of the explosion higher that began in September.

Gold was up 30% last year and silver 80%.  Usually, when something is up that much in one year, it usually lags the next year.


----------



## Oddball (Jan 4, 2011)

Investors gotta pay off them Christmas shopping bills, man.


----------



## Toro (Jan 4, 2011)

I believe that the precious metals markets are in distribution and are topping, at least in the short-term.  

I began to liquidate my holdings today and will be completely out within the next day or two.  I do not believe that this is the ultimate top but am stepping aside to let this play out.


----------



## Toro (Jan 14, 2011)

Both gold and silver are getting whacked again today on news that China has raised bank reserve requirements for the fourth time in two months.  I believe that the precious metals are topping here, and the next move is down.


----------



## uscitizen (Jan 14, 2011)

Toro said:


> Both gold and silver are getting whacked again today on news that China has raised bank reserve requirements for the fourth time in two months.  I believe that the precious metals are topping here, and the next move is down.



Maybe, I have heard that before though.


----------



## LordBrownTrout (Jan 14, 2011)

I don't mind the back and forth as long as it moves up, which it will continue to do.  I'll sell at around 100 an ounce.


----------



## Valerie (Jan 14, 2011)

> Gold prices were extending post-market losses from Thursday after Bernanke said he expected the U.S. economy to grow between 3% and 4% in 2011, much better than expected. The positive news was a sledgehammer for gold.
> 
> If you read between the lines, this could mean that the Fed could stop or alter its $600 billion bond-buying program before it runs out in June which would limit the flow of extra money in the system. Investors had been buying gold as protection against this program which many expected would devalue the dollar and were buying gold as a safe place to preserve their wealth.
> 
> ...



Gold Prices Tank on Moves to Curb Inflation - Yahoo! Finance


----------



## Valerie (Jan 14, 2011)

"_Gold mining stocks, a risky but profitable way to buy gold, were sinking Friday. Gold stocks can lead gold prices on the way up and way down.

Morgan says the underlying equities can be a leading indicator for the gold price. "They're breaking down more than the actual gold and silver metals are and because of that I think we are going to see further weakness in the metals themselves."

Yamana Gold was 3.17% lower at $11.57 while Goldcorp was down 2.45% at $41.04. Other large gold stocks Agnico-Eagle and Eldorado Gold were trading at $69.54 and $17.26, respectively. _"


----------



## Toro (Jan 25, 2011)

The RSI for gold went below 35 today.  There have been 15 separate occurrences since 2001 when this has happened, and in each case, gold was higher a year later by on average 13%.  It was higher 14 times 5 trading days, 10 trading days and 3 months later. The only time when it was lower was during the teeth of the financial crisis in 2008.

The caveat is that if this really is the top in gold, then these statistics are bunk.  It appears that gold is putting in a more formidable top here, unlike the other times it has corrected over the past decade.  Also of worry is that gold has been going down even as the dollar has been falling.  When the bull market in gold ultimately ends, people are going to get killed, so you have to be careful.


----------



## KissMy (Jan 26, 2011)

BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.

WTF!!! 

Did investors *really* think that the fed was not going to continue their QEII program until June? 

I will bet that QEIII will begin as soon as QEII ends.


----------



## Mini 14 (Jan 26, 2011)

Toro said:


> The RSI for gold went below 35 today.  There have been 15 separate occurrences since 2001 when this has happened, and in each case, gold was higher a year later by on average 13%.  It was higher 14 times 5 trading days, 10 trading days and 3 months later. The only time when it was lower was during the teeth of the financial crisis in 2008.
> 
> The caveat is that if this really is the top in gold, then these statistics are bunk.  It appears that gold is putting in a more formidable top here, unlike the other times it has corrected over the past decade.  Also of worry is that gold has been going down even as the dollar has been falling.  When the bull market in gold ultimately ends, people are going to get killed, so you have to be careful.



Gold FUTURES, maybe.

But not physical gold.

Anyone buying futures in metals is running a huge risk, while holding metals is far safer than putting money in the bank (and FAR more profitable).

I'm hoping all the banks fail. Then I'll be King of the World, Ma!


----------



## Paulie (Jan 26, 2011)

KissMy said:


> BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.
> 
> WTF!!!
> 
> ...



Imagine if QEII doesn't work as intended, and the Fed just decides to stop the inflationary policy.

It would expose them as useless and irrelevant while they wasted trillions.  They will continue to throw money at this until some kind of positive spin can be put on it, while they fool the country into thinking they have some kind of creative and comprehensive exit plan.

I'm actually surprised that Toro isn't seeing past the bullshit.  

These aren't the same times that we were in throughout this past decade Toro.  It's very possible that all bets are off at this point.


----------



## Toro (Jan 26, 2011)

KissMy said:


> BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.
> 
> WTF!!!
> 
> ...



Gold was over-sold.  We will probably get a bounce.

However, it still appears to be weak technically, and after the bounce, I expect lower lows.


----------



## LordBrownTrout (Jan 26, 2011)

I'm holding on.  This market is not good and there are no positive prospects that I see in the near future.  I'm not a pessimist but I've never seen anything like this.


----------



## Toro (Jan 26, 2011)

Paulie said:


> KissMy said:
> 
> 
> > BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.
> ...



I expect that gold will be higher at some future date.

But when gold falls, it will fall dramatically and spectacularly, and there will be a lot of blood on the floor.  Gold is an investment, not a religion.  Too many gold bugs don't make the distinction.

The technical formation for gold is unlike any we've seen since the bull market began.  It has put in what appears to be formidable resistance.


----------



## Paulie (Jan 26, 2011)

Toro said:


> Paulie said:
> 
> 
> > KissMy said:
> ...


Well I admittedly don't know a lot about technicals, but I would imagine that this gold situation would compare to a company that was profiting tons of money, but somehow the technicals were signaling resistance.  

Yeah, maybe right now a good short play would work, but fundamentally it seems pretty bullish to me.  

I think the smartest money knows what they need to see from the Fed before the plug is pulled.  And it isn't any of that dog and pony shit they've tried using recently, either.  Interest on reserves, discount rate tricks, manipulating treasury yields, etc.

I'm talking about some serious bank reserve extinguishment.  Call me crazy, but I don't see that anywhere in the foreseeable future.


----------



## Toro (Jan 26, 2011)

I'm not short gold or silver here.  I was contemplating a short-term buy of gold today.  But my short-term trades have sucked lately, so I passed.


----------



## KissMy (Jan 26, 2011)

Toro said:


> I'm not short gold or silver here.  I was contemplating a short-term buy of gold today.  But my short-term trades have sucked lately, so I passed.



I almost did the same thing but by the time I saw the news & price it had already moved $20. It only moved $2 more for a total of $22 bounce after the FOMC. I would have only made $2. I decided to wait to see if this was a bounce or a trend that will continue tomorrow.

All the commodities have been declining for weeks but today they all jumped up. Gold was up against every currency today. The big decline in the Baltic Dry Shipping Index is what has me worried about all commodities because they are not moving or being consumed.


----------



## KissMy (Jan 27, 2011)

Gold is trending down again this morning. We should get a pop from the jump in jobless rate just announced.


----------



## Toro (Jan 27, 2011)

KissMy said:


> Toro said:
> 
> 
> > I'm not short gold or silver here.  I was contemplating a short-term buy of gold today.  But my short-term trades have sucked lately, so I passed.
> ...





China has been trying to slow it's economy. The Shanghai index is down 16% from the highs, though it may be putting in a bottom here. 

What I think is happening is that investors are rotating out of commodities and bonds and into stocks. For example, West Texas oil is down 5% in January and natural gas is flat but oil equities are up 5%.


----------



## KissMy (Jan 27, 2011)

Toro said:


> KissMy said:
> 
> 
> > Toro said:
> ...



Yes that is what has been going on all month. The thing I am looking for is a big snap back rally. But if the employed workforce is truly increasing then the trend very well could be down for some time until people figure out government still can't balance the debt even with everyone working.


----------



## KissMy (Jan 27, 2011)

After studying the unadjusted employment trend I decided to sell 15 more gold Buffalo coins at $1388 & 50 silver eagle coins at $29.45

Now I am down to 50 gold Buffalo coins & 150 silver eagle coins.


----------



## Toro (Jan 27, 2011)

Gold and silver got whacked again today, reversing badly intra-day. This demonstrates the selling pressure in the precious metals. 

However, gold reached it's 150 day moving average. Over the past two years, the 150 day has provided support. But if the market is set on liquidating it's positions, it won't matter.


----------



## KissMy (Jan 28, 2011)

It looks like that snap back rally into gold is happening. Time to buy gold, silver & oil. Sell stocks they are getting hit. Money is flowing from stocks to gold.


----------



## KissMy (Jan 28, 2011)

The plunge protection team is pushing back hard against the stock market correction.


----------



## Toro (Jan 28, 2011)

KissMy said:


> It looks like that snap back rally into gold is happening. Time to buy gold, silver & oil. Sell stocks they are getting hit. Money is flowing from stocks to gold.



Its going up because of what's happening in the Middle East.  I think its setting up for a shorting opportunity.


----------



## Mini 14 (Jan 28, 2011)

Toro said:


> KissMy said:
> 
> 
> > It looks like that snap back rally into gold is happening. Time to buy gold, silver & oil. Sell stocks they are getting hit. Money is flowing from stocks to gold.
> ...



I think you're spot-on (pun intended


----------



## KissMy (Jan 28, 2011)

Toro said:


> KissMy said:
> 
> 
> > It looks like that snap back rally into gold is happening. Time to buy gold, silver & oil. Sell stocks they are getting hit. Money is flowing from stocks to gold.
> ...



Yes, I think you may be right. The riots are caused by commodity inflation in those countries. If those world leaders want to keep their heads, they are going to have to raise their currency values to lower inflation & commodity prices. This run-up in Gold & Silver is going to be short lived. With China, India, Egypt, Yemen & a whole host of other countries having to slow food & fuel inflation we will see currencies rise & precious metals drop a long ways. It sucks having to wait all weekend while everyone figures this out before markets open.


----------



## Terral (Jan 29, 2011)

Hi Toro:

Well, well. We have a topic where we might agree. ;0)



Toro said:


> Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> 
> I bought back much of my gold and silver exposure yesterday and added a bit today.  There is a bid underneath gold, and though silver is extended, there is support at ~$25-$26.  A few weeks of consolidation for silver would do it a world of good.



I agree that silver has support at 25 bucks, but that number is only going higher in the coming year. The notion that gold and silver is a bubble is a 'myth' from the large banks trying to rally support for the depreciating US fiat dollar. I believe we are looking at the last change to buy silver under 30 dollars per ounce, as the dollar devaluation continues and more dollars are required to buy all commodities, stocks, etc.. The only reason we have the opportunity to buy silver at below that 30 dollar mark is because of JP Morgan-Bankster manipulation of the markets. 

[ame="http://www.youtube.com/watch?v=Gl47z2g2EvI"]Part 1 JP Morgan Silver Manipulation Explained[/ame]

[ame="http://www.youtube.com/watch?v=uPg4qTNTP-E&feature=related"]Part 2 JP Morgan Silver Manipulation Explained[/ame]

[ame="http://www.youtube.com/watch?v=AId_UiPtPpQ&feature=related"]Part 3 JP Morgan Silver Manipulation Explained[/ame]

Zerohedge.com < educate yourself and buy more silver. 

[ame=http://www.youtube.com/watch?v=ScZlVQ1BMBM]Max Keiser and Alan Grayson Explain[/ame]

Get off your butt and buy physical silver right now (28.03 spot), before the price goes over 30 bucks, so you can cash in on the best opportunity to multiply your money in history. ;0)

GL,

Terral


----------



## Terral (Jan 29, 2011)

Greetings to All:

Silver has support at 25 bucks right now, but that number is only  going higher in the coming year. The notion that gold and silver is a  bubble is a 'myth' from the large banks trying to rally support for the  depreciating US fiat dollar. I believe we are looking at the last change  to buy silver under 30 dollars per ounce, as the dollar devaluation  continues and more dollars are required to buy all commodities, stocks,  etc.. The only reason we have the opportunity to buy silver at below  that 30 dollar mark for the next two months or so is because of *JP Morgan-Bankster manipulation* of the  markets. The trading range appears to be between about 25.80/26.50 and around 30 dollars, so the best time to buy for the next two months (could be less time) is at the dips near 25 bucks. For 200 ounces of silver, that ranges in price between 5000 (25 bucks) and 6000 dollars (30 bucks). However, when you consider that some experts are saying that silver can go up to 500 dollars per ounce, then buying at any price below 30 bucks is a bargain IMHO. 

Also, do not claim later that you have not been warned about '*Widespread Silver Bar Shortages*' . This will become common in 2011 as we see the coming currency crisis gain momentum. Buy and get physical silver today (not stocks/paper silver), while you can still receive shipments.

[ame="http://www.youtube.com/watch?v=Gl47z2g2EvI"]Part 1 JP Morgan Silver Manipulation Explained[/ame]

[ame="http://www.youtube.com/watch?v=uPg4qTNTP-E&feature=related"]Part 2 JP Morgan Silver Manipulation Explained[/ame]

[ame="http://www.youtube.com/watch?v=AId_UiPtPpQ&feature=related"]Part 3 JP Morgan Silver Manipulation Explained[/ame]

Zerohedge.com < educate yourself and buy more silver. 

[ame="http://www.youtube.com/watch?v=ScZlVQ1BMBM"]Max Keiser and Alan Grayson Explain[/ame]

Get off your butt and buy physical silver right now (28.03 spot 1/29/11 @ 11:42 AM), before  the price goes over 30 bucks, so you can cash in on the best  opportunity to multiply your money in history. There is no rush, because the Chinese and big banks are still shorting the silver market, but use this opportunity to buy and take physical possession of as much silver bullion and silver coins as possible (this company is good). 

GL,

Terral


----------



## Mr. H. (Jan 29, 2011)

Didn't the Hunt brothers try to corner the silver market?
They got their clocks cleaned.


----------



## Terral (Jan 29, 2011)

Hi H:



Mr. H. said:


> Didn't the Hunt brothers try to corner the silver market? They got their clocks cleaned.



The owners of the FED (Rothschild/Rockefeller/Morgan, etc.) are manipulating silver prices to give strength to their failing fiat currencies that are devaluing around the world and heading for a crash. These Global Banksters are orchestrating a global currency crisis that includes crashing the dollar, so you are wise to trade your worthless fiat Fed dollars for silver 'before' the prices go sky high. 

GL,

Terral


----------



## LordBrownTrout (Jan 29, 2011)

I already boought a decent amoung back at 9 bucks an ounce a couple of years ago.  I think I'll make another jump at 26 and then watch it go north as fiat devalues.


----------



## finebead (Jan 29, 2011)

I bought my gold in 2003, 2 years after it hit its 23 year low in 2001 at 265.  I paid 400, but I made gold prove it was in a long term bull market.  I sold out over a couple years finishing this year, average out price was 1200.  Can it go to 2000, yep, 3000, maybe.

Gold peaked in '78 at 885 an ounce, pushed up by high inflation.  Paul Volker was appointed Fed chairman by Jimmy Carter to kill inflation, and Volker killed it good (and caused a deep recession in 81-82, but that was back when fed chairmen had integrity and balls, which greenspan forgot both of those things).  Gold went down for the next 23 years bottoming at 265.

Now gold is spiking based on the huge deficit and money supply creation.  All that is needed to pop that bubble is for the repub house and some leadership by the president to make a compromise and begin to bring down the deficit.  It can't be brought down overnight without creating a depression.  If the plan implements long term steady lowering of the deficit, gold will wilt IMO.  Now, can the repubs and the pres do it?  Won't be easy.  Everything will have to be on the table.  

Social security means testing.  Limits on medicare and medicaid spending (covered procedures, end of life care).  Cuts in defense (why do we need to spend as much as the next 20 nations combined?  We don't, there is no strategic threat to the US today.  Foreign bases will have to close, just like England gave up her colonies).  Taxes will have to rise (perhaps back to the 1995 levels).  We have to do it all, for the good of the nation, we have to get to spending levels we can live with, without debasing our currency which will lower the standard of living for all americans.  I expect average house size in the US will fall, we won't be able to afford to buy a big one, nor pay the taxes, nor insure it, nor heat and cool it due to higher energy prices.

Changes are coming, and it is caused by technology like robots and computers multiplying the effect of the few workers needed to drive them.  All the other workers will have to scramble for a job, but not necessarily a high wage job.

The reason the president and congress may reach a compromise on deficit reduction is because we have to.  We can control our deficit via a plan, or we can have measure forced on us by the international community that buys our debt today (China, Japan).  A plan seems a much better way to go than an dollar crisis and spike up in interest rates.

If we put such a plan in place, I would expect to see a long term bear market in gold, similar to what happened when Volker killed inflation in the late 70's and early 80's.  I want to buy gold the next time it gets to a 15 or 20 year low and govt. looks like it is going to run irresponsible deficits.  Then it is pretty easy to make money on gold.  Now I consider it a speculative play to buy it up near all time highs and bet the govt. cannot do what it must do.

I look at stocks and see a better deal.  PE ration on the S&P 500 is much lower now than in 1999 or 2007.  Stocks are more fairly valued now.

It's just like buying a house, when you buy one when price per sq. ft. is historically low (good valuation level), you stand a better chance of enjoying appreciation.  If you buy when the price per sq ft is at all time highs, you stand a good chance to lose money in the short term, and your long term profit potential is low also.

Always buy good values...


----------



## Terral (Jan 29, 2011)

Hi fine:



finebead said:


> ... Now gold is spiking based on the huge deficit and money supply creation.  All that is needed to pop that bubble is for the repub house and some leadership by the president to make a compromise and begin to bring down the deficit.



If these were regular market cycles, then perhaps we might agree. However, you cannot compare current Fed printing of trillions and trillions and trillions of dollars to anything we have seen in history. The fiat dollar is being debased at record pace with no end in sight. You have never seen global governments buying up gold and silver like we are seeing that today. The dollar has been the world currency, but today the dollar is weakening and shaky and confidence is dwindling. In fact, the only reason you can buy silver at below 30 bucks an ounce is because of Bankster manipulation; which is another reason to buy now! The U.S. deficit is out of control and there is no way of reversing the downward spiral to ultimate default that will begin with the States and find everyone swimming in a sea of DEBT.  



finebead said:


> It can't be brought down overnight without creating a depression.



The USA has 23 percent unemployment and no bottom in the housing markets saying that we are already in the Depression. There is far too much worker displacement for any real recovery to get traction in the USA, which should be plainly obvious to everyone. The current ponzi economy is propped up by massive stimulus/bailouts that will eventually run out of steam and see gold/silver prices soar. Again, you cannot compare the upcoming train wreck of the US Economy to anything in recorded history, because nobody has ever orchestrated a bubble the size of this current catastrophe that is about to blow up in all of our collective faces.  



finebead said:


> If the plan implements long term steady lowering of the deficit, gold will wilt IMO.  Now, can the repubs and the pres do it?  Won't be easy.  Everything will have to be on the table.



You have got to be kidding! The Illegal Alien Foreign National (Barry) squatting in the White House is working for the House of Rothschild/Rockefeller/Morgan and the same people that are orchestrating the coming collapse. The smart money is running after gold and silver, because the world realizes that a new gold-based currency will emerge after the collapse; when all fiat currency is inflated to infinity and rendered worthless.



finebead said:


> Social security means testing.  Limits on medicare and medicaid spending (covered procedures, end of life care).  Cuts in defense (why do we need to spend as much as the next 20 nations combined?  We don't, there is no strategic threat to the US today.  Foreign bases will have to close, just like England gave up her colonies).



The problem with your 1970's-era thinking is that fiat dollar value is disappearing fast and the solutions to your problems thus far have been to print up more worthless fiat currency that leads to inflation and hyperinflation. *China, Russia and Iran* have been dumping the dollar for gold (story) for some time now. This is the kind of news I am reading everywhere on this topic:

PakAlertPress.com


> *China, Russia, Iran Dumping Dollar For Gold*
> 
> ... This buying, for  protection, has served to thwart the efforts of US policymakers,  the  Treasury, other central banks in Europe and the Fed, from being  able to  continue *the blatant suppression of both gold and silver  prices*. The  malefactors, except for forays into derivatives and  futures, which are  transitory, *have lost control and suppression of  gold and silver prices*,  and it is only *a matter of time* before all  visages of any control will  be visible.


In other words, the rules for playing the gold and silver markets are rapidly changing and we are now standing at the threshold of an entirely new ballgame resulting from 'currency wars.' 

SafeHaven.com Article


> *Gold: Currency Wars and China*
> 
> Once again gold has made fresh highs as the Fed prepares its second or is   it the third round of quantitative easing (a.k.a. money printing) which involves   buying assets (a.k.a debt) to drive down yields and hopefully stimulate more   borrowing and spending. Two years after the Lehman collapse and implosion of   the housing sector, the financial system is still on life support. With *an anemic domestic market of lost jobs*, *lost homes and lost income*, the Americans,   Europe and Japan are trying the familiar false remedies of subsidies and *competitive   devaluations* to give exports a boost. And now the sovereign debt troubles of   the weaker members of the euro-zone threaten to take the system down again.
> 
> Washington's insatiable appetite for debt and taxes has become just too big.   In *reflating this bubble* with yet *another round of quantitative easing*, Fed   Chairman Bernanke (a.k.a. Helicopter Ben) has *greatly increased the risk of   a global currency war* dragging down an *already vulnerable banking system*. Desperately   the Americans and Europeans have resorted to the printing press, manipulating   their currencies lower destabilizing capital flows, raising fears of an *all   out currency war*, similar to the one that spawned the Great Depression. [More]


In other words, these corrupt governments are not going the way of responsibility and are recklessly printing up more and more money that only gives the economic system MORE DEBT. Silver and gold are NOT the bubble! The eight hundred pound gorilla in the room is the growing stimulus/bailout/quantitative easing BUBBLE that is definitely going to BURST. You have lost your job-out of money-and trying to fix everything by making the house payment with your credit card, which we all know DOES NOT WORK in the long run. Yes, there are happy times for a little while, but eventually the bills come due and all your cards are maxed out and into bankruptcy you go. America 'is' going to default on the 202 trillion dollar debt, but we are just waiting around to know 'when' that is going to happen. 



finebead said:


> Taxes will have to rise (perhaps back to the 1995 levels).  We have to do it all, for the good of the nation, we have to get to spending levels we can live with, without debasing our currency which will lower the standard of living for all americans.


How are you going to raise taxes on Americans, when illegal aliens have their jobs? How are you going to raise taxes on Americans whose jobs have been outsourced overseas or NAFTA offshored to other nations? Nobody in Washington DC is even trying to save the broken US economy. NOBODY. They are all moving chairs around on the USA Titanic and pointing fingers at everyone else for the gigantic mess looking us all in the face. Do not talk to me about raising taxes as any solution, when you have millions and millions and millions of illegal aliens stealing identities and jobs from Americans and sending our money south of the border to support their families in Mexico. BTW, just the interest payment on our debt at these low interest rates is 4,000,000,000 every day and that does not touch the principal! That is four billion dollars going out the window ever day 'before' you start paying the bills. 



finebead said:


> I expect average house size in the US will fall, we won't be able to afford to buy a big one, nor pay the taxes, nor insure it, nor heat and cool it due to higher energy prices.


You should expect the children and the parents to move back in with grandma, so that perhaps collectively they can afford to make the house payment and eat rice and beans ...



finebead said:


> The reason the president and congress may reach a compromise on deficit reduction is because we have to.


Give me a break! The corrupt Bush/Obama Administrations and both houses of Congress are corrupt to the core and have no solutions to the economic chaos coming down the road. They are just waiting for the entire system to implode, so they can help the House of Rothschild/Rockefeller bring in their New World Order in the aftermath of the collapse. Those among you investing your worthless dollars in silver right now will have some chance of survival, but those of you worshiping at the altar of fiat currency will be left with little or nothing. 

GL,

Terral


----------



## finebead (Jan 29, 2011)

As Warren Buffet says, all the gold in the world would just about buy all the farm land in america.  If the SHTF, what would you rather have, a big cube of gold, or all the farmland in america?  Answer: take the farmland, you can feed your family and do useful things with it.  The gold just sits there and does nothing.

Are you a gold dealer?  Doom and gloom purveyor?


----------



## Ernie S. (Jan 29, 2011)

Bought silver in August at $20.50 and again last month at $28.50. I bought my dealer's last 100 oz
I'm still OK on gold, but I wish I had followed my hunch and sold it for silver at $1420.


----------



## Terral (Jan 29, 2011)

Hi fine:



finebead said:


> As Warren Buffet says, all the gold in the world would just about buy all the farm land in america.  If the SHTF, what would you rather have, a big cube of gold, or all the farmland in america?  Answer: take the farmland, you can feed your family and do useful things with it.  The gold just sits there and does nothing.



Here is the deal: The value of your farm today is depreciating quickly with the big farms taking over and squeezing the little guys out. However, having your money in silver at 25 or 30 and seeing that go to 100 or 250 or 500 as some people say will give you more money to buy more land after the coming crash. Would you rather afford a small farm or a big farm? ;0)



finebead said:


> Are you a gold dealer?  Doom and gloom purveyor?



Naw. I am just a voice crying in the wilderness about a great opportunity to buy stock in the coming economic collapse. Currency wars lead to a currency crisis and that is when gold and silver shine. BTW, my advice is to buy small denomination silver for barter (1 to 5 ounces). Gold will not work as well, because a single ounce will be 2000+ plus dollars and that requires a lot of lead to defend in a survival mode environment. A one ounce 100-250 dollar bar of silver might work just fine. Actually I never bought any silver before and this purchase puts some of the final touches on my personal survival kit.

GL,

Terral


----------



## Terral (Jan 30, 2011)

Greetings to All:

[ame=http://www.youtube.com/watch?v=Lv1Ie_sJkoc]Egypt, Gold, Silver, and Oil Update[/ame]

GL,

Terral


----------



## Terral (Jan 30, 2011)

Greetings to All:

[ame=http://www.youtube.com/watch?v=tJlw0FbJmsM]WorldWide Revolution = Buy More Silver![/ame]

GL,

Terral


----------



## Terral (Feb 2, 2011)

Greetings to All:

This is the kind of story that we shall see throughout 2011:

ZeroHedge.com



> *Scotia Mocatta Sells Out Of All Silver Bars*
> 
> When a week ago we  noted that ScotiaMocatta sold out of the Valcambi 1 kg block, yet once  again showed the 100 oz silver bar as  back in stock, we said: "We will  keep tabs on how long before this also becomes "sold out."" We have the  answer and it is 7 days. As of today, Canada 's biggest bullion bank is  out of not only the 100 oz silver bar, *but all silver bars*! This follows yesterday's news that in January the US mint sold 50% more silver than in any month before. [More]


Right now Monex.com is showing the silver spot price at *28.24* (check @1:17 PM) or down 29 cents from yesterday, while at the same time some silver outlets are out of silver bars! I still expect the price to bounce between about 25.50 to 30 bucks, but eventually the price will go parabolic and panic will set in and the time buy at these rates will be over. The smart money is going after the silver, before the quantitative easing drug wears off and the dollar weakens dramatically and prices go through the roof! 

PS. You may want to take a look at this video from my Conspiracy Theories Forum Post:

[ame="http://www.youtube.com/watch?v=T3PsRSt9Ays"]Pole Shift - Dollar Inflation[/ame]

GL,

Terral


----------



## mdn2000 (Feb 2, 2011)

Lead is more useful than silver, especially in hard times. 

Mexico has too much Silver, I would worry that it all gets dumped on the market at once, Silver will lose its value the fastest, I cannot see Silver as a good investment.

Lead though, maybe copper, seeds, grain, water purifiers.


----------



## william the wie (Feb 2, 2011)

mdn2000 said:


> Lead is more useful than silver, especially in hard times.
> 
> Mexico has too much Silver, I would worry that it all gets dumped on the market at once, Silver will lose its value the fastest, I cannot see Silver as a good investment.
> 
> Lead though, maybe copper, seeds, grain, water purifiers.



Silver (inventory) stocks have been shrinking for decades. Uses of silver have been increasing particularly in electronics. Lead being poisonous is seeing its industrial uses shrink.


----------



## Terral (Feb 2, 2011)

Hi mdn:



mdn2000 said:


> Lead is more useful than silver, especially in hard times.
> 
> Mexico has too much Silver, I would worry that it all gets dumped on the market at once, Silver will lose its value the fastest, I cannot see Silver as a good investment.
> 
> Lead though, maybe copper, seeds, grain, water purifiers.



Mdn is bringing up some very good points. Let us take a look at my Survival List from that topic:

Surviving The Economic Collapse



> Travel Trailer w/solar power system
> 4-man tent
> 2-man tent
> Sleeping bags
> ...


 
I have already purchased most of these things and the mountain bike is in storage as we speak. The animal traps have been spray-painted and the beans and rice are all happy in their vacuum-packed bags. I have more lead in .308 rifle and double-0 buckshot and .38 and .357 ammo than can be carried. After all, ammunition will be in very short supply after the crash and a box of shells might be worth more than the same amount of silver. 

The question is not whether lead is better or worse then silver, but rather whether I want to hold onto fiat fed dollars that are depreciating fast OR silver @ 28 bucks that is predicted to go to 100 and 250 and 500 bucks by professing experts. Hmmmm ... decisions, decisions. ;0) After all, this guy might be right ...

[ame=http://www.youtube.com/watch?v=T3PsRSt9Ays]Pole Shift - Dollar Inflation[/ame]

... or his calculations might be off. Either way, wisdom says to hope for the very best while preparing for the worst-case scenario. 

GL,

Terral


----------



## Terral (Feb 4, 2011)

Hi all:

Imagine buying silver for 30 bucks per ounce and selling for 500 dollars.

[ame=http://www.youtube.com/watch?v=Qi8fV8n_UBM]$5000 Gold And $500 Silver[/ame]

GL,

Terral


----------



## william the wie (Feb 4, 2011)

The rule of thumb is that when the Dow reaches an ounce of gold go long LEAP calls on the index and get out of gold, which may still go up but not as fast as the big stocks.


----------



## Terral (Feb 8, 2011)

Greetings to All:

The time is running out to get silver around 30 bucks:

[ame=http://www.youtube.com/watch?v=pfM43DCZ0io]Silver Update Extreme Backwardation[/ame]

You guys had better listen to the dog, because the day is coming when prices go sky high and you cannot find silver to buy anywhere.

GL,

Terral


----------



## Mini 14 (Feb 8, 2011)

I started betting on silver at $5. Far better investment than gold, IMO, and a no-brainer going forward.

I have around $5,000 face of 90% US coinage for barter, but the majority of mine is bars and Eagles.

If you aren't holding it, it is no different than buying MSFT, KO, or F.


----------



## Terral (Feb 8, 2011)

Hi Mini:



Mini 14 said:


> I started betting on silver at $5. Far better investment than gold, IMO, and a no-brainer going forward.
> 
> I have around $5,000 face of 90% US coinage for barter, but the majority of mine is bars and Eagles.
> 
> If you aren't holding it, it is no different than buying MSFT, KO, or F.



You are very wise indeed. Just for the record, silver is trying to break through the *30-dollar threshold* right now as we speak (check) and is up about 75 cents, with gold up 17 bucks. I am still hoping for one last dip near 26 bucks, but the world is catching on that the fiat money system is collapsing under too much debt. JP Morgan and the Banksters are having trouble keeping the paper price of silver connected to the real commodity, and when that decoupling manifests itself fully, then silver prices will go through the roof and you will not see 30 dollar silver again IMHO. 

[ame="http://www.youtube.com/watch?v=duRN9e-3o6g"]Severe Silver Shortage Should Start Soon[/ame]

GL,

Terral


----------



## KissMy (Feb 8, 2011)

J.P. Morgan Will Accept Gold as Collateral 


> J.P. Morgan Chase & Co. said it will allow clients to use the metal as collateral in some transactions. For example, a hedge fund wanting to borrow money for a short period can put up gold as collateral and use the borrowings to invest elsewhere, betting on making a better return. Typically, banks accept only Treasury bonds and stocks in such agreements.
> 
> By making the announcement, J.P. Morgan is effectively saying gold is as rock solid an investment as triple-A rated Treasurys, adding to a movement that places gold at the top tier of asset classes. It also is trying to capitalize on all the gold now owned by hedge funds and private investors that is sitting idle in warehouses.
> 
> "It's solidifying a trend that gold is re-establishing its role as a monetary and financial asset,"




Firm urged hedge against state bonds it helped sell


> Goldman, Sachs & Co. urged some of its big clients to place investment bets against California bonds this year despite having collected millions of dollars in fees to help the state sell some of those same bonds.
> 
> The giant investment firm did not inform the office of California Treasurer Bill Lockyer that it was proposing a way for investment clients to profit from California's deepening financial misery. In Sacramento, officials said they were concerned that Goldman's strategy could raise the interest rate the state would have to pay to borrow money, thus harming taxpayers.




The Congressional Show-Trial Of Meredith Whitney Begins Tomorrow


> Ms. Whitney has declined an invitation to appear before the panel of the House Oversight and Government Reform. But the subcommittee&#8217;s chairman, Representative Patrick T. McHenry, Republican of North Carolina, said that would not dissuade him from investigating her record.
> 
> &#8220;This isn&#8217;t a gotcha thing, but she&#8217;s going to be part of the hearing, whether or not she participates,&#8221; he said. &#8220;If she doesn&#8217;t want to come forward in a venue like this, that makes a statement.&#8221;
> 
> Yes, that's not ominous or anything.




*If speaking the truth is considered treason, what kind of nation are we?*


----------



## LordBrownTrout (Feb 8, 2011)

*Shhhhhhhhhhhhhhhhhhhhhhhhh, dont scare it!!!!!!!!!!!!*


----------



## waltky (Feb 8, 2011)

At the boarding house where I lived...
 things were getting very old...
long grey hairs were in the butter...
silver threads among the gold.

When the hog died we had sausage...
when the cat died - catnip tea...
when the landlord died I left there...
spare ribs were too much for me.


----------



## Toro (Feb 8, 2011)

Both gold and silver are at an interesting juncture here.  Silver is running up into resistance where it could not break through a few months ago.  Gold appears to have put in a near-term bottom but will run into the same issue another $40 higher.  

The fundamentals are working against the precious metals.  Interest rates have spiked hard over the past several days, the dollar is trying to stabilize while stocks are moving higher as the market prices in faster economic growth.  One would think precious metals would pull back in these conditions, but this has been a powerful bull market, and any move to new highs during deteriorating conditions for the precious metals would be a sign of strength.


----------



## sparky (Feb 10, 2011)

so if we can assume the _value_ of earthy commodities ,gold, silver, copper , etc are inversly proportional to the dollar's standing in the world fiat, what happens if China edges us out ?


----------



## Terral (Feb 11, 2011)

Greetings to All:

[ame="http://www.youtube.com/watch?v=16GRfXF0UtU"]JP Morgan Has A Big Problem[/ame]

All the precious metals on the *Monex Board* (check) are pushing down right now as the world is deluded into run after worthless fiat dollars. This might be the start of the final dip before the massive parabolic run up that many anticipate when the dollar crashes. I am hoping that silver goes down near $25 one last time for a final purchase before the crap hits the fan. ;0)

GL,

Terral


----------



## KissMy (Feb 14, 2011)

Reuters: Some States Worse Than European Sovereigns



> U.S. states' fiscal problems may be worse than European countries such as Greece and Portugal. While the states debt to GDP ratios are not nearly as elevated as those of European sovereigns, and they aren't as likely to default, their finances look worse based on other metrics.
> 
> When looking at budget deficits to revenues, both Illinois and New Jersey are in worse shape than even Greece and Portugal, but not as bad as Ireland. When examining the ratio of how much money certain states need to borrow vs. their outstanding debt, Illinois and Pennsylvania far outpace Spain, Portugal, and Greece - not a good sign. This could become a particularly severe problem if interest rates rise too fast and states are unable to sell debt.
> 
> As a result of the fiscal problems being encountered by states such as Illinois, California and New Jersey, many states are facing significant spending cuts and some analysts believe that it is just a matter of time before a wave of defaults hit municipal bonds. Investors have been pulling out of municipal bonds in droves, which in turn, drives up interest rates in the space.



Meredith Whitney is going to be vindicated with her report of the Tragedy of the Commons. As senator, Obama left Illinois in shambles. Now as president Obama's budget is doing the same to the USA. The correction in Gold, Silver & other commodities is over. This new budget disaster will eventually send commodities to new highs.

Whitney Muni Bond Forecast 'An Important Call': Jim Chanos


> Jim Chanos, of Kynikos Associates, said that he agrees at least in principle that the state of municipal finance is poor and not a good bet for investors. "I think her general sense was correct," he said. "You weren't getting compensated for the risk as an investor and that's an important call and that's something people need to hear from time to time."
> 
> Chanos compared the municipal debt situation to the mortgage industry, when subprime loans given to high-risk borrowers were hit with waves of defaults that ultimately brought down the financial services industry and required a government bailout.
> 
> ...


----------



## sparky (Feb 15, 2011)

to my knowledge, the munibond market is in the 2Trillion $$$ range, maybe the tax exempt status makeds it attractive, i really _don't _know......

But the interesting legislation occuring to _'help'_ those states in the red (notably California) by allowing them to declare bankrupcy directly confronts munibonds ratings

Now everyone thinks sewer plants, or whatever municipal infastructure being bonded, but isn't the largest recipent the municipal retirees , most of which are unionized, along with pensions?  

imho, this smells of union busting cloaked in the guise of helpy helperton bankrupcy legislation .....


----------



## KissMy (Feb 15, 2011)

France wants new global finance system


> France will help the transition to a global financial system based on 'several international currencies', the French Economy Minister said today.
> 
> France, as current head of the Group of 20 countries, will help the transition to a global financial system based on 'several international currencies', French Economy Minister Christine Lagarde said today...
> 
> France has previously said it wanted to see the global financial system reduce its reliance on the dollar for a more broad-based arrangement.


----------



## Mini 14 (Feb 18, 2011)

Silver headed to $32 today?

And gold over $1400 again?


----------



## LordBrownTrout (Feb 18, 2011)

Cotton prices, food, ......soaring.  Here we go.


----------



## william the wie (Feb 18, 2011)

LordBrownTrout said:


> Cotton prices, food, ......soaring.  Here we go.


With stocks in a melt up, bonds crashing and real estate trying to find a bottom where but precious metals can you go?


----------



## KissMy (Feb 18, 2011)

william the wie said:


> LordBrownTrout said:
> 
> 
> > Cotton prices, food, ......soaring.  Here we go.
> ...



Crude oil is really $108 & rising. The headline shown here in the USA is $87 but that is way off the average global price. It is being manipulated by a small amount of land locked WTI crude price. This is the price that gets printed in US headlines making people here think there is no inflation. Just because a small amount of WTI crude in a storage location that is used to measure USA oil price is not currently able to get to refineries creating a small surplus pushing that small supply price down in no way represents the true market price for global oil. RBOB is the gasoline that you buy at the pump & it's price is climbing because it is made from the imported global crude oil. Corn, Beans, Fertilizer, Steel, Coal, Cotton, Copper, precious metals & nearly all transportable commodities are climbing. This will squeeze consumer staple companies profits & cause inflation.


----------



## Toro (Feb 18, 2011)

Silver passed $32 this morning.  It is up 21% since hitting the intra-day low on Jan 28, rising more than 1% per trading session.


----------



## Valerie (Feb 18, 2011)

> Friday February 18, 2011, 4:23 am EST
> 
> Gold rose, silver gained to a 30- year high and palladium jumped to the highest price in almost 10 years on demand for precious metals to hedge against declines in other assets because of unrest in the Middle East.



Gold Rises, Silver Goes to 30-Year High as Middle East Unrest Spurs Demand - Yahoo! Finance


----------



## Toro (Feb 18, 2011)

I'm not sure what to make of this.  

Much of this has to be coming from the Mid-East.  Much of the Mid-East keeps their wealth in gold and silver.  They have been a big supplier of scrap for recycled gold during this bull market.  I imagine the scrap supply from the ME is dissipating.  Remember, gold went from $160 to $850 in a year during the height of the Iranian Hostage Crisis in 1980.  It then collapsed.

Also, problems in Europe may also be fueling demand.  Overnight borrowing from the ECB has spiked to 10x the average over the past few days, leading some to think a few European banks are in trouble.

Interest rates and the dollar have been pulling back a bit over the past few days, so that is fueling demand, but with the economy starting to accelerate and interest rates rising off the bottom, it will be interesting to see if gold can continue to catch a bid.

Silver is hitting highs but gold is not.  For this bull market to continue, gold has to be rising too.  Silver has been impressive but we shouldn't trust the move too much until gold breaches resistance.


----------



## KissMy (Feb 18, 2011)

Toro said:


> I'm not sure what to make of this.
> 
> Much of this has to be coming from the Mid-East.  Much of the Mid-East keeps their wealth in gold and silver.  They have been a big supplier of scrap for recycled gold during this bull market.  I imagine the scrap supply from the ME is dissipating.  Remember, gold went from $160 to $850 in a year during the height of the Iranian Hostage Crisis in 1980.  It then collapsed.
> 
> ...



Charts of resistance can only tell you so much. We just had a 9% correction in gold that is very typical before it continues to new highs. It will get there. The out of whack US oil price is causing the US dollar to appear stronger than it really is. Then you have a flight to dollars because of Middle East & European problems currently helping the dollar. The reality is there is a very strong global commodities price boom going on but we can't see it here because our headline oil price is $21 dollars below true market price & our US dollar is temporarily elevated.


----------



## Toro (Feb 18, 2011)

You aren't seeing a flight to dollars.

Also, spreads between American and European and Japanese bonds have been widening, which is why the dollar has been stronger, at least until a few days ago when spreads eased.  But the technical and economic picture is for higher interest rates as growth accelerates, which is dollar positive.  So the question then becomes, what happens to gold?  Gold and silver have actually been trading directionless relative to the dollar this year, often rising when the dollar rises and falls when the dollar falls.  This is actually positive for precious metals because you don't want PMs being a dollar play.  You want it to be a fiat currency play.


----------



## KissMy (Feb 18, 2011)

Toro said:


> You aren't seeing a flight to dollars.
> 
> Also, spreads between American and European and Japanese bonds have been widening, which is why the dollar has been stronger, at least until a few days ago when spreads eased.  But the technical and economic picture is for higher interest rates as growth accelerates, which is dollar positive.  So the question then becomes, what happens to gold?  Gold and silver have actually been trading directionless relative to the dollar this year, often rising when the dollar rises and falls when the dollar falls.  This is actually positive for precious metals because you don't want PMs being a dollar play.  You want it to be a fiat currency play.



So far when China & others raised interest rates Gold quickly recovered. Because China keeps increasing their buying more gold in-spite of those rate hikes. It is strange but the other economies are booming in-spite of rate hikes thus sucking up all the worlds commodities. The only thing that would derail that is if a bubble popped in China. Many have been calling for China's overheated economy to crash. The thing is it may not be overheated. There are massive amounts of people who want homes, food, cars, oil, etc. over there. I don't foresee demand destruction. I think their economic engine can run at least 3 times further than ours before demand falls.


----------



## Toro (Feb 18, 2011)

Generally, a boom does not end when authorities begin tightening.  Booms end when monetary conditions are tight.  Even in China, despite the increases in reserve requirements, the real rate of interest is still negative.  Most of the world still has easy money.

What makes me worry about the precious metals is that there was selling on huge volume a few months ago, and the resistance for gold is pretty formidable.  What I want to see is gold moving through resistance preferably on higher volume.  Silver sliced through resistance like it wasn't even there, so maybe gold will too.  Silver is up on good volume today.


----------



## KissMy (Feb 18, 2011)

Toro said:


> Generally, a boom does not end when authorities begin tightening.  Booms end when monetary conditions are tight.  Even in China, despite the increases in reserve requirements, the real rate of interest is still negative.  Most of the world still has easy money.
> 
> What makes me worry about the precious metals is that there was selling on huge volume a few months ago, and the resistance for gold is pretty formidable.  What I want to see is gold moving through resistance preferably on higher volume.  Silver sliced through resistance like it wasn't even there, so maybe gold will too.  Silver is up on good volume today.



Investors are diversifying into other commodities that are now rising faster than gold. These other commodities are simply playing catch-up to gold's long strong run. Other commodities are currently out-performing gold as all that easy money that gold was hedging invsetors against has finally driven up global consumption levels. This does not mean gold is heading down.


----------



## Terral (Feb 21, 2011)

Greetings to All:



Terral said:


> ... Get off your butt and buy physical silver right now (28.03 spot 1/29/11 @ 11:42 AM), before  the price goes over 30 bucks, so you can cash in on the best  opportunity to multiply your money in history. There is no rush, because the Chinese and big banks are still shorting the silver market, but use this opportunity to buy and take physical possession of as much silver bullion and silver coins as possible (this company is good).



How many USMB readers bought silver at *$28.03* on January 29, 2011?? Click on the 'good company' (Gainsville Coins) link to see the price now at 33.81 and rising. That is almost a 6-dollar increase since the end of January! Does this mean to stop buying silver? No!

[ame="http://www.youtube.com/watch?v=PgiU62wy8No"]Max Keiser[/ame]

Some are saying that silver will blow through 80 bucks and 100 bucks and  200 bucks with some saying silver will surpass 500 dollars. 

[ame="http://www.youtube.com/watch?v=3eDFTYA7ZRc"]Banksters, Gold, Silver and the Near Future[/ame]

Other experts expect silver prices to rise to more than 2000 dollars per ounce. No. I am no seller of silver (never sold one ounce) and no financial planner or any such thing. I am only sharing insider information about how to get your worthless paper dollars into silver in preparation of the coming economic crash. If you read the Opening Post and looked at all the facts, then you know that JP Morgan and the Banksters are losing their ability to manipulate silver prices down. At 16/20 to 1 for silver versus gold, silver should be selling for 80 bucks per ounce right now! JP Morgan is losing the silver short position battle, which is seeing the real value rise above the artificial paper value. More and more people are demanding delivery of the actual silver and more and more people around the world are chasing smaller and smaller amounts of gold and silver. 

I am telling all of you that the price of silver will go through the roof and then there will be *NO SUPPLY* (link). Zero! Everywhere you go to try and buy silver will be '*Out Of Stock*,' because dwindling silver inventories will be saved and only given to the best customers that does not include you and me. 

GL,

Terral


----------



## Ernie S. (Feb 21, 2011)

I bought at $20.50 and again at 28.50. I also bought quite a bit of gold at $1240 something, gotta check... I wish I had put that into silver back in August. In stead of about 16%, I'd be looking at over 60% return. I'm thinking that if Silver settles back under 30,  I may convert half of my gold.


----------



## kwc57 (Feb 21, 2011)

No, Glenn Beck told me to buy gold.


----------



## Ernie S. (Feb 21, 2011)

kwc57 said:


> No, Glenn Beck told me to buy gold.


Someone is paying Beck to tell me to buy gold...

Evewryone who has researched precious metals has their own theory. When I started buying PM's a friend told me to go 75% silver and 25% gold, maybe a bit of platinum if I felt lucky. What I had read told me to go 75% gold. I should have listened to Mark, I guess. When I bought my last silver at $28.50, Mark told me silver was ready to crash and he had gotten out.
I was tempted to follow him out of PM all together, but I was seeing $35 Ag. I'm glad I didn't follow his advice this time.
Now that Ag is $34, I'm betting on a 10% fallback before a run to $50 by summer.

Don't follow me any more than you'd follow Beck. I've been wrong as often as I've been right.


----------



## LordBrownTrout (Feb 21, 2011)

Massive debt, economy spiraling, QE.....infinite +1, dwindling silver resources, to name a few.  I bought in at 10 an ounce, 1460 oz, two bags, sold one, bought another one, have been on a wait for three months for another 715 ounces.


----------



## Ernie S. (Feb 21, 2011)

LordBrownTrout said:


> Massive debt, economy spiraling, QE.....infinite +1, dwindling silver resources, to name a few.  I bought in at 10 an ounce, 1460 oz, two bags, sold one, bought another one, have been on a wait for three months for another 715 ounces.


Buying 90% coins? Sometimes I get a good buy. Like today, I could probably buy at about $27 at one local pawn shop. I usually buy .999 10, 100 and kilo bars. You can buy junk silver coin cheap, but they rape you at sale


----------



## LordBrownTrout (Feb 21, 2011)

Ernie S. said:


> LordBrownTrout said:
> 
> 
> > Massive debt, economy spiraling, QE.....infinite +1, dwindling silver resources, to name a few.  I bought in at 10 an ounce, 1460 oz, two bags, sold one, bought another one, have been on a wait for three months for another 715 ounces.
> ...



Yeah, that's the drawback.  I usually price junk coins every two or three weeks and they're usually about three bucks off spot.  These are at local coin dealers.  I checked at thirty and they were offering between 26 and 27 on junk coins.  Are kilo bars and .999 hard to find?


----------



## Toro (Feb 21, 2011)

Well, I have to give Terral credit.  Even though he has a lot of wacky theories, silver is up almost 30% since the OP.

I only hope he knows when to get out!


----------



## Ernie S. (Feb 21, 2011)

LordBrownTrout said:


> Ernie S. said:
> 
> 
> > LordBrownTrout said:
> ...


I have a guy in Fort Lauderdale I deal with. If I just stop by, he generally has 2 or 3oo oz on hand. If I give him a couple days I can get more. He's a jewler located in a co-op. He sells mostly estate jewlery, does some nice custom stuff, but most of his business is PM. He deals in cash only and on a first name basis. A local flea market here usually has 10 and 100 oz bars on display, but they're very proud of them at spot + 5 or so.. I give Marty a buck or buck and a half over spot.
 There's probably someone like that near you. You just gotta look for them or talk to friends into PM.


----------



## Toro (Feb 22, 2011)

Gold and silver may be putting in a top here, at least in the near-term.  Both have reversed intra-day, and the stocks of the gold and silver companies appear to be acting in classic topping fashion.  Also, even though silver hit new highs, gold did not, and there is significant resistance at the $1430 level.


----------



## KissMy (Feb 22, 2011)

Gold will make a new high. The global economy will continue to drive commodities. Crude oil will also make a new high. We just saw Corn, Wheat, Cotton, & Copper have all just made new highs. Prices do not go in a straight line but they are consistently making new highs. BUY THE DIPS! The US dollar is done by 2020. $113 Trillion in unfunded liabilities. Then you have huge problems in 38 US States. CYA!!!


----------



## liebuster (Feb 22, 2011)

KissMy said:


> Gold will make a new high. The global economy will continue to drive commodities. Crude oil will also make a new high. We just saw Corn, Wheat, Cotton, & Copper have all just made new highs. Prices do not go in a straight line but they are consistently making new highs. BUY THE DIPS!* The US dollar is done by 2020.* $113 Trillion in unfunded liabilities. Then you have huge problems in 38 US States. CYA!!!




I'd be willing to say the dollar is gone by late 2012 or 2013. If I'm wrong, then good for everyone.


----------



## miller (Feb 24, 2011)

liebuster said:


> KissMy said:
> 
> 
> > Gold will make a new high. The global economy will continue to drive commodities. Crude oil will also make a new high. We just saw Corn, Wheat, Cotton, & Copper have all just made new highs. Prices do not go in a straight line but they are consistently making new highs. BUY THE DIPS!* The US dollar is done by 2020.* $113 Trillion in unfunded liabilities. Then you have huge problems in 38 US States. CYA!!!
> ...



Kiss the dollar good bye now.  Bernanke has guaranteed the destruction of the dollar.  He is not only incompetent he is delusional.  For a quick profit see this analysis.
Screwed Again: GOLD OPPORTUNITY


----------



## Mini 14 (Feb 24, 2011)

While we continue to beat the daily ebb and flow of precious metals here (and I thoroughly enjoy it, as we have some excellent insight in this thread), anyone not buying to hold long-term is sealing their own fate. It isn't a question of "when" gold, silver, and the other precious metals will rise, it is only a question of how quickly.

I wouldn't want to make a living day-trading gold and silver, the moves are simply to dramatic and too unpredictable, and anyone who says they have it figured out hasn't been in the game very long. But long-term holdings are EASILY the smartest transactions I've ever made. I bought at historical highs several times over the past 3 years, and I'm still rolling in the profits.

Day-to-day......you got me......

But buy-and-hold is a no brainer.


----------



## miller (Feb 24, 2011)

Toro said:


> Gold and silver may be putting in a top here, at least in the near-term.  Both have reversed intra-day, and the stocks of the gold and silver companies appear to be acting in classic topping fashion.  Also, even though silver hit new highs, gold did not, and there is significant resistance at the $1430 level.



There are significant buy stops at $1429.  Get me long at $1413 right now because they will hit those stops by Friday afternoon in time for weekend margin calls.

See this: Screwed Again: GOLD OPPORTUNITY


----------



## Toro (Feb 24, 2011)

I would like to see a pullback in gold to the $1380 level then another assault on the highs.  I'd be in heavily then.


----------



## william the wie (Feb 24, 2011)

Toro said:


> I would like to see a pullback in gold to the $1380 level then another assault on the highs.  I'd be in heavily then.


Understandable but gold and even more so silver with its greater industrial uses is becoming less predictable every year and month. You may be on the sidelines during a major move with that provisio. Chasing a meltup can hurt.


----------



## Toro (Feb 24, 2011)

Both gold and silver got hit pretty hard when rumours that Gaddafi had been shot began to circulate, as did oil.  Interestingly, when the State Dept said that they had no news of Gadaffi being killed, precious metals and energy did not recoup their losses.  Both gold and silver are bouncing a bit in the evening sessions but this panic buying has been driven by fear.  When fear leaves the market, I think you could see a significant reversal.  I have taken a small short position in silver that I will cover if I am stopped out.  We may have seen at least a near-term top in the complex given the huge intra-day reversals, especially in oil, as the panic buying may have ended.  It should be noted that I have been very unsuccessful trading silver on the short side.


----------



## Trajan (Feb 24, 2011)

I am sorry but I have to say, I have no issue with pulls backs ala nervous profit takers....I am ready to jump if my chicken shit number is breached......A friend (here) and I spoke 2 years ago about gold, I told him I had just took the plunge...at $998. Next to a 89' Amgen buy at $55, this will be the best move I have ever made.


----------



## KissMy (Feb 24, 2011)

I took profits in oil & gold today as well. If this civil war ends these fear induced prices will pull back. I plan to buy back in the week of March 11, 2011 because a "Day of Rage" in Saudi Arabia is planned for that date. I don't believe the Saudi people are as pissed off at their leaders as these previous countries were, but I am not going to sit on the sidelines if that country explodes. I am going to be in Oil, Gold & Silver.


----------



## Toro (Feb 24, 2011)

KissMy said:


> I took profits in oil & gold today as well. If this civil war ends these fear induced prices will pull back. I plan to buy back in the week of March 11, 2011 because a "Day of Rage" in Saudi Arabia is planned for that date. I don't believe the Saudi people are as pissed off at their leaders as these previous countries were, but I am not going to sit on the sidelines if that country explodes. I am going to be in Oil, Gold & Silver.



CNBC reported today that the King of Saudi Arabia returned with great jubilation.  

From what I am hearing and reading, it is unlikely that the kingdom will explode.


----------



## KissMy (Feb 24, 2011)

Toro said:


> KissMy said:
> 
> 
> > I took profits in oil & gold today as well. If this civil war ends these fear induced prices will pull back. I plan to buy back in the week of March 11, 2011 because a "Day of Rage" in Saudi Arabia is planned for that date. I don't believe the Saudi people are as pissed off at their leaders as these previous countries were, but I am not going to sit on the sidelines if that country explodes. I am going to be in Oil, Gold & Silver.
> ...



The Kings people may have been showing great jubilation. The revolutionist will remain quiet & out of sight until the time comes to riot otherwise they would be hunted down & killed. You can't always trust what is coming out of these countries. The Gaddafi was Shot rumor & we killed Bin-Ladin in the mountains mistake are proof of that. How do we know how many & how organized the revolutionist are if they operate in complete secrecy. If you wanted to join a revolution you would not tell anyone until the time came to act.


----------



## LordBrownTrout (Feb 24, 2011)

Mini 14 said:


> While we continue to beat the daily ebb and flow of precious metals here (and I thoroughly enjoy it, as we have some excellent insight in this thread), anyone not buying to hold long-term is sealing their own fate. It isn't a question of "when" gold, silver, and the other precious metals will rise, it is only a question of how quickly.
> 
> I wouldn't want to make a living day-trading gold and silver, the moves are simply to dramatic and too unpredictable, and anyone who says they have it figured out hasn't been in the game very long. But long-term holdings are EASILY the smartest transactions I've ever made. I bought at historical highs several times over the past 3 years, and I'm still rolling in the profits.
> 
> ...



Same here.  I bought silver at lows and am hanging in for the long term.  I'm not savvy when it comes to buying and selling on dips.  I'll probably make one more push while silver is still in the thirties.  I could easily see it reaching 50, 70 an ounce by the end of the year, possibly a hundred by the end of next year.  The negative part of that is that things are going to be bad.


----------



## KissMy (Feb 25, 2011)

If you are investing in oil watch out for the companies who signed contracts with fallen leaders.

Big Oil companies have signed around $50 billion in deals with Muammar Gaddafi over the next few decades. A post-Qaddafi regime could reject these deals and worse.

&#8226;Eni signed a 10-year $28 billion investment deal in 2007, with oil and gas supply contracts through 2047

&#8226;BP signed a $900 million production contract in 2007, with exploration rights in a massive offshore field. BP is expected to invest $20 billion over two decades

&#8226;Exxon paid $97 million for exploration rights in 2008, with a $72 million signing bonus and $25 million in educational scholarships


----------



## Toro (Feb 25, 2011)

KissMy said:


> Toro said:
> 
> 
> > KissMy said:
> ...



Stratfor is saying that the royal family isn't in any danger of falling.  However, they noted succession issues, given that the leadership are all octogenarians.

FTR, I covered my silver short at a small loss.


----------



## Trajan (Feb 27, 2011)

*ahem*..

Tribal chiefs join opposition to Yemeni president - Yahoo! News


if Saleh falls, this has a very high likely hood of really ratcheting %hit up.


----------



## miller (Mar 1, 2011)

miller said:


> liebuster said:
> 
> 
> > KissMy said:
> ...



$1432 April Gold.  They hit the stops.  See my post here with my link:
Screwed Again: GOLD OPPORTUNITY


----------



## miller (Mar 1, 2011)

There were huge sellers at $1429.  It took all day until the buy stops finally bid the April contract above $1431.

The safe and smart play now would be to take the $17 profit at $1431 and parlay that profit by buying a straddle (a call and a put) at the $1430 strike.  Gold prices will move big from this price but its impossible to predict which way.

With the QE2 Bernanke plan to wreck the dollar, the gold could go much higher.  But this recommendation was for a quick move as I stated in my blog.

Depending on the volume and open interest, I recommend liquidating the straddle by the end of this week.


----------



## miller (Mar 1, 2011)

See the trading update on gold:
Screwed Again: TAKE PROFIT ON GOLD NOW


----------



## LordBrownTrout (Mar 1, 2011)

Thanks, Bernanke.  Keep shoving us off the cliff with QE infinities.....ala 600B more.   Does wonders for silver, gold, precious metals though.


----------



## Trajan (Mar 1, 2011)

Toro said:


> KissMy said:
> 
> 
> > Toro said:
> ...



I have followed strafor as a member for years, they have pretty good outlook and good sources, but, I think,  they missed the boat on this one toro. Karen Elliot House is somehting of an expert on the house of saud. 

i will try and find her latest article, but for brevity's sake, they have a huge succession problem, mixed with the young turk angst. 

edit...here we go..

Karen Elliott House: From Tunis to Cairo to Riyadh? - WSJ.com


----------



## miller (Mar 1, 2011)

LordBrownTrout said:


> Thanks, Bernanke.  Keep shoving us off the cliff with QE infinities.....ala 600B more.   Does wonders for silver, gold, precious metals though.



Until you cash in the gold, you didn't make a dime.  Remember the Hunts?

You would have made way more in cotton and coffee.  This entire forum needs to learn that Bernanke is an imbecile who has no clue, and he's delusional.  If he isn't fired he will destroy the dollar.  This can happen any day.  We went of the cliff when the banks collapsed.

Read this:  Screwed Again


----------



## LordBrownTrout (Mar 2, 2011)

miller said:


> LordBrownTrout said:
> 
> 
> > Thanks, Bernanke.  Keep shoving us off the cliff with QE infinities.....ala 600B more.   Does wonders for silver, gold, precious metals though.
> ...



This ain't the Hunt brothers scenario unfolding.  There are several factors driving pm's into the stratosphere and will continue for the long term.


----------



## miller (Mar 3, 2011)

Lock in the gold profit at $1418 against the $1430 put.

Screwed Again: Lock in gold profit


----------



## miller (Mar 4, 2011)

Take another profit.

Screwed Again: Take another profit on gold


----------



## editec (Mar 4, 2011)

miller said:


> Take another profit.
> 
> Screwed Again: Take another profit on gold


 

Buy 1 April gold futures at $1418  to lock in the profit on the $1430 put.  If the market crashes we only make the $1200 minus the $1430 straddle cost ($2000 call, $2000 put = $4000).  If gold heads back to $1440 again we take our profit on the futures contract we bought at $1418.


Would you be kind enough to show me the math behind this play? (which is quoted, above, but I cannot change the font color for some reason)  

I realize that I'm asking a lot, but I don't understand how, after one takes the cost of taking both positions, you can make any money this way.


----------



## KissMy (Mar 4, 2011)

Saudi Arabia contagion triggers Gulf rout

Buy Silver & Oil, Sell Stocks.


----------



## Trajan (Mar 4, 2011)

yea well and Yemen hasn't fallen yet either. buy and hold. even at this price.


----------



## miller (Mar 4, 2011)

editec said:


> miller said:
> 
> 
> > Take another profit.
> ...



Tell me what you think the cost is.  If you are unable to subtract, there's nothing I can do for you.


----------



## Toro (Mar 4, 2011)

Silver hit a multi-decade high today.

I own no gold and silver but bought a bit of oil.  The best moves in the precious metals often come in times of fear, but such moves are usually ephemeral since fear can disappear overnight.  If - and when - Gaddafi is shot dead, I wouldn't be surprised in gold dropped $100 and oil dropped $10.  I prefer buying off money printing, which the Fed is doing.  The weakness in the dollar is fucking pathetic.  Investors should be flocking to Treasuries but they want nothing of it.


----------



## LordBrownTrout (Mar 4, 2011)

KissMy said:


> Saudi Arabia contagion triggers Gulf rout
> 
> Buy Silver & Oil, Sell Stocks.



Yep.  Silver is cruising and headed into stratosphere levels.  I might sell at 200 but maybe not.

The odd thing is, I hate what's happening.


----------



## william the wie (Mar 4, 2011)

LordBrownTrout said:


> KissMy said:
> 
> 
> > Saudi Arabia contagion triggers Gulf rout
> ...


Gold and silver is for when you hate what's happening.


----------



## Terral (Mar 6, 2011)

Terral said:


> Max Keiser and Alan Grayson Explain
> 
> Get off your butt and buy physical silver right now (28.03 spot 1/29/11 @ 11:42 AM), before  the price goes over 30 bucks, so you can cash in on the best  opportunity to multiply your money in history. There is no rush, because the Chinese and big banks are still shorting the silver market, but use this opportunity to buy and take physical possession of as much silver bullion and silver coins as possible (Check).



Silver was just at 36.33 or up over 8 bucks in just over a month. Every ounce of silver is one share of stock in the coming dollar collapse. ;0)

Terral


----------



## Toro (Mar 10, 2011)

Gold and silver got whacked today, with gold at one time down $24 and silver down $1.40.  Both bounced off their lows on news of Saudi authorities firing into a crowd of demonstrators this afternoon.  However, this is a day when gold and silver should have been strongly positive, given the news in the ME and the downgrade of Spain by Moody's.  

Gold looks like its topping here, at least near-term.  Gold did hit highs a few days ago but gold stocks did not.  The GDX and GDXJ never hit the highs of January.  This is a "non-conformation" of the move in gold and is bearish.  Silver sliced through the January highs like the highs weren't even there, and the silver stocks followed.  However, there are cracks in the precious metals bull market, and one should be cautious.  

I do not think the bull market in precious metals is over, but I'm going to let the market talk to me before re-establishing positions.  Right now, the market is telling me to be careful.


----------



## Paulie (Mar 10, 2011)

Toro said:


> Gold and silver got whacked today, with gold at one time down $24 and silver down $1.40.  Both bounced off their lows on news of Saudi authorities firing into a crowd of demonstrators this afternoon.  However, this is a day when gold and silver should have been strongly positive, given the news in the ME and the downgrade of Spain by Moody's.
> 
> Gold looks like its topping here, at least near-term.  Gold did hit highs a few days ago but gold stocks did not.  The GDX and GDXJ never hit the highs of January.  This is a "non-conformation" of the move in gold and is bearish.  Silver sliced through the January highs like the highs weren't even there, and the silver stocks followed.  However, there are cracks in the precious metals bull market, and one should be cautious.
> 
> I do not think the bull market in precious metals is over, but I'm going to let the market talk to me before re-establishing positions.  Right now, the market is telling me to be careful.



The market is a beautiful woman.  She talks to me, she whispers in my ear.  Sometimes she fucks me, sometimes I fuck her.  She's nuts but for some reason I keep coming back for more.


----------



## KissMy (Mar 15, 2011)

This big market dip is caused by the news of nuclear disaster in Japan.

All the nuclear power plant reactors that could "melt down" have been de-commissioned for over the past 30 years or have been updated to use a sub critical mass fuel just like this ones in Japan.

A nuclear meltdown is nearly impossible. All that happens in a partial "melt down" is that 1 or 2 fuel rods overheated and deformed. There is no way for white hot molten weapons grade uranium to spill out of the reactor confines to create a huge "Plutonium mushroom cloud".

There are no eyes on these reactors. All info comes from radiation monitoring away from these plants. The media is hyping this because of the lack of real time eyes on certain facts. Just because nobody can give the media definite answers, speculation & fantasy fill the news.

Buy stocks & commodities on this big dip.


----------



## Baron (Mar 15, 2011)

Toro said:


> Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> 
> I bought back much of my gold and silver exposure yesterday and added a bit today.  There is a bid underneath gold, and though silver is extended, there is support at ~$25-$26.  A few weeks of consolidation for silver would do it a world of good.



What will you do with your gold and silver after crisis, only few people will purchase they, the prises will go rapid down and you will lost your money.


----------



## Mini 14 (Mar 15, 2011)

I have bought every ounce I can get my hands on today.

My wife is out of town, and she is going to kill me when she gets back


----------



## Toro (Mar 15, 2011)

Baron said:


> Toro said:
> 
> 
> > Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> ...



I own no gold and silver at this time.



Gold and silver are breaking down.  I believe they have topped, near-term.  More worringly, gold never hit a new high in other currencies such as yen, euros or pounds.  This causes concern regarding the bull market in gold and silver.


----------



## NYcarbineer (Mar 15, 2011)

Gold went down today on a day it should have soared.

That's generally considered indicative of something toppy.


----------



## Mini 14 (Mar 16, 2011)

Ahhh......maybe she ISN'T going to kill me after all.....


----------



## Toro (Mar 24, 2011)

Gold hit an all-time high today at $1447 while silver hit at 31-year high at $38.  Both reversed intra-day and ended at the lows at 4pm.  (Futures markets close at 6pm GMT and have bounced a bit since the lows.)  Both had what are known as a bearish outside reversal day, when the price hits a high then closes on the low, with the range of the trading day greater than yesterday, i.e. a higher high and a lower low than yesterday.

The cause of the reversal was the CME raising margins on silver by ~$600 per contract.  The CME has been raising margin requirements throughout the past year, and when they do, the pattern has been for the precious metals to have a bearish outside reversal day like today then weaken over the next few days.  Lately, the metals then push to new highs.

I've started to rebuild my positions.  If the prices hold, I will continue to add.


----------



## Terral (Mar 24, 2011)

Hi guys:



Terral said:


> ... Get off your butt and buy physical silver right now (28.03 spot 1/29/11 @ 11:42 AM), before  the price goes over 30 bucks, so you can cash in on the best  opportunity to multiply your money in history . . .  use this opportunity to buy and take physical possession of as much silver bullion and silver coins as possible (this company is good).



If someone bought 500 ounces of silver on January 29, 2011 at 28.03 per ounce ($14,015), they would be up 10 bucks ($19,000) in less than two months. That reflects how much the dollar has lost value and silver is going to the moon. ;0)


----------



## Mad Scientist (Mar 24, 2011)

I appreciate your efforts Terral but it's mostly falling on deaf ears here. 

By the way, the head of the Federal Reserve Bank of Dallas said the US is close to insolvency and that "the fix will be painfull". Let's face it, Obama and Congress aren't gonna' do anything about it. I figger the US dollar will melt down sometime in the june-august time frame.

While I don't really have the money to buy silver I *am* stocking up on food for the coming food riots. Bought a shotgun and I'm looking at a Glock 23.

When the "great unwashed" in the cities realize their gubamint check doesn't buy much food anymore the rioting will start. Shit, they already riot for the NBA championship. Just imagine when those animals can't eat.

And if I'm wrong, I just have a lot of food and a few weapons. No loss for me. But if I'm right...


----------



## Gadawg73 (Mar 25, 2011)

Time to sell gold is now. Buy it back when it is at $700 in 14 months and more when it is at $550 in 28 months. 
Buy low, sell high.
Look at the last 50 years. 
Stock market has doubled in the last 2 years. Commodities are still under valued but not metals. 
Gold is never a long term hold as a investment. Never has been, never will be.


----------



## Toro (Mar 25, 2011)

Since August 1971 when Nixon finally abandoned the last remnants of the gold standard, stocks have risen 10.1% per year with dividends reinvested while gold has increased by 9.3%.  Without dividends reinvested, i.e. you spent the dividend income, the annual return from stocks was 8% per year. 

That doesn't mean that one should rush out and buy gold here necessarily. Stocks have often performed poorly when gold has performed well, and vice-versa. And one day the bull market in precious metals will end badly. However people have underestimated the returns of precious metals since they were completely freed as a monetary unit.


----------



## Zander (Mar 25, 2011)

Speculators should short gold and silver. Set stops at $1448 .60 April Gold and $38.18 May silver.


----------



## KissMy (Mar 25, 2011)

Zander said:


> Speculators should short gold and silver. Set stops at $1448 .60 April Gold and $38.18 May silver.



No! No! - They should do a put call straddle. The comming Euro crisis will send the US dollar on a wild up ride while our own crisis & the Japan disaster will send the dollar on a wild down ride. Expect large swings in gold & silver. Profit from both up & down price swings. Ultimately  Gold & Silver will be much higher than today over the next 10 years.


----------



## Toro (Mar 25, 2011)

I see absolutely no evidence that the top is in. This is not what tops look like. Maybe it's different this time or maybe this is the beginning of the top, but I would strongly recommend against shorting here. Shorts get their faces ripped off during a bull market / bubble. If we are nearing a top and this is the beginning of a bear market, there will be lots of time to make money on the short side.


----------



## Gadawg73 (Mar 25, 2011)

Toro said:


> Since August 1971 when Nixon finally abandoned the last remnants of the gold standard, stocks have risen 10.1% per year with dividends reinvested while gold has increased by 9.3%.  Without dividends reinvested, i.e. you spent the dividend income, the annual return from stocks was 8% per year.
> 
> That doesn't mean that one should rush out and buy gold here necessarily. Stocks have often performed poorly when gold has performed well, and vice-versa. And one day the bull market in precious metals will end badly. However people have underestimated the returns of precious metals since they were completely freed as a monetary unit.



Take out the last year and your return on gold is 1% a year.


----------



## Toro (Mar 25, 2011)

The compounded annual return of gold from Aug 71 to the end of 2009 was 8.8%.


----------



## LordBrownTrout (Mar 25, 2011)

I may sell my silver at 200 an ounce in a couple of years, not sure yet, still contemplating.


----------



## Terral (Mar 25, 2011)

Hi Mad:



Mad Scientist said:


> I appreciate your efforts Terral but it's mostly falling on deaf ears here.



Amen to that. Silver looks poised to go to the moon, so I have not removed the Buy Silver Now! link from my sig, even though I am already in the silver game at much lower levels.  



Mad Scientist said:


> By the way, the head of the Federal Reserve Bank of Dallas said the US is close to insolvency and that "the fix will be painfull". Let's face it, Obama and Congress aren't gonna' do anything about it. I figger the US dollar will melt down sometime in the june-august time frame.



JP Morgan is losing the ability to manipulate the silver price down and they are getting beaten on their short position. Many do not know that JP Morgan applied to be a Comex Vault (list) and was approved in only two days rather than waiting the regular 45 days. Now they can claim to send or receive silver and keep the paper game going, while using the FED back door as QE-infinity to pay off silver buyers not to take delivery of the metal. This is corruption beyond belief right under the noses of regulators and Congress watching JP Morgan manipulate the market around their short position (story). 

Bernanke is destroying the fiat dollar and JP Morgan is shorting the silver that must go up in value with the crashing dollar, which makes very little sense; unless they are using Fed-created worthless dollars to keep the ponzi scheme going. The whole world is waking up to the fact that silver is WAY undervalued, so the push is on to get as much of the precious metal before JP Morgan loses the paper game short position battle. 



Mad Scientist said:


> While I don't really have the money to buy silver I *am* stocking up on food for the coming food riots. Bought a shotgun and I'm looking at a Glock 23.



Amen. I bought my food and survival supplies and guns and ammo before getting into silver, because we know that eventually the crap is going to hit the fan and our foe will be all of the unprepared people who refused to heed all the warning signs. 



Mad Scientist said:


> When the "great unwashed" in the cities realize their gubamint check doesn't buy much food anymore the rioting will start. Shit, they already riot for the NBA championship. Just imagine when those animals can't eat.



That day is coming for sure, as the crap is hitting the fan all over the planet. We are in the calm before the storm comes home to roost in the USA.



Mad Scientist said:


> And if I'm wrong, I just have a lot of food and a few weapons. No loss for me. But if I'm right...



Amen again. Better to have our survival supplies and not need them, than to need them and be left unprepared for what is obviously coming.


----------



## william the wie (Mar 25, 2011)

LordBrownTrout said:


> I may sell my silver at 200 an ounce in a couple of years, not sure yet, still contemplating.


Look up the asset allocation theory and relative rankings of different portfolios. Depending on the circumstances silver could be underpriced at $1000/oz or overpriced at $10/oz, it can happen.


----------



## LordBrownTrout (Mar 25, 2011)

william the wie said:


> LordBrownTrout said:
> 
> 
> > I may sell my silver at 200 an ounce in a couple of years, not sure yet, still contemplating.
> ...



Thx, Wie.  I'll do some research into that.


----------



## KissMy (Mar 26, 2011)

CNBC: Gold Replacing Dollar as Worlds Reserve Currency?


> Central banks are shedding dollars, reducing their holdings by about $9 billion in previous quarter, according to Nomura Securities Jens Nordvig, global head of G10 FX Strategy.
> 
> What are they buying instead? Gold.



N.C. lawmaker wants state to produce its own currency


> Cautioning that the federal dollars in your wallet could soon be little more than green paper backed by broken promises, state Rep. Glen Bradley wants North Carolina to issue its own legal tender backed by silver and gold.
> 
> The Republican from Youngsville has introduced a bill that would establish a legislative commission to study his plan for a state currency. He is also drafting a second bill that would require state government to accept gold and silver coins as payment for taxes and fees.



Utah Reps. pass bill to allow gold, silver coins as legal tender


> The state of Utah is on the verge implementing its own proto-Gold Standard. The House and Senate have voted in favor of HB317, which would make gold and silver coins legal tender. Governor Gary Herbert has until the end of the month to veto the bill.
> 
> In fear of the United States dollar being virtually worthless, some legislators in several states have introduced legislation that would allow their state to mint their own currency.
> 
> According to the Salt Lake Tribune, Utah residents may soon be allowed to use gold and silver coins in order to purchase goods and services. Lawmakers in the House and Senate have passed HB317 47-26 that would allow Buffalo and Eagle coins to be used as legal tender. Furthermore, the bill exempts the transfer of gold and silver from state taxes. Foreign minted coins, such as Krugerrands, Napoleons and Pandas, would not be accepted under the bill.


----------



## Toro (Mar 26, 2011)

These are the annual returns of the spot price gold since Nixon took America off the gold standard.

1971 Sept-Dec	1.8%
1972		47.0%
1973		67.0%
1974		72.3%
1975		-23.7%
1976		-4.1%
1977		22.6%
1978		37.0%
1979		126.5%
1980		15.2%
1981		-32.6%
1982		14.9%
1983		-16.3%
1984		-19.2%
1985		5.8%
1986		19.0%
1987		24.5%
1988		-15.3%
1989		-2.2%
1990		-4.6%
1991		-7.7%
1992		-5.7%
1993		17.4%
1994		-1.9%
1995		1.0%
1996		-4.6%
1997		-22.2%
1998		0.2%
1999		0.1%
2000		-5.5%
2001		2.5%
2002		24.7%
2003		19.3%
2004		5.5%
2005		18.0%
2006		23.0%
2007		31.0%
2008		5.1%
2009		25.5%
2010		29.1%
2011 to Feb    -0.5%

The past 10 years for gold has been fantastic.  I doubt the next 10 years will be as good.

Of the past 39 years, gold has been down in 14 years, with an average loss of -11.8%.  Stocks were down in 9 of those years, with an average decline of -15.3%. Gold has been much more volatile though, with gold volatility at 28.5% compared to 17.7% for stocks.  

If one created a portfolio of 50% stocks and 50% gold and rebalanced at the beginning of each year, the average return would have been 11.9%, which beats returns for both stocks and gold on their own.  There would have been only 7 down years in the past 39, with an average decline of 8.2%.  Volatility would have been 15%.


----------



## Toro (Mar 26, 2011)

KissMy said:


> CNBC: Gold Replacing Dollar as Worlds Reserve Currency?
> 
> 
> > Central banks are shedding dollars, reducing their holdings by about $9 billion in previous quarter, according to Nomura Securities Jens Nordvig, global head of G10 FX Strategy.
> ...



More importantly, the CME and JP Morgan are accepting gold as collateral.


----------



## KissMy (Apr 1, 2011)

Pimco's Gross Sees Little Value In Treasurys As US Debt Grows


> Pimco's Bill Gross, founder of bond powerhouse Pimco explained in his April outlook that he had dumped his U.S. Treasury holdings at the end of February because he sees little value in the market given the nation's mounting debt burden.
> 
> In addition to the $9.1 trillion in federal debt seen on the books, Gross is worried about the hefty portion of each year's budget that goes toward *non-discretionary and entitlement spending. Including obligations for Medicare, Medicaid and Social Security, the "true but unrecorded" U.S. debt is $75 trillion, Gross said, which amounts to near 500% of gross domestic product.*
> 
> ...


----------



## LordBrownTrout (Apr 1, 2011)

Ol Ben secretly gave away 3 trillion to foreign banks.  Yep, sky is the limit now on precious metals.


----------



## Toro (Apr 1, 2011)

It was a decent day for the precious metals today.  After getting hammered after the jobs report, they recovered and closed near the days highs, with gold at $1430 and silver at $37.70.  

Gold is having a hard time getting through $1450 however.  Silver is still in an uptrend but gold appears to moving sideways.


----------



## Toro (Apr 7, 2011)

Gold and silver have been hitting a series of highs over the past few days.  Spot gold is trading at $1464 in Asian trading, an all-time high, while silver is at $39.80, a 31-year high.

Gold is breaking out of its six-month consolidation, busting through formidable resistance.  Silver sliced through its "formidable" resistance like a hot-knife through butter weeks ago.  I would not be surprised if silver breaks $40 while I'm asleep.  I am expecting silver to test its all-time high of $50, which, at this rate, may be within a few months.


----------



## elvis (Apr 7, 2011)

[ame=http://www.youtube.com/watch?v=X-HQJXI4nVw]YouTube - U2 - Silver & Gold[/ame]


----------



## Toro (Apr 11, 2011)

Silver had a negative reversal day today, gapping up in the morning and closing on the lows.  This is often associated with topping action, if perhaps only for the near-term.  Thus, mid-morning, I blew out all my silver.

I still have my gold position, however.  I would expect that if silver is going to go down, gold will too (and vice-versa).  However, gold did not exhibit the same toppy action that silver did today, so I continue to hold.  If the market starts talking to me, telling me to sell my gold, I'll do so.


----------



## Sky (Apr 12, 2011)

You guys sound so full of it!!

One ounce of Gold still buys an Armani Suit - Yup!

Those markets are so manipulated - it makes my eyes tear up every five years I look at the prices....

The dollar is now 5c of its value since 1910. What is the argument?

In my book, what counts is how many ounces of the shiny stuff you hold...


----------



## Toro (Apr 12, 2011)

I sold my gold position this morning when it broke $1450.


----------



## Avatar4321 (Apr 12, 2011)

Anyone who thinks the system is actually going to break down and purchases silver or gold is a fool.

If anything, we should be buying and planting seeds to grow new food and to sell seeds for times of trouble. Heck, even if the system doesn't break down, that would be wise considering the inflation thats hitting food lately.


----------



## liebuster (Apr 14, 2011)

Silver is about $42/oz. Holy shit!!


----------



## Toro (Apr 14, 2011)

The melt up in silver is clearly on. A mania is developing. Sentiment is very bullish. A violent reversal cannot be ruled out but it may not happen until silver hits $50. The move in silver has not been confirmed by silver stocks. Take a look at the purest silver company SLW. Nor is it being confirmed by gold or gold stocks, at least not yet.


----------



## KissMy (Apr 14, 2011)

Toro said:


> The melt up in silver is clearly on. A mania is developing. Sentiment is very bullish. A violent reversal cannot be ruled out but it may not happen until silver hits $50. The move in silver has not been confirmed by silver stocks. Take a look at the purest silver company SLW. Nor is it being confirmed by gold or gold stocks, at least not yet.



Corn & Soybeans are melting down & Silver is melting up.


----------



## Toro (Apr 14, 2011)

I will say this. My son told me that one of his friends fathers was investing in silver, and I was eating in a restaurant the other day discussing gold and silver with a friend when this stranger came over out of the blue and told me he was invested in silver too. So you are starting to see these frothy anecdotes.


----------



## KissMy (Apr 14, 2011)

Toro said:


> I will say this. My son told me that one of his friends fathers was investing in silver, and I was eating in a restaurant the other day discussing gold and silver with a friend when this stranger came over out of the blue and told me he was invested in silver too. So you are starting to see these frothy anecdotes.



I am feeling that also. My mother asked me what the symbol was for a good Silver stock ETF. I have always used her as a bubble gage. She always gets in at the top. I didn't know if it was from my brother & I hounding her to get out of dollars for the past 3 years. She never listens to us.

Another shocker I have came across is farm land at several auctions in the last quarter has sold for over 10,000 an acre.

Midwest land demand , brings soaring prices


> The value of Iowa farmland jumped 26 percent since March 2010. According to a survey by the Iowa Farm and Land Chapter No. 2 of the Real Land Institute, it is the biggest annual increase in more than three decades for the state.
> 
> Iowa State University reporting 16 percent in November, the Federal Reserve at 18 percent, the University of Nebraska at 22 percent, and Illinois Realtors ranging from 9 to 15 percent.



A bubble is just starting to form from the falling dollar. The question is will the dollar stop falling for the next decade. US Government Deficit = Money Creation. The budget is out of control for a while.


----------



## Toro (Apr 14, 2011)

However, these are only minor anecdotes.  Silver and gold aren't full fledged manias.  Yet.

Hulbert's gold sentiment indicator is at a level where historically, there has been a significant correction in gold and silver prices.


----------



## FireFly (Apr 14, 2011)

I am toying with the idea of buying GLD & SLV straddles & borrowing against my tier 1 asset gold coins to buy another 360 acres of farm land. There is no money in cash renting it but you can make some serious coin farming right now. Plus the land price is starting to rise. I have just got to convince the current 85 year old land owner next to my property that he can't take it with him & he will enjoy that cash right now.


----------



## Toro (Apr 14, 2011)

That graph won't end well.  Farmland going up 35% in two years is unhinged.


----------



## Gadawg73 (Apr 14, 2011)

Gentleman, gold mania is speculative. That is what is happening now. Let me appeal to your reason and investing common sense in commodities trading, especially gold:
1. Gold is going high because of investors. Folks, demand for gold is cratering and declining fast. Jewlery, which accounts FOR MORE THAN HALF of the demand for gold worldwide, has fallen sharply with a bad economy.
2. India purchases more gold than any other country. When the price is very high they can not afford to purchase as much to make the jewelry.
3. Then we have price pressure from the demand side. Higher and increasing prices of gold means gold miners have to work over time. The supply of gold worldwide has jumped over 10% in the last 15months. With high prices they plow up as much as they can and then we get an over supply. And guess what happens then? The slightest decrease in demand sends prices plummeting as extraction per ounce costs are rising high.
4. High prices of gold also brings out the sellers and re-sellers and sellers of resellers! All of a sudden now every spare piece of old gold whatever is being soldby everyone everywhere. Everywhere you go there is some dude with a sign "We buy Gold". This further floods the market with an over supply of gold which, again, will drive down the price fast swith the slightest decrease in demand.
5. No one knows how long hedge fund bets are. Often times gold lies in futures, as the ownership is never even taking delivery of the gold itself.

If you have extra $$$ then go for it with a small % but watch gold fall to the $800 range within the next 20 months and stay there for a while.


----------



## Jos (Apr 15, 2011)

Would you rather be holding Gold & Silver or paper & ink?


----------



## Mad Scientist (Apr 15, 2011)

Jos said:


> Would you rather be holding Gold & Silver or paper & ink?


This. Gold has appreciated in value because the Chairman of the Federal Reserve has seen fit to try to destroy the value of the dollar through QEI and QEII soon to be followed by QEIII.


----------



## Gadawg73 (Apr 15, 2011)

Jos said:


> Would you rather be holding Gold & Silver or paper & ink?



Well, no one holds any gold unless it is in your hands and many do not know that what they are getting are futures or funds, not the metal.
You own metals and land and invest in stocks and bonds.
You can not eat gold or paper or ink. 
But I agree with you now, weprint damn $$$ and soon inflation will rise again. But long term that will not stop the pressures of demand on metals.
If I bought low and sold high, and selling is getting out, it does not matter what I own or invest in.
If you bought gold at $900 and it goes to $2000 and you are holding it you have made no $$. 
You have to sell to profit.
Watch the supply rise with higher prices and the second demand goes down the price will drop like a sack of rocks.
Metals are a great hedge against inflation but as a ling term hold as an investment they do about half as well as the market. 
I would sell 20% now and 20% every quarter. American corporations are sitting on over a trillion dollars in cash now. When they start spending that that will also pressure the commodities market down.


----------



## Toro (Apr 15, 2011)

It is getting stupid in silver. I've seen this many times before. It will end badly. 

But that doesn't mean it won't get stupider before it ends, as I expect it will. But it feels to me like a frenzy right now.


----------



## Mad Scientist (Apr 15, 2011)

Toro said:


> It is getting stupid in silver. I've seen this many times before. It will end badly.
> 
> But that doesn't mean it won't get stupider before it ends, as I expect it will. But it feels to me like a frenzy right now.


But has the Fed printed a massive amount of dollars before? Gold and silver isn't going up in value merely from speculation like the Hunt Brothers did years ago. It's going up because the value of the dollar is going down. People are beginning to realize this and are bailing from the dollar before their life savings are wiped out. 

At least if you have gold or silver you can then trade *that* into whatever our handlers install as the new currency after the dollar is destroyed.


----------



## Toro (Apr 15, 2011)

There are always rationales behind manias. In housing it was they aren't building any more land. In tech it was the Internet was going to change life. Both were true and both destroyed a lot of wealth for people. 

I've been trading gold and silver for nearly a decade now. I don't think it's over. Generally manias end when money is tight. Right now money is loose. But currently, it feels like a frenzy to me. That doesn't mean silver can't go to $50 in a hurry but I think it's dangerous right now so I've stepped aside.


----------



## FireFly (Apr 15, 2011)

Gold & silver are climbing because people with a savings account know they must diversify out of dollar bonds. They are buying land, commodities & stocks. US savings bonds, savings accounts & the dollar are over.


----------



## Toro (Apr 15, 2011)

The last few days, it appears that the frantic buying is being driven by retail investors in the ETF market. There has been a spike in prices both days within the first 20 minutes of trading.


----------



## liebuster (Apr 16, 2011)

I have noticed that the pawn shops and antique shops are getting silver coins in and they are being sold very quickly. Thats at least according the shop owners. They said they has been a huge demand for silver coins. 

I think long term silver is going to keep rising because more and more people are waking up and realizing that the dollar is going to be dead. Most people, myself included, aren't going to have the money to buy a oz. of gold but rather a bunch of silver coins. 

*Basically I believe there is going to be a run on U.S. silver coins. *

On a side not I was in Denver yesterday and there was a large protest with megaphones outside the Denver Federal Reserve branch.  Guess what they we calling an end to...............


----------



## LordBrownTrout (Apr 16, 2011)

Once it hits mainstream around 150-200 an ounce, I'm selling.


----------



## KissMy (Apr 18, 2011)

Gold & Silver are going to soar after S&P downgraded the USA


----------



## LordBrownTrout (Apr 18, 2011)

KissMy said:


> Gold & Silver are going to soar after S&P downgraded the USA



Just saw that. Silver is already up almost a buck today at around 43.50.


----------



## Paulie (Apr 18, 2011)

Yeah there's no inflation at all 

I feel like such a moron for pushing gold and silver the last few years.


----------



## KissMy (Apr 18, 2011)

I own a lot of US minted Gold & Silver coins. I also own a lot of Oil, GLD & SLV options. Yes the deficit is moving me on up! 

[ame="http://www.youtube.com/watch?v=p9y4iXAso4I"]Movin' on Up![/ame]


----------



## Toro (Apr 18, 2011)

Dude you're rolling in it. I sold all mine last week. D'Oh!


----------



## KissMy (Apr 18, 2011)

Toro said:


> Dude you're rolling in it. I sold all mine last week. D'Oh!



Looks like my farm land is out pacing Gold. I own quarter of a 1,000 acre farm. That land is now worth over $10 million. That makes my portion of the land alone worth $2.5 million not counting buildings, equipment, improvements & income.


----------



## Toro (Apr 19, 2011)

Since the intra-day high on Jan 3, gold is up 5.2% while gold stocks are down 1.2%. Silver is even crazier. The silver miners ETF, an ETF of silver stocks, is up 1.6% during that time whereas spot silver has risen 41%. Generally such diversions don't end well so I remain on the sidelines.


----------



## Toro (Apr 19, 2011)

KissMy said:


> Toro said:
> 
> 
> > Dude you're rolling in it. I sold all mine last week. D'Oh!
> ...


----------



## Mr Liberty (Apr 19, 2011)

Gadawg73 said:


> Gentleman, gold mania is speculative. That is what is happening now. Let me appeal to your reason and investing common sense in commodities trading, especially gold:
> 1. Gold is going high because of investors. Folks, demand for gold is cratering and declining fast. Jewlery, which accounts FOR MORE THAN HALF of the demand for gold worldwide, has fallen sharply with a bad economy.
> 2. India purchases more gold than any other country. When the price is very high they can not afford to purchase as much to make the jewelry.
> 3. Then we have price pressure from the demand side. Higher and increasing prices of gold means gold miners have to work over time. The supply of gold worldwide has jumped over 10% in the last 15months. With high prices they plow up as much as they can and then we get an over supply. And guess what happens then? The slightest decrease in demand sends prices plummeting as extraction per ounce costs are rising high.
> ...


I disagree.  We are going into hyperinflation.  This will drive silver and gold up higher.  All fiat currency value, given enough time, has gone to zero.  The US dollar is no exception.  
I like the EFT because of the margin.  $43.73 high today--if you use a stop, the risk are acceptable.


----------



## Gadawg73 (Apr 19, 2011)

Mr Liberty said:


> Gadawg73 said:
> 
> 
> > Gentleman, gold mania is speculative. That is what is happening now. Let me appeal to your reason and investing common sense in commodities trading, especially gold:
> ...




Long term charts shows that previous gold rallies occurred in the context of high inflation. The current rally has occurred with an absence of high inflation so your hyperinflation theory is like gold investing, speculative and without any facts to show it would have any influence.
Fact is the world's gold supply is rising faster than the US money supply now. If this presists then a gold collapse is inevitable. Gold's supply increase with a stable dollar will push gold down. Gold bugs adamantly, with little or no facts to support their theory, believe the opposite. They believe inflation will come roaring back and that the money supply will explode.
The irony of all of this is guess what the sellers of all this gold are taking and wanting as payment:
AMERICAN DOLLARS!
Unlike most commodities gold has little industrial or intrinsic value. 
Given the high prices and suspect fundementals no rational investor would have bought Miami Beach condos in 2006 or tech stocks in 1999. Yet many did just like they are buyig gold now because they fall victim to confirmation bias and see only what they want to see. Today the conditions of the gold market are the same:
Gold sales for 2000: 3200 tons: 3190 tons for jewelry and 10 tons as investment
Gold sales for 2010: 3900 tons: 1850 tons for jewelry and 2100 tons as investment

Brother if those facts do not wake you up to the reality of gold as strictly a speculative market as of NOW then nothing will. Get out now. Gold will be at 800, if that, within 20 months, most likely much sooner.


----------



## The Infidel (Apr 19, 2011)

Gold Futures Top $1,500 on Outlook for Escalating U.S. Debt, Dollar Slump - Bloomberg


----------



## Toro (Apr 19, 2011)

Gadawg73 said:


> Brother if those facts do not wake you up to the reality of gold as strictly a speculative market as of NOW then nothing will. Get out now. Gold will be at 800, if that, within 20 months, most likely much sooner.



I thought tech was crazy in 1996.  I thought housing was nuts in 2003.

One thing I've learned in investing is that things can go farther for longer than anyone could initially imagine.

I've invested and traded in the gold and silver markets since 2002 and I'm out right now because it's getting frothy out there.  So I'm expecting a near-term top soon.  However, bubbles usually end when monetary policy is tight.  The tech bubble ended when the Fed raised the funds target to 6.5%.  The housing bubble ended when the Fed raised it to 5.25%.  Right now the rate is 0%, and they are still easing with QE2.  Bubbles usually don't end at these levels, though maybe it is different this time, I don't know.  Usually they end when the Fed has been hiking rates many times and years after the interest rate cycle bottomed.  The last time gold topped in 1980, yields on the long bond went from 8% to 11% while gold quadrupled.  

My guess - and I emphasize the word "guess" - is that sometime within the next month or two, we are going to have a violent correction, followed by an acceleration into new highs in the spring.  But like I said, I'm just guessing.


----------



## william the wie (Apr 19, 2011)

Toro said:


> Gadawg73 said:
> 
> 
> > Brother if those facts do not wake you up to the reality of gold as strictly a speculative market as of NOW then nothing will. Get out now. Gold will be at 800, if that, within 20 months, most likely much sooner.
> ...


I think you may be overoptimistic on gold. Given silver's industrial uses and low substitutability I am more optimistic about that but with the debt ceiling and budget battles ahead I will be headed for the sidelines soon.


----------



## LordBrownTrout (Apr 20, 2011)

Univ of Texas just bought a boatload of gold bullion. I'm with wie though, I'm sticking with silver. 

Whoa! University of Texas Takes Delivery of a Billion Dollars Worth of Gold by Robert Wenzel


----------



## Toro (Apr 20, 2011)

Silver is in a full blown melt up. The RSI is now pushing 87. The last time it was this high was March 3, 2008. It rose another 4% over the next two weeks but was down 12% a month later and 33% six months later, though that was in the midst of the financial crisis. 

The prior time it was this high was April 10, 2006. It proceeded to rise another 13% over the next four weeks but wound up being down 38% after it finally peaked a few months later. 

Otherwise the RSI has never been as strong over the past decade in silver.


----------



## LordBrownTrout (Apr 20, 2011)

Commodoties, pm's, food, gas, are heading big time north now. We're accruing interest debt at an astounding rate that I've never seen before.  It's phenomenal and scary.


----------



## william the wie (Apr 20, 2011)

LordBrownTrout said:


> Commodoties, pm's, food, gas, are heading big time north now. We're accruing interest debt at an astounding rate that I've never seen before.  It's phenomenal and scary.


All I can figure is that Wall St. is moving into precious metals in anticipation of a May rather than a June collapse of the indices.


----------



## Gadawg73 (Apr 20, 2011)

william the wie said:


> LordBrownTrout said:
> 
> 
> > Commodoties, pm's, food, gas, are heading big time north now. We're accruing interest debt at an astounding rate that I've never seen before.  It's phenomenal and scary.
> ...



Commodities are used up, all of them except metals. We burn oil, eat the food and make products out the others. 
The same gold that was sold 1000 years ago to the present is still around and every ounce mined adds to the supply. With little industrial use and the jewler market dry because of the high prices there is one way to go when demand goes a little slow.


----------



## Toro (Apr 20, 2011)

william the wie said:


> I think you may be overoptimistic on gold. Given silver's industrial uses and low substitutability I am more optimistic about that but with the debt ceiling and budget battles ahead I will be headed for the sidelines soon.



I don't buy the industrial argument.  Most of the incremental demand is coming from investment.  The industrial argument is IMHO an argument people use to justify paying higher and higher prices, like they did in the housing bubble when people said "They aren't making any more land," or during the tech bubble when people said "The Internet is going to be huge."  It's merely a rationalization IMO.

Having said that, the supply/demand dynamics are and have been very favourable, much more so than gold.  Silver outstanding is a fraction of gold in the world, so the mania takes silver much higher than gold.


----------



## Toro (Apr 20, 2011)

Gadawg73 said:


> The same gold that was sold 1000 years ago to the present is still around and every ounce mined adds to the supply.



That's one reason why gold is so desirable as a currency.


----------



## Gadawg73 (Apr 20, 2011)

Toro said:


> william the wie said:
> 
> 
> > I think you may be overoptimistic on gold. Given silver's industrial uses and low substitutability I am more optimistic about that but with the debt ceiling and budget battles ahead I will be headed for the sidelines soon.
> ...



You are right about the land argument almost all the time.
But even in this market if you follow the 3 most important factors when buying land you will still make very good $$$ long term.
LOCATION, LOCATION AND LOCATION. And mine is in a great location.


----------



## Toro (Apr 20, 2011)

Gadawg73 said:


> You are right about the land argument almost all the time.
> But even in this market if you follow the 3 most important factors when buying land you will still make very good $$$ long term.
> LOCATION, LOCATION AND LOCATION. And mine is in a great location.



Oh, I agree.  Unfortunately, people were using that as an excuse to buy _any_ real estate.

Tokyo property prices in 1991 equaled the value of real estate in all of Canada.  They weren't making any more land in Japan either.  That didn't stop home prices in Tokyo from falling 60% over the next two decades.


----------



## uscitizen (Apr 20, 2011)

william the wie said:


> Toro said:
> 
> 
> > Gadawg73 said:
> ...



since I bought eagles at a bit over $500 I do not see how I can lose.


----------



## Mad Scientist (Apr 21, 2011)

This isn't a bubble. It isn't like the real estate bubble, it isn't like the dot com bubble which was pure speculation. This isn't the Hunt brothers trying to corner the silver market.

*It's the dollar devaluing.*

I'm not buying gold and silver as an investment. I'm buying gold and silver so that my savings isn't destroyed by QE I, II, and soon to be III.

China, Russia, India, Brazil and many other emerging markets are *moving away* from the dollar. Soon (maybe it is already) the dollar will not be the worlds reserve currency. That will cause *everyone's* standard of living to fall in this country, and *the value of the dollar to drop with it*.

If the plane you're flying on catches fire, you're gonna' bail out right?


----------



## editec (Apr 21, 2011)

Toro said:


> william the wie said:
> 
> 
> > I think you may be overoptimistic on gold. Given silver's industrial uses and low substitutability I am more optimistic about that but with the debt ceiling and budget battles ahead I will be headed for the sidelines soon.
> ...


 
I suspect that commodities generally are going up because confidence in the dollar and other EURO currencies is going down.

But as to silver?

I think by comparison to toehr precious it is somewhat overpriced.

Why?

*Because John Q Public* (world wide, I might add) *is frightened* and they can afford to put a little something into silver but not into gold and platinum, palladium etc.

On the event of something approaching hyper inflation,_ silver becomes the medium of exchange for daily purchasing_ (which is what the working classes have to concern themselvesw with) while _GOLD becomes the specie for investment and major purchases_.

This is, I suspect, the reason that silver is rising even faster than most other metals.

It can be a end of the economic world specie that many more people can afford to purchase than gold, and one with a value that suits day-to-day purchasing needs, too.

You know what is next in line for people to start buying up?

COPPER PENNIES.

Again for that same reason...the copper penny (not the news ones the old ones) actually have som REAL intrinsic worth.

They could easily become one of the units of exchange that people trust when their trust for the greenback erodes.


----------



## Gadawg73 (Apr 21, 2011)

Mad Scientist said:


> This isn't a bubble. It isn't like the real estate bubble, it isn't like the dot com bubble which was pure speculation. This isn't the Hunt brothers trying to corner the silver market.
> 
> *It's the dollar devaluing.*
> 
> ...



Everyone buying gold is paying for it in DOLLARS.


----------



## Mad Scientist (Apr 21, 2011)

Gadawg73 said:


> Mad Scientist said:
> 
> 
> > This isn't a bubble. It isn't like the real estate bubble, it isn't like the dot com bubble which was pure speculation. This isn't the Hunt brothers trying to corner the silver market.
> ...


Well yeah, because those dollars will *soon be worthless*. Best to get something of value for them *now*.


----------



## Toro (Apr 21, 2011)

Gadawg

Gold is higher in all currencies, at least over the past few years.  Silver is at all time highs in every currency right now.  

IMO the bet on gold isn't so much an anti-dollar play as it is an anti-fiat currency play. Because the dollar underpins the global monetary system, if it falls it drags all other fiat currencies down with it.


----------



## LordBrownTrout (Apr 21, 2011)

I would much rather prefer the economy to be steamrolling, unemployment at 4,5 percent, gold at 300, silver at 4 bucks. The pace at which the dollar is being destroyed is unsettling.  I find it hard to cheer as silver goes into the stratosphere.


----------



## william the wie (Apr 21, 2011)

LordBrownTrout said:


> I would much rather prefer the economy to be steamrolling, unemployment at 4,5 percent, gold at 300, silver at 4 bucks. The pace at which the dollar is being destroyed is unsettling.  I find it hard to cheer as silver goes into the stratosphere.


Relative silver supply vs. relative gold supply vs. expected price ratios between the two metals is all out of whack. Once prices go parabolic they will crash.


----------



## Toro (Apr 21, 2011)

Not to put a damper on the party or anything but don't be surprised if the COMEX increases margins on silver contracts soon. They do that periodically when they think speculation is getting out of hand. As a reference, when margins were hiked on sugar last year, sugar fell from $33 to $25 in two days. It recovered but a frothy environment can create such downdrafts.


----------



## Toro (Apr 21, 2011)

The other thing I'd point out is that even though silver has gone nuts, silver stocks have not. The purest silver company is Silver Wheaton, which is a royalty company and has no operational exposure. It's stock has languished. The silver miners ETF, ticker SIL, is still below it's highs.


----------



## liebuster (Apr 21, 2011)

Toro said:


> The other thing I'd point out is that even though silver has gone nuts, silver stocks have not. The purest silver company is Silver Wheaton, which is a royalty company and has no operational exposure. It's stock has languished. The silver miners ETF, ticker SIN, is still below it's highs.



Could that be because investors are buying actual silver instead of paper silver???? If there no demand for silver stocks then the price will lag the physical silver price. Right???


----------



## KissMy (Apr 22, 2011)

liebuster said:


> Toro said:
> 
> 
> > The other thing I'd point out is that even though silver has gone nuts, silver stocks have not. The purest silver company is Silver Wheaton, which is a royalty company and has no operational exposure. It's stock has languished. The silver miners ETF, ticker SIN, is still below it's highs.
> ...



I talked with Monex, Kitco & All American Gold last evening to buy my brother & I more physical Gold & Silver coins.

*There are NO Silver American Eagles to be had.* I ended Up having to buy 100 1ozt Silver Canadian Maple Leafs from Canada at $5,039.00 delivered almost a month from now. That is $50.39ozt. The SLV ETFs are not keeping pace with the market & lags by 10%. Germany has some Silver Vienna Philharmonics for sale.

Also bought 30 Gold American Buffalos at $47,649.00 delivered almost 3 weeks from now. The GLD ETFs are also not keeping pace with the market & lags by 8.25%.

They all said that hedge funds were there largest physical Silver customers right now. The average citizen are not the ones buying Silver. JP Morgan has been major short Silver since $32ozt. & not lending money on Silver collateral.  Wow that has gotta hurt. JP Morgan is long Gold & lending money on Gold collateral.


----------



## Toro (Apr 22, 2011)

liebuster said:


> Toro said:
> 
> 
> > The other thing I'd point out is that even though silver has gone nuts, silver stocks have not. The purest silver company is Silver Wheaton, which is a royalty company and has no operational exposure. It's stock has languished. The silver miners ETF, ticker SIN, is still below it's highs.
> ...



Generally when the stocks lag the commodity, it is a sign of an unsustainable move in the commodity. That doesn't mean silver can't go higher. Also, the silver stocks may eventually follow. The SIL - not the SIN I referenced earlier -has an intriguing chart pattern and may be on the verge of new highs. And gold is hitting new highs but not in the same manic manner. So this tells me there is a mania in silver right now. Silver tends to peak in April or May but then I am expecting a parabolic one day move of say $5-$7, and then a reversal signaling the top, at least for the near term.


----------



## Toro (Apr 22, 2011)

Re: stocks are paper. 

I'd be careful with this argument. Companies like SLW buy royalty streams to take possession of physical silver. The "paper" is merely an ownership stake in a company with rights to buy physical silver from miners. Other miners such as PAAS pull the stuff out of the ground. So for the market to believe that these moves are permanent, the stocks of the miners must move higher. 

FTR there isn't a lot of silver in circulation but there is a lot of silver in the earth's crust. Silver producers increased production 13% last year, I believe, which I think was the largest increase in many years. Also, I believe, miners have stopped dehedging and are starting to hedge again.


----------



## editec (Apr 22, 2011)

liebuster said:


> Toro said:
> 
> 
> > The other thing I'd point out is that even though silver has gone nuts, silver stocks have not. The purest silver company is Silver Wheaton, which is a royalty company and has no operational exposure. It's stock has languished. The silver miners ETF, ticker SIN, is still below it's highs.
> ...


 
I suspect that that is a big part of it, LB.

AGain, your theory supports my theory that silver is higher than most commodities because the LITTLE GUYS like myself are buying SILVER to hold against and END OF THE DOLLAR hyperinflative event.

I realize that there are very good reason for silver to rise with other commodities, but that extra push in silver is coming from _the panic that is rising in the population which NEVER buys silver or gold as an investment play_, but ONLY as a _last ditch, hold the fort effort_ for an end of the economic world event.

The last thing in the world I really want is for my tiny silver cache to make me a high return on investment.

And the fact that my investment of about four years or so ago has quadrupled in value is most alarming as it indicates that the dollars in my savings accounts  are losing as roughly the same alarming rate.

And I cannot simply convert those dollars into coin because...well it's all about timing and cost of same.

There is no smooth and cost effective way for small holders of silver to buy and sell the stuff.

The premiums one pays for small silver purchases and the liquidity of same make entry and exit from silver coins less than ideal for NON investors.

Per usual, the small guy, even if he sees the tsuami headed toward the beach, can't really do much to prepare for it.


----------



## Toro (Apr 22, 2011)

The Sprott Physical Silver Trust ETF is trading at a 22% premium to NAV. That's nuts, but it demonstrates the mania for physical silver.


----------



## LordBrownTrout (Apr 22, 2011)

editec said:


> liebuster said:
> 
> 
> > Toro said:
> ...



The statement that I boldened is one of my fears.  My silver holdings have rought quintupled in the last three years.  I plan on holding until about 120-160 an ounce and then selling approx 80 percent of holdings.  The problem with that, as you pointed out, will be the dollar.  If that scenario comes to fruition then I'll be buying tangibles ie land.  I disagree somewhat with your assessment of silver becoming mainstream as of yet though.  I'm thinking more in the 70 to 80 price range.  I want out of it when it's full mainstream.


----------



## Toro (Apr 22, 2011)

I would point out that silver rising fourfold is NOT because the dollar has declined by that amount.  It has not.  There is nothing that the dollar has fallen by 75% against, other than silver.

Instead, it is the perception that the dollar _will fall in the future_ by a large amount which has driven gold and silver higher.


----------



## KissMy (Apr 22, 2011)

Toro said:


> I would point out that silver rising fourfold is NOT because the dollar has declined by that amount.  It has not.  There is nothing that the dollar has fallen by 75% against, other than silver.
> 
> Instead, it is the perception that the dollar _will fall in the future_ by a large amount which has driven gold and silver higher.



That is not correct. Farm Land, Corn, Oil, Cotton, Silver, Gold & Copper all have had a near 4 fold increase. The illusion that the dollar has not fallen by 75% is because the CPI excludes these items & other foreign currencies are falling at similar rates. Plus housing has also been sliding because of the bubble.

Smoke & mirrors my friend Smoke & mirrors. I figured the average rate of commodity inflation is around 9%. In order to stop this bull run in commodities & dollar collapse the Fed must take interest rates to 9%. That will cost the US Government $1.35 Trillion a year in interest. With the onset of the Baby Boomer's retiring I figure the US Dollar has passed the point of no return. The only question is how much can they control the slide.

The real question now is how many people have been borrowing to buy these commodities. So far I feel most are just trading out of cash to commodities which will not be a bubble. You need massive leverage to cause a bubble.


----------



## Toro (Apr 22, 2011)

KM

None of those things are up 300%-400% in 3-4 years, except silver.  Copper was 3.50, corn was 3.60, oil was 65, gold was 700, and farmland is up about 30% in four years.  

Now I get it. Commodities are what housing was a decade ago and tech stocks 15 years ago. But the reason why precious metals have been going nuts is because of 0% interest rates, a tripling of the Fed's balance sheet and debt worries. These all portend future inflation (maybe) whereas we are currently experiencing *asset* inflation as the excess liquidity in the world rolls from one asset class to another.


----------



## LordBrownTrout (Apr 22, 2011)

Toro said:


> KM
> 
> None of those things are up 300%-400% in 3-4 years, except silver.  Copper was 3.50, corn was 3.60, oil was 65, gold was 700, and farmland is up about 30% in four years.
> 
> Now I get it. Commodities are what housing was a decade ago and tech stocks 15 years ago. But the reason why precious metals have been going nuts is because of 0% interest rates, a tripling of the Fed's balance sheet and debt worries. These all portend future inflation (maybe) whereas we are currently experiencing *asset* inflation as the excess liquidity in the world rolls from one asset class to another.



I'm a regular produce grazer at the supermarket.  I've watched fresh produce rise anywhere from 100 to 300 percent in the last two years.


----------



## Toro (Apr 22, 2011)

Sure. Many commodities have risen by a lot. I expect them to continue rising. But it is not indicative of broad inflation, at least not yet. That's my point. 

RSI for silver closed at a smidgen under 90. Only once before in the last few decades has it been that high.


----------



## KissMy (Apr 22, 2011)

In July 2010 Missouri farm land average price was $2318 per acre. 23 days ago Missouri farm land sold for a record high of $10,700/acre. That is a 461% increase in less than 10 months. The farm was bought with cash not credit.


----------



## Toro (Apr 22, 2011)

Thanks for posting that. Its fascinating. But I don't know if it is indicative of the broad market. Google The Economist farmland article since I can't post it right now. It has a graph of broad farm prices. I've also been tracking farmland in Canada since I have inlaws who farm in Saskatchewan and prices have been rising low to dingle double digits. 

That is BTW quite high. Robert Shiller has identified farmland as the next possible bubble.


----------



## Toro (Apr 22, 2011)

Here is the article. 

American farmland: Sowing bubbles | The Economist


----------



## william the wie (Apr 22, 2011)

Toro said:


> Here is the article.
> 
> American farmland: Sowing bubbles | The Economist


Sorry Toro China and the Gulf states have been buying farmland worldwide for decades. This is not a domestic bubble but the asset inflation is ignored when it happens in Madagascar, Mali, Argentina and Brazil.


----------



## liebuster (Apr 22, 2011)

Toro said:


> Sure. Many commodities have risen by a lot. I expect them to continue rising. But it is not indicative of broad inflation, at least not yet. That's my point.
> 
> RSI for silver closed at a smidgen under 90. Only once before in the last few decades has it been that high.



Forgive my ignorance but what is RSI? I'm not an investor so I don't look at all those "internal" numbers and stats. I just go on my gut and try to pay attention to the "writing on the wall" 

Is it better to have a higher RSI number or a lower one??


----------



## Jos (Apr 22, 2011)

> The Relative Strength Index (RSI) is a technical indicator used in the technical analysis of financial markets. It is intended to chart the current and historical strength or weakness of a stock or market based on the closing prices of a recent trading period.



Relative Strength Index - Wikipedia, the free encyclopedia


----------



## Toro (Apr 22, 2011)

Generally, an RSI above 70 is considered overbought and 30 oversold. At 90, RSI is at an extreme level. That doesn't necessarily mean it will fall but it can mean that there is extreme over-optimism, leaving silver vulnerable to a sharp correction. The last time RSI got to 90 in April 2006, it was up 19% a month later but was down 9% three months later and 13% six months later. When it peaked a month later, silver fell 38% a month after that. This doesn't mean silver will do the same thing as in 2006 but you have to be careful.


----------



## LordBrownTrout (Apr 24, 2011)

Considering buying 3 to 400 oz of .999 tomorrow. Not sure yet but I don't think we're anywhere near the ceiling yet.


----------



## Jos (Apr 24, 2011)

Take a look at Ebay, silver is selling at spot +50%


----------



## LordBrownTrout (Apr 24, 2011)

Jos said:


> Take a look at Ebay, silver is selling at spot +50%



That is a very good point. It's doing the same at APMEX.  I talked to an agent over there Friday and they can't keep enough junk silver in stock. When I bought junk at 9, I paid 11 an oz. That was about two years ago.


----------



## Toro (Apr 24, 2011)

Silver has opened at $47.75 in Asia.


----------



## Mr Liberty (Apr 24, 2011)

Toro said:


> Silver has opened at $47.75 in Asia.



I saw that now trading at 47.83.  China is pushing hard to stop using the dollar as a reserve.  I found this
Gold And Silver Making New Huge Moves, As China Makes Fresh Noises About Dumping The Buck
If the dollar loses status as reserve currency,  silver will advance even faster.
I don't believe in crystal balls, but I'm hearing outrages predictions, like $1500 per oz.  Of course along with that is some very bad news for everything else.


----------



## Toro (Apr 25, 2011)

Silver may be topping here, at least in the near term. Over night silver brushed up against $50. It has since reversed and is now trading below $47 as I type. 

Unless the silver bulls can reverse this trend and close strong, this looks like a classic top to me. However, there was also an intraday reversal at $41 and it did not signal the top in silver. But this had become a very crowded and frenzied trade and I think the risk of a significant decline is high. I don't think the bull market is over however.


----------



## Toro (Apr 25, 2011)

I have put on a short on silver. With 0.2% of my capital I have purchased puts on the SLV with a strike price of $30 expiring in June at a cost of $0.12 per contract. 

I am not predicting that silver will fall to $30. I just see a good risk/reward tradeoff here. Silver may be topping but it may not. If I am wrong I lose my premium paid. If I am right, the payoff is 4x or higher. 

The silver bulls are doing a good job of trying to keep the silver mania going. Silver bottomed at around 10:30am. (The first moves of the day are often faded in the first hour.). It was then bought. The buying has been huge. At nearly 2pm, volume on th SLV was 141 million, near the all time high of 149 million on Nov 9/10. I imagine if you were to add up all the silver ETFs, we would already be at record highs. Given that a disproportionate amount of trading comes in during the last two hours, we will smash the trading volumes. 

This is being driven by retail investors as the commitment of traders report shows fairly high but not sky high open interest. Also SLW is down today. Thus I think a top is near. 

Having said that, I have tried to short silver a few times over the past several years and have usually been wrong.


----------



## KissMy (Apr 25, 2011)

Toro said:


> I have put on a short on silver. With 0.2% of my capital I have purchased puts on the SLV with a strike price of $30 expiring in June at a cost of $0.12 per contract.
> 
> I am not predicting that silver will fall to $30. I just see a good risk/reward tradeoff here. Silver may be topping but it may not. If I am wrong I lose my premium paid. If I am right, the payoff is 4x or higher.
> 
> ...



 OMG Dude! You did not buy your option far enough out into the future. There really is a short term Silver shortage. JP Morgan may be forced to cover its massive shorts soon. I realize there is a lot of silver in the ground that miners can ramp up & get at to bring it to market. These miners have likely already sold those expected increased silver product into the futures market. A lot of this new production is likely factored in. It will take a year or more for these miners to put down this silver bull run.


----------



## Toro (Apr 25, 2011)

This is a near term trading call. I believe their is a manic frenzy in the silver market that is not being confirmed in the gold market nor in the silver miners equity market. We have seen a bearish intraday reversal that looks to me to be a blowoff top. Intraday volatility was 8%, which is also often a signal of a near term top.  Volume was huge. The SLV hit 189 million shares. And gold and silver tends to top in April or May.

Now I could very well be wrong which is why I allocated only a sliver of capital. But I think the risk/reward here is skewed to the downside.


----------



## Mr Liberty (Apr 25, 2011)

Toro said:


> I have put on a short on silver. With 0.2% of my capital I have purchased puts on the SLV with a strike price of $30 expiring in June at a cost of $0.12 per contract.
> 
> I am not predicting that silver will fall to $30. I just see a good risk/reward tradeoff here. Silver may be topping but it may not. If I am wrong I lose my premium paid. If I am right, the payoff is 4x or higher.
> 
> ...



I cashed out today.  Short might be a good move.  I'll wait until after Bernanke talks on Wednesday.  Incredible movements today the volatility was too much for me.  I'm short in the short term hoping to pick it up again @42.


----------



## KissMy (Apr 25, 2011)

The US Dollar is very very weak & getting weaker. Lack of jobs, excess debt, excess spending means Bernanke will continue to buy treasuries keeping rates low. Inflation this summer will run somewhere between 20% to 35%.


----------



## Toro (Apr 25, 2011)

I think the dollar will bottom this year, though maybe I'm wrong.

There are massive short positions in the dollar, and even more massive implied shorts, i.e. long silver.  There could be violent moves when the Fed starts to hike interest rates, which could be sooner than many think.  I expect many traders to get wiped out when that happens.



> The parabolic move in silver is making a lot of veteran traders nervous that an already notoriously volatile market could get even more unstable as the gray metal races toward $50 an ounce.
> 
> While no one is calling a top to the market, sharp swings, like Mondays $4 an ounce move in the May silver futures on the Comex division of the New York Mercantile Exchange, are not for the faint of heart.
> 
> ...



Kitco Exclusive News


----------



## Synthaholic (Apr 26, 2011)

There was a short piece about silver on NPR today.  One of the experts they interviewed attributed the rise in price to cell phones, computer products, and other technology which heavily use silver.


----------



## Toro (Apr 26, 2011)

Silver fell to $44.80 in overnight trading and is now trading at $46 before the open.  I'm looking for silver to fall to $38-$42, though I don't use price targets when trading.  If I think I am wrong, I'll exit my position quickly.


----------



## CoolBreeze (Apr 26, 2011)

I've been buying it since the 80's.  You guys are far behind the time.


----------



## Toro (Apr 26, 2011)

Interesting morning. Silver tested it's overnight lows of $44.70 and bounced, andis now above $45. I expect a rally into mid day and then we will see from there. SLW is getting hammered, breaking $40, but actually may offer a decent oversold bounce.

Gold is a bit problematic. After weathering the selloff in silver fairly well, it appears to have broken it's near term uptrend and is trading below $1500. Nothing serious but it looks like it could go back to $1475. 

Pullbacks are healthy. Straight up parabolic moves are not. The move in silver as of late has been stupid. A significant decline then consolidation allows the market to build a base for a longer more sustainable move. The worst thing that could happen now would be for silver to quickly go back and retest it's high then fail. If that happens, I will get seriously short silver


----------



## boedicca (Apr 26, 2011)

Toro - I'd appreciate your insights on the following article:

_Yes, another crash is coming, unavoidable, just like 2008. Not because our totally dysfunctional government is collapsing into anarchy, thanks to the 261,000 Super-Rich Lobbyists. Not just because our monetary system is run by the Bernanke Printing Press Company. And not just because a soulless conspiracy of Wall Street CEOs cares nothing for democracy and the public interest, only for their stockholders and their year-end bonuses.

Another crash is coming soon because were back playing the same speculative games as we did for years prior to the 2008 crash. When we collapse, it will be because Americas leaders never learn the lessons of history. Never. In a BusinessWeek editorial, Peter Coy and Rouben Farzad described the bubbles:

Its as if 2008 never happened. Once again the worlds investors are pumping up bubbles that will probably explode in their faces. After the popping of a real estate bubble led to the first global recession since the 1930s, world markets are frothing like shaken Champagne. Pundits claim to have spotted price increases that are unsupported by economic fundamentals in assets ranging from U.S. farmland to Israeli biotech to Australian housing to Chinese cemetery sites. Commodities have soared. Global junk-bond issuance hit a record in the first three months of the year  this is the granddaddy of them all, an almost-encompassing bubble right at the heart of monetary systems. ..._

2008 crash deja vu: We


----------



## Toro (Apr 26, 2011)

I don't know. I don't think the financial crisis has ended. We keep doing the same things which got us in this mess in the first place. It worries me. The housing bubble was bigger than the tech bubble, and the policy response for the housing bubble was bigger than the tech bubble by orders of magnitude. Have the authorities learned anything?  I have serious doubts. 

So if you think the affects of the policy response will create even bigger problems than the housing bubble, what will that be?  To me, that would be a currency crisis. I think there will be at least one if not three currency crises for the big three currencies - the dollar, euro and yen. 

Maybe we get through this I don't know, but I think the risks are dangerously high over the next 5-10 years. This is why I think it is prudent to hold some gold and silver long term. However, like the ends of the tech and housing bubbles, people will lose a lot of money investing in gold and silver when it ultimately ends.


----------



## JackDan (Apr 26, 2011)

Toro said:


> I don't know. I don't think the financial crisis has ended. We keep doing the same things which got us in this mess in the first place. It worries me. The housing bubble was bigger than the tech bubble, and the policy response for the housing bubble was bigger than the tech bubble by orders of magnitude. Have the authorities learned anything?  I have serious doubts.
> 
> So if you think the affects of the policy response will create even bigger problems than the housing bubble, what will that be?  To me, that would be a currency crisis. I think there will be at least one if not three currency crises for the big three currencies - the dollar, euro and yen.
> 
> Maybe we get through this I don't know, but I think the risks are dangerously high over the next 5-10 years. This is why I think it is prudent to hold some gold and silver long term. However, like the ends of the tech and housing bubbles, people will lose a lot of money investing in gold and silver when it ultimately ends.



Toro you seem level headed when it comes to business decisions.  I like it.  

Overall, I feel many stocks/commodities/houses are still overvalued and a medium correction is due soon.  Silver has long term upswing and I do continue to see it go up long term, but it has gone up too fast, as many things have in the last year, and I do believe it will have a small correction shortly.  If it doesn't then we might have some bigger issues to deal with like you speak of.


----------



## editec (Apr 26, 2011)

I love this place.

And discussions like these are the reason why.


----------



## Ernie S. (Apr 26, 2011)

We saw out 10% correction last night. I'll buy at 43 if it goes that far, or a 40:1 GSR.


----------



## JackDan (Apr 26, 2011)

editec said:


> i love this place.
> 
> And discussions like these are the reason why.



x2


----------



## KissMy (Apr 27, 2011)

You should be buying Silver on this corrective dip.


----------



## KissMy (Apr 27, 2011)

Decoding Bernanke's extended period comments. "PIMCO's Bill Gross Bernanke extended period January 2012" "Fed confirms will finish out $600 bln in bond buys. Repeats plans to keep rates low for "extended period"

I expect no Fed tightening until at least January 2012.


----------



## Toro (Apr 29, 2011)

Is silver topping?  Too early to tell but it may be, at least in the near term. It is having a hard time breaking through $50, and may be in the process of forming a triple top. 

The behavior in gold says otherwise.  Gold has performed extremely well and is yet showing no signs of topping.  If gold is going to move higher it is likely silver will as well. 

However the price action in silver had been manic. Options volume on the SLV has been greater than the SPY, which is crazy. 

I have a very small short position here expressed in deep OTM puts. I may add to them if silver continues to falter or sell if silver moves to new highs.


----------



## xsited1 (Apr 29, 2011)

Toro said:


> Is silver topping?  Too early to tell but it may be, at least in the near term. It is having a hard time breaking through $50, and may be in the process of forming a triple top.
> 
> The behavior in gold says otherwise.  Gold has performed extremely well and is yet showing no signs of topping.  If gold is going to move higher it is likely silver will as well.
> 
> ...



How far out of the market are you with the silver puts?  I might just have to do that.  If you don't mind, what's the strike price and month you're trading?


----------



## Toro (Apr 29, 2011)

xsited1 said:


> Toro said:
> 
> 
> > Is silver topping?  Too early to tell but it may be, at least in the near term. It is having a hard time breaking through $50, and may be in the process of forming a triple top.
> ...



It's pure speculation. I own the June SLV puts with a 30 strike.  The bid/ask is 8/10 cents. I don't expect it to fall that far but a decline into the 30s would double or triple the price. 

The action in gold today would belie a collapse in silver, given that it hit new highs. However, the action in gold and silver stocks continues to be poor. 

Another positive for the PMs has been the action in oil. I am very long oil with positions in the ERX, HEU.TO and calls on the OIH. This is a trade however, and I may start selling on further strength.


----------



## Toro (May 1, 2011)

Silver is getting whacked in Asia. After hitting $49 on Thursday and closing at $48 on Friday, silver fell $5 to below $43. It has since recovered to $45. I don't know why. 

Tops are often accompanied by high volatility. I believe we may be topping in silver here and I may add to my silver short on strength.


----------



## KissMy (May 1, 2011)

Oil, Gold & Silver got whacked when news that Osama was killed hit the news. Silver dropped 12% but is now recovering.

They got Osama & his Son & 3 other leaders during the firefight. They also killed Qaddafi's Son & 3 Grand Children over the weekend.

This will drop the terror premium off of the oil price. Also Obama will draw down US Troops before the 2012 Election. This will ease the deficit & strengthen the US Dollar.

Oil, Gold & Silver are going to drop like a stone. Gas will drop & Obama's poll numbers will climb.

This will strengthen the US Dollar so much so that I had to change my Avatar.


----------



## KissMy (May 2, 2011)

*Notice the huge Silver & Gold price drop when the news was leaked that Osama Bin Laden was killed.*


----------



## liebuster (May 2, 2011)

I think this correction will be short lived. Once people realize that Bin Laden being dead or alive had nothing to do with the economic policies of our dear "leaders" things will go back to "normal".


----------



## Toro (May 3, 2011)

I sold half my put position. I own June puts on the SLV with a strike of $30. I bought contracts at $0.12. I sold half my position at $0.25. Thus, I will not lose on this trade, even if the puts expire worthless. 

Silver is now at $42.50. My target range is $38-$42 but I think there is a good chance silver could fall to $33-$35.


----------



## LordBrownTrout (May 3, 2011)

Glad to see it pull back a few dollars. May pick up another junk bag if it falls to 35.


----------



## JackDan (May 3, 2011)

LordBrownTrout said:


> Glad to see it pull back a few dollars. May pick up another junk bag if it falls to 35.



Sounds like what I said when it was at 33, I said I would buy another 500 ounces if it dropped down to 28, but it never even went back into the 20's.  If it falls back down to 35, I will be there with you ready to purchase some more.


----------



## Toro (May 3, 2011)

I closed a quarter of my original silver short position, selling puts at $0.40.  I am keeping a quarter of my position, but even if it falls to $0, the trade will be near a double.

I wouldn't be surprised to see a bit of a bounce.  If there is a large bounce in silver, I may reinstate my shorts.  I think silver is going into the $30s.


----------



## KissMy (May 3, 2011)

Typically commodities will cover the gap before continuing in the intended direction. There was a huge trading gap created after Osama was killed. The commodities had a short term (gap reversal) recovery to cover that gap but have now resumed their downward direction.

Pressure will mount to withdraw troops now that Osama is gone. This will improve the US budget outlook, credit rating & dollar strength above it's dire forecast. It also takes the terror premium off of oil which will improve the economic outlook above its forecasted slowing.

This is going to hurt commodities until people get a good read of what the future will bring. Most believed all of the wars & terrorism would continue until after the next election.


----------



## Toro (May 4, 2011)

Silver liquidation is in full swing. I have now covered 85% of my original short position and will keep the remaining position as play money, perhaps as a way to gain exposure if silver were to fall before $30. 

The market did show signs of stabilization in the afternoon. I would not be surprised to see a bounce, given how oversold silver has become. I would consider reloading my shorts if it bounced to $43-$45. 

I am also contemplating longs. The RSI on silver is 41. There have been nine occasions since the bull market began a decade ago when the RSI fell below 30. On eight of this occassions, silver was higher three and six months later on average by 22% and 32% respectively. An RSI of 30 or lower implies a price of $30-$35 over the next 10 days.


----------



## Toro (May 5, 2011)

Silver has been whacked over the past 6-7 days, falling 25%. However, gold is down 5.1%. The Russell 2000 has fallen 4.6%.  Thus, the decline in gold is a normal correction. 

Silver got crazy, and is now correcting for it's crazy action. The behavior in silver suggests a top that may not be breeched for some time. However, there is no reason to think the same about gold, at least not yet. 

My guess is that gold and silver have topped seasonally, as they usually do in April and May. However, I don't think the ultimate top is in. It may be topping but I don't think so. I do think more weakness is coming but a buying opportunity may present itself in the summer.


----------



## KissMy (May 5, 2011)

Toro said:


> Silver has been whacked over the past 6-7 days, falling 25%. However, gold is down 5.1%. The Russell 2000 has fallen 4.6%.  Thus, the decline in gold is a normal correction.
> 
> Silver got crazy, and is now correcting for it's crazy action. The behavior in silver suggests a top that may not be breeched for some time. However, there is no reason to think the same about gold, at least not yet.
> 
> My guess is that gold and silver have topped seasonally, as they usually do in April and May. However, I don't think the ultimate top is in. It may be topping but I don't think so. I do think more weakness is coming but a buying opportunity may present itself in the summer.



I feel all commodities are getting hit by a quadruple whammy. They were a bit frothy. Traditional seasonal timing,"sell in May & go away". Death of Osama. Europe raising rates. Exchanges raising margin requirements.

Oil just got a 10% haircut. Silver 20+% haircut. Gold 6% haircut. Corn, Soybeans & Wheat slashed. It is a broad based commodities rout. Osama's death means markets must correct to meet future forecast for US dollar & debt even though his death has currently not brought any troops home. It is the long range forecast.

This is just like the case I made HERE at this LINK with you about how when Bush lifted the drilling ban on the GOM & OCS it caused oil to plummet from $147 down to the $30s even though currently no oil had been added to the supply. A large enough political event / shift changes futures markets ahead of supply & demand.


----------



## Mad Scientist (May 5, 2011)

I want to apologize to everybody for the recent downturn in Gold and Silver. I just bought my first oz. of Gold and about 22 oz.'s of Silver about 2 weeks ago so *naturally*, they *both* hit the skids.

It's the story of my life man!


----------



## Toro (May 5, 2011)

I closed my short position, selling my last tranche of puts at $1.03. I think silver is going lower but I don't want to be a pig here. I will start to look to get long, but it is dangerous right now.

First support is at $33. Around this level, RSI will approach 30.


----------



## jillian (May 5, 2011)

Mad Scientist said:


> I want to apologize to everybody for the recent downturn in Gold and Silver. I just bought my first oz. of Gold and about 22 oz.'s of Silver about 2 weeks ago so *naturally*, they *both* hit the skids.
> 
> It's the story of my life man!



don't feel bad. there's an old story about how if the general public knows all about a "good buy", it's too late.

happens to lots of people.


----------



## Mad Scientist (May 5, 2011)

Gold down $43! F*ck me! 

I read that gold and silver is down because George Soros and his gang sold off massive amounts of their holdings. I don't believe this is due to dollar confidence returning because unemployment filings are up.

I'm gonna' wait for gold and silver to stabilize, then I'm gonna' buy some more!


----------



## KissMy (May 5, 2011)

Mad Scientist said:


> I want to apologize to everybody for the recent downturn in Gold and Silver. I just bought my first oz. of Gold and about 22 oz.'s of Silver about 2 weeks ago so *naturally*, they *both* hit the skids.
> 
> It's the story of my life man!



Ok you need to redeem yourself. At what price drop would you consider selling? I need to know when to buy.


----------



## LordBrownTrout (May 5, 2011)

I'm actually glad to see this correction.  I'm buying another bag or two if it slides to 25 .


----------



## KissMy (May 5, 2011)

I am still short since Monday & will stay short for one more day or when silver hits $32. then I am going neutral until a week before QEII is slated to end. I know Bernanke is not going to take his foot off the gas in June. Commodities will spring back to life when QEII does not end.


----------



## JackDan (May 5, 2011)

LordBrownTrout said:


> I'm actually glad to see this correction.  I'm buying another bag or two if it slides to 25 .



seriously, I bought a couple hundred ounces around 11$ so I was shocked to see it top @48$, but it is a long term investment.  Even if it drops to 25$ I will buy more, because in 2 years it will be back up to 50$.


----------



## LordBrownTrout (May 5, 2011)

JackDan said:


> LordBrownTrout said:
> 
> 
> > I'm actually glad to see this correction.  I'm buying another bag or two if it slides to 25 .
> ...



We'll be sniffing 60 by the end of the year.


----------



## liebuster (May 5, 2011)

Damn!! I was thinking about swapping out my silver for gold a couple of weeks ago. It would have been a good move cause I could swap back for silver when it bottomed out and end up with even more.


----------



## KissMy (May 6, 2011)

It looks like the jobs numbers this morning turned commodities around.


----------



## Mad Scientist (May 6, 2011)

KissMy said:


> Mad Scientist said:
> 
> 
> > I want to apologize to everybody for the recent downturn in Gold and Silver. I just bought my first oz. of Gold and about 22 oz.'s of Silver about 2 weeks ago so *naturally*, they *both* hit the skids.
> ...


Haha! Well, I figger even if gold and silver lost *half its value* I'd still only be down about $1400. I've lost more than that in Vegas in one day!

I figger silver will bottom around 30, then I'll buy some more. As far as gold goes, I'm a little gun shy about it right now.


----------



## Toro (May 6, 2011)

KissMy said:


> It looks like the jobs numbers this morning turned commodities around.



Risk on!

I will short any straight up bounce. I may buy after a period of consolidation. 

The best scenario is if we consolidate and build a base for the next six months then head higher.


----------



## B. Kidd (May 6, 2011)

How about that Soros.
Knew when to sell his silver.


----------



## KissMy (May 7, 2011)

Mad Scientist said:


> I want to apologize to everybody for the recent downturn in Gold and Silver. I just bought my first oz. of Gold and about 22 oz.'s of Silver about 2 weeks ago so *naturally*, they *both* hit the skids.
> 
> It's the story of my life man!



You still have not made a bad investment. Since you own physical coins you haven't lost that much. Street value for those are still $40. How would you like to own a stock that went to zero with zero chance of coming back? With physical metals that is impossible. If you owned the Dow 30 stocks since the "Great Depression" every one of them has gone to zero except for GE that got a bailout. They just keep on switching them out to make the number climb. Have you heard about Greece? If you owned Greece Drachma (their currency) right now you just lost half your buying power. If Greece is kicked off the Euro they are toast. Given time, every paper has gone to zero.

Gold & silver haven't even fallen to their 100 day moving average. Think of investing like a boat when everyone is freaking-out & running to one side of the boat, you want to be the only one running to the other side of the boat. We just had a situation where to many people bailed on the US dollar to fast. Now the crowd ran back into US dollars. Guess where you should now start running. It is hard to gather the courage to run against the crowd, but that is where the money is.


----------



## Zander (May 7, 2011)

The following message is sponsored by GOLDLINE. 



KissMy said:


> Mad Scientist said:
> 
> 
> > I want to apologize to everybody for the recent downturn in Gold and Silver. I just bought my first oz. of Gold and about 22 oz.'s of Silver about 2 weeks ago so *naturally*, they *both* hit the skids.
> ...


----------



## Mad Scientist (May 7, 2011)

Zander said:


> The following message is sponsored by GOLDLINE.


Actually, I bought from APMEX.com 


KissMy said:


> You still have not made a bad investment. Since you own physical coins you haven't lost that much. Street value for those are still $40. How would you like to own a stock that went to zero with zero chance of coming back? With physical metals that is impossible. If you owned the Dow 30 stocks since the "Great Depression" every one of them has gone to zero except for GE that got a bailout. They just keep on switching them out to make the number climb. Have you heard about Greece? If you owned Greece Drachma (their currency) right now you just lost half your buying power. If Greece is kicked off the Euro they are toast. Given time, every paper has gone to zero.


Exactly, that's why I bought Gold and Silver. Not because I think it's gonna' go ballistic (although I hope it does), but the US Government, and the Federal Reserve, aren't exactly acting in a manner that makes me wanna' buy their stock (the dollar). And as you pointed out, I just don't wanna' lose all my money when that "stock" goes to zero.


----------



## Mad Scientist (May 7, 2011)

B. Kidd said:


> How about that Soros.
> Knew when to sell his silver.


I read that he only sold his paper holdings, *not* his physical silver.


----------



## Toro (May 7, 2011)

KissMy said:


> Mad Scientist said:
> 
> 
> > I want to apologize to everybody for the recent downturn in Gold and Silver. I just bought my first oz. of Gold and about 22 oz.'s of Silver about 2 weeks ago so *naturally*, they *both* hit the skids.
> ...



Silver sliced through it's 100 day moving average, I believe. I think it bounced off the 125 day MA but I'm not at my BBerg so I can't confirm. 

Though I do think the bull market in PMs has more to go, I think it will end very badly. I think gold and silver will fall 70%-90% when the bubble collapses. Now that might be in 2016 after gold has hit $4000, I don't know. But people will lose a lot of money. 

I don't like to look over generations when thinking about individual' time horizon. The bulk of an individual's investment time horizon occurs over 20-30 years. Gold fell from $850 to $250 in 18 years. People putting the bulk of their savings into gold during that time, expecting to retire in 20 years saw tremendous wealth destruction.


----------



## Toro (May 9, 2011)

I bought June SLV 40 calls today with a very small slice of capital to play this dead cat bounce in silver. I would be surprised if I owned this position next week.


----------



## KissMy (May 9, 2011)

Toro said:


> KissMy said:
> 
> 
> > Mad Scientist said:
> ...



I checked with Yahoo on SLV, Monex on physical Silver Spot, & physical Silver Coins. They all show that it never even hit the 100 day moving average so this bull market has not been broken. It was a needed correction & now it is off to the races again.

Also Europe is in turmoil. Germany is has just had a "Grass Roots" "TEA Party" form. Greece is fucked & it is about to get really ugly over there.


----------



## Mr Liberty (May 10, 2011)

KissMy said:


> Toro said:
> 
> 
> > KissMy said:
> ...



The only EFT that did briefly cross the 100 MA was PSLV. 
This could be a dead cat bounce or just a simple correction and the trend will continue.  I'm bullish so I hoping my buy stop will trigger tomorrow or Thursday.  If I'm wrong, the buy stop of $20.10 on ZSL is in place.
I couldn't be happier with the returns over the last 10 weeks.


----------



## Toro (May 10, 2011)

Mr Liberty said:


> The only EFT that did briefly cross the 100 MA was PSLV.
> This could be a dead cat bounce or just a simple correction and the trend will continue.  I'm bullish so I hoping my buy stop will trigger tomorrow or Thursday.  If I'm wrong, the buy stop of $20.10 on ZSL is in place.
> I couldn't be happier with the returns over the last 10 weeks.



It's been a fantastic year for silver.

But if it bounces rapidly, then I will reload on the short side, only in bigger size.


----------



## Mr Liberty (May 10, 2011)

Toro said:


> Mr Liberty said:
> 
> 
> > The only EFT that did briefly cross the 100 MA was PSLV.
> ...



That's a smart move.  Are you bullish or bearish?


----------



## Toro (May 10, 2011)

Mr Liberty said:


> Toro said:
> 
> 
> > Mr Liberty said:
> ...



Depends on your time frame.  I don't think gold has seen a top, and if gold has not seen a top, I doubt silver has as well.  The problem is that the action in silver was manic, behavior often associated with tops.  

My guess - and I emphasize the word "guess" - is that we have a bounce, silver goes into the $40s then collapses somewhere into the $20s sometime by July.  It then builds a base in the fall and starts moving up in the winter and spring of next year.  

It appears that the monetary authorities, after contributing mightily to the tech and housing bubbles, have learned nothing and have created the conditions - along with the federal government - to perpetuate asset bubbles.  If I am correct, then what is the next asset bubble?  Probably commodities.  And if commodities are going into a bubble, bubbles usually don't end when the yield curve is very steep, as it is now.  Bubbles end when curves are flat.  (They are flat in India.)  So if commodities are going into a bubble, silver will almost certainly hit a new high.

But I could be completely wrong.  And if I am, I will change my position in no time flat and probably not tell anyone.


----------



## Toro (May 11, 2011)

We may be seeing the beginning of the end of the dead cat bounce. Silver has reversed pretty hard overnight after hitting $39.50 in Asia, coming within a whisker of the $40 range I was expecting.  It has since reversed $2 but is trying to stabilize. This may be an opportunity to short.


----------



## KissMy (May 11, 2011)

Toro said:


> We may be seeing the beginning of the end of the dead cat bounce. Silver has reversed pretty hard overnight after hitting $39.50 in Asia, coming within a whisker of the $40 range I was expecting.  It has since reversed $2 but is trying to stabilize. This may be an opportunity to short.



I haven't looked at the volume yet but the price swing is nearly the same as the past 3 days & at the same time. If it follows the pattern it dropped ar 6:00AM CT & should turn up right now at 8:30AM CT


----------



## Toro (May 11, 2011)

I have covered my silver long at a small loss. I think any strength are shorting opportunities.


----------



## KissMy (May 11, 2011)

Toro said:


> I have covered my silver long at a small loss. I think any strength are shorting opportunities.



If you go short, do it at the end of the day. Gold & Silver rise all day & then gap down by morning. Make money while you sleep.


----------



## Toro (May 11, 2011)

KissMy said:


> Toro said:
> 
> 
> > I have covered my silver long at a small loss. I think any strength are shorting opportunities.
> ...



It has been my experience that trading isn't dependent on time of day.  That pattern may hold for a bit then reverse violently.


----------



## KissMy (May 11, 2011)

Toro said:


> KissMy said:
> 
> 
> > Toro said:
> ...



Oops my bad. You were right. Major down turn happened after it tried to climb this morning.


----------



## Toro (May 11, 2011)

KissMy said:


> Toro said:
> 
> 
> > KissMy said:
> ...



That seems to always happen to me.


----------



## Mr Liberty (May 11, 2011)

I shorted this today at about 11:00 EST.  It was probably a mistake.  It may rise before the market opens.  I usually don't buy unless there is an established trend.  If it is still below $36.00 I will be OK.  I hope you longs did not get burned too bad.


----------



## KissMy (May 13, 2011)

The US Corp of Engineers is about to open the Morganza Spillway in Louisiana. This will flood & shut down many Oil Refineries & damage the main fuel pipeline feeding the entire North East USA. Crude Oil prices are falling on this news & gasoline & fuel oil prices are rising. This is giving the US dollar a lift today.


----------



## liebuster (May 13, 2011)

KissMy said:


> The US Corp of Engineers is about to open the Morganza Spillway in Louisiana. This will flood & shut down many Oil Refineries & damage the main fuel pipeline feeding the entire North East USA. Crude Oil prices are falling on this news & gasoline & fuel oil prices are rising. This is giving the US dollar a lift today.


'

I see you've changed your avatar...


----------



## Toro (May 24, 2011)

I re-established positions in gold and silver today.  Both have been reacting fairly well the last few weeks.  I think gold is easier than silver here, since gold has far less overhead to deal with.  Gold only fell 7% top to bottom during the vicious sell-off in commodities whereas silver fell 35% in a few weeks.  That means there are a whole bunch of recent buyers of silver above these levels who are under water who may be looking to escape their positions as they approach break even.  If silver can progress despite this, it will be bullish.  

I am not fully invested and will look to add to positions in the near future.  I usually buy options but options are expensive so I have been buying ETFs.  As always, if I am wrong, I will quickly cut my positions.  I view this as a trading position.

Good news is that speculative positions in silver are now back to levels when silver was less than $10.







USD Short Covering, EUR Capitulation Ending, Silver Spec Longs At Two Year Lows | zero hedge


----------



## KissMy (May 24, 2011)

liebuster said:


> KissMy said:
> 
> 
> > The US Corp of Engineers is about to open the Morganza Spillway in Louisiana. This will flood & shut down many Oil Refineries & damage the main fuel pipeline feeding the entire North East USA. Crude Oil prices are falling on this news & gasoline & fuel oil prices are rising. This is giving the US dollar a lift today.
> ...



Yes I did change my Avatar back because the corrective run-up in the US Dollar is over. So many investors were leveraged against the dollar that it had to spring back. That has ended & it is time to bet against the dollar again. Nothing much has changed in the world as far as fiat currency goes. Most currencies are still dropping & many like the US Dollar are in serious peril.

I went Bullish on Gold on Thursday.


----------



## Toro (Jun 1, 2011)

I liquidated all my precious metals positions today.  I am sitting mainly in cash right now.


----------



## KissMy (Jun 2, 2011)

I have been in Gold, Corn & Cash since May 19th. I have stayed away from silver.

I own physical Gold which performs better than stocks such as Cameco that has & will continue to get hit as the world backs away from Nuclear Energy after Japan's meltdown.

We are just 28 days away from the Fed extending QE2 or starting QE3.


----------



## Toro (Jun 2, 2011)

QE2 will be extended as the Fed has already said they would be buying bonds to replace the bonds on their balance sheet expire.  I'll wait to see about QE3 though.  If QE3 is coming, there will be a lot of time to make money off it.  I'd prefer to see the whites of their eyes before firing.


----------



## KissMy (Jun 2, 2011)

Toro said:


> QE2 will be extended as the Fed has already said they would be buying bonds to replace the bonds on their balance sheet expire.  I'll wait to see about QE3 though.  If QE3 is coming, there will be a lot of time to make money off it.  I'd prefer to see the whites of their eyes before firing.



Treasuries have been dropping as investors embrace the RISK OFF trade. Extending QE2 is a must & QE3 will have to push investors out of Treasuries or the RISK OFF trade will roll the stock market. With 9% unemployment & the bad jobs numbers coming out we are seeing the whites of their eyes. All the current political posturing will cave in at the last minute.


----------



## Toro (Jun 8, 2011)

I've shorted gold at $1533 as a trade.  My stop is at $1545.  My initial target is $1500.

I've sucked at trading this year however.


----------



## Mad Scientist (Jun 8, 2011)

Toro said:


> QE2 will be extended as the Fed has already said they would be buying bonds to replace the bonds on their balance sheet expire.  I'll wait to see about QE3 though.  If QE3 is coming, there will be a lot of time to make money off it.  I'd prefer to see the whites of their eyes before firing.


Just got another oz. of Silver in the mail today! Come on QE III!


----------



## william the wie (Jun 8, 2011)

Toro said:


> I've shorted gold at $1533 as a trade.  My stop is at $1545.  My initial target is $1500.
> 
> I've sucked at trading this year however.


No offense but with the asset markets apeshit crazy isn't this the time to pull in horns and concentrate on not losing your ass?


----------



## Toro (Jun 8, 2011)

william the wie said:


> Toro said:
> 
> 
> > I've shorted gold at $1533 as a trade.  My stop is at $1545.  My initial target is $1500.
> ...



I'm about 80% cash right now.  This is a quick trade.  Plus, if things are going to go haywire, they are more likely to do so on the downside than the upside.


----------



## william the wie (Jun 8, 2011)

Toro said:


> william the wie said:
> 
> 
> > Toro said:
> ...


I certainly agree with that last part but I am of the opinion that flight to safety is likely to mean higher values for Gold and USD, obviously you do not share that opinion could you tell me why? I do not like unpleasant surprises from data I overlooked and it sounds like you may have data that I did overlook.


----------



## Toro (Jun 8, 2011)

william the wie said:


> Toro said:
> 
> 
> > william the wie said:
> ...



Well, a flight to safety might mean a flight to gold, I don't know.  If its a currency crisis, then you might see a flight to gold.  But silver just got whacked, falling 35% a few months ago.  That worries me.  But I might change my mind and go long gold tomorrow, I don't know.


----------



## Toro (Jun 9, 2011)

I changed my mind and covered my gold short for a small loss.  But I also covered all my hedges, which were profitable, and now have a slight long on stocks.


----------



## KissMy (Jun 9, 2011)

KissMy said:


> I have been in Gold, Corn & Cash since May 19th. I have stayed away from silver.
> 
> I own physical Gold which performs better than stocks such as Cameco that has & will continue to get hit as the world backs away from Nuclear Energy after Japan's meltdown.
> 
> We are just 28 days away from the Fed extending QE2 or starting QE3.



I have stayed long Gold, Corn & Cash since May 19th despite the rest of the commodities falling. Corn is going to set a new price record!


----------



## Toro (Jun 9, 2011)

Monetary policy and rebalancing: Read this speech, then sell the dollar | The Economist


----------



## Zander (Jun 9, 2011)

Toro said:


> Monetary policy and rebalancing: Read this speech, then sell the dollar | The Economist



I am going long the dollar starting.....NOW!!!


----------



## Toro (Jun 10, 2011)

Zander said:


> Toro said:
> 
> 
> > Monetary policy and rebalancing: Read this speech, then sell the dollar | The Economist
> ...





FTR The Economist predicts $5 oil in 1999!







Drowning in oil | The Economist
The next shock? | The Economist


----------



## KissMy (Jun 10, 2011)

Zander said:


> Toro said:
> 
> 
> > Monetary policy and rebalancing: Read this speech, then sell the dollar | The Economist
> ...



Well it looks like the markets are going to actually be forced to call the Fed's bluff. An all cash position for the next week may be a good idea. Markets are going to drop until the government gives in.


----------



## Truthmatters (Jun 10, 2011)

George Soros sells his gold - Telegraph


----------



## KissMy (Jun 10, 2011)

Truthmatters said:


> George Soros sells his gold - Telegraph



This is months old dude. Everyone knows this. The Fed is testing the waters & it is going to get egg on its face. I am not taking a hit on this. I am going to cash.


----------



## Toro (Jun 10, 2011)

Gee, maybe I covered too soon.


----------



## KissMy (Jun 10, 2011)

The PPT will make sure the DOW does not close in the $11K range it is in today. They can't have that number in print all weekend. It will close over $12K today for sure.


----------



## KissMy (Jun 10, 2011)

WOW! - They let the DOW close at $11,951.91 for the weekend headline. I can't believe they let that happen. It looked like the PPT jumped in twice between 2:00 & 3:00 & knocked the DOW way up to $12k. This is a shock. Are they really not going to rescue this market? 6 straight weeks of falling indexes, stocks & jobs. It looks like they are going to let a crisis happen to justify another rescue & perhaps shake people out of commodities in the process.


----------



## KissMy (Jun 15, 2011)

Wow Gold is hanging in there & up a bit even as stocks & oil tumble. Gold has actually become a safe-haven for the risk off trader.


----------



## Trajan (Jun 15, 2011)

Zander said:


> Toro said:
> 
> 
> > Monetary policy and rebalancing: Read this speech, then sell the dollar | The Economist
> ...



Oh so you watched the vid I posted? he was speaking of 15-18 months...but yo go ahead and park that big fella....


----------



## Toro (Jun 24, 2011)

KissMy said:


> Wow Gold is hanging in there & up a bit even as stocks & oil tumble. Gold has actually become a safe-haven for the risk off trader.



I bought some gold about a week ago but my discipline forced me to blow it out off the open this morning at a loss

That's the story of my year.  I'm have an awful year, down ~9% and getting chopped up in a trendless market.  I'm dying a death of a thousand cuts as every time it looks like things start to go, they reverse violently, as gold did yesterday.  I'm sure 90% of my trades have been wrong this year.

I looked at shorting silver earlier today, and should have.  That probably means silver is going up next week!


----------



## KissMy (Jun 24, 2011)

Toro said:


> KissMy said:
> 
> 
> > Wow Gold is hanging in there & up a bit even as stocks & oil tumble. Gold has actually become a safe-haven for the risk off trader.
> ...



I got my ass handed to me this week also. I have been short the GLD to offset the physical gold in my safe. I had this short on all the way up until just prior to market open on the day Bernanke ran his mouth. I got tired of watching my short lose my cash so I covered thinking maybe I was wrong. This left all the gold in my safe exposed. Gold shot up over $10 after I covered so I was feeling good when I left for the day. The next day I saw the price & went OMG!!! Then I was thinking I needed to wait for the last huge trade to clear before I shorted again so after that big drop I waited for a bounce to short again. Needless to say I waffled & still did not get my short back on. I wound up on the wrong side up & down. I am pissed.


----------



## william the wie (Jun 24, 2011)

Toro said:


> KissMy said:
> 
> 
> > Wow Gold is hanging in there & up a bit even as stocks & oil tumble. Gold has actually become a safe-haven for the risk off trader.
> ...


try some 6-12 month black swan hedges with that strategy I discussed with you it may not be as profitable as what you are currently doing but with less stress. Not including the medical treatment costs for the stress on your P&L is a major error of personal accounting.


----------



## Zander (Jun 24, 2011)

I am sitting tight- I liquidated the long bonds at 4.15 after a quick 10% gain since February.  I do have a small position in Vanguards Healthcare Fund- but other than that, I am sitting in cash and short term treasuries.


----------



## Toro (Jun 25, 2011)

Zander said:


> I am sitting tight- I liquidated the long bonds at 4.15 after a quick 10% gain since February.  I do have a small position in Vanguards Healthcare Fund- but other than that, I am sitting in cash and short term treasuries.



I'd have done better if I took your advice at the beginning of the year.


----------



## Zander (Jun 25, 2011)

Toro said:


> Zander said:
> 
> 
> > I am sitting tight- I liquidated the long bonds at 4.15 after a quick 10% gain since February.  I do have a small position in Vanguards Healthcare Fund- but other than that, I am sitting in cash and short term treasuries.
> ...



You are too kind.   I'd  trust you with my money in a second Toro.  You're just going through a rough patch. Trading is difficult, frustrating, and often gut wrenching. That is why Buy and Hold (or is it buy and pray?) is so popular.


----------



## KissMy (Jun 26, 2011)

Gold & Silver are off again tonight. Trading opened tonight at 6:00PM & Gold is down $4.00 & Silver is off $0.35


----------



## uscitizen (Jun 26, 2011)

Damn!  Gold Eagles down to only $1,000 more than I paid for them.


----------



## Alastair (Jun 30, 2011)

Hi, The Gold and silver are going beyond limits in price increase and still it is up going.It has been great investment in these two two metals resulting huge profit for investors.I have this opinion as I concluded.


----------



## Toro (Jun 30, 2011)

I have established a small short position in silver. Both silver and gold look vulnerable here.


----------



## KissMy (Jun 30, 2011)

Toro said:


> I have established a small short position in silver. Both silver and gold look vulnerable here.



Gold & silver are acting squirly. I am short Silver & Gold also but it has been painful for a couple of days. After listening to Greenspan I don't see additional QE unless the economy nosedives. He also believes that the debt limit will not be raised by the August 2nd deadline. Tim Geithner will be stepping down. The government may be shutting down for a time. M2 money supply is not rising as fast as the QE of M1 money supply. Banks are not lending. Government will be trying new tools to get expansion going in the next month.


----------



## Toro (Jul 6, 2011)

I forgot to mention that I covered my small silver short yesterday for a slight loss. The ECB changed its requirements for holding Greek bonds by saying that as long as any ratings agency does not have Greece as defaulting, the ECB could still own Greek bonds. This differs from past statements that if any ratings agency had Greece in default, it couldn't hold Greek bonds. Since I'm sure there will be some spineless compliant (and probably French) ratings agency willing to do what Paris wants, the ECB will no longer need to jettison it's Greek holdings. This is fundamentally positive for gold and by extension silver since it further debases fiat currencies. Plus, silver has had a clear bid underneath it over the past week. 

The technical picture for both gold and silver remain problematic and seasonality is a negative but I will be watching for reentry points over the next month or two.


----------



## Toro (Jul 11, 2011)

I reestablished my positions last week, buying silver as silver looked clearer to me than gold. It appeared there was a floor at $33. There is overhead at $38-39. Gold is hitting an all time high in euros today and sits near an all time high in dollars.  I would prefer that gold back and fill over the next month but I will be adaptive depending on what the market is saying.

Given how poor my trading has been however, I might have just signaled a top in the PM markets!


----------



## KissMy (Jul 11, 2011)

I went long Gold & Silver pre-market Tuesday July 5th. I have took a beating trying to short. The Euro is in such trouble that even when the US Dollar is up, gold is up. It really does not matter at this point if the US Gov shuts down or we have QE3. Europe will continue to drive precious metals.


----------



## Zander (Jul 11, 2011)

Investors should stay in Cash. Speculators should take maximum  Short on S&P 500.


----------



## Toro (Jul 11, 2011)

I would be wary of any government securities if there is a default in August. Treasuries have been the default "risk off" play. If the risk off play becomes risky, you could see some real fireworks.


----------



## Trajan (Jul 11, 2011)

Toro said:


> I reestablished my positions last week, buying silver as silver looked clearer to me than gold. It appeared there was a floor at $33. There is overhead at $38-39. Gold is hitting an all time high in euros today and sits near an all time high in dollars.  I would prefer that gold back and fill over the next month but I will be adaptive depending on what the market is saying.
> 
> Given how poor my trading has been however, I might have just signaled a top in the PM markets!



I have a project at the house I would like to get done. I am really thinking of cashing in perhaps a third of my gold held to get it done, I have a price quoted for the work a full third less than 2007 when I considered it last.

 I have the cash but, I don't want to use it, I am not sure at this point how far gold has to run, vs. inflation comparatively it has not hit a "historical' high and things appear a great deal worse altogether than they did in say, 78.  

decisions decisions.


----------



## Toro (Jul 11, 2011)

Trajan said:


> Toro said:
> 
> 
> > I reestablished my positions last week, buying silver as silver looked clearer to me than gold. It appeared there was a floor at $33. There is overhead at $38-39. Gold is hitting an all time high in euros today and sits near an all time high in dollars.  I would prefer that gold back and fill over the next month but I will be adaptive depending on what the market is saying.
> ...



Of course, after I made that above post, silver fell $1. lol

Story of my year.


----------



## Toro (Jul 12, 2011)

Gold hit $1573 today, near an all-time high, on release of the Fed minutes. There is internal debate about QE3, with some members arguing for another round if the economy stays soft. This has taken the market by surprise as investors had thought QE3 was off the table. 

Also it was reported that speculative net longs in gold have fallen to the lowest level since February, providing potential buying power to move gold higher.


----------



## Trajan (Jul 13, 2011)

Toro said:


> Gold hit $1573 today, near an all-time high, on release of the Fed minutes. There is internal debate about QE3, with some members arguing for another round if the economy stays soft. This has taken the market by surprise as investors had thought QE3 was off the table.
> 
> Also it was reported that speculative net longs in gold have fallen to the lowest level since February, providing potential buying power to move gold higher.



see my QE 3 therad

and I aint selling squat, gold today, gold tomorrow....the house can wait. Cha Ching!


----------



## Toro (Jul 13, 2011)

Gold hit an all-time high today.  Gold remains in a powerful, multi-year bull market.  Announcements like this feed the precious metals.

I had gotten pretty long silver last week.  I will look to get extremely long over the next while, given the increasingly positive fundamentals for precious metals.  I'd like to see a bit of backing and filling first, though.  Gold is on fire and could use a rest.


----------



## Trajan (Jul 13, 2011)

Toro said:


> Gold hit an all-time high today.  Gold remains in a powerful, multi-year bull market.  Announcements like this feed the precious metals.
> 
> I had gotten pretty long silver last week.  I will look to get extremely long over the next while, given the increasingly positive fundamentals for precious metals.  I'd like to see a bit of backing and filling first, though.  Gold is on fire and could use a rest.



I agree, in sailing terms we got the puff we needed to move away from the pier of 1500-50 chains...

were are at sea again.


----------



## KissMy (Jul 13, 2011)

Lets hear it for QE3!

*QE3! - QE3! - QE3! - QE3! - QE3! - QE3!*


----------



## KissMy (Jul 13, 2011)

Bernanke actually thinks Gold & Silver are not money! 


> During the Q&A portion of the testimony, Congressman Ron Paul asked Bernanke if he thinks gold is money.  Bernanke replied, &#8220;No.  It&#8217;s a precious metal.&#8221;
> 
> Dr. Paul then asked why do central banks hold gold in reserves.  All Bernanke could say to that was &#8220;Tradition.&#8221;
> 
> When asked by Dr. Paul if he monitors the price of gold &#8211; which today hit another new all-time record high, of $1,588.90 per ounce, amid speculation over QE3 &#8211; Bernanke responded that he does.



J.P. Morgan Chase & Co. will accept Gold as collateral.


> J.P. Morgan Chase & Co. will accept Gold as collateral. Typically, banks accept only Treasury bonds and stocks in such agreements. By making the announcement, J.P. Morgan is effectively saying gold is as rock solid an investment as triple-A rated Treasurys, adding to a movement that places gold at the top tier of asset classes.



Moody's said it could cut the United States' prized triple-A credit rating.

*I got news for Bernanke - Gold & Silver are Money!*​[ame="http://www.youtube.com/watch?v=JVArPiDebdY"]Gold & Silver are being accepted across Michigan[/ame]
[ame="http://www.youtube.com/watch?v=h4_ehBNlCL0"]I got news for Bernanke - Gold & Silver are Money![/ame]


----------



## JackDan (Jul 14, 2011)

Great points people.  Europe and the debt ceiling are definately going to push PM's up I believe in the next couple weeks.  If we suddenly reach a deal on the debt ceiling, (doesn't look to good right now) PM's could fall but we are still looking at Greece defaulting which could could continue to prop up fiat currencies further.


----------



## LordBrownTrout (Jul 14, 2011)

We're on a continuous trend now towards instability in the world.  PM's will continue to rise.


----------



## KissMy (Jul 31, 2011)

Gold just opened down $16 on new that house passed debt bill & senate is closer to agreement.


----------



## Toro (Aug 1, 2011)

KissMy said:


> Gold just opened down $16 on new that house passed debt bill & senate is closer to agreement.



And then bounced on the horrendous ISM number.


----------



## KissMy (Aug 1, 2011)

Citigroup says Gold could top US$2,500 an ounce and might even hit US$5,000

JAPAN PREPARES FOR CURRENCY INTERVENTION


----------



## Ernie S. (Aug 3, 2011)

Au $1666.10
Ag $41.09
I'm so proud of my President, I could vomit.


----------



## Valerie (Aug 3, 2011)

> Wednesday, August 3, 2011
> 
> 
> Central banks are ramping up their gold buying as they seek to diversify their reserves away from the dollar and other beleaguered currencies.
> ...




That's A LOT of Gold!


----------



## KissMy (Aug 3, 2011)

Valerie said:


> > Wednesday, August 3, 2011
> >
> >
> > Central banks are ramping up their gold buying as they seek to diversify their reserves away from the dollar and other beleaguered currencies.
> ...



Yeah - The dollar & other paper currency are done as far as world reserve currencies. The US Federal reserve will end up buying all of our debt to prevent the US from having to pay a real interest rate. We are basically monetizing the debt.


----------



## LordBrownTrout (Aug 3, 2011)

I don't want to see our economy at $5000 an ounce.  I'd prefer to be in the mountains at that point.


----------



## Trajan (Aug 3, 2011)

in adjusted dollars gold peaked at approx. 2100 bucks in the carter years so, hang on....


----------



## KissMy (Aug 4, 2011)

Gold had a $40 reversal today along with a top 9 stock market sell-off. I am wondering if now that QEII has ended & a austerity bill is now law does this mean deflation is now actually setting in? The dollar may rise & all prices fall until a new QEIII plan is actually implemented.

Gold & Silver may start dropping big like the stock market. There are even rumors of China slowing. We could be again facing global deflation/depression. Until other countries start printing money & or the US cranks up QEIII, we may be in for a slide.

Cash may be King again.


----------



## Mad Scientist (Aug 4, 2011)

KissMy said:


> Gold had a $40 reversal today along with a top 9 stock market sell-off. I am wondering if now that QEII has ended & a austerity bill is now law does this mean deflation is now actually setting in? The dollar may rise & all prices fall until a new QEIII plan is actually implemented.
> 
> Gold & Silver may start dropping big like the stock market. There are even rumors of China slowing. We could be again facing global deflation/depression. Until other countries start printing money & or the US cranks up QEIII, we may be in for a slide.
> 
> *Cash may be King again*.


Really? All I'm reading about is that currency wars are heating up, that means inflation and *currency devaluation*.


----------



## editec (Aug 5, 2011)

I guess I am becoming cynical in my old age (and I mean cynical in the bad sense of the word, not that noble philophical sense of the word).

What is the worst possible outcome? STAGFLATION, right?

_All the pain of inflation_ but as the economy tanks, nobody is making more money to compensate for the losses in the value of their money.

Remember that state of affairs, folks?

Given that _that_ is the worst possible outcome?

*That's what I expect we'll be seeing.*

In fact, that is what we are ALREADY seeing, isn't it?

The cost of living is climbing but wages and employment are stagnant.

We'll have both an increasing supply of money but those greenbacks will be chasing an decreasing amount of goods and services.

Somebody (other than the FED) has GOT to get some real (read not NEW) follars back into circulation, folks.

IF the government cannot spend because it is broke, then the fat cats sitting on old money had best pony up and start investing in THIS nation for a change.


----------



## hjmick (Aug 5, 2011)

I didn't feel like reading the whole thread... I hope no one else beat me to it...

[ame=http://www.youtube.com/watch?v=oMlqn_Hjyi8]&#x202a;Rudolph the Red-Nosed Reindeer "Silver and Gold"&#x202c;&rlm; - YouTube[/ame]


----------



## Toro (Aug 5, 2011)

KissMy said:


> Gold had a $40 reversal today along with a top 9 stock market sell-off. I am wondering if now that QEII has ended & a austerity bill is now law does this mean deflation is now actually setting in? The dollar may rise & all prices fall until a new QEIII plan is actually implemented.
> 
> Gold & Silver may start dropping big like the stock market. There are even rumors of China slowing. We could be again facing global deflation/depression. Until other countries start printing money & or the US cranks up QEIII, we may be in for a slide.
> 
> Cash may be King again.



Right now, I'm 92% cash.  The rest is mainly property casualty insurance stocks.

Bull markets usually end when monetary conditions are tight, not when they are extraordinarily loose, as they are today.  Bull markets usually don't end when monetary conditions begin to tighten either.  The last years of the bull markets in technology and housing saw their best years when the Fed was at the end of their tightening cycle, not at the beginning.  With the politicians kicking the can down the road and the Fed talking about QE3, the developed world policies remain extraordinarily bullish for precious metals.

Having said that, in the developing world, monetary conditions are either tight or becoming tight.  The yield curves in India and Brazil are inverted, while China has been tightening reserve requirements and have been clamping down on housing speculation.  This is bearish for precious metals in the near term.  

Also, if we are crashing, I do not expect silver and gold to hold up.  When we start plummeting, the margin clerks take control, and they will sell whatever they need to get liquid, including gold and silver.  Remember, during the Financial Crisis, silver fell from $20 to $8.  However, silver went to $50 a few years later.  

I am expecting a similar response, as I expect precious metals to eventually enter a parabolic stage in the future.  But maybe I'm wrong, I don't know.


----------



## Toro (Aug 5, 2011)

Speculation is that the ECB will buy Italian and Spanish bonds. If true, this is very bullish for gold and silver, though there may be some knee jerk selling on dollar strengthening.


----------



## KissMy (Aug 5, 2011)

Toro said:


> Speculation is that the ECB will buy Italian and Spanish bonds. If true, this is very bullish for gold and silver, though there may be some knee jerk selling on dollar strengthening.



This is Europe's QEI.

Markets are freaking psycho.

For some reason my volume chart is flat-lined due to a high spike this morning. Freaking $400 point bounce in the DOW while I went to the bathroom. High frequency computer traders are screwing things up.


----------



## Toro (Aug 5, 2011)

We need a witty monicker. 

EQE?  QEE?


----------



## KissMy (Aug 6, 2011)

Gold upgrade to a Tier 1 Asset while US Bonds get downgraded.


----------



## editec (Aug 6, 2011)

Gold and silver prices are barometers of the herds' uncertainty.

Their prices are driven in large part by ANIMAL SPIRITS.

Remember when gold hit  the high $800s in the late 70s?

Then it fell and stayed in the $300 range for decades?

Markets for those commodities are rational _until the market isn't rational._


----------



## Toro (Aug 6, 2011)

Friday was quite the day for gold.

We had the ECB continue to let its balance sheet deteriorate and the US was downgraded.

The fundamentals for precious metals have gotten a whole lot brighter.


----------



## editec (Aug 6, 2011)

Toro said:


> Friday was quite the day for gold.
> 
> We had the ECB continue to let its balance sheet deteriorate and the US was downgraded.
> 
> The fundamentals for precious metals have gotten a whole lot brighter.


 
If the play is short term (like a futures contract), I suspect it is an over-reaction.

If the play is longer term, (like a buy and hold strategy) then I suspect it is sage.


----------



## KissMy (Aug 7, 2011)

Where will the funding for the $115 Trillion in US unfunded liabilities come from? See: US Debt Clock

I assume there will be a compromise. 1/3 in cuts, 1/3 in higher tax revenues & 1/3 from currency debasement. So 1/3 of the $115 Trillion unfunded liabilities = $38.33 Trillion in currency debasement over the next 10 years.

NPR says US unfunded liabilities come to $211 Trillion. Clearly this puts way further up shit creek without a paddle.

NPR: A National Debt Of $14 Trillion? Try $211 Trillion


> "If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $211 trillion. That's the fiscal gap," he says. "That's our true indebtedness."


----------



## Toro (Aug 7, 2011)

Gold is up $40 at $1690 on the downgrade at 6:30pm on Sunday.


----------



## KissMy (Aug 7, 2011)

Toro said:


> Gold is up $40 at $1690 on the downgrade at 6:30pm on Sunday.



Gold is now over $1,700 an ounce. 

ounce Gold Buffalo & Eagle Coins over $1,800.

1/10 ounce Gold Buffalo & Eagle Coins over $201 = $2010 per ounce.


----------



## Toro (Aug 8, 2011)

$1710 at 6am.


----------



## LordBrownTrout (Aug 8, 2011)

Damn, why didn't I buy in at $1300.


----------



## Trajan (Aug 8, 2011)

Toro said:


> KissMy said:
> 
> 
> > Gold had a $40 reversal today along with a top 9 stock market sell-off. I am wondering if now that QEII has ended & a austerity bill is now law does this mean deflation is now actually setting in? The dollar may rise & all prices fall until a new QEIII plan is actually implemented.
> ...






actually I read just last week Paulson dumped BAC ( who will mark my words require a bailout) and IF he has an alike position in say, Citicorp. who is up next, he would get liquid on his SPDR (GLD), he could create a correction of say 15-20 % in a heartbeat.......*gulp*.


----------



## Trajan (Aug 8, 2011)

Toro said:


> Speculation is that the ECB will buy Italian and Spanish bonds. If true, this is very bullish for gold and silver, though there may be some knee jerk selling on dollar strengthening.




I thought Italy canceled its auction for this month?


----------



## LordBrownTrout (Aug 8, 2011)

Time for more silver.  

Fed forced to consider fresh stimulus - FT.com


----------



## Toro (Aug 9, 2011)

At 6am, gold is at $1770.


----------



## Toro (Aug 9, 2011)

Gold is at risk of topping here. It has fallen nearly $30 from the all time high of $1780 earlier this morning. We can still go higher but the risk of a reversal exists.

Silver is acting poorly.  Silver is sitting at support.


----------



## Toro (Aug 9, 2011)

I think gold is topping here. The Fed statement, which ignited a powerful rally in stocks, is ultimately bullish for precious metals. However, gold is extremely overbought and extended at these levels, and is showing classical topping behavior.  Silver has been and continues to act poorly. I may even put a small short on gold. But I think that after a pullback, gold ultimately goes higher, and I will look to reload on the long side.


----------



## KissMy (Aug 10, 2011)

60% of US Treasuries will come due in the next 3 years. By the FED vowing to keep rates low by buying them, they could effectively monetize a huge chunk of the US debt.

 Lets hear it for Gold!


----------



## KissMy (Aug 10, 2011)

Gold Hit $1,800!!!!!!!!!!!!!!!!!!!!!!!!


----------



## Toro (Aug 10, 2011)

FTR I have not shorted gold. 

Yet.


----------



## Trajan (Aug 10, 2011)

goooodaaaawwwg......am I the man or what? 







*2K by X mas....*


----------



## Toro (Aug 10, 2011)

Gold hit an RSI today of 87. Only once before in this bull market has it gotten this high, May 9 2006 when it hit $699.  It proceeded to rise another 4.5% over two days. From there, it fell 5.7% over the next week, 10.3% over two weeks, and 15.5% over the month. 

The RSI was also this high in 1980 when it was melting up. Both occurrences were in January of that year. Both times, gold was hammered within days. 

Gold is in full blown panic mode. These typically do not last.


----------



## KissMy (Aug 10, 2011)

Toro said:


> FTR I have not shorted gold.
> 
> Yet.



What method are you using to predict market turns?


----------



## Toro (Aug 10, 2011)

KissMy said:


> Toro said:
> 
> 
> > FTR I have not shorted gold.
> ...



Ideally, I want to see an intraday reversal closing on the lows and confirmed the next day. It wasn't confirmed today. We may get confirmation in a few days. However, technicals mean crap in a banking / sovereign crisis.


----------



## Toro (Aug 10, 2011)

The other signal would be a big gap up followed by a big down day closing near the low which is lower than the low of the previous big up day, and then the third day seeing a rally that falls short of the intraday highs of the prior two days. Weakness on the fourth day would be a very interesting day for a short entry.


----------



## KissMy (Aug 10, 2011)

Toro said:


> KissMy said:
> 
> 
> > Toro said:
> ...



I agree, this crisis is dwarfing the usual technicals. The only market turns are created by Central Banks.


----------



## Toro (Aug 10, 2011)

Gold pushing $1820


----------



## Trajan (Aug 10, 2011)

Toro said:


> Gold hit an RSI today of 87. Only once before in this bull market has it gotten this high, May 9 2006 when it hit $699.  It proceeded to rise another 4.5% over two days. From there, it fell 5.7% over the next week, 10.3% over two weeks, and 15.5% over the month.
> 
> The RSI was also this high in 1980 when it was melting up. Both occurrences were in January of that year. Both times, gold was hammered within days.
> 
> Gold is in full blown panic mode. These typically do not last.



of course not, I see a gold correction , maybe even a $100 drop, but the fundamentals have not changed.....or that is nothing has been introduced to change them and I think the money men are tired of betting on the come ala bernbank. *shrugs*


----------



## Trajan (Aug 10, 2011)

my strategy was/is jumping in on the yearly lows; P&G, J&J I'll bottom at 58, 



full disclosure; I have lock in on Adobe at 22 and Intel at 19. 

WMT was triggered today. 

do I drop gold at 1750 and lock it all on my a fore mentioned blues?  that is the big question, my liquidity ( and nerve) goes only so far.....


----------



## Toro (Aug 11, 2011)

I've placed a small short on gold by buying deep out of the money puts to limit my downside. I think gold is vulnerable below $1700. I expect to be out of this trade in days. I will look for an entry point on the long side after a correction.


----------



## Toro (Aug 11, 2011)

Last night, gold hit $1815 in Asia before reversing hard and hitting a low if $1732, an $83 reversal, before rallying after COMEX futures closed.  This intraday reversal is bearish but needs follow through before one gets aggressively short. I am short but not aggressively. 

I am more interested in silver on the long side. Whereas gold went nuts, silver consolidated, and may be setting up for an upward move in the not too distant future.


----------



## Trajan (Aug 11, 2011)

My nerve is on hold


----------



## KissMy (Aug 16, 2011)

Global Gold productions about 5,490 ounces per hour & the US debt is growing at about $101.7 million per hour. That means we create $18,524 worth of debt per ounce the world produces.


----------



## Toro (Aug 16, 2011)

I bought silver today. Silver looks more interesting to me than gold.


----------



## Toro (Aug 19, 2011)

Gold is pushing $1870 this morning.

I'm wondering if silver is going to retest the $50 high.


----------



## KissMy (Aug 19, 2011)

Toro said:


> Gold is pushing $1870 this morning.
> 
> I'm wondering if silver is going to retest the $50 high.



Gold is moving scary fast.

Silver is anyones guess. Silver is part commodity & part currency. Gold is nearly all currency.


----------



## Toro (Aug 19, 2011)

Silver is now at $42. My guess is that if there is a scramble for gold, there will be a scramble for silver too.

Don't be surprised if they hike gold margins again.


----------



## KissMy (Aug 19, 2011)

Toro said:


> Silver is now at $42. My guess is that if there is a scramble for gold, there will be a scramble for silver too.
> 
> Don't be surprised if they hike gold margins again.



I am expecting another margin hike soon. It will have less effect this time. There is significant hoarding of physical gold bullion by literally every type of major market participant from global central banks, hedge funds, endowment funds, investment banks, all the way down to the retail investor.

Silver will likely make a run for $50.


----------



## editec (Aug 19, 2011)

Libria has 143.8_ metric_ tons of gold.

Given that the USA froze Libya's $30 Billion cash assets, and MoMar needs to pay the bills for counter-revolution, one wonders if some of that gold won't soon be coming on the market.


----------



## Toro (Aug 19, 2011)

Chavez is calling back his gold. This could cause a spike in the gold price. 

Silver closed on the highs. I bought a bit more today and nearly have a full position on.


----------



## KissMy (Aug 19, 2011)

editec said:


> Libria has 143.8_ metric_ tons of gold.
> 
> Given that the USA froze Libya's $30 Billion cash assets, and MoMar needs to pay the bills for counter-revolution, one wonders if some of that gold won't soon be coming on the market.



That much won't make a dent. That is only 1/3 of what the University of Texas Endowment Holds.


----------



## Toro (Aug 19, 2011)

Interactive Brokers is saying be prepared for a margin hike for gold contracts.


----------



## LordBrownTrout (Aug 19, 2011)

Toro said:


> Gold is pushing $1870 this morning.
> 
> I'm wondering if silver is going to retest the $50 high.



I believe it will and the new barrier will be 60, possibly by the end of the year.


----------



## Trajan (Aug 19, 2011)

Toro said:


> Interactive Brokers is saying be prepared for a margin hike for gold contracts.



yea I head that the other day too....


----------



## KissMy (Aug 21, 2011)

Gold popped up $20 at the open to $1,875


----------



## Zander (Aug 21, 2011)

Time to short gold. Put a stop at 1950.  Double your position on short once it drops below 1750


----------



## Toro (Aug 21, 2011)

I have been a buyer of silver.

Libya might cause a bit of a pullback, but I would be a buyer on any weakness.  The technical buying over the past two weeks has been very impressive.

Interestingly, oil is down suggesting that Libya may have no impact and we are continuing the trend of August.


----------



## Mad Scientist (Aug 21, 2011)

Toro said:


> I have been a buyer of silver.
> 
> Libya might cause a bit of a pullback, but I would be a buyer on any weakness.  The technical buying over the past two weeks has been very impressive.
> 
> Interestingly, oil is down suggesting that Libya may have no impact and we are continuing the trend of August.


I just bough 8 more ounces of Sliver myself. Gold is out of my range for now, though maybe I should buy grams?

Speaking of Gold, you think Qaddafi's 144 tons of Gold will affect the market?:
The Battle For Libya Is Almost Over As Is The Battle For Its 144 Tons Of Gold « InvestmentWatch  The best source of news, analysis, and intelligent discussion


----------



## KissMy (Aug 21, 2011)

Toro said:


> I have been a buyer of silver.
> 
> Libya might cause a bit of a pullback, but I would be a buyer on any weakness.  The technical buying over the past two weeks has been very impressive.
> 
> Interestingly, oil is down suggesting that Libya may have no impact and we are continuing the trend of August.



There is some serious money to be made in the WTI  crude - Brent/ Light Louisiana Sweet crude oil SPREAD of $23 - $25. I think the spread will collapse & Libya might kick it off.


----------



## Toro (Aug 21, 2011)

Mad Scientist said:


> Toro said:
> 
> 
> > I have been a buyer of silver.
> ...



I like silver better than gold right here.  Gold has run very hard, very fast.  Silver has been consolidating.


----------



## KissMy (Aug 21, 2011)

Tripoli falls to Libyan rebels

This will have the same impact on Gold & Silver prices as the Killing of Osama. It will be to a lesser degree of course.

Oil, Gold & Silver will fall. Dollar & Euro rally. Stocks up.

Gold was at $1,880 on KITCO when the story broke. It is now at $1,868.


----------



## Toro (Aug 22, 2011)

KissMy said:


> Tripoli falls to Libyan rebels
> 
> This will have the same impact on Gold & Silver prices as the Killing of Osama. It will be to a lesser degree of course.
> 
> ...



One would think it would be bad for precious metals.  But they are holding in pretty well.  Let's see what Monday brings.


----------



## KissMy (Aug 22, 2011)

Keeping interest rates low at least until 2013 will add more money to the system than QEII did. This is definatly QEIII & Gold will continue to climb.


----------



## editec (Aug 22, 2011)

They keep interest rates low yet nobody except the truly wealthy can borrow.

Nice game, eh?


----------



## KissMy (Aug 22, 2011)

BLOOMBERG just announced that Gold (GLD) is now the worlds second largest ETF behind the S&P 500 ETF & in weeks GOLD will be the worlds largest ETF.


----------



## editec (Aug 22, 2011)

NEW YORK SPOT PRICES 

Gold  dropped down to 1858.50 (or so) by  and climbed  back up to about $1870 in the last half hour or so.

I presume, given the above post, that volume of trading is rather high.


----------



## Ernie S. (Aug 22, 2011)

kwc57 said:


> No, Glenn Beck told me to buy gold.



Beck was right, huh?
$1903.20. Who knew?


----------



## Jos (Aug 22, 2011)

Right now, I would suggest selling Gold to buy Platinum (DYODD)


----------



## KissMy (Aug 22, 2011)

GLD, For Now, Is World&#8217;s-Biggest ETF


> The market upheaval this month has led investors into gold and out of equities in such force that the physical bullion fund, SPDR Gold Shares (GLD), has for now eclipsed for the first time the SPDR S&P 500 ETF (SPY) as the world&#8217;s-biggest exchange-traded fund.
> 
> As of last Friday, GLD had $76.67 billion and SPY had $74.38 billion, according to data compiled by IndexUniverse. GLD&#8217;s rapid rise in assets reflects powerful inflows as well as spiking prices, just as SPY&#8217;s declining assets reflect outflows as well as the S&P 500&#8217;s 10 percent price slide this month.
> 
> ...



GLD ETF certificates can now be considered a gold backed currency. If you need to buy something from far away with gold you can simply transfer the GLD ETF electronically. Fiat currencies will soon be history. Gold has been upgraded to Tier 1 asset class & the US dollar has been downgraded below AA. You can even use gold as collateral for loans.


----------



## HenryBHough (Aug 22, 2011)

Arsenic is a strategic metal.  It's used to strengthen copper and to make the lead plates used in automobile batteries.  Nobody has paid much attention to its' dramatic increase in price in recent months.  It even has household uses, especially if Obama gets re-elected and one can no longer afford food or housing.  Main problem is secure storage as, should the aforementioned happen, the hordes will be breaking down your door if they know you have it.


----------



## Toro (Aug 22, 2011)

KissMy said:


> GLD, For Now, Is Worlds-Biggest ETF
> 
> 
> > The market upheaval this month has led investors into gold and out of equities in such force that the physical bullion fund, SPDR Gold Shares (GLD), has for now eclipsed for the first time the SPDR S&P 500 ETF (SPY) as the worlds-biggest exchange-traded fund.
> ...



Stuff like this scares me.  It reminds of all the money going into the tech bubble or into private equity in 2006.

But it means that there is a parabolic stage coming.  Maybe we're in it.


----------



## FireFly (Aug 22, 2011)

Toro said:


> KissMy said:
> 
> 
> > GLD, For Now, Is World&#8217;s-Biggest ETF
> ...



We are & this currency will grow until the Fed lets rates rise. This is not the 1970's. We are in deep shit.


----------



## Toro (Aug 22, 2011)

Gold is at $1910.  

It's going to $2000.  I wonder if it will do that by Bernanke's speech on Friday then sell off on the news?


----------



## Trajan (Aug 22, 2011)

Toro said:


> Gold is at $1910.
> 
> It's going to $2000.  I wonder if it will do that by Bernanke's speech on Friday then sell off on the news?



unreal. things must be bad, very bad and is beginning to make itself a fait accompli amongst   the bowels of the EU puzzle palace aside from just our issues, I thought we'd have a modest pull back and reset in gold, and thought, 2K as I said last week by Christmas. 

and as i have noted a while ago, thew late 70s inflation adjusted gold price was like, 2250?.....and I have to say it appears to me, this contagion is worse, by far. 

when a schmuck like me makes a 100% gain on a commodity, things are jacked....


----------



## Toro (Aug 22, 2011)

Don't assume gold going to the moon is necessarily indicative of bad things.  It is to some extent, but these things take a life of their own.  When things go parabolic, they usually do so on perceptions that do not correspond to fundamentals - think tech stocks and housing prices.  My job as a trader and investor is to be able to differentiate between what is real and what is hype.  There is little doubt in my mind that the end game for gold and silver will be all hype.  Whether that is now, however, is open to question.  Though I believe gold has gotten ahead of itself, I'm guessing there are more gains ahead after the inevitable correction.

FTR, I am heavily long silver, and got so last week and the week prior.  But I will be gone in an instant if I think the trade is breaking down.  Because when it ultimately breaks down, it will be extremely ugly.


----------



## Trajan (Aug 22, 2011)

Toro said:


> Don't assume gold going to the moon is necessarily indicative of bad things.  It is to some extent, but these things take a life of their own.  When things go parabolic, they usually do so on perceptions that do not correspond to fundamentals - think tech stocks and housing prices.  My job as a trader and investor is to be able to differentiate between what is real and what is hype.  There is little doubt in my mind that the end game for gold and silver will be all hype.  Whether that is now, however, is open to question.  Though I believe gold has gotten ahead of itself, I'm guessing there are more gains ahead after the inevitable correction.
> 
> FTR, I am heavily long silver, and got so last week and the week prior.  But I will be gone in an instant if I think the trade is breaking down.  Because when it ultimately breaks down, it will be extremely ugly.



I understand and agree they at some point become driven by their own innate momentum, fear, indecision and euphoria. 


commodities have imho take on a life of their own and are being fully propelled  and are driven by the momentum gained by nations taking advantage of  Bernbanks money manipulation, the latest announcement will just fuel it further, ex; south America is enjoying a boom in farm commodities exports, gold is no different in that it has been subjected to a rocket booster driven by same ( plus the EU and their issues) ....when will it end? Beats me,  BUT, I have a buyer set for the whole load and my new chicken shit number burned into my mind.


----------



## liebuster (Aug 22, 2011)

Toro said:


> Don't assume gold going to the moon is necessarily indicative of bad things.  It is to some extent, but these things take a life of their own.  When things go parabolic, they usually do so on perceptions that do not correspond to fundamentals - think tech stocks and housing prices.  My job as a trader and investor is to be able to differentiate between what is real and what is hype.  There is little doubt in my mind that the end game for gold and silver will be all hype.  Whether that is now, however, is open to question.  Though I believe gold has gotten ahead of itself, I'm guessing there are more gains ahead after the inevitable correction.
> 
> FTR, I am heavily long silver, and got so last week and the week prior.  But I will be gone in an instant if I think the trade is breaking down.  Because when it ultimately breaks down, it will be extremely ugly.



Couldn't you say that gold is going up because people realize the fundamentals in everything else is screwed up and manipulated? 

I realize that mine and your definition of "fundamentals" are probably different. I guess what I'm saying is people are realizing that all these weekly reports of job numbers and housing numbers, consumer prices, etc, etc. are manipulated and that reality doesn't match the fundamentals therefor a flight to the worlds oldest currency is inevitable. 

As long as there is a demand for the yellow metal, right?


----------



## editec (Aug 23, 2011)

I think people are getting set up for a fleecing.

Remember when Gold hit $800+ in the late 70s?

Then what happened?

Do any of us see USD hyperinflation in our _near future?_

I sure as hell don't.

Remember also, how real estate would _always be a safe investment?_

The herd is restless and fearful.

The herd IS being spooked and spooked by cabals who make it their business to stampede the herd.

Of course the market can stay wrong longer than we can remain solvent.

Gold is up about 66% in the last year.

Platinum's price, on the other hand, hasn't gone up all that much.

A year ago it was about 1600. Today it is about 1900. That's about a 20+% increase

One would think that platinum would retain its normal higher price (compared to gold) if the "fundamental" were driving the metals markets.


----------



## Toro (Aug 23, 2011)

liebuster said:


> Couldn't you say that gold is going up because people realize the fundamentals in everything else is screwed up and manipulated?
> 
> I realize that mine and your definition of "fundamentals" are probably different. I guess what I'm saying is people are realizing that all these weekly reports of job numbers and housing numbers, consumer prices, etc, etc. are manipulated and that reality doesn't match the fundamentals therefor a flight to the worlds oldest currency is inevitable.
> 
> As long as there is a demand for the yellow metal, right?



I think you are correct.  

I have invested in gold and silver for 10 years now.  When I first started, the end game to my thesis was an eventual loss of confidence in all fiat currencies.  Now, I didn't see the extent of the housing bubble and the financial crisis a decade ago, but the logical end to all this, given the economy and the responses, is probably some sort of currency crisis.  I could be dead wrong, of course.  However, if so, we probably have some ways to go.

The other possibility is that we are in the currency crisis right now, given the problems in Europe.  At the end of boom, there is usually some sort of parabolic move.  We may be seeing that parabolic move right now.  If so, you must be prepared for it, because the aftermath of the end of the vertical boom is very ugly.  Lots of people will be hurt by it, because they won't be able to recognize the end.


----------



## Bern80 (Aug 23, 2011)

I've been watching the escalating price of gold and kind of shopping around. I was just curious, is it typical that it is always going to be priced well above the market rate? I was looking at the new e-bay section for example. They have a 2.5 gram gold bar for $193. That would be $77.20 per gram. I believe the market price for gold is by the troy oz. and there are 31.10 grams per troy oz. The current market price is $1870 per troy ounce I believe or $60 a gram. Did I mess something up there or is that just the way the gold market is?


----------



## Toro (Aug 23, 2011)

Looks like Zander is making money. After hitting $1913 this morning, gold has reversed and sold off, and is down $70 at 2.30pm. A 50% retracement of the recent move takes gold down to $1700. 

Silver is also getting hit, falling 6% after climbing over $44 last night, which is the top end of an upward sloping channel. The bottom end of that channel is $39-$40, meaning half the correction is likely over. 

Gold and silver have been driven by fear in August. I expect that will change as fear dissipates and the market once again focuses on inflation and currency debasement.


----------



## Valerie (Aug 23, 2011)

> *SPDR Gold ETF Becomes the Largest ETF in the World *
> 
> 
> With gold prices nearing $1,900 and more assets flowing in, the SPDR Gold ETF has become the largest ETF in the world, surpassing the heavily-traded S&P 500 SPDR.
> ...




News Headlines


----------



## Valerie (Aug 23, 2011)

editec said:


> I think people are getting set up for a fleecing.
> 
> Remember when Gold hit $800+ in the late 70s?
> 
> ...





Yes, there is a very unsettling divergence there, so be careful folks!


----------



## Zander (Aug 23, 2011)

Zander said:


> Time to short gold. Put a stop at 1950.  Double your position on short once it drops below 1750



Gold is headed lower for now, possibly much lower. It's a bubble and it popping as we speak.


----------



## Trajan (Aug 23, 2011)

Zander said:


> Zander said:
> 
> 
> > Time to short gold. Put a stop at 1950.  Double your position on short once it drops below 1750
> ...



I disagree.


----------



## Toro (Aug 23, 2011)

The $300 rise in gold in 6 weeks has the whiff of a bubble but bubbles and bull markets generally do not end when monetary conditions are enormously loose as they are today. They usually end when conditions are tight. Also, there are anecdotes of the public's involvement, such as the GLD becoming the largest ETF, but for the most part, neither the public nor the professionals are there in a big way. 

Maybe it's different this time, I don't know, but history suggests otherwise.

That doesn't mean we can't get a good correction though.


----------



## elvis (Aug 23, 2011)

Trajan said:


> Zander said:
> 
> 
> > Zander said:
> ...



With people expecting another recession, how could gold go lower?


----------



## Zander (Aug 23, 2011)

I think we'll see a nice correction, followed by an up swing, followed by a massive bust.  I don't know the exact time frame, but I am riding the down wave for now.....So far it has been a very good trade.


----------



## Zander (Aug 23, 2011)

elvis said:


> Trajan said:
> 
> 
> > Zander said:
> ...


1) Strengthening dollar (the EU, British pound, and Japanese Yen are all a mess) 
2) Central banks may decide to sell gold - they can collapse the price in about 10 seconds by selling hundreds of tonnes with the click of a mouse. (yes tonnes!! not ounces)
3) Miners are producing more gold today than any time in history. 
4) all bull markets eventually run out of steam


----------



## Toro (Aug 23, 2011)

This is fun!



Zander said:


> 1) Strengthening dollar (the EU, British pound, and Japanese Yen are all a mess)



Gold is going up in all currencies.  Holding gold is a vote against fiat currencies, not just one currency.



> 2) Central banks may decide to sell gold - they can collapse the price in about 10 seconds by selling hundreds of tonnes with the click of a mouse. (yes tonnes!! not ounces)



Central bankers are net buyers of gold at $1500.  They were big sellers at $300.  That's your best argument about the efficacy of central banks as market timers.  In the meantime, the buying continues.



> 3) Miners are producing more gold today than any time in history.



This is recent.  For most of the past decade, mine production was falling, not rising.



> 4) all bull markets eventually run out of steam



Completely true.  They all do eventually.


----------



## Paulie (Aug 23, 2011)

Zander said:


> elvis said:
> 
> 
> > Trajan said:
> ...



What if Bernanke goes QE3?


----------



## Zander (Aug 23, 2011)

Paulie said:


> Zander said:
> 
> 
> > elvis said:
> ...



I think it's already baked in the cake....


----------



## Trajan (Aug 23, 2011)

Zander said:


> Paulie said:
> 
> 
> > Zander said:
> ...



no, I am not quite so sure of that,  if you mean the price reflects this already.


----------



## Trajan (Aug 23, 2011)

Paulie said:


> Zander said:
> 
> 
> > elvis said:
> ...



he will, but hes going to wait, I expected it by October..now I am not so sure,  Perry was right, its political now, purely.


----------



## Zander (Aug 23, 2011)

Toro said:


> This is fun!
> 
> 
> 
> ...



From what I understand, the Central banks that are buying are India, China, Russia and other emerging markets. Developed nations Central bankers are net sellers of gold.   

Keep in mind gold is rarely consumed--almost all of the gold ever mined remains in use as jewelry or as bars in bank vaults. That's a lot-o-gold!!


----------



## Trajan (Aug 23, 2011)

Zander said:


> elvis said:
> 
> 
> > Trajan said:
> ...



if you have a tip, or some policy here to fore unknown the $ is going to strengthen, and I don't mean a 10 cent bump, please share. 

I am not sure of this but,  if the central banks ( euro US) are already squeezed for capitalization wouldn't that inflate the currency there by diluting their net holdings  once  sold after a short period?


----------



## Paulie (Aug 23, 2011)

Zander said:


> Paulie said:
> 
> 
> > Zander said:
> ...



If that's true, I'd love to be short gold in the event that he announces he ISN'T going with QE3.

Otherwise, I still think gold has some upside with a minimum downside.  You have to consider the fact that there's no historical precedent to go on about the Fed effectively exiting their asset holdings timely enough to avoid what would be pretty bad price inflation.  We've never seen a balance sheet like this one in HISTORY.


----------



## Toro (Aug 23, 2011)

Zander said:


> From what I understand, the Central banks that are buying are India, China, Russia and other emerging markets. Developed nations Central bankers are net sellers of gold.
> 
> Keep in mind gold is rarely consumed--almost all of the gold ever mined remains in use as jewelry or as bars in bank vaults. That's a lot-o-gold!!



The gold market is actually pretty small.  It doesn't take much to move gold.  We could bang down gold $50 in a heartbeat if we wanted to.

And silver is much, much, much thinner.

FTR, I don't think QE3 is baked into the cake.  If the Bernank announced QE3, I think gold would be at $2000 almost instantly.


----------



## Toro (Aug 23, 2011)

Japan is downgraded by Moody's.

Moody&#039;s Downgrades Japan From Aa2 To Aa3 | ZeroHedge

I do think gold is acting as if it wants to correct, however.


----------



## Toro (Aug 23, 2011)

Shanghai hiked margin requirements on gold.

Precious Metal Margin Warfare Jumps The Pacific, As Shanghai Hikes Gold Margins For Second Time In A Month, Prepares To Crush Silver | ZeroHedge


----------



## KissMy (Aug 23, 2011)

Toro said:


> Shanghai hiked margin requirements on gold.
> 
> Precious Metal Margin Warfare Jumps The Pacific, As Shanghai Hikes Gold Margins For Second Time In A Month, Prepares To Crush Silver | ZeroHedge



They have played that margin requirement card to many times. It now has little effect. Libya had the largest negative effect on gold for the last couple of days.

Central banks are now buying even more gold. This is not the top by a long shot. Some day at least a year from now the central banks may have acquired enough gold to do a coordinated dump along with an interest rate hike to crash gold & scare people back into their paper currency.


----------



## Toro (Aug 24, 2011)

Silver has broken $40. Gold is down $150 from the intraday top yesterday. 

Support for silver is $39.  If you are into Fibonaccis, gold's 50% retracement is at $1730. So we are getting close as sellers panic.


----------



## Toro (Aug 24, 2011)

The CME jacked up margin requirements on gold after the close. Gold fell $8 on the news. 

You've really got to wonder about the CME. They contribute to volatility like this.


----------



## Zander (Aug 24, 2011)

I must admit that I am feeling quite smug today...


----------



## Toro (Aug 24, 2011)

Zander said:


> I must admit that I am feeling quite smug today...



That's when you should take profits.

I was feeling pretty good two days ago.  Mr. Market doesn't like it when we feel good.


----------



## Valerie (Aug 24, 2011)

I heard some technical guys saying how Gold went parabolic at 1600 and they think it is going to retrace at least back to that level...Soon.  Then I wonder about the fib number once it gets to that point.


----------



## Zander (Aug 24, 2011)

Toro said:


> Zander said:
> 
> 
> > I must admit that I am feeling quite smug today...
> ...



I agree! I am lowered the stops along the way.


----------



## KissMy (Aug 24, 2011)

Valerie said:


> I heard some technical guys saying how Gold went parabolic at 1600 and they think it is going to retrace at least back to that level...Soon.  Then I wonder about the fib number once it gets to that point.



It will likely get close to 1600 because that is the 100 day moving average. It has bounced off of that moving average many times over the past 2 years. It just seems extreme dollar wise this time because it went up to far to fast. Gold is up $400 in a month, so if it only comes back $300 it is no big deal. Just your average correction.


----------



## Toro (Aug 24, 2011)

Valerie said:


> I heard some technical guys saying how Gold went parabolic at 1600 and they think it is going to retrace at least back to that level...Soon.  Then I wonder about the fib number once it gets to that point.



I was looking at that today.  The 50% retracement is at $1733.  The 62% is at $1675 (I believe).


----------



## Toro (Aug 25, 2011)

Gold brushed $1700 early this morning.  It has now fallen 11% in three days.

I think we are not far from the bottom in gold.  Bernanke's speech tomorrow is a wildcard, however.

Silver went to $38.60, which is a bit below the lower band of its upward sloping channel.  It has since bounced.  We'll see if it holds.  The next level of support for silver is $35-$36, which represents the bottom of a powerful, multi-year trend.


----------



## editec (Aug 25, 2011)

Trajan said:


> Zander said:
> 
> 
> > Zander said:
> ...


 
And the above exchange, cowgirls and cowboys, is why MARKETS exist.


----------



## Zander (Aug 25, 2011)

Personally, I  feel that Bernanke's speech on Friday will have little or no effect on market psychology or direction. He's not going to announce another QE program or other large program. He's going to speak in vague generalities. The FED has few options. 

I like what former Vice Chairman of Governors of the Federal Reserve System, Alan Blinder, said: 
"The Fed has run out of the strong tools, and is turning to weak ones. When you&#8217;re fighting in a foxhole and you&#8217;ve used up the machine guns and hand grenades, then you pull out the sword and start throwing rocks."

Maybe Helicopter Ben can throw a few rocks?  Either way, I don't expect anything earth shattering come Friday.


----------



## KissMy (Aug 25, 2011)

Zander gets one right in 13 years, but how does his investments stack up against Ron Paul's over that same period?

[ame="http://www.youtube.com/watch?v=mjwOT8pmydE"]Peter Shiff on Ron Paul's Investments.[/ame]


----------



## Toro (Aug 25, 2011)

I did some analytics on the gold bull market and the sell-off this week.

Since the bull market began in 2001, there have been four occasions when gold has moved 18% to 23% above the 150-day moving average line which were then followed by severe corrections.  The periods of the significant moves higher were 

Oct 05-May 06 
Sept 07-Mar 08 
Aug 09-Dec 09 
July 11-Aug 11.  

On three of the four occasions, gold bounced off the 150 DMA, consolidated, then broke to new highs.  (The other time, it bounced off the 150 DMA then moved higher without consolidating.)  The returns from the break-out to the blow-off top were as follows.

05/06  49%
07/08  48% 
2009  25%
2011  21%

Interestingly, the return was lower for this latest ramp but the time was compressed compared to the other three occasions.

Inevitably, the market corrected.  On all three prior occasions, the market pulled back to the 150 DMA.  The corrections preceding a significant bounce were as follows

May-June/06 (1 month)  26%
March 2007 (1 week)  12% 
December 2009  12%

Thus far, gold has corrected 11%.  A 12% correction from the top would put gold at $1670-$1680.

In each case, after the sharp declines, there was a bounce.  Returns during the bounces were as follows

June-July 06  25%
March 08  5%
January 10  8%

In 2008 and 2010, the market ultimately went lower after the initial bounce.  In 2006, after the bounce, the price approached the low but did not break it.  The declines after the initial bounces were as follows

July-October 2006  17%
March-May 2008  11%
January-February 2010  11%

On the Fibonacci levels, the retracements from the highs were as follows

05/06  Sold off hard then bounced right at the 76% retracement level.
07/08  Initially bounced at the 38% level then went through the 50% level but did not hit the 62% level.
2009  Sold off hard then bounced at the 62%.  Eventually approached but did not hit the 76% level.

Where are we today?

This morning, gold bounced right at the 62% level at $1704.  The 76% level is at $1662.  

The only time when gold broke through the 76% retracement level was during the Financial Crisis, when it briefly retraced all the gains from the 07/08 ramp in October then, it rose nearly 50% and approached new highs a few months later.

Using the Fibonacci levels, we can retrace the bounces from the low to the previous highs.  These are the returns from peak to trough, and the retracement levels from the intermediate term low to the previous high.

2006  26% decline, just below a 76% retracement (about 70%)
2008  18% decline, 76% retracement
2010  15% decline, 123% retracement

Thus, if we are mapping out a trading strategy going forward, it would look something like this.

The 62% retracement level is $1704, which was hit this morning.   A 76% retracement level is at $1660.  $1660 is a 13% decline from the top, which approximates the 12% decline of the last two peaks.  So a fairly good low is $1660-$1680.  We can approximate a near-term bottom of $1660-$1700.

A bounce of 5%-8% would not be unexpected.  A 5% bounce of the lows this morning  the 62% retracement level  puts us at $1790.  An 8% bounce of $1660 also puts us at $1790.  This morning, after hitting $1704, gold rallied 4% to $1770.  That may be enough to put in a near-term top before it heads lower.  We will see.

An 11% decline from $1790 then puts us at $1595, which would represent a 16.5% decline from the $1913 top on August 23.  This is smack-dab in the middle of the 15% and 18% declines of the past two occasions.  We would then expect the price to rise to at least the $1820-$1840 level as losses are retraced.  Then we will see from there.

So if the past is prologue, this is what we would expect to see.  

	A bounce to $1790
	A decline to $1595
	A bounce back to $1820-$1840
	A pullback and consolidation, then an assault on the old highs.

Price targets are approximate.  I blew out of my silver trading position this afternoon as gold approached $1770.  A 4% bounce from the lows is good enough for me.  I closed out my trading position earning 0.002% over the past two weeks, certainly not worth eating the tremendous volatility where within six trading sessions, silver rose 9%, fell 12.5%, then bounced 4%.  I retain a small core position in silver.

*Of course, this framework is merely a guide.  One should not trade by this.  *The market can and will do anything.  Markets will do anything they want.  The past doesnt repeat itself precisely.  If it did, this job would be easy, not extraordinarily difficult as it is sometimes.


----------



## Valerie (Aug 25, 2011)

The technical gurus are saying at least $1500 in the short term.


You always have to watch for the signs of conviction once you get to that point, but in the longer term they are calling for $2500 a few years out...


Toro, what I was wondering yesterday is considering that the technical annalists see gold as having gone "parabolic" after $1600, I wonder if we shouldn't also figure the fib number from THAT point (as a high) that could potentially realize itself on the down side in the short term...?


----------



## LordBrownTrout (Aug 25, 2011)

Toro said:


> I did some analytics on the gold bull market and the sell-off this week.
> 
> Since the bull market began in 2001, there have been four occasions when gold has moved 18% to 23% above the 150-day moving average line which were then followed by severe corrections.  The periods of the significant moves higher were
> 
> ...



Keep up the good work.  I've found some of your evaluations more reliable than many of the editorials/analysis that I've read.


----------



## Trajan (Aug 25, 2011)

Toro said:


> Gold brushed $1700 early this morning.  It has now fallen 11% in three days.
> 
> I think we are not far from the bottom in gold.  Bernanke's speech tomorrow is a wildcard, however.
> 
> Silver went to $38.60, which is a bit below the lower band of its upward sloping channel.  It has since bounced.  We'll see if it holds.  The next level of support for silver is $35-$36, which represents the bottom of a powerful, multi-year trend.



aside from Bernbanks speech the Bureau of Econ Analysis will release their adjustment to the Q2 gdp number....any bets? 

I say...sub 1%

will Bernbank show any garter ala QE3?


----------



## Toro (Aug 26, 2011)

Trajan said:


> Toro said:
> 
> 
> > Gold brushed $1700 early this morning.  It has now fallen 11% in three days.
> ...



Oh, I stopped betting on that type of stuff long time ago.  Too expensive!


----------



## Toro (Aug 26, 2011)

LordBrownTrout said:


> Keep up the good work.  I've found some of your evaluations more reliable than many of the editorials/analysis that I've read.



Thanks.  Much appreciated.  

Of course, I am often wrong.  And I could be here too.  The trick to surviving is to be able to recognize when you are wrong and getting out once you realize it.  If there is just one thing I can emphasize as strongly as possible, it is this - if you are wrong about a trade or an investment, sell it, don't rationalize keeping it for other reasons, even if you are selling at a loss.  You can always buy it back if you realize you were right in the first place.  But if you are right about being wrong and you sell it, you will most likely save yourself a lot of money and stress.

The caveat to what I just wrote - well, one of the many caveats - is that a time will come, I believe, when gold goes parabolic, and stops acting to the rhythms and patterns it has acted in the past.

If you study the Tech bubble of 1999-2000, you find that there were a few scary double-digit declines that occurred over a few days during the final ramp up, only for the market to turn and go straight back up to new highs.  That time may be coming soon.

Gold $3,000? - Portfolio Insights by Brett Arends - MarketWatch

There is a lot in this article in which I agree, particularly the part about ownership.  Despite the noise, not many people own gold, and few institutional portfolio managers own gold.  When I talk to other money managers, most still don't have either gold or gold stocks in their portfolios.


----------



## Toro (Aug 26, 2011)

Gold hit $1795 this morning. 

During the silver top in April, it fell hard over a few days, ripped back higher to the old high, stalled, then rolled over. That's a possibility with gold as well.


----------



## KissMy (Aug 26, 2011)

Toro said:


> Gold hit $1795 this morning.
> 
> During the silver top in April, it fell hard over a few days, ripped back higher to the old high, stalled, then rolled over. That's a possibility with gold as well.



What do you think gold will do if Bernanke does not ease any more & leaves the jobs situation to congress?


----------



## Toro (Aug 26, 2011)

I think the near term bias for gold is lower.


----------



## Toro (Aug 28, 2011)

I am a bull on gold.  However, the gold bull market will end like all bull markets - badly.  I'm just not sure when.

Gold bottomed in 1998.  Thus, we are 13 years into the gold bull market, and probably in the final third.  I think that there will be an ultimate blow off top in gold, and it might happen within the next few years.  

Most people do not own gold, I believe.  However, the sentiment on gold is certainly changing.  In a recent poll, when asked, more people believe that gold is the best long-term investment than anything else.  As a gold bull, that scares me, and I take it seriously.  I do think we have some more to run, but we now have to start planning for the ultimate end to the gold bull market.







The Scariest Gold Data Point I Have Seen | Kid Dynamite's World

"Stocks" was the top pick at the end of the Tech bubble. "Real estate" was the top pick at the end of the housing bubble.  "Gold" will be the top pick at the end of the gold bubble.


----------



## Toro (Aug 29, 2011)

Gold hit $1840 on Friday after bottoming at $1704 on Thursday.  That is an 8% return, right on target with the 5%-8% bounce after the initial sell-offs of the past two ramps in the price of gold.  Today it reversed downward fairly hard.

If the pattern continues to hold, we would expect an 11% to 17% decline from $1840, or downside price targets of $1640 for an 11% decline and $1530 for a 17% decline.


----------



## Zander (Aug 29, 2011)

I am staying short...for now.


----------



## Trajan (Aug 29, 2011)

I am wearing my shorts....for now..;O)


----------



## Zander (Aug 29, 2011)

Trajan said:


> I am wearing my shorts....for now..;O)



You're just pissed because I nailed it so well!! 

Not to rub it in, but I also told you to buy the long bond in February. If you would have, you would have made at least 20% in 6 months on an essentially risk-less trade (that's before the dividends too ) ...


----------



## KissMy (Aug 29, 2011)

I went short to hedge my physical gold. Major head & shoulders pattern has formed so I feel gold is at least going through the 50 day moving average & near the 200 day moving average.

The Fed is not going to accelerate the printing press for now, they will maintain the low for longtime interest rate cruising speed for now. Gold will also have to back off the accelerator & return to it's 100-200 day average cruising speed.


----------



## Toro (Aug 30, 2011)

I think a garden-variety correction is ahead for gold.

Having said that, it may happen faster than in the past, or it may not happen at all.  Absolutely nothing has changed over the past week to think that the gold bull market is over, except maybe the realization that we aren't going into a recession.  But a recession isn't an underpinning of the gold bull market.  Nothing has changed in Europe.  Two Greek banks merging solves nothing.  We were just dramatically overbought in gold and there was too much fear in the world.  I don't like the fear trade for gold because it is too ephemeral.  I like the debasing-currencies-indefinitely trade, because the structural foundations are much more solid.


----------



## KissMy (Aug 30, 2011)

From Toro's link: The Scariest Gold Data Point I Have Seen


> The survey did not ask the question &#8220;do you currently own gold or have gold-related exposure as a part of your investment portfolio?&#8221;  That would have been more straightforward, and an even better indicator.  The survey did, however, ask if respondents had money invested in the stock market (59% said &#8220;yes&#8221 &#8211; and the bullishness on gold was consistent amongst those who were stock owners (34% answered that they were most bullish on gold as a long term investment amongst both the entire national survey, and those who were stock owners).



34% 0f 59% = 20% likely own gold. That was about 5% at the beginning of the year. This is a 4 fold increase but is it enough to bust a bubble yet? After-all 68.4% of families owned homes in the housing bubble. There may likely be one more even stronger parabolic blast higher in gold ahead if the Fed hints at QE3.


----------



## Toro (Aug 30, 2011)

Gold popped this morning on the Chicago Fed Pres talking on CNBC this morning. The high this morning sits below yesterday's high. This could be a near term shorting opportunity. However, gold is in a powerful bull market and all shorts are near term trades. 

Silver remains in an uptrending channel.


----------



## KissMy (Aug 30, 2011)

Another Fed decenter Minneapolis Kocherlakota is now turning dovish. Not just Chicago Charles Evans.

We are now to 2 descending fed votes. QE3 is more likely.

Greece is in negotiated default to Euro banks.

Euro banks may require bailout / recapitalization.

Greece bonds are not marked to market but are marked to fictional model.

More currency must be printed.


----------



## Trajan (Aug 30, 2011)

KissMy said:


> Another Fed decenter now turning dovish. Not just the Chicago Fed. QE3 is more likely.
> 
> Greece is in negotiated default to Euro banks.
> 
> ...



yea I said as much 2 weeks ago on the Euro thread. read the Jackson Hole speeches, especially Lagarde's....

I said so 3 weeks ago and stand but this too, there will be another TARP here in the US.
And one in Europe, they won't call it that but they will 'enact ' one...( they have been half stepping it so far ).


----------



## Trajan (Aug 30, 2011)

Zander said:


> Trajan said:
> 
> 
> > I am wearing my shorts....for now..;O)
> ...



I like you man , yada yada- know you a long time, yada yada- but let me share this with you amigo, 3 things my grandfather god rest his soul told me and have stood the test of time;  that half a point in gambling has killed more guys than ww2, never ever underestimate another persons greed and, there is no such thing as risk free....

you know I am not a day trader, I am ion this for the long haul....I am glad for you and whomever makes a buck....I got in at 998 and will sit like a hen on the golden egg, pun intended, when it hits 2k, peace out, I get up and walk away from the table.


----------



## Toro (Sep 1, 2011)

I put a small short on gold today.  It essentially hedges my small long silver position.


----------



## Zander (Sep 1, 2011)

Trajan said:


> Zander said:
> 
> 
> > Trajan said:
> ...


No worries my man. You do what you feel you need to do. It's your money.  But I do have a few questions...

Why $2000? Is that a magic number ?? What if it drops to $1500? Will you sell then?  What if it drops to $998? What will you do?  I don't care what you do, but personally, before I make any investment I establish a game plan, and then I stick with it.  A lot of money has been lost due to emotional driven decisions made in the heat of the moment.  

Bulls and Bears make money; Pigs get slaughtered. 

Don't be a pig!


----------



## editec (Sep 1, 2011)

What is the underlying reason gold is climbing?

Isn't it a loss in confidence?

Now imagine what happens when/if confidence returns.

What happens to the gold market when the _Glen Beck retail gold purchasing_ stops?

Of course, this scenario is premised on the possiblity that _something happens that will restore the confidence_ (on Main Street) in our government and its currency.

So if you're thinking that_ that_ isn't likely anytime in the near future, I can't argue with that theory, either.

I know I do not have to remind any of you folks who are actual traders what happened to the price of gold after the big run up in the late 70s.

It could happen again, could it not?

Assuming that the economy begins to recover and the man in the street stops worrying about hyperinflation, of course.


----------



## Trajan (Sep 1, 2011)

Zander said:


> Trajan said:
> 
> 
> > Zander said:
> ...



oh hell no, I have my chicken shit number and have said so, 1500. 

Risk aversion and NOT being a pig says, 2K and out. A guy like me? who just dabbles in blue chips and has 'house' ( corp worker stock) and doesn't day trade etc? ...making a 100% return? dude, thats heaven, thats a killing minus a machine gun, I don't care and you'll never hear me cry if it hits say 2500....if folks  have the balls to go that far, power to them. I got in on a lark, looking for a 20% pop....look at me now

Like the man says you gotta know when to hold'em and know when to fold'em and execute come what may.


----------



## Toro (Sep 1, 2011)

Gold has gone up because there has been a loss of confidence in fiat currencies, occasional bursts of fear, a lack of supply coming onto the market, growing wealth in the developing nations and momentum. 

The loss of confidence in fiat currencies is the primary reason IMHO.  When confidence returns, gold will get crushed. But governments around the world continue to pursue policies which undermine confidence in fiat currencies. Thus, the bull market in gold continues.


----------



## Toro (Sep 1, 2011)

Zander said:


> Trajan said:
> 
> 
> > Zander said:
> ...



I've made a lot of money being a pig!  

But I wouldn't recommend others do the same.


----------



## KissMy (Sep 1, 2011)

Toro said:


> Zander said:
> 
> 
> > Trajan said:
> ...



Pigs make the most money when the animal spirits cause the majority to stampede driving prices parabolic. Don't bail out until the majority of the heard are in a full on stampede. Right now only about 20% are running for the gold.


----------



## Toro (Sep 1, 2011)

KissMy said:


> Toro said:
> 
> 
> > Zander said:
> ...



I'll take really big positions and bail at the first site of any danger whatsoever.  If I'm wrong selling, I'll buy it back at higher prices.

But to do this successfully, you have to pay very close attention and be willing to live with the volatility, which most people can't do.  Sometimes I can't do it.


----------



## KissMy (Sep 1, 2011)

Toro said:


> KissMy said:
> 
> 
> > Toro said:
> ...



I can see a case for larger swings in gold going foreword. With the exchanges adjusting the reserve requirements & the central bankers buying more gold they will have more leverage to coordinate & swing the market to shake the average citizen out. They will make it hard for us to pick the market turns.


----------



## Toro (Sep 2, 2011)

Oops!  So much for that gold short!  The yellow metal is at $1880 on the bad jobs number. 

I still think gold looks very extended here. I like silver better, which is trading in an uptrending channel.


----------



## Ernie S. (Sep 2, 2011)

Considering the dow is headed to tank this morning, short term gold looks good.
Do you see $1,900 today?


----------



## Trajan (Sep 2, 2011)

I was looking thru my coins and custom jewelery yesterday, I have an 1811 Napoleonic 20 franc piece set in 24 ct.  gold mounting with matching chain as a necklace....acquired it , had it made for 500 bucks 15 years ago.......my signet ring is an ancient Trajan Silver Denarius,  Extra Fine, in a 24 ct. gold ring setting.....15 years ago? 260 for the coin, another 400 for the ring and mounting..... I could unload these both for 4k right now...unreal.


----------



## editec (Sep 2, 2011)

Toro said:


> Gold has gone up because there has been a loss of confidence in fiat currencies, occasional bursts of fear, a lack of supply coming onto the market, growing wealth in the developing nations and momentum.
> 
> The loss of confidence in fiat currencies is the primary reason IMHO. When confidence returns, gold will get crushed. *But governments around the world continue to pursue policies which undermine confidence in fiat currencies. Thus, the bull market in gold continues*.


 
Yeah that's exactly the problem in investing now,  is it not?

Pricing isnt based on market fundamentals, but rather the market is now driven by what the government do or do not do.

In other words, when the Insiders elect, they can control markets by RUMORS or what they may or may not do.

They can set up the buying public like bowling pins by touting one rumor, and when they elect, they can crush a bull or bear market by doing or implying they will do something else!

FROTH MARKETS, folks.

Unless you have an INSIDERS perspective, unless you have POLITICAL INSIDER information, you are powerless to make any kind of rational decision about future pricing.

I do NOT believe that these markets are on the level.


----------



## Toro (Sep 2, 2011)

Ernie S. said:


> Considering the dow is headed to tank this morning, short term gold looks good.
> Do you see $1,900 today?



Unlikely. 

A contrarian with cahones would short it here. I'm not that guy!

I would like to see gold consolidate for awhile, then make an assault on new highs.


----------



## Trajan (Sep 2, 2011)

Toro said:


> Ernie S. said:
> 
> 
> > Considering the dow is headed to tank this morning, short term gold looks good.
> ...



no worries Toro, I've made a few calls, we'll stumble around within a $75 range till Obamas speech..then, zoom.


----------



## Toro (Sep 5, 2011)

Elections in Germany were bad for Merkel this weekend.  The bailouts were an issue.  Stocks are Europe are getting hammered and gold is pushing $1900.  Silver is off.   Italian bonds are down for the 11th day in a row.

For me, it is around here were gold must stop going up.  If gold busts through the highs, I will cover my small short position and look to go long.


----------



## Ernie S. (Sep 5, 2011)

Toro said:


> Ernie S. said:
> 
> 
> > Considering the dow is headed to tank this morning, short term gold looks good.
> ...



OK couple days late, but I just saw $1,900. The market is down 250. (Friday)
I'll admit I'm no expert, but a year ago, I predicted $1,800 in mid August and 2 grand by Christmas.
My thought is that gold will level off around 2,200 by next June and fall, corresponding to a stock market recovery as it becomes clearer that there will be a change in leadership.


----------



## Trajan (Sep 5, 2011)

Toro said:


> Elections in Germany were bad for Merkel this weekend.  The bailouts were an issue.  Stocks are Europe are getting hammered and gold is pushing $1900.  Silver is off.   Italian bonds are down for the 11th day in a row.
> 
> For me, it is around here were gold must stop going up.  If gold busts through the highs, I will cover my small short position and look to go long.



yes they did, she dropped 5.5% in her home state. The SPD looks posied to  drop the CDU Merkel and build their own colation. 

The rubes have woken up in full. the bailout appetite in Germany can only sink lower. *shrugs*


----------



## Toro (Sep 5, 2011)

Trajan said:


> Toro said:
> 
> 
> > Elections in Germany were bad for Merkel this weekend.  The bailouts were an issue.  Stocks are Europe are getting hammered and gold is pushing $1900.  Silver is off.   Italian bonds are down for the 11th day in a row.
> ...



Probably.

If so, it means lower stocks and probably higher gold prices.

European stocks are at support.  Gold is at resistance.  Something has got to give.

Also, the index of coincident and leading indicators I have referenced in the past and has been remarkably prescient is now saying the economy is back in mild expansion after being negative for a few months.


----------



## Paulie (Sep 5, 2011)

editec said:


> Toro said:
> 
> 
> > Gold has gone up because there has been a loss of confidence in fiat currencies, occasional bursts of fear, a lack of supply coming onto the market, growing wealth in the developing nations and momentum.
> ...



It's still based on market fundamentals, it's just that governments are doing as much as possible to affect those fundamentals.


----------



## Toro (Sep 5, 2011)

CNBC World just flashed Greek 1 year bonds were yielding 82%.

That's ridiculous.


----------



## Toro (Sep 6, 2011)

Gold hit an all-time high overnight at $1921. It then promptly plunged $60. 

A pullback would be healthy.


----------



## Toro (Sep 6, 2011)

I increased my short in gold this morning.  It is a trade and it is small.


----------



## Toro (Sep 7, 2011)

Gold is at $1800. I covered the majority of my short position but still keep a position on. I will be watching the $1730 area.


----------



## Toro (Sep 9, 2011)

I covered my small gold short for a small profit.


----------



## Toro (Sep 12, 2011)

I have a small short position in silver.


----------



## KissMy (Sep 15, 2011)

Are the coordinated Central Bankers really going to ease further or is this a head fake. Gold keeps trying to correct back to the moving average & the Central Bankers keep jawboning but not advancing their easing. I have been to busy lately to watch the market news.


----------



## KissMy (Sep 16, 2011)

Donald Trump Accepts Gold Instead of Dollars From Tenant



> For the first time ever, Trump will accept today gold bullion instead of dollars for a lease deposit from his newest tenant in one of his marquee properties, 40 Wall Street, a 70-story skyscraper in Manhattan's Financial District... Trump will accept the gold at an event in the lobby of the Trump Tower at 725 Fifth Avenue. Usually, Trump gets a certified check for a security deposit when leasing space in one of his office towers.


----------



## domonkoz (Sep 17, 2011)

I have a mineral rights claim of a few hundred acres in Breckenridge CO, right near the blue river. Ive taken a few grams out, nothing major, just running material through a sluice box.  But you try swinging a pick axe at 10,000 feet, into very rocky dirt.  Out of 4 of us I was the only one who didnt have to go home from altitude sickness.  Fine gold though, our friend has pulled 3 ounces out running a highbanker in another area up there.  Took him 14 trips total over the year, but still proves its there for the taking, its all in how you set up.


----------



## Valerie (Sep 22, 2011)

I pity the fool who bets against the US Dollar!  

Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar - Forbes


----------



## Trajan (Sep 22, 2011)

Toro said:


> Gold is at $1800. I covered the majority of my short position but still keep a position on. I will be watching the $1730 area.



good call. I am making calls right now lining up my sales. just in case,  at 1550, I head out the door to my dealers.


----------



## percysunshine (Sep 22, 2011)

domonkoz said:


> I have a mineral rights claim of a few hundred acres in Breckenridge CO, right near the blue river. Ive taken a few grams out, nothing major, just running material through a sluice box.  But you try swinging a pick axe at 10,000 feet, into very rocky dirt.  Out of 4 of us I was the only one who didnt have to go home from altitude sickness.  Fine gold though, our friend has pulled 3 ounces out running a highbanker in another area up there.  Took him 14 trips total over the year, but still proves its there for the taking, its all in how you set up.



Most of the gold mines near Breckenridge make more money off of showing tourists what a gold mine looks like than they make from the gold in the mines.


----------



## Toro (Sep 22, 2011)

I covered my silver short.

Yesterday.

Just before the Fed meeting.






It's just been that type of year...


----------



## Toro (Sep 26, 2011)

Overnight, gold fell to $1530 and silver touched $26.  This is what a liquidation feels like.


----------



## Trajan (Oct 5, 2011)

Toro said:


> Overnight, gold fell to $1530 and silver touched $26.  This is what a liquidation feels like.



not yet.


----------



## Valerie (Oct 12, 2011)

Valerie said:


> I pity the fool who bets against the US Dollar!
> 
> Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar - Forbes





^^^  




> Top Stories
> 
> *Gold to Hit $1300* -- and 3 Other Commodity Shockers
> 
> ...




*Gold Oct 11
(COMEX: GCV11.CMX )
Last Trade:	1,684.10*


----------



## Zander (Oct 12, 2011)

Trajan said:


> Toro said:
> 
> 
> > Overnight, gold fell to $1530 and silver touched $26.  This is what a liquidation feels like.
> ...



You still clinging to your dream of $2000.00 gold ??


----------



## KissMy (Oct 12, 2011)

Zander said:


> Trajan said:
> 
> 
> > Toro said:
> ...



Just as predicted gold corrected above its 200 day average before continuing its bull run to new highs. Unless the USG makes REAL budget cuts in excess of $4 Trillion, gold will soar parabolic.


----------



## Toro (Oct 12, 2011)

KissMy said:


> Zander said:
> 
> 
> > Trajan said:
> ...



Gold went through, then came back to and bounced off the 150 DMA line.  

I still don't trust it here.  I want to see more backing and filling first.


----------



## Zander (Oct 12, 2011)

KissMy said:


> Zander said:
> 
> 
> > Trajan said:
> ...



No, it won't. It's done, cooked, over. I checked my crystal ball and everything!


----------



## KissMy (Oct 13, 2011)

Zander said:


> KissMy said:
> 
> 
> > Zander said:
> ...



99.1% debt to GDP ratio & climbing, $115.9 Trillion in un-funded liabilities & climbing, of course, there is nothing to see here.


----------



## Toro (Oct 19, 2011)

I'm beginning to look at gold again. It's fallen right back into the channel in which it has been trending for the past nine months. Also, since the bull market started in 2001, there have been 16 times when the RSI for gold has fallen below 35. And 16 times,  gold was up six months later by on average 14%. Using this strategy, a buy signal was given on Sept 23 when gold hit $1649. If the pattern were to continue, gold would expected to be $1877 by March. 

Two bullish and two bearish points. First, for the bulls, talks of a bailout fund in Europe is very bullish for gold in the intermediate term since it would devalue another fiat currency, though it might trade down in the near term as fears of a banking implosion are off the table. Also, we are in the strongest time of the year for gold, which is typically Sept through March. 

For the bears, if the talks of a bailout fund collapses, gold would be at risk as it could lead to a flight to the dollar and liquidity being withdrawn from the system. Also, the 16% decline over three sessions in Sept must be respected. That is a huge move that may be foreshadowing the end of the bull market. 

I wrote earlier that if form holds, gold should retrace to the 150 day moving average, which was the $1590 level. After slicing through to $1532, we did that, and now appear to be bouncing along it. 

I have generally played gold through the options markets and leveraged ETFs over the past few years, but given the risks mentioned above, I would be more inclined to buy plain vanilla ETFs such as the GLD, PHYS or SGOL, though I might change my mind.


----------



## Ropey (Oct 19, 2011)

I just made some major movement into gold myself.


----------



## Trajan (Oct 19, 2011)

We have taken the auspices.....The Trajanic Imperial Aureus Board says, buy and stand fast in the ranks!


----------



## Ropey (Oct 19, 2011)

Trajan said:


> We have taken the auspices.....The Trajanic Imperial Aureus Board says, buy and stand fast in the ranks!



When it was ~1,300 I bought fairly large, and then when it made it past 1800 I sold. Back to buying...



Zander said:


> Trajan said:
> 
> 
> > Toro said:
> ...



It's not a dream.   It's a very good possibility imo...


----------



## Toro (Oct 19, 2011)

FYI the 150 day moving average for gold is currently $1605.


----------



## Ropey (Oct 19, 2011)

Toro said:


> FYI the 150 day moving average for gold is currently $1605.



Are you going to spend your 1K (1024KB) rep power on some of it Toro?


----------



## Toro (Oct 19, 2011)

I'm willing to give all my rep away as long as I get to say who it goes to.


----------



## Ropey (Oct 19, 2011)

Toro said:


> I'm willing to give all my rep away as long as I get to say who it goes to.



Give away?   I was just making a joke on 1024 = 1K (large)  = Buy gold... 

It's just a play on words Toro. I'm like that.  I play with words.


----------



## Mr. H. (Oct 19, 2011)

Gotta reply to get that evil number out of the "reply" column.

Carry on...


----------



## KissMy (Oct 20, 2011)

Toro said:


> FYI the 150 day moving average for gold is currently $1605.



There you go. 3:30AM Gold bounced hard off of $1609. Time to buy for the $1700+ breakout.


----------



## editec (Oct 20, 2011)

So what happens to the price of Au when Greece fails?

Does the end to the uncertainty make the gold market freak out, or become more sanguine?


----------



## KissMy (Oct 20, 2011)

editec said:


> So what happens to the price of Au when Greece fails?
> 
> Does the end to the uncertainty make the gold market freak out, or become more sanguine?



If Greece fails that wipes out debt, so initially there is deflation & Gold goes down. But just like the failure of Lehman would have took down every bank unless the governments bailed them out, the failure of Greece will take down Portugal, Ireland, Italy, Spain & most of the Big Banks thus every bank.

There will have to be a massive bailout = Gold goes up.


----------



## Toro (Oct 20, 2011)

KissMy said:


> Toro said:
> 
> 
> > FYI the 150 day moving average for gold is currently $1605.
> ...



I'd like to see it consolidate first, backing and filling for a few weeks, bouncing off the 150 DMA. I'd feel more comfortable buying the $1700 breakout than buying right now because the chart still may be treacherous.


----------



## KissMy (Oct 20, 2011)

Qaddafi's death will hurt gold's price for a few days.


----------



## Toro (Oct 21, 2011)

The Fed is talking about more QE.



> Federal Reserve officials are starting to build a case for a new program of buying mortgage-backed securities to boost the ailing economy, though they appear unlikely to move swiftly.
> 
> The idea would be to target any new efforts by the central bank at the parts of the economy that are most severely impeding a recoverythe housing and mortgage marketsby working to push down mortgage rates.
> 
> Lower mortgage rates, in turn, could encourage more home buying and mortgage-refinancing, and help the economy by freeing up cash for consumers to spend on other goods and services. Mortgage rates are already very low, but some Fed officials believe they might be pushed lower. Moreover, Fed officials believe their past purchase programs helped to lift stock markets, by driving investors from low-risk investments toward riskier investments.



Housing Market May Get Fed Aid - WSJ.com


----------



## Toro (Nov 27, 2011)

Time to revive this thread.

I own some gold but not in the volume I've owned in the past.  Gold seems to holding support here, but if it falls below $1670, it will break support and I'm gone.


----------



## FireFly (Nov 28, 2011)

1929 = 2008

1933 = 2012

Here comes the second run on the banks & subsequent bailout.


----------



## KissMy (Nov 28, 2011)

Fed secretly handed out $8 trillion

 Move along - Nothing to see here. 

 In Recent News - Bank of America has developed a plan to issue nearly $3 billion in common stock to raise capital and reduce debt, changing course after saying for months that it did not intend to sell new shares.


----------



## Toro (Nov 28, 2011)

KissMy said:


> Fed secretly handed out $8 trillion
> 
> Move along - Nothing to see here.
> 
> In Recent News - Bank of America has developed a plan to issue nearly $3 billion in common stock to raise capital and reduce debt, changing course after saying for months that it did not intend to sell new shares.



That Fed news is pretty something.

The BofA share issuance could be the catalyst to buy the shares.

In the meantime, I'm getting more confident that gold is holding and will make a move to $1800-$1900.  As usual, I could be dead wrong.


----------



## Valerie (Nov 28, 2011)

Toro said:


> KissMy said:
> 
> 
> > Fed secretly handed out $8 trillion
> ...






Couldn't we all...


----------



## Trajan (Nov 28, 2011)

I am seriously thinking of liquidating some of my ancient numismatics. I bought a lot during the Clinton dip, $280-325 range....in a coupla of years I'll buy them back


----------



## Toro (Nov 30, 2011)

News of the interest rate cut on dollar swap lines has stocks and gold soaring this morning. I had been buying gold heavily the past week and got very lucky this morning. I have only bought a little silver. It has been trading in a narrow range lately. However, given gold is beginning to move and liquidity is increasing, I imagine silver will climb. So I plan to start buying silver in size.


----------



## Toro (Dec 7, 2011)

> Gold is likely to be higher in early January than it is today, according to a contrarian analysis of current gold-market sentiment.
> 
> To appreciate the confidence with which contrarians can make such a forecast, consider the conclusion of contrarian analysis in early July, the last time I devoted a column for Barrons.com on the subject. (See Hulbert on Markets, "Gold Can Head Even Higher," July 13.)
> 
> ...



Market Timers' Bearishness Points to Higher Gold - Barrons.com

I own a lot of gold and silver.  But I might change my mind and sell it all tomorrow.


----------



## Trajan (Dec 7, 2011)

Toro said:


> > Gold is likely to be higher in early January than it is today, according to a contrarian analysis of current gold-market sentiment.
> >
> > To appreciate the confidence with which contrarians can make such a forecast, consider the conclusion of contrarian analysis in early July, the last time I devoted a column for Barrons.com on the subject. (See Hulbert on Markets, "Gold Can Head Even Higher," July 13.)
> >
> ...





stand fast in the ranks.


----------



## Toro (Dec 8, 2011)

Bad day in the PM and risk markets today as ECB President Draghi said the bank wouldn't be expanding it's bond purchase program.

I unwound my silver position at a small loss - this year has been a succession of unwindings at small losses for me - because the technical position near term cannot be construed as bullish.  The technical position in gold is still positive but precariously so. Thus I have retained my position. Like silver, gold had a bearish outside reversal day and closed on the lows, but it is sitting on support and can still be construed as being in a near term uptrend. However, a break below $1700 and I will liquidate my position.


----------



## Toro (Dec 9, 2011)

I liquidated all my gold holdings today for a sliver of a profit. I think we are not far from bottoming but I want to see more consolidation first. 

Gold has bounced off the 150 day moving average five times since 09. The 150 dma is $1665. Watch that price.


----------



## KissMy (Dec 9, 2011)

Printing presses are running full time to keep the EU a-float until they get a working united governmental budget structure in place. This will likely take them 2 years. There will be an awful lot of printing going on until then.


----------



## Jos (Dec 12, 2011)

Gold dropped $50?
Live Gold, Silver, Platinum, Palladium Quote Spot Price Chart - Kitco


----------



## Zander (Dec 12, 2011)

$1665 last I checked...


----------



## KissMy (Dec 12, 2011)

Zander said:


> $1665 last I checked...



Glad I shorted GLD to cover my physical gold in my safe late on Friday after the failed Euro meeting. The money the worlds central banks printed will not cover the coming economic slow down. Less debt velocity, fewer loans & slowing velocity of money means strong currency. Gold will continue down until countries start stimulating. Oil & Grains will get hit the hardest. After a couple of months they will finally dump enough currency into the banks to cover all the bad debt. Then money velocity will turn & gold will rise again.


----------



## Toro (Dec 14, 2011)

I shorted silver yesterday after the Fed meeting and covered this morning.  Precious metals have been routed, and the technical trend that began in 2009 has been broken.  That doesn't mean gold and silver can't continue to rise or that the bull market is over.  However, both have some work to do to reestablish the upward trend.

In the meantime, gold bounced off the bottom boundary of a large triangle today and held.  If it holds, upside is as high as $1700.  I will watch to see if gold holds over the next few days.  If it does, I intend to play it as a short-term trade.


----------



## Toro (Dec 14, 2011)

Zander said:


> $1665 last I checked...



Props to Zander for shorting gold near its all-time high.

Well done sir!


----------



## KissMy (Jan 4, 2012)

'True Revolution' Ahead for US Fiscal Future: Alan Greenspan


> The United States faces a "true revolution" in the choices it will have to make to secure its fiscal future now that the welfare state has run up against a "brick wall of economic reality," former Federal Reserve Chairman Alan Greenspan said Wednesday.



January 2010 - Employee Compensation in State and Local Governments


> A recent study by Robert Novy-Marx and Joshua Rauh found that governments are &#8220;severely underestimating&#8221; their pension liabilities by the use of high discount rates.10 Using more realistic assumptions, the authors found that state and local pensions were underfunded by $3.2 trillion, or three times more than the officially reported amount.



Funding gap doubles for US corporate pensions


> From a moderate surplus at the end of 2007, pension plan assets at S&P 500 companies now cover only about 74 per cent of estimated liabilities, calculates Credit Suisse, a deficit of roughly $450bn. At the start of the year the S&P 500 pension funding gap was estimated at $250bn, according to Credit Suisse.



I love how the media always hypes that corporations are sitting on piles of cash. 

The Fed's $16.6 Trillion Bailouts Under-reported

Actual U.S. Debt Exceeds GDP Of Entire Planet


----------



## KissMy (Jan 13, 2012)

Zero Hedge: Foreigners Sell Record $85 Billion In Treasurys In 6 Consecutive Weeks - Time To Get Concerned?



> ...contrary to what one hears in the media, foreigners are offloading US paper hand over first...the traditional diagonal rise in foreign holdings of US paper has not only pleateaued, but it is in fact declining: a first in the history of the post-globalization world." Well as of today's H.4.1 update, the outflow has increased by yet another $8 billion to a new all time record of $85 billion, in 6 consecutive weeks, which is also tied for the longest consecutive period of outflows from the Fed's Custody account ever. This week's sale brings the total notional of Treasurys in the Custody account to just $2.66 trillion (down from a record $2.75 trillion) and the same as April of last year. And since the sellers are countries who have traditionally constantly recycled their trade surplus into US paper, this is quite a distrubing development. So while the elephant in the room could have been ignored 4, 3 and 2 weeks ago, it is getting increasingly more difficult to do so at this point, especially with US bond auctions mysteriously pricing at record low yields month after month. But at least the mass dump in Treasurys explains the $100 swing higher in gold in the past month.


----------



## Toro (Jan 14, 2012)

10 year T bonds hit a low of 1.87% yesterday.


----------



## editec (Jan 14, 2012)

Speaking as a working class stiff, I find it highly amusing watching the MERELY AFFLUENT trying to protect their nesteggs from the manipulations of their MASTERS.

Buy gold! buy bonds! beat inflation! Keep playing the losing game that we're manipulated such that for people like you there will be no SAFE HAVENS.

MERELY Affluent Americans, many of them at least, are in for a very unpleasant wake up call when the shit once again hits the fan.

No matter how the merely affluent structure their portfolios, when enough of them have put their money in one kind of investment, the MASTERS OF FINANCE will find a way of raping that game.

The can crash the market when that's where the money is, they can crash real estate when that's where it is.  They can yank the values of bonds, or commodities at will.

The ONLY protection we really have is an honest goverment.

In orhter words?

We have no protection from the highly skillfully organized criminals that dominate the world of finance.


----------



## Trajan (Jan 20, 2012)

Toro said:


> Zander said:
> 
> 
> > $1665 last I checked...
> ...



time to sniff my jock  just cashed a 5 week 25% killing on Adobe.......boooyah baby.


----------



## Zander (Jan 20, 2012)

Toro said:


> Zander said:
> 
> 
> > $1665 last I checked...
> ...



Blind squirrel

Nut ?


:Lol:


----------



## Toro (Jan 20, 2012)

BTW, ECB LTRO = EuroQE

Good for precious metals.  

I'm still waiting though.


----------



## FireFly (Jan 25, 2012)

Fed says no rate hike until 2014! 

Gold is going ballistic!


----------



## Toro (Jan 25, 2012)

I just shake my head at what a damning indictment this is of the utter failure of the economics profession.  Monetary policy has become a complete joke.

Both the Fed and the ECB are engaged in QE, so the capital markets are experiencing a sugar high.

The questions is where does gold peak?  $2000?  $3000?  $4000?  I don't know, but I can't imagine that it has peaked, given how the monetary authorities are doing their best to wreck their currencies and punish savers at the expense of reckless debtors.


----------



## Trajan (Jan 25, 2012)

when will it wear off? when the sugar runs out? or we crash?


----------



## Toro (Jan 26, 2012)

Trajan said:


> when will it wear off? when the sugar runs out? or we crash?



I'm exaggerating somewhat.  The economy appears to be getting better, so some of this rally is based on improving fundamentals.


----------



## editec (Jan 26, 2012)

The only money they're inventing* is the money going to the BANKSTERS* to help them shore up their outstanding-debt-to-cash-position ratios.

Thus far, although the experts cannot seem to agree on the totals -- the amount of *new money invented* is either $16 TRILLION to estimates as high as $26 TRILLION bucks.

When (if) the economy starts to recover THEN I'd expect to see real inflation kick in.

Not before.

But the disasterous effects of the crashing EURO (and sovereign debt crises associated with that) means that enormous amounts of (perceived) cash make it rather difficult to determine whether the money supply (world wide, in this case) will be greater than or less than it was when the world's economies were humming.

There's a gigantic CONFIDENCE hole where the *perceived wealth* used to be, kiddies.

For example, in my case my_ perceived wealth (wealth* in value* that is not really capitalized until I sell a real asset)_ has dropped by about $50,000 in the last three years. *Now to me that's a lot of dough I no longer have access to*.

When you multiply my *confidence eroding* experience times millions of homeowners and investors, then the actual perception of money is _WAAAAAAAAAAAAAAAAAAAAAAAY _down.

And *it is the perception of LOST wealth* that is NOT being counted in most of our Monetary equasions because there is NO WAY to put that into our economic _MODELS._

Frankly, I have no idea how we could count this, but I know perfectly well that *the perception of our wealth plays as larger a role in the economy than the amount of cash actually in circulation.*

PUBLIC CONFIDENCE about _perceieve wealth_ plays a greater role in economic health than any _monetary metric_ that we can easily compute.


----------



## Mad Scientist (Jan 26, 2012)

Toro said:


> I just shake my head at what a damning indictment this is of the utter failure of the economics profession.  Monetary policy has become a complete joke.
> 
> Both the Fed and the ECB are engaged in QE, so the capital markets are experiencing a sugar high.
> 
> The questions is where does gold peak?  $2000?  $3000?  $4000?  I don't know, but I can't imagine that it has peaked, given how the monetary authorities are doing their best to wreck their currencies and punish savers at the expense of reckless debtors.


Wait a minute, hold yer horses there Toro! 

Didn't you admonish me a while back when I said the economy is in the sh*tter, won't recover and that we should be buying gold and silver? Did you not say "Don't underestimate The US Economy"?

Is this a sign that you've thrown in the towel?


----------



## Toro (Jan 26, 2012)

Mad Scientist said:


> Toro said:
> 
> 
> > I just shake my head at what a damning indictment this is of the utter failure of the economics profession.  Monetary policy has become a complete joke.
> ...



I can't remember TBH but it has been a losing bet to underestimate the US economy over the long run. But our monetary authorities are doing their best to wreck fiat currencies.


----------



## TakeAStepBack (Jan 26, 2012)

Rethinking the Gold Bubble
Not current, but an interesting read about Operation Twist, QE2 and gold stability if you're interested.


----------



## Trajan (Jan 26, 2012)

TakeAStepBack said:


> Rethinking the Gold Bubble
> 
> Not current, but an interest read about Operation Twist, QE2 and gold stability if you're interested.



the link doesn't work.


----------



## TakeAStepBack (Jan 26, 2012)

Sorry about that. It works now...


----------



## TakeAStepBack (Jan 30, 2012)

Federal Reserve Ignites Gold Price Rally

01/26/12 - 03:13 PM EST


> NEW YORK (TheStreet ) -- Gold prices climbed higher Thursday, still bathed in the afterglow of the Federal Reserve's commitment to cheap money through late 2014.
> Gold for February delivery added $26.60 to close at $1,726.70 an ounce at the Comex division of the New York Mercantile Exchange. The gold price has traded as high as $1,731.50 and as low as $1,703 an ounce while the spot price was adding $13, according to Kitco's gold index.





> Gold's rally was three fold. The first leg of the move was rapid short covering. Many traders had been selling positions and/or shorting gold headed into today's options expiration, and the Fed's announcement forced them to quickly buy back positions. That move pulled gold prices to the $1,700 an ounce level, which then triggered buy orders, where traders previously committed to buying gold at that price. A close at $1,700 also then triggered buy orders internationally. The SPDR Gold Shares(GLD_) added 9 tons of gold yesterday. "We will move gently back to the $1,900 level over the next few months," says Norman, "but won't happen rapidly."
> Norman thinks the Fed in essence squashed gold's recent period of price consolidation, but that a huge spike up isn't in the cards. One of the biggest drags on gold will be the situation in Europe and a better economy in the U.S. "I do think one of the big drags is that the U.S. is placed to make a recovery better than others," argues Norman, which might at some point help support the dollar and weigh on the euro especially if questions remain over the solvency of the southern Eurozone nations.
> Gold should be seen as a safe haven asset, the worse off Europe gets the more investors should buy gold as protection, but that hasn't been happening as a stronger dollar has trumped as the safe haven of choice. Norman thinks there are four or five years left in this bull-run and that the gold price could double from current levels at its peak. GFMS, an independent research consultancy, on the other hand, thinks that the bull-run could end in 2013.
> GFMS, in its 2011 Gold Survey report, forecasts a volatile year for gold prices with gold sinking as low as $1,600-$1,550 an ounce, averaging out at $1,760 and perhaps spiking to $2,000 an ounce. But then the party is over.
> "We think the peak would be towards the end of this year or maybe in the first half of next year," says Neil Meader, research director at Thomson Reuters GFMS. The main end to gold's 10 year bull run would come with a renewed faith in currencies as the structural imbalances that have impeded paper money slowly start to fade. So far there have been no revisions made to this forecast since the Fed's announcement.



I'm betting against that prediction. The illusion of a strengthening dollar could have a short term effect, but in the long run the bull will rage on.


----------



## KissMy (Feb 4, 2012)

Toro said:


> Trajan said:
> 
> 
> > when will it wear off? when the sugar runs out? or we crash?
> ...



This current fake Wallstreet rally was driven by FDIC Bank Reserve Releases. These FDIC bank reserve releases are driving bank profits, not revenue or earnings.


----------



## Toro (Feb 4, 2012)

The rally is being driven by better economic data and the LTRO. 

Hiring has been strong.


----------



## KissMy (Feb 8, 2012)

Employment was down. That headline was only seasonally adjusted BS. Gold shot up $40 yesterday off the morning lows after Bernanke spoke.

Ben Bernanke says the job market isn't as strong as the steadily declining unemployment rate might suggest. He noted that the unemployment rate doesn't capture the plight of millions of people who have stopped looking for work or part-timers who can't find full-time jobs.

Bernanke agreed that an unemployment rate of 8.3 percent is understating the jobs problem. "It's very important to look not just at the unemployment rate, which reflects only people who are actively seeking work."..."There are also a lot of people who are either out of the labor force because they don't think they can find work."..."There are also a lot of people who are working part-time, and they'd like to be working full-time but they can't find full-time work."

Another Brokerage Bites the Dust: Is Wall Street In Trouble?


> Over the past couple of weeks, quietly and with little fanfare, three separate small brokerages bit the dust. In January WJB Capital Group and Ticonderoga Securities both announced that lack of trading activity on the stock markets and a lack of capital in-house required them to close their doors and cease operations. Last week, we lost a third broker when Kaufman Bros., a highly regarded, minority-owned firm that played a key role in helping the U.S. government liquidate its stakes in the banks bailed out during Troubled Asset Relief Program, would also turn out the lights.
> 
> Previously, the failures of tiny brokers like Soleil Securities (absorbed by Ticonderoga last summer) and Gleacher & Co. might have been written off as aberrations. Now it looks like they were harbingers of doom -- and the failures of WJB, Ticonderoga, and Kaufman could be just the leading edge of "a wave of closures among brokers that rely on trading volume to generate revenue."
> 
> ...


----------



## Toro (Feb 8, 2012)

Companies are telling us the economy is getting better. Nonfarm payrolls have added 500k jobs over the past two months. ADP jobs are about the same. New unemployment and continuing claims are falling. The household survey is showing growing employment. And I can tell you anecdotally here in Florida, things are picking up. 

Maybe this isn't sustainable, but I believe the bears who have been bearish for a long time will disbelieve data which contradicts their thesis, and that is happening now with all the perma-bears I follow.


----------



## KissMy (Feb 8, 2012)

I would be cautious about believing those employment numbers.



> Allen West: 'Is Someone Playing with Unemployment Numbers?' - New numbers on the economy came out today, revealing some seemingly positive trends, such as a drop in the unemployment rate. One of these numbers is a major drop in black unemployment, from 15.8% to 13.6%, a huge jump. On the surface, it's good news.
> 
> Allen West, however, isn't having it -- he thinks someone may have tampered with the figures.
> 
> ...



Bill Clinton has done this trick to the BLS numbers before. He excluded the inner cities from the survey where high concentrations of unemployed & black people live. I guess Hillary has shared this secret with Barack.



> Clintons Unemployment Numbers Trick - The Clinton administration also reduced monthly household sampling from 60,000 to about 50,000, eliminating significant surveying in the inner cities. Despite claims of corrective statistical adjustments, reported unemployment among people of color declined sharply, and the piggybacked poverty survey showed a remarkable reversal in decades of worsening poverty trends.


----------



## Toro (Feb 8, 2012)

KissMy said:


> I would be cautious about believing those employment numbers.
> 
> 
> 
> ...



Triangulate the data and the info.  These are the sources telling us employment is improving. 

- the household survey
- the establishment survey
- weekly claims
- ADP
- ISM
- companies

Again, this might be a false dawn, I don't know, but also consider these truisms

- perma bulls and bears are always the last to identify turns
- at some point, this will end
- the trajectory of the recovery is remarkably following the typical roadmap of the aftermath of asset bubble collapses as detailed by Reinhardt and Rogoff, which means we are not far from the end

I think we have one more leg down at some point but intellectual flexibility and not being dogmatic has served me well for many years. 

If the economy really is getting better, stocks have a long way to go on the upside and shorts are going to get their faces ripped off.


----------



## KissMy (Feb 8, 2012)

Toro said:


> Triangulate the data and the info.  These are the sources telling us employment is improving.
> 
> - the household survey
> - the establishment survey
> ...



If there is growth it certainly is not organic or sustainable given the rising national debt & unfunded liabilities. We are certainly in a Japanese style bear market. Just because it appears like people are just perma bears, they may just be practical. We have had a 20+ year bull market & only 10 year bear market. Japan is 21+ years now on a bear market.


----------



## Toro (Feb 8, 2012)

KissMy said:


> Toro said:
> 
> 
> > Triangulate the data and the info.  These are the sources telling us employment is improving.
> ...



We've had rising national debt and unfunded liabilities for the better part of the last 50 years and that hasn't stopped growth. Now I do think that if something isn't done about both, we will have real problems _eventually_.  But we can have many years of organic fundamental growth before it becomes a problem. I remember all sorts of apocalyptic predictions about imminent collapse because of debt and deficits _in the 80s_ and it's hard to argue that growth wasn't organic over the next generation. Now maybe we are nearing The Reckoning, I don't know. We will be one day if we don't get this under control. But the reason why we are growing now is because we have been wiping out the excesses in the housing and financial systems, and people are growing more confident. All economic growth is a function of productivity growth over the long-term. Productivity is the foundation for rising wealth. Asset bubbles and too much debt only matter in the short and intermediate term. They only matter if they affect productivity. Otherwise, they are sideshows in the grand scheme of things.


----------



## Wiseacre (Feb 8, 2012)

"  Asset bubbles and too much debt only matter in the short and intermediate term. They only matter if they affect productivity.   "


Not understanding why debt in particular doesn't matter long term if it continues to grow.   Right now interest rates are near zero and so the interest payment on the debt isn't that bad.   But we're raising the debt principle by a trillion bucks or more a year, and eventually those rates have to start going up.   On a macro level that has to negatively affect productivity and it'll get worse as time goes on.


----------



## KissMy (Feb 8, 2012)

You have a better chance of being right being bullish now than bearish. According to the Dow vs Gold chart we are closer to the bottom than the top. But I think we still have more to go on the Dow PE/Ratio & Dow vs Gold Ratio. I think 2013 will be the year of the Bull. Elections will bring optimism, the health-care law will start paying out instead of just taxing & we will be past the mortgage resets, defaults & foreclosure hump.


----------



## Toro (Feb 8, 2012)

Wiseacre said:


> "  Asset bubbles and too much debt only matter in the short and intermediate term. They only matter if they affect productivity.   "
> 
> 
> Not understanding why debt in particular doesn't matter long term if it continues to grow.   Right now interest rates are near zero and so the interest payment on the debt isn't that bad.   But we're raising the debt principle by a trillion bucks or more a year, and eventually those rates have to start going up.   On a macro level that has to negatively affect productivity and it'll get worse as time goes on.



Sure.  Cash flows that get diverted from productive uses - i.e. investment - to unproductive uses - i.e. interest payments - will weigh on productivity over time.  But if you take it to the logical end game, you will get a default and interest will no longer get paid and cash flows will no longer be diverted into interest.  Of course, though, we don't want that, because in the intermediate term, that will be enormously disruptive and bad, and we should have a plan to slash spending so we can avoid it.  But it doesn't change the structural foundation of this country's economy long-term.

I don't think KissMy is correct in saying that there is "artificial growth" *right now* because of the debt.  The truth is that debt relative to GDP isn't particularly high.  What matters is publicly traded debt, which is about 80%-85% of GDP at the moment.  Canada was 100% in the 90s.  Italy and Belgium are at 120%.  And the US is a far more important, vibrant and deeper economy than any of them.  Plus, it possesses the world's reserve currency, so it can print away the debt.

Don't get me wrong.  We have to have a plan to start cutting spending, if not now, then within the next five years.  The Obama administration has failed miserably in this regard.  But as it pertains to the economy *right now*, the deficit and the debt are not creating artificial growth.


----------



## Toro (Feb 8, 2012)

KissMy said:


> You have a better chance of being right being bullish now than bearish. According to the Dow vs Gold chart we are closer to the bottom than the top. But I think we still have more to go on the Dow PE/Ratio & Dow vs Gold Ratio. I think 2013 will be the year of the Bull. Elections will bring optimism, the health-care law will start paying out instead of just taxing & we will be past the mortgage resets, defaults & foreclosure hump.



The mortgage thing is over.  The housing market is near a bottom, if it hasn't bottomed already.  People waiting for this huge next wave down in housing are going to be sorely disappointed.  The math works like this.

Household formation in this country averages about 1.3-1.4 million a year.  Depreciation of the housing stock each year is 100-300k.  So each year, we need 1.5-1.6 million houses to be built.  Housing starts, however, have been about 600k.  In the last few months, we are building new, single family homes at the lowest level in recorded history, which is over 40 years.  Thus, we are eating through normalized inventory at about 1 million homes a year.  I say "normalized" because actual household formation has been 1-1.1 million homes a year for the past few years as people delay getting married or moving out of their parent's house.

Currently, outstanding inventory is about 1.9 million units.  This represents about six months of supply, i.e. it takes on average six months to sell a house.  This is the long-term average.  A few years ago, it was 12 months supply.  Now, we are back to average.  But this is off depressed sales.  What will happen is that demand will snap back faster than people think because we have depressed demand.  Thus, on a normalized basis, we will completely wipe out supply in less than two years, but in fact, it will be faster as household formation will start to accelerate above trend.

The bears' biggest argument is the "shadow inventory," which is the inventory that will come onto the market as banks increase foreclosures.  This is true.  But let's look at that.  There are currently 4.5 million homes with mortgages that are 60 days delinquent.  Historically, 90% of those will default.  Thus, there will be about 4 million defaults and repos.  However, there is always a shadow inventory.  There are roughly 150 million households.  The normal rate of 60 day delinquency is about 0.25%, this represents about 400k households.  So the "excess" shadow inventory is about 3.6 million.  However, what will happen is that as the economy starts to improve, that delinquency number will fall because the disruption has been so huge, and as people start feeling more confident and get new jobs, will start paying their mortgage again.  There are many companies buying mortgages from banks and working out new payment schedules to keep people in their homes.  So there may be perhaps 3 million foreclosures that will eventually hit the market.  Remember, we have a normalized supply deficiency of about 1 million homes.  Even more intriguing is that about a quarter of the foreclosures are in one state, Florida.  So excluding Florida, you may have a shadow inventory of maybe 2-2.25 million homes.  And as demand accelerates, this shadow inventory will get eaten away pretty quickly.  

And even that may be an exaggeration.  I have contacts into the two biggest real estate brokers in the Tampa Bay region, and they are saying that they are at their lowest inventories ever, i.e. they don't have enough homes to sell.  And I have also heard that buyers have started popping up in numbers in the Sarasota region over the past few months.

Thus, the shadow inventory is likely to get cleared away in about two years.  Thus, this problem is likely to have ended by 2013 or 2014.  I wouldn't expect a big rebound however.  Normally, it takes some time for people to adjust their expectations, so maybe home prices don't really start climbing until 2015, a full nine years after home prices peaked, about on track with other global housing booms and busts.  But as a catalyst to create another big leg down in housing, it's simply not there IMHO.


----------



## KissMy (Feb 8, 2012)

Toro said:


> The mortgage thing is over.  The housing market is near a bottom, if it hasn't bottomed already.  People waiting for this huge next wave down in housing are going to be sorely disappointed.  The math works like this.
> 
> Household formation in this country averages about 1.3-1.4 million a year.  Depreciation of the housing stock each year is 100-300k.  So each year, we need 1.5-1.6 million houses to be built.  Housing starts, however, have been about 600k.  In the last few months, we are building new, single family homes at the lowest level in recorded history, which is over 40 years.  Thus, we are eating through normalized inventory at about 1 million homes a year.  I say "normalized" because actual household formation has been 1-1.1 million homes a year for the past few years as people delay getting married or moving out of their parent's house.
> 
> ...



I also have 2 realtor friends in the Tampa, FL area. I have been telling them to start putting in low-ball bids & try to get some houses because the will hit bottom mid 2012. They keep telling me I am crazy & the market is not near bottom. Of course they also told me I was crazy when I told them to sell all their real-estate except for farm land in in 2006. I have bought 4 houses in the midwest since the crash & have 3 rented. I am looking to get a REO for vacation in Tampa & another rental here.

I have a couple of stupid in-laws in the Tampa area who bought expensive lake front lots for a couple of million dollars at the peak in 2007. They mortgaged everything to get them. They lost their ass & their properties. Now they only have their homes they occupy & are extremely upside down on them.


----------



## KissMy (Feb 9, 2012)

*Corporate insiders are now selling their companies&#8217; stock at a rate not seen since late last July.*


----------



## KissMy (Feb 12, 2012)




----------



## KissMy (Feb 15, 2012)

From 2001 to 2006 the U.S. Treasury&#8217;s issued no long bonds. At the end of 2009, 36% of government debt was due within a year. This means up until operation twist most of the government debt was short to medium term being rolled over rapidly. Now that the rates are very low, Bernanke is pushing this debt out to 10 year treasuries. This is the secret sauce in "Operation Twist" in order to make room to allow for a potential short term rate hike to stave off hyper-inflation if necessary. Bernanke thinks he can keep the "Gold Bugs" at bay with this scheme while not bankrupting the treasury with unfordable interest rates. If they push enough low interest debt into long term, a rate hike will hit the main street economy very hard & keep unemployment high. Government dependents, workers & contractors will reap the benefits again. Bernanke believes he can keep the dollar & government in tact with this scheme.


----------



## Valerie (Feb 19, 2012)

> *February 17, 2012
> *
> 
> Billionaire hedge-fund manager John Paulson *wrote a letter to investors saying now is the time to buy gold*, as prices are going to soar this year.
> ...









> Paulson & Co., the hedge fund founded by billionaire John Paulson, *cuts its stake in the SPDR Gold Trust by 15 percent in the fourth quarter* ...
> 
> Paulson, Vinik, Tudor Sell SPDR Gold ETF Shares; Soros Buys - Businessweek


----------



## Paulie (Feb 19, 2012)

Valerie said:


> > *February 17, 2012
> > *
> >
> > Billionaire hedge-fund manager John Paulson *wrote a letter to investors saying now is the time to buy gold*, as prices are going to soar this year.
> ...



That's not the Treasury Sec. Paulson, though.  That was Hank.


----------



## Valerie (Feb 19, 2012)

Paulie said:


> Valerie said:
> 
> 
> > > *February 17, 2012
> ...




Yes, my bad... JOHN Paulson sold 15% of his holdings of gold as he tells his investors it's a good time to buy gold...........


IMO it's time to sell Gold on peak days...Sell into the strength.


----------



## Paulie (Feb 19, 2012)

Toro said:


> KissMy said:
> 
> 
> > You have a better chance of being right being bullish now than bearish. According to the Dow vs Gold chart we are closer to the bottom than the top. But I think we still have more to go on the Dow PE/Ratio & Dow vs Gold Ratio. I think 2013 will be the year of the Bull. Elections will bring optimism, the health-care law will start paying out instead of just taxing & we will be past the mortgage resets, defaults & foreclosure hump.
> ...



Just tell me I still have another year or so to get my money right and buy a house.  I've wasted 10 years of my life and I'm way behind on where a man my age should be, but I have 2 businesses now that are doing well and I'm saving.  I thought I was ready to buy a house in 09 but I missed an opportunity and then put it off, and now I'm ready to get back in the game, but I need another year.


----------



## Toro (Feb 19, 2012)

Paulie said:


> Toro said:
> 
> 
> > KissMy said:
> ...



(Almost) All real estate is local.  

However IMHO even though I think we are bottoming nationally, I don't think there is a spike in home prices coming anytime soon.


----------



## KissMy (Feb 23, 2012)

Wall Street Journal: Why can not we believe the Fed

A review of the Federal Reserve from 1986 to 2006 discovered that they missed with their forecast 100% of the time. Most of the time the Fed missed the forecast by 50% or more. And 50% of the time the Fed missed with their forecast by 100%.

Private companies were far more accurate at forecasting.


----------



## KissMy (Feb 28, 2012)

Forbes - The Federal Reserve's Explicit Goal: Devalue The Dollar 33%

AP: Anti-Fraud Effort Disappoints Medicare Fraud has grown by 30% since Obamacare passed & promised us that they would prevent further Fraud & fund the health-care bill with the savings. Medicare fraud is now over $125 Billion a year & growing. That fraud alone would fund all the wars. The US dollar is headed for a major train wreck.


----------



## Toro (Feb 29, 2012)

Gold and silver getting crushed this morning on the Bernank's testimony. We've had too many of these downdrafts lately to make precious metals safe. 

Interesting that it hit the top end of it's channel before collapsing.


----------



## TakeAStepBack (Feb 29, 2012)

A hands off fed can make that happen. Downshifting to 2% in gold and lost a bit on silver.
the good news is the dollar should see some short term strengthening.


----------



## KissMy (Feb 29, 2012)

Warren Buffett just bought Cookson gold refinery. Also Iran is now accepting Gold for Oil.


----------



## Toro (Feb 29, 2012)

Gold down $100 today.


----------



## TakeAStepBack (Feb 29, 2012)

it'll slow climb back. But there is sure to be a correction since the wizard made his announcement.


----------



## KissMy (Mar 1, 2012)

Europe to Seize Greece&#8217;s Gold


> According to the fine print of a treaty signed on February 21, the European Union now has the power to seize Greece&#8217;s gold reserves. The modifications the EU is forcing into the Greek constitution vest Greece&#8217;s creditors, mainly European banks and the European Central Bank, with the authority to take gold from the Bank of Greece.


----------



## KissMy (Mar 8, 2012)

ECB Balance Sheet Jumps to a Record $3.96 Trillion Amid Lending to Banks 31 Percent Bigger Than The German Economy


> The European Central Banks balance sheet surged to a record 3.02 trillion euros ($3.96 trillion) last week, 31 percent bigger than the German economy, after a second tranche of three-year loans.
> 
> Lending to euro-area banks jumped 310.7 billion euros to 1.13 trillion euros in the week ended March 2, the Frankfurt- based ECB said in a statement today. The balance sheet gained 330.6 billion euros in the week. It is now more than a third bigger than the U.S. Federal Reserves $2.9 trillion and eclipses the 2.3 trillion-euro gross domestic product of Germany (EUANDE), the worlds fourth largest economy.
> 
> ...


----------



## Toro (Mar 9, 2012)

Technicals have been bad.  Fundamentals remain good.


----------



## KissMy (Mar 9, 2012)

Who Cares About Sterilization? The Fed Pretty Much Just Announced QE3


----------



## TakeAStepBack (Mar 23, 2012)

A bear market this week. Down a bunch on FCX, PLG and MVG. Hoping for a bounce back in the coming weeks. If FCX keeps tanking, I'm going to buy more shares as it is sure to rebound.


----------



## sparky (Mar 24, 2012)

my q here is what good is gold if the $$ crashes?

~S~


----------



## KissMy (Mar 24, 2012)

sparky said:


> my q here is what good is gold if the $$ crashes?
> 
> ~S~



OPEC accepts Gold for Oil.


----------



## TakeAStepBack (Mar 24, 2012)

sparky said:


> my q here is what good is gold if the $$ crashes?
> 
> ~S~



Gold is the real money. Which is why CBs keep hoarding it. It's the golden rule. He who owns the gold makes the rules.

"$$$" in this instance is just paper.


----------



## sparky (Mar 25, 2012)

well correct me if i'm wrong, but one can't actually _own_  gold 

one is given a _paper _certificate

so, wuz da dif?

~S~


----------



## KissMy (Mar 25, 2012)

sparky said:


> well correct me if i'm wrong, but one can't actually _own_  gold
> 
> one is given a _paper _certificate
> 
> ...



Thats funny! I have lots of gold coins in my possession. I only use paper to short gold if I believe it is going down.


----------



## sparky (Mar 25, 2012)

Executive Order 6102 - Wikipedia, the free encyclopedia



> Executive Order 6102 required U.S. citizens to deliver on or before May 1, 1933, all but a small amount of gold coin, gold bullion, and gold certificates owned by them to the Federal Reserve, in exchange for $20.67 (equivalent to $371.10 today[3]) per troy ounce. Under the Trading With the Enemy Act of October 6, 1917, as amended on March 9, 1933, violation of the order was punishable by fine up to $10,000 ($167,700 if adjusted for inflation as of 2010) or up to ten years in prison, or both. Most citizens who owned large amounts of gold had it transferred to countries such as Switzerland.[citation needed]
> 
> Order 6102 specifically exempted "customary use in industry, profession or art"a provision that covered artists, jewellers, dentists, and sign makers among others. The order further permitted any person to own up to $100 in gold coins (a face value equivalent to 5 troy ounces (160 g) of Gold valued at about $7800 as of 2011). The same paragraph also exempted "gold coins having recognized special value to collectors of rare and unusual coins." This protected gold coin collections from legal seizure and likely melting.



~S~


----------



## Toro (Mar 25, 2012)

sparky said:


> Executive Order 6102 - Wikipedia, the free encyclopedia
> 
> 
> 
> ...



That's been repealed.


----------



## Polk (Mar 25, 2012)

Gold, like paper money, is only worth what people are willing to trade for it.


----------



## TakeAStepBack (Mar 25, 2012)

The difference is understanding correctly what worth, or intrinsic value, is. People don't print gold. But, certificates of gold are good in the event demand for payment can be met. Dollars are good as long as confidence is. Gold lasts forever.


----------



## Toro (Mar 25, 2012)

TakeAStepBack said:


> The difference is understanding correctly what worth, or intrinsic value, is. People don't print gold. But, certificates of gold are good in the event demand for payment can be met. Dollars are good as long as confidence is. Gold lasts forever.



Gold can still go back down to $500 an ounce even if it does last forever.


----------



## TakeAStepBack (Mar 25, 2012)

I don't see that ever happening.


----------



## Toro (Mar 25, 2012)

TakeAStepBack said:


> I don't see that ever happening.



I don't know.

But a decade ago, when I first started buying gold, I didn't know anyone who thought it would be pushing $2000, me included.


----------



## Polk (Mar 25, 2012)

TakeAStepBack said:


> The difference is understanding correctly what worth, or intrinsic value, is. People don't print gold. But, certificates of gold are good in the event demand for payment can be met. Dollars are good as long as confidence is. Gold lasts forever.



Gold doesn't have any intrinsic value outside of industrial applications. Any value beyond that is build on the same confidence fiat currency is.


----------



## sparky (Mar 25, 2012)

Polk said:


> Gold, like paper money, is only worth what people are willing to trade for it.



let's go with that Polk

if we're all hungry, and i have a chicken, how much is gold going to be worth?

~S~


----------



## TakeAStepBack (Mar 26, 2012)

Incomplete question for a viable answer.


----------



## TakeAStepBack (Mar 26, 2012)

Toro said:


> TakeAStepBack said:
> 
> 
> > I don't see that ever happening.
> ...



I know. But it will take a major paper money correct in the form of deflation to get the price down to $500 again. Which I dont see happening. Gold is an excellent investment in that regard. It will continue to climb (save for some short term slides created by the CB wizards) unless something major changes in competing world paper money for that to happen. As you know, the price is so high due to inflation and debasement of the dollar.


----------



## sparky (Mar 26, 2012)

I still question the validity of an investment based on a monetary system (the dollar) many of you expect to fail 

what good will any gold certificates be then?

~S~


----------



## uscitizen (Mar 26, 2012)

Gold certificates?

Have only physical in hand gold.


----------



## sparky (Mar 26, 2012)

Ok USC

let's say the dollar tanks

you've got _gold_

i've got _chicken_

can you think of the scenario that might occur?

~S~


----------



## Jos (Mar 26, 2012)

Lots of people have chickens, not many have gold


----------



## uscitizen (Mar 26, 2012)

sparky said:


> Ok USC
> 
> let's say the dollar tanks
> 
> ...



I have cattle, my neighbor has chickens, no problem.
We all have gardens around here and can stuff.

Gold will always be in demand and one can buy chickens with it, lots of chickens.


----------



## TakeAStepBack (Mar 26, 2012)

sparky said:


> Ok USC
> 
> let's say the dollar tanks
> 
> ...



Gold is only a medium of exchange (other than it's industrial/cosmetic/aesthetic uses). In the event that the dollar collapses, gold will not immediately become a mode of exchange (in most instances) as survival commodities will be worth more than an exchange mode in food riots, chaos, etc...

However, for the purposes of long term investment as the paper currencies of the world race to the bottom, economic law over thousands of years of human interaction dictates that gold and silver are real money if there are robust markets for exchange. it is what replaced barter and it happened naturally. Humans create economic markets, not bureaucrats who think they can quantify human action with natural sciences.


----------



## Paulie (Mar 26, 2012)

Toro said:


> TakeAStepBack said:
> 
> 
> > I don't see that ever happening.
> ...


In hindsight, it shouldn't be hard to realize why.

There's definitely been a hell of a lot more inflationary pressure on gold than deflationary, since then.

Runaway debt with no austerity in sight, currencies being devalued for the purpose of trade advantages, perpetual unfunded wars and entitlements...why should gold go down?


----------



## Jos (Mar 26, 2012)

TakeAStepBack said:


> sparky said:
> 
> 
> > Ok USC
> ...



British Gold Sovereign coins are given to the US air force pilots in their survival gear, if they crash in a hostile territory. British Gold Sovereign coins being preferred by the most powerful nation in the world shows the world wide acceptance that these coins have acquired. During World War II, Allied pilots carried British Gold Sovereign in their survival kits as well. Even in Operation Desert Storm the American pilots and the British SAS troops carried British Gold Sovereigns in their survival kits as emergency money, in case of getting shot down over Iraq.


----------



## TakeAStepBack (Mar 27, 2012)

Gold and silver seem to be on the mend in the market. The silver stocks I own were upp 4% yesterday. Gold up a few points after taking a nose dive.


----------



## Toro (Mar 27, 2012)

Paulie said:


> Toro said:
> 
> 
> > TakeAStepBack said:
> ...



Hindsight is always 20/20. 

I got a ton of pushback a decade ago on buying gold. Now, the pushback is always on the sell side. 

Gold may go to $5000 first but it will one day be below $500. Remember, gold is a commodity.


----------



## TakeAStepBack (Mar 27, 2012)

Toro said:


> Paulie said:
> 
> 
> > Toro said:
> ...



It's a commodity as of the end of the classical gold standard. Before that, it was a medium of exchange for thousands of years. There is no way gold will ever hit 5,000 FRNs and turn around and be be 500 FRNs unless a massive monetary policy shift happens. I don't see that shift ever occurring. 

Maybe it will, my FRNs are not on that bet.


----------



## Toro (Mar 27, 2012)

TakeAStepBack said:


> Toro said:
> 
> 
> > Paulie said:
> ...



I have no idea what will happen, but the history of all commodities - gold included - is that they have a huge boom that eventually collapses.  The reason for that is simple - eventually, the price leads to a huge supply response.  There has been a decade of declining production, but we are starting to see gold production supply grow again.  The marginal cost of lifting gold out of the ground is ~$900, nearly half the market price.   Over time, the marginal price of commodities equals the marginal cost.  That's why they are called "commodities."  They are completely interchangible and fungible.  Plus, virtually all new demand has come from investors.  Gold is completely at the whim of sentiment.  One day, sentiment will change, and the end game will be very ugly.

We are at all-time highs in nominal and inflation-adjusted price.  Historically, buying commodities at all-time highs and holding for the long-term has been a disaster.  I don't know why this time will be any different.  Gold is a commodity.  It is not a religion nor a political statement.  There is a time and a place for everything.  Now is the time for gold.  But at some time, it will not be.  Those who view gold as anything other than a commodity to be a traded will eventually get destroyed.


----------



## TakeAStepBack (Mar 27, 2012)

That would be true of commodities that do not hold the historical intrinsic value that gold and silver do. CBs hoard gold for a very good reason. It is hard money and always has been. Paper fiat money in history, has never lasted the tests of time. They always end in ruin because the process is in part NOT in the equation (extraction, supply). This leads to inflation and round we go.

Will the world of banks today find a way to restore confidence or seamlessly change one currency in for another? 

Time will tell. As for gold, as stated, a correction in the current monetary policy that is drastic, or the above would need to occur to bring the price away from the current ranges experienced with the dollar.
Gold will continue to be a good long term investment as long as it's up against the current financial and currency climates.


----------



## TakeAStepBack (Mar 27, 2012)

Here is a history of the gold commodity in perspective.

http://www.nma.org/pdf/gold/his_gold_prices.pdf

Notice no inflation from 1850 to 1920.

From 1870 to 1907 before the panic, the world experienced some of the best prosperity and growth we ever saw. Gold was the standard and international trade was based on the hard back of gold voluntarily. Something changed......


----------



## Toro (Mar 27, 2012)

TakeAStepBack said:


> That would be true of commodities that do not hold the historical intrinsic value that gold and silver do. CBs hoard gold for a very good reason. It is hard money and always has been. Paper fiat money in history, has never lasted the tests of time. They always end in ruin because the process is in part NOT in the equation (extraction, supply). This leads to inflation and round we go.
> 
> Will the world of banks today find a way to restore confidence or seamlessly change one currency in for another?
> 
> ...



Though I'm neither short nor long gold at the moment, I agree that gold _probably_ goes up a whole lot before it goes down a whole lot.  The fundamentals for gold are still good.  But here is a long term graph of the price of gold.







The history of gold prices is one of volatility.  And despite the volatility, the price of gold in 2000 was the same as it was in 1805.

One day, gold will _probably_ crash back down again.  Maybe it won't, I don't know, but I doubt it won't.  I'd rather buy land that has fallen 80%-90% and is dirt cheap as an inflation hedge rather than gold, which has already risen 650% and is extremely expensive based on historical prices.  If I had to lock my money away for 10 years, I'd buy US land and US stocks rather than gold.  In fact, I'd be willing to short gold if I knew it wouldn't get called away.


----------



## DSGE (Mar 27, 2012)

Haha. I love goldbugs. 








OH MY GOD THERE'S A HOUSING BUBBLE. WE'RE ALL GONNA BE RUINED THEN THE CURRENCY WILL COLLAPSE!








Gold, however will stay strong because of its historical intrinsic value.


----------



## KissMy (Mar 27, 2012)

Crude oil is going to be the new "Gold Rush" by 2040 due to population & its exploding energy consumption. There are 23,200 man hours of work energy in a barrel of oil. If you had to pay $1 per man hour of energy that stuff would cost you $23,200 per barrel or $552 a gallon.

The good thing about gold is it is the only currency other than US Dollars that can buy Crude Oil from foreign countries. Gas, Oil & Fuel have a short shelf life, is difficult to manage & store & cost a lot to store. Physical gold is free & easy to store, has a forever shelf life & has no capital gains or inventory tax.

As for the short term I think gold is going down some unless Bernanke starts QE3 soon, then it will make a new high. Looking at the debt clock over the past month, many of the largest government spending programs are decreasing. I am sure it is only a temporary spending slowdown & may only last couple years at best before the Boomer's suck the money out of the system. But it does seem to be putting pressure on gold.


----------



## TakeAStepBack (Mar 27, 2012)

DSGE said:


> Haha. I love goldbugs.
> 
> 
> 
> ...



Time will tell if gold is in a bubble. My economic understanding says that the dollar is through QE, debt/deficit, and gold reactionary.  A beer is on me if I'm wrong, but I don't believe I am.

We'll know in a few years or less....


----------



## Paulie (Mar 27, 2012)

TakeAStepBack said:


> DSGE said:
> 
> 
> > Haha. I love goldbugs.
> ...



The bottom line is, does the Fed exit from their enormous portfolio before that monetary base starts to multiply?

That will dictate what gold does, whether it's $5,000 or $500.


----------



## DSGE (Mar 27, 2012)

Paulie said:


> TakeAStepBack said:
> 
> 
> > DSGE said:
> ...



I don't think that is the bottom line, since gold isn't an especially good inflation hedge.


----------



## Toro (Mar 27, 2012)

Paulie said:


> The bottom line is, does the Fed exit from their enormous portfolio before that monetary base starts to multiply?
> 
> That will dictate what gold does, whether it's $5,000 or $500.



The plan is to inflate away the debt.  Not all at once, but financial repression for some time like after WWII.  That's when gold goes up to $5000.  Then, they jack up interest rates and gold collapses to below $500.


----------



## Toro (Mar 27, 2012)

TakeAStepBack said:


> Time will tell if gold is in a bubble. My economic understanding says that the dollar is through QE, debt/deficit, and gold reactionary.  A beer is on me if I'm wrong, but I don't believe I am.
> 
> We'll know in a few years or less....



I don't know if gold is a bubble or not, but I suspect it is entering bubble territory.  But bubbles generally don't end until monetary policy is tight.  The gold bubble of the late 70s ended when long-term bond yields backed up from 8% to 11%.  The juiciest part of the tech bubble occurred when the Fed was raising interest rates from 3.5% to 6.5% after LTCM.  The housing bubble only stopped after the Fed had risen the funds rate from 1% to 5.25%.  Right now, interest rates are 0%.  CPI has been above zero for almost the entire time the Fund's rate has been at the zero bound.  If history is any guide, there is still some time to go in the gold bull market.

But, as always, I may be wrong.  And the precious metals market is either topping or consolidating.  It's best to wait and confirm the uptrend IMHO, because if it is the top, people will lose a lot of money from here.


----------



## KissMy (Mar 27, 2012)

We are not through this financial crisis by a long shot. Ally Bank is the re-branded GMAC General Motors credit division. They are going to need a bail-out soon or go bankrupt. Bankruptcy will kill GM & Chrysler's auto loans. 74% of Ally Bank stock is owned by the U.S. Treasury Department. QE3 may not be that far off.


----------



## Douger (Mar 27, 2012)

Toro said:


> Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> 
> I bought back much of my gold and silver exposure yesterday and added a bit today.  There is a bid underneath gold, and though silver is extended, there is support at ~$25-$26.  A few weeks of consolidation for silver would do it a world of good.


How many acres of land do you own with good soil and water ?


----------



## percysunshine (Mar 27, 2012)

Douger said:


> Toro said:
> 
> 
> > Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> ...



All land with good soil and water have been declaired 'wetlands', and thus public property, by executive order.

Some folks are a bit slow on the uptake.


----------



## Toro (Mar 27, 2012)

Douger said:


> Toro said:
> 
> 
> > Considering that precious metals are one of the few assets in a bull market and a semi-frequent topic of discussion on this board, I figured gold and silver deserved their own thread.
> ...



I own one acre of property of this God's green earth, divided between a large lot in the city and a lot a 30 second stroll from some of the most beautiful beaches on earth.


----------



## sparky (Mar 28, 2012)

Jos said:


> British Gold Sovereign coins are given to the US air force pilots in their survival gear, if they crash in a hostile territory. British Gold Sovereign coins being preferred by the most powerful nation in the world shows the world wide acceptance that these coins have acquired. During World War II, Allied pilots carried British Gold Sovereign in their survival kits as well. Even in Operation Desert Storm the American pilots and the British SAS troops carried British Gold Sovereigns in their survival kits as emergency money, in case of getting shot down over Iraq.



while that's interesting hx Jos, it bears the onus of a _stable_ market

i would think most would have something to say about the market of late being somewhat unstable, lotta bubbles that go _'pop'_ , with the owners of what they thought a sure thing following suit

now i suppose that's all a matter of finding an economic chair when the bubble music stops, but my point of valuation is, it's in the eyes of the _beholder_ when this happens

how is gold any more _'earthly'_ or _'intrisic'_ than one's real estate in said respect?

~S~


----------



## Paulie (Mar 28, 2012)

DSGE said:


> Paulie said:
> 
> 
> > TakeAStepBack said:
> ...



When I want lip from Paul Krugman I'll scrape it off your nuts.

Thanks


----------



## Paulie (Mar 28, 2012)

Toro said:


> Paulie said:
> 
> 
> > The bottom line is, does the Fed exit from their enormous portfolio before that monetary base starts to multiply?
> ...



Can you imagine how much money they have to extinguish to get rates back up and have enough deflationary pressure to bring gold down that far?

I'm admittedly not an expert in the micro sense, but I'm picturing the Volcker era being the good old days compared to this.


----------



## DSGE (Mar 28, 2012)

Paulie said:


> DSGE said:
> 
> 
> > Paulie said:
> ...



Powerful argument, that there.


----------



## Paulie (Mar 29, 2012)

DSGE said:


> Paulie said:
> 
> 
> > DSGE said:
> ...



How about this...since common belief is that gold IS a good inflation hedge, why don't you prove your case.


----------



## Toro (Mar 29, 2012)

Paulie said:


> DSGE said:
> 
> 
> > Paulie said:
> ...



Actually, he is correct.  There has been little correlation between the consumer price index and the price of gold.


----------



## KissMy (Mar 29, 2012)

Toro said:


> Actually, he is correct.  There has been little correlation between the consumer price index and the price of gold.



There has also been little correlation between the consumer price index and reality.


----------



## percysunshine (Mar 29, 2012)

KissMy said:


> Toro said:
> 
> 
> > Actually, he is correct.  There has been little correlation between the consumer price index and the price of gold.
> ...



When food and energy, the things people need,  are excluded from the measurement...well....


----------



## KissMy (Mar 29, 2012)

percysunshine said:


> KissMy said:
> 
> 
> > Toro said:
> ...



They leave out way more than that. They exclude housing, water, sewer, trash, gas electric, utilities, property taxes, food, sales taxes, new taxes, etc.


----------



## DSGE (Mar 29, 2012)

percysunshine said:


> KissMy said:
> 
> 
> > Toro said:
> ...



That's an idiotic lie. They're not excluded at all.


----------



## DSGE (Mar 29, 2012)

KissMy said:


> percysunshine said:
> 
> 
> > KissMy said:
> ...








Here's what's included in the CPI and the relative weights: http://www.bls.gov/cpi/cpiri2011.pdf




> property taxes,  sales taxes, new taxes, etc.



It's not a standard of living index. It's a Consumer Price Index. It measures the price of consumer goods and services. If those taxes impact the price of consumer goods, then they're absolutely included implicitly. I think the index you're looking for is called "disposable income".


----------



## DSGE (Mar 29, 2012)

Paulie said:


> DSGE said:
> 
> 
> > Paulie said:
> ...



That's not a common belief at all. Maybe it's common among goldbugs...

It should be easy enough for you to show that the real price of gold is stable.


----------



## KissMy (Mar 30, 2012)




----------



## DSGE (Mar 30, 2012)

KissMy said:


>



http://www.bls.gov/cpi/cpiri2011.pdf

Well how about that, in the CPI food and energy are weighted as 24% of urban consumer expenditures. 2% more than your unsourced weight.


----------



## editec (Mar 30, 2012)

I think there's a signficant difference between buying and selling gold to make money in a going economy, versus holding gold and silver for the end of the economy event.

When you hold gtold and silver for an end of cvilization scenario, you are assuming that your gold and silver will buy you something you actually need_....like CHICKENS._


So your *Krugerrand* might actually not be worth a chicken in truly *hard times.*


Might I suggest that it might make more sense to store up things that you'll actually need?

 Coffee, cigarettes, drugs, food, guns, ammo, those are the KINDS of things you'll and everybody else will be _needing._

Gold and silver_ might_ you buy you stuff...then too, _it might not._

Your starving children aren't going to be clamoring for GOLD, they're going to be crying for FOOD.

Just a thought.

Plan accordingly.


----------



## TakeAStepBack (Mar 30, 2012)

Monetarists still think they can control the velocity of the monies. Human action is always quantifiable.....somehow.


----------



## DSGE (Mar 30, 2012)

TakeAStepBack said:


> Monetarists still think they can control the velocity of the monies. Human action is always quantifiable.....somehow.



No they don't. What are you talking about?


----------



## Paulie (Mar 30, 2012)

KissMy said:


> Toro said:
> 
> 
> > Actually, he is correct.  There has been little correlation between the consumer price index and the price of gold.
> ...



Very true.


----------



## Paulie (Mar 30, 2012)

DSGE said:


> Paulie said:
> 
> 
> > DSGE said:
> ...



Now we're talking about stability?

In times when the Fed is increasing the monetary base, gold goes up.  Gold has been going up since the early part of last decade when the Fed dropped rates down to 2% and housing boomed.  Governments have been running huge deficits ever since, waging unfunded wars, etc, and gold has been going up.

You'll have to forgive me if I don't run to CPI and other indices as the only indication of inflationary policies.  

What are you paying less for these days other than tech products?


----------



## DSGE (Mar 30, 2012)

Paulie said:


> Now we're talking about stability?



Yeah. To be a good hedge against inflation, the real price of gold should be relatively stable. The nominal price won't be, but the real price needs to be. It can't be moving around like crazy for reasons other than inflation. So just show me a relatively stable real price of gold.



> In times when the Fed is increasing the monetary base, gold goes up.



We can get to analysing your claims once you actually substantiate them. 



> Gold has been going up since the early part of last decade when the Fed dropped rates down to 2% and housing boomed.



Post hoc ergo propter hoc? Also, more interest rate nonsense. I wish I could just shoot everybody who tries to use interest rates to assess the stance of monetary policy, because that is so fucking dumb. What, do you think there's one interest rate that just stays the same forever? It's just always 5% or something. Then "the Fed drops it down to 2%", oh no that must be easy money. It's not like the natural rate moves or anything.



> Governments have been running huge deficits ever since, waging unfunded wars, etc, and gold has been going up.



Well there's a hint. Maybe people like gold because it's a hedge against any potential crises. The cool thing about gold, which makes it different from other assets like bonds and stocks is that it isn't anybody's liability. So if a crisis hits, you don't have to worry about the solvency of your counterparty. Of course setting aside rising demand from emerging markets, which goldbugs never seem to consider.



> You'll have to forgive me if I don't run to CPI and other indices as the only indication of inflationary policies.



I don't run to the CPI either. I run to NGDP growth. 

Also, what's with all this anecdotal post hoc bullshit? Either you're dumb enough to actually believe your own shit, in which case I doubt it's productive to be talking to you, or you think I'm stupid enough to swallow it. Either way, could you please start producing actual arguments and evidence, rather than bullshit? That'd be super.

What are you paying less for these days other than tech products?[/QUOTE]


----------



## Toro (Mar 31, 2012)

DSGE said:


> Well there's a hint. Maybe people like gold because it's a hedge against any potential crises. The cool thing about gold, which makes it different from other assets like bonds and stocks is that it isn't anybody's liability. So if a crisis hits, you don't have to worry about the solvency of your counterparty. Of course setting aside rising demand from emerging markets, which goldbugs never seem to consider.



Demand for gold has come primarily through the loss of confidence in fiat currencies.  Most of the increase in the demand from gold over the past decade has come through investment products, primarily ETFs.  Demand from Asia, primarily China, has also been significant, but again, at least part of that in China is coming from investment demand through physical ownership via loss in confidence in the dollar.  There are counterparty issues regarding the ETFs - which is why some ETFs such as Sprott's are so popular - and when you listen to the largest owners of the ETFs, their rationale for owning gold through the ETFs is the loss of confidence in fiat currencies.

As for inflation, it depends on how you define it.  Gold certainly has not been a hedge against consumer price inflation.   However, if you define inflation as the creation of money, then gold has been more effective.


----------



## FireFly (Mar 31, 2012)

editec said:


> I think there's a signficant difference between buying and selling gold to make money in a going economy, versus holding gold and silver for the end of the economy event.
> 
> When you hold gtold and silver for an end of cvilization scenario, you are assuming that your gold and silver will buy you something you actually need_....like CHICKENS._
> 
> ...



The problem is most things you need are perishable. You also do not know exactly you will require in the future. You may need surgery but the surgeon does not want anything you have. You may need solar panels, wind turbine, batteries, copper wire, shortwave radio, education for kids, medicine, shoes, gasoline, heat, grain for your animals, etc. But the companies that make this stuff don't want anything you have. A crop farmer needs Potash Fertilizer, Glyphosate weed killer, Diesel Fuel, Tractor Parts, etc. Hardly any of this stuff comes from this country & the foreigners won't accept anything but Gold.

If you don't have physical gold in your possession, you will be up shit creek without a paddle if the economy collapses, the dollar loses its status as the world reserve currency, dollar collapses or the world passes "Peak Oil".

Yes you will need weapons & food. But if you also don't have gold & farm land, you might just wind up using your guns on yourself.


----------



## DSGE (Apr 1, 2012)

Toro said:


> DSGE said:
> 
> 
> > Well there's a hint. Maybe people like gold because it's a hedge against any potential crises. The cool thing about gold, which makes it different from other assets like bonds and stocks is that it isn't anybody's liability. So if a crisis hits, you don't have to worry about the solvency of your counterparty. Of course setting aside rising demand from emerging markets, which goldbugs never seem to consider.
> ...



This makes no sense at all. "If you define inflation as the creation of money, then gold has been more effective". The creation of money is irrelevant if it isn't raising nominal spending (and hence prices in the long run). Rising prices reduces the purchasing power of money. That's something you need to hedge against. Increasing the money stock only for it to be held, rather than contributing to nominal spending, has no effect. That doesn't need to be hedged, because nothing happens! The purchasing power of money is not reduced by increasing the money stock. The purchasing power of money is reduced by prices rising _in response_ to that new money trying to be spent. If the new money is held, it's effect on real variables is equivalent to there not being any new money at all.

Also, I seriously don't get why those of the Austrian persuasion don't understand this. Even under no central bank, under strictly free banking, the supply of money increases endogenously to offset increases in the demand to hold money. It's absurd that people think it's somehow optimal or natural for the supply of money to be fixed.


----------



## editec (Apr 1, 2012)

FireFly said:


> editec said:
> 
> 
> > I think there's a signficant difference between buying and selling gold to make money in a going economy, versus holding gold and silver for the end of the economy event.
> ...


 
I suspect you are and are bascially on the same page here.  I suspect we just talking about two  different kinds of social COLLAPSE.

The worth of gold truly depends on the condition of the nation.

If the collapse is orderly, that is to say if the structure of society and markets remains essantially intact, and all we're facing is hyperinflation, then YES gold and silver are going to be VERY useful.

But if the collapse is disorderly, if the structure of society and markets really goes very chaotic, then gold and silver aren't going to be an especially useful items to have.

I know it must seem impossible that things can ever get so bad that people won't value such well understood units of value as fold and silver, but things CAN get that bad, too.

Starving people in a collapsed society do not value GOLD or silver very highly.  Their needs (and fear) are too immediate for them to value something they cannot ACTUALLY use.

Gold and silver are ONLY useful as long as people are confident that there is still market enough around that people will recognize those units of value as having a market value.

Here's the thing...people always need to eat but they do NOT always value _symbolic representations of value_.


----------



## TakeAStepBack (Apr 1, 2012)

In the face of an economic collapse, which will not be orderly, gold and silver will not be units of exchange until a relative level of stability is restored. There are several ways that it could go in such an event. From my point of view, the next financial crisis is only a how and when, not an if.


----------



## Paulie (Apr 1, 2012)

DSGE said:


> Toro said:
> 
> 
> > DSGE said:
> ...


You miss the point.  The point is that increases in the supply of money are perceived to be an inevitable cause of rising prices.  Cash runs to gold in response to money creation for the purpose of hedging before consumer prices rise.  

Whether or not you believe in such a thing is irrelevant because as it stands, the increase in the supply of money is historic as well as the increase in the price of gold.


----------



## Toro (Apr 1, 2012)

DSGE said:


> This makes no sense at all. "If you define inflation as the creation of money, then gold has been more effective". *The creation of money is irrelevant if it isn't raising nominal spending (and hence prices in the long run).*



*Stop!  *

The rest of your paragraph reinforces this point, so I've excluded it.  

Clearly, you are an intelligent and well-educated individual, schooled in modern economic theory and, I think you are demonstrating an absolutely critical flaw in modern economic thought.  I think it's part of the reason why so many conventional economists were unable to identify the stock market bubble of the late 90s and the housing bubble of the mid 00s, and the dangers they wrought.

A rising supply of money does NOT necessarily translate into higher consumer/producer price inflation.  It might, or it might not.  It depends on the circumstances.  It probably (well, almost certainly) does over the long run but it may not over the short and intermediate term.  Instead, excess liquidity can flow into asset markets, pushing up asset prices rather than into, say, labour markets.  Austrians say that inflation is defined as the excess creation of money, and consumer price inflation is merely an effect of that.  But it is not the only effect, and can manifest itself in other ways.  Thus, the rising price of gold is, in part, indicative of the excess creation of money over the past decade.  Thus, the argument goes, gold has been a good indicator of inflation, just not consumer price inflation.  (At least not yet, anyways.)  Maybe I'm wrong, I don't know, but I think this explains a lot of what has happened in the economy over the past 15-20 years. 



> Also, I seriously don't get why those of the Austrian persuasion don't understand this. Even under no central bank, under strictly free banking, the supply of money increases endogenously to offset increases in the demand to hold money. It's absurd that people think it's somehow optimal or natural for the supply of money to be fixed.



I agree.  This is why I've argued with the gold bugs against the gold standard.  The retort from the more thoughtful gold bugs paraphrases Churchill in that gold is the worst form of money, except for all the others.  We've essentially had a completely free fiat money system for 40 years now.  Some would say its worked pretty well.  Others would say, "Yes, but communism 'worked' for nearly 70 years in the USSR before it collapsed under its inevitable logical contradictions."  I have much more sympathy for this argument.

Or, perhaps a better analogy is Nassim Taleb's "Turkey Problem."

The Turkey Problem | Stephen Kinsella


----------



## FireFly (Apr 1, 2012)

editec said:


> FireFly said:
> 
> 
> > editec said:
> ...



Unless you have your own self contained & self supportive working farm & a way to defend it against roving bands of thugs, then there will have to be a trusted reliable medium of exchange such as gold. There are nearly 7 billion people on the planet. Without a functioning trade system there is no way to grow enough food or distribute it to the people. There will be all out war before starvation.

Farming is an expensive high risk high tech operation & *requires* a medium of exchange. Farmers must have a supply of Potash Fertilizer, Glyphosate weed killer, Diesel Fuel, Tractor, Planter, Trucks, Sprayers, Harvesting Equipment & Parts, storage facilities, grain drying equipment, accurate measuring & mixing equipment, computerized on-board GPS navigation dispensing, loading equipment, Pesticide, Nitrogen, Phosphate, Natural Gas, Electricity, Copper, Steel, Rubber, Weather Forecast, savings to reinvest in the event of crop failure or insurance, etc.


----------



## TakeAStepBack (Apr 2, 2012)

Toro said:


> DSGE said:
> 
> 
> > This makes no sense at all. "If you define inflation as the creation of money, then gold has been more effective". *The creation of money is irrelevant if it isn't raising nominal spending (and hence prices in the long run).*
> ...



There are internal debates regarding the supply of money within the Austrian school too. It is not a windfall of agreement on this. The increase in the amount of gold extracted from the ground is around 1.5% per year. Rothbard  used to say to those claiming there wasnt enough gold in the world to have a gold standard. You could have a gold standard with a single ounce, he said. Its not about the amount; its about price.

He is right.


----------



## Toro (Apr 2, 2012)

TakeAStepBack said:


> Toro said:
> 
> 
> > DSGE said:
> ...



The problem with gold as a monetary base is that it's supply is erratic. From 2000 through 2009, global gold production actually declined by ~1% per year despite the price of gold rising from $250 to $1500. (It rose by 4% in 2010.)  Through the 80s and 90s, however, gold production rose by 3%-5% per annum. Ideally, the supply of money should grow at the rate of the economy. Gold doesn't do that except over very long periods of time.


----------



## TakeAStepBack (Apr 2, 2012)

That is true. However, and again, the amount is not the most important aspect. It is the true price that is the real point of interest. The "price" indicated in FRN is not the real exchange rate of gold. It assumes that the fiat money dollar is anchor by which all prices are calculated. This is true as of right now, but if the money supply was gold and the amount of gold is limited, the dynamic between price completely changes.

Like I showed back before about the inflation of the "price" of gold through the 1800s, up until about 1920. It remained almost completely stable. Even though gold was mined, refined and coined (among other uses) in that period. The idea is that real wealth is created by labor which in turn, creates capital. Printing paper escapes this idea and becomes an object at the whims of those in charge of its printing and calculations. That in and of itself is the reason paper money always fails, while gold was money by economic law for at least 5,500 years. Wealth can not be created out of thin air. it requires labor, and in turn capital to generate.

Will the fiat system in place last the sands of time? Not according to the complexity theory, human nature/action and history.


----------



## DSGE (Apr 3, 2012)

Toro said:


> DSGE said:
> 
> 
> > This makes no sense at all. "If you define inflation as the creation of money, then gold has been more effective". *The creation of money is irrelevant if it isn't raising nominal spending (and hence prices in the long run).*
> ...




I know. That's why I chose my words carefully. I said "raising nominal spending (and hence prices _in the long run_).

For new money to have any effect at all on the real economy, somebody has to try to spend it. Hence it _must_ raise _nominal spending_. If it doesn't raise nominal spending, it is just sitting there. It's being held as liquid money. It may as well not exist in the first place. 





> > Also, I seriously don't get why those of the Austrian persuasion don't understand this. Even under no central bank, under strictly free banking, the supply of money increases endogenously to offset increases in the demand to hold money. It's absurd that people think it's somehow optimal or natural for the supply of money to be fixed.
> 
> 
> 
> I agree.  This is why I've argued with the gold bugs against the gold standard.  The retort from the more thoughtful gold bugs paraphrases Churchill in that gold is the worst form of money, except for all the others.



That's a more thoughtful response, except it's wrong. Just freezing the monetary base is far superior to a gold standard. Oh that's another thing that confuses me about Austrians: why do you get so many of them in love with the gold standard? Free Banking is what they should obviously be pushing for.




> We've essentially had a completely free fiat money system for 40 years now.  Some would say its worked pretty well.  Others would say, "Yes, but communism 'worked' for nearly 70 years in the USSR before it collapsed under its inevitable logical contradictions."  I have much more sympathy for this argument.



Except it's not fiat money that hasn't been working well, it's central bank discretion. 



> Or, perhaps a better analogy is Nassim Taleb's "Turkey Problem."
> 
> The Turkey Problem | Stephen Kinsella



I should really get around to reading Black Swan. I wanted to read Fooled by Randomness first, but my library doesn't have it (and I don't want to buy it).


----------



## editec (Apr 3, 2012)

FireFly said:


> editec said:
> 
> 
> > FireFly said:
> ...


----------



## editec (Apr 3, 2012)

FireFly said:


> editec said:
> 
> 
> > FireFly said:
> ...


----------



## Toro (Apr 3, 2012)

DSGE said:


> Toro said:
> 
> 
> > DSGE said:
> ...



Both of those books are worth it. I've read hundreds of books on finance and economics over the years and they are at the very top of the list, if for any other reason Taleb's style and wit, which is often sorely lacking in this discipline.


----------



## DSGE (Apr 3, 2012)

Toro said:


> ...if for any other reason Taleb's style and wit, which is often sorely lacking in this discipline.



Too right.


----------



## Paulie (Apr 3, 2012)

Toro said:


> DSGE said:
> 
> 
> > This makes no sense at all. "If you define inflation as the creation of money, then gold has been more effective". *The creation of money is irrelevant if it isn't raising nominal spending (and hence prices in the long run).*
> ...



This is a great point and one I neglected to consider...the asset markets.  You can have stable CPI and other price inflation indicators, and still have inflated asset prices as a result of excess money creation.  The excess liquidity sitting in bank reserves, while perhaps not being multiplied via lending, can be put to work in the asset markets which can and does lead to bubbles.

This is why I think the best way to describe inflation is an increase in the money supply.


----------



## Paulie (Apr 3, 2012)

DSGE said:


> Except it's not fiat money that hasn't been working well, it's central bank discretion.



Why do you think that is?  Why is it that the supposed most genius economic minds of our time seem to keep getting it wrong, while the supposed economic kooks of the world seem to be getting it right? ... i.e., the Austrians who foresaw the stock market and housing bubbles.

Is it really just a complete and total ineptitude on their part, or could they be directing monetary policy for the benefit of someone else besides the ones who are being negatively affected by it the most?


----------



## DSGE (Apr 3, 2012)

Paulie said:


> Toro said:
> 
> 
> > DSGE said:
> ...



How is it that asset prices are increasing but not the prices of consumption/investment goods? The only way that happens is if one agent who is holding money rather than spending it buys an asset from another person whose intention is just to whole the money as liquidity and not to spend it. If asset prices are increasing in this way, so the fuck what? That's having no real effect on economic activity. What matters is if somebody buys an asset, the proceeds of which then get used to purchase consumption/investment goods (raising their prices). I mean that's the whole thing with the Austrian school isn't it? The relative price of consumption and investment goods gets distorted leading to resources being mal-distributed. If it's just increasing asset prices without leading to increase goods prices, it doesn't have any real effect.


Looking at the money supply to assess the stance of monetary policy is a mistake because it doesn't account for changes in the desire to hold money. Back in the old days, everybody thought monetary velocity was constant. So Austrians could say that inflation is an increase in the money supply, and monetarists could recommend a constant money growth rule. We know that velocity isn't actually constant, so we have to account for changes in the demand for money. So instead of talking about a rising money supply as easy money, we should be talking about rising nominal spending.


----------



## Paulie (Apr 3, 2012)

DSGE said:


> Paulie said:
> 
> 
> > Toro said:
> ...



Asset price increases in this case precede consumer goods price increases.  But how do we get to the consumer price inflation if the asset bubble bursts before that happens?  You're ignoring the housing bubble situation.  Housing and related investment products almost led to the systemic failure of the entire global economy.  The deflationary collapse that ensued would nullify any trailing consumer price increases, and then it's wash, rinse, repeat, with Fed monetary policy.  The Fed seems to think reflating the economy is good, and that an asset bubble or bubbles is just a consequence worth enduring.  The problem with that is bubbles don't inflate forever.  

That cash runs to gold in this monetary environment is really not hard to understand.  But USD will also run to stronger currencies as well.  Any of these moves is a hedge against inflation, or the devaluation of the currency if that's how you'd prefer to look at it.


----------



## DSGE (Apr 3, 2012)

Paulie said:


> DSGE said:
> 
> 
> > Except it's not fiat money that hasn't been working well, it's central bank discretion.
> ...



Maybe the Fed isn't as insulated as we like to think and they actually do face political pressures?  Maybe there are perverse incentives we're unaware of? Maybe the power goes to their head? I don't know, and I don't care. Forget about analysing why discretion doesn't work, just take away their damn discretion! Then it becomes a moot point. 

We may disagree on what rules to constrain them with [though I think I could get you to come around to my side (hint: my side is that as long as it's a given that there is a central bank, they should aim to achieve what would otherwise happen in a free market: the stabilisation of nominal spending)], but I think we both agree that they need to have strict operating rules and accountability if they're going to exist at all. 



> while the supposed economic kooks of the world seem to be getting it right? ... i.e., the Austrians who foresaw the stock market and housing bubbles.



I'm gonna let that one slide.


----------



## Paulie (Apr 3, 2012)

DSGE said:


> Paulie said:
> 
> 
> > DSGE said:
> ...



Fair enough on your first part, but why "let it slide"?  Are you suggesting the Austrians didn't warn of the housing bubble while even Greenspan (a supposed somewhat advocate of the Austrian school) was off in lala land?


----------



## DSGE (Apr 3, 2012)

Paulie said:


> DSGE said:
> 
> 
> > Paulie said:
> ...



I don't understand what this is saying. 




> You're ignoring the housing bubble situation.  Housing and related investment products almost led to the systemic failure of the entire global economy.  The deflationary collapse that ensued would nullify any trailing consumer price increases, and then it's wash, rinse, repeat, with Fed monetary policy.



With the housing bubble situation, taking as given that I buy this story (which I don't), the Fed's easy money is channelled into raising the price of houses. There we go. The price of houses go up, the price of building material goes up, the price of construction labour goes up. It's not just "inflated asset prices". The prices of real goods and services are being affected by the loose money. So the housing bubble is not an example of asset prices being inflated without any effect on the price of goods. 



> The Fed seems to think reflating the economy is good, and that an asset bubble or bubbles is just a consequence worth enduring.  The problem with that is bubbles don't inflate forever.



Serious misunderstanding of monetary policy there. Have you really taken the time to learn what the Fed thinks? Or are you just guessing what they think based on your biases?


----------



## DSGE (Apr 3, 2012)

Paulie said:


> DSGE said:
> 
> 
> > Paulie said:
> ...



I think when it comes to bubbles the Austrians are a stopped clock. I also think there's a pretty big case of confirmation bias (they're not held accountable for their incorrect predictions of doom and gloom). The fact of the matter is, bubbles are only noticed after the fact. Great, they looked at a case-shiller home price index chart and noticed it got crazy. The same happened in Australia, no collapse of home prices here though (which you kind of think would have happened the same time it was happening to everyone else). Funny how they can't take the same method and apply it to gold prices though. And how many of the "predictions" were at least somewhat specific? "Hey guys, these MBSs and CDOs are kind of fucked up. Might want to watch out for those". I didn't hear any of that. Only "the Fed is kept interest rates too low for too long, the price of housing is quite a bit higher than its historical trend, housing bubble!". Honestly, I'd rather ask John Edwards for investment advice (the psychic, not the senator).


----------



## TakeAStepBack (Apr 3, 2012)

Yeah, no. That is not how the predictions happened. Austrian scholars had the housing bubble pegged in 2002. The only thing they did not predict to the T, and never do, is the timing of the burst.


----------



## DSGE (Apr 3, 2012)

TakeAStepBack said:


> Yeah, no. That is not how the predictions happened. Austrian scholars had the housing bubble pegged in 2002. The only thing they did not predict to the T, and never do, is the timing of the burst.



Oh, my mistake. So you can link me up to "Austrian scholars" talking about the crucial importance of securitization, weird asset backed securities, agency problems and leverage in the development of the soon-to-be housing bubble? Because seriously, all I've heard is "low interest rates + high house prices => housing bubble"


----------



## Paulie (Apr 3, 2012)

DSGE said:


> TakeAStepBack said:
> 
> 
> > Yeah, no. That is not how the predictions happened. Austrian scholars had the housing bubble pegged in 2002. The only thing they did not predict to the T, and never do, is the timing of the burst.
> ...



Why does it really matter at the end of the day what specifics they warned about?  It's a chicken/egg scenario.  Absent artificially low interest rates...basically a dangling carrot in front of the faces of the masses...would there have been such extreme malinvestment in housing?  

Something has to kick a bubble off...it doesn't just start because people all think it would be real awesome and neato to chase housing now that the stock chase was over.  The smart money saw a huge opportunity to grab home loans for cheap, and then eventually the stupid money followed suit...this is expected human behavior, herd mentality, whatever you want to call it.  Housing has been around for centuries.  The bubble doesn't just happen in a vacuum.  The initial motivation has to be there, and then as the craze progresses, the smart money progresses into more comprehensive ways to continue profiting from it, i.e. the securities markets.

If you have a better way of explaining the bubble from inception to collapse, I'd love to hear it.


----------



## TakeAStepBack (Apr 3, 2012)

I'd have to go dig up what i read that far back. The talk of the time was that the federal reserve was creating a climate of moral hazard and malinvestment. Along with the signs of booming credit heading into both residential and commercial real estate. These guys have been getting it right for the last hundred years, right down to Mises qaccurately predicting both the great depression and the federal reserves reactions. 

Predictions among Austrian scholars was all over the place at that time (2001-2002) and slowly narrowed in as the burst became obvious to even the most in need of economic remediation.


----------



## Paulie (Apr 3, 2012)

Isn't the whole point of the Fed targeting such a low interest rate, to spur borrowing and spending?  If people aren't borrowing at 6%, and still not at 4%, then perhaps 2% might finally do the trick.

It did.


----------



## TakeAStepBack (Apr 3, 2012)

Basically, yes. They got the seen out of the action, but as per usual, completely missed the unseen consequence of the actions. The Austrian scholars tend to search for, pin point and develop the understanding of the unseen. They've got it down pretty good.

Also, not all Austrian scholars agree on a gold standard. Some advocate for free banking, some for specie money, etc..the one thing they agree on is that gold is not an investment, gold is not a commodity. Gold is money par excellence as it has been for over 5,000 years.


----------



## DSGE (Apr 3, 2012)

Paulie said:


> DSGE said:
> 
> 
> > TakeAStepBack said:
> ...



First thing's first, "artifically low interest rates". How do you gauge whether interest rates are "artificially low" or whether they reflect the "natural rate of interest"? Do you assume that the "natural rate" is constant for no reason, or that it's somehow impossible that it could fall to 1% (or lower)? I'd really like to know how an Austrian assesses the tightness/loosness of monetary policy.




> If you have a better way of explaining the bubble from inception to collapse, I'd love to hear it.



We came up with some cool securities which helped spread risk awesomely when the price of the underlying asset was non-decreasing. These assets got rated default-risk free but paid a premium as if they were risky. There was a change in relative demand towards these assets because a) they paid a higher return for the same perceived amount of risk, b) their AAA rating meant you could become highly leveraged on them. Mortgage originators kept lowering their lending standards so that they could spit out more of these wicked assets. When housing prices eventually declined all these assets went to shit. But by that time they were systemic. The fall in housing prices couldn't be mitigated the usual way, by an increase in the demand and supply of mortgage credit, since the mechanism through which that happened was now fucked beyond belief. So home prices just totally tanked.


----------



## DSGE (Apr 3, 2012)

Paulie said:


> Isn't the whole point of the Fed targeting such a low interest rate, to spur borrowing and spending?  If people aren't borrowing at 6%, and still not at 4%, then perhaps 2% might finally do the trick.
> 
> It did.



No. The Fed tries to target 2% PCE inflation. That effectively has them trying to target the unobservable "natural rate of interest".


----------



## DSGE (Apr 3, 2012)

TakeAStepBack said:


> I'd have to go dig up what i read that far back. The talk of the time was that the federal reserve was creating a climate of moral hazard and malinvestment. Along with the signs of booming credit heading into both residential and commercial real estate. These guys have been getting it right for the last hundred years, right down to Mises qaccurately predicting both the great depression and the federal reserves reactions.
> 
> Predictions among Austrian scholars was all over the place at that time (2001-2002) and slowly narrowed in as the burst became obvious to even the most in need of economic remediation.



Sources are always welcome.


----------



## DSGE (Apr 3, 2012)

TakeAStepBack said:


> Also, not all Austrian scholars agree on a gold standard. Some advocate for free banking, some for specie money, etc



Free banking is the correct one. 




> ..the one thing they agree on is that gold is not an investment, gold is not a commodity. Gold is money par excellence as it has been for over 5,000 years.



Well that's super dumb. Crazy super dumb. Gold is not remotely money. T-bills are closer to being money than gold. Gold used to be a medium of exchange. It's not any more. Austrians need to deal with it.


----------



## Paulie (Apr 3, 2012)

DSGE said:


> Paulie said:
> 
> 
> > Isn't the whole point of the Fed targeting such a low interest rate, to spur borrowing and spending?  If people aren't borrowing at 6%, and still not at 4%, then perhaps 2% might finally do the trick.
> ...



Yes, we all know the Fed is tasked with keeping prices stable and employment full, but lowering the fed funds rate to 2% and increasing bank reserves is to get money moving again.  The inflation rate isn't going to rise to their target if people aren't borrowing and spending, right?  Like you said, otherwise it would just sit there and may as well not even exist.  So of COURSE the Fed intends to get to a rate of interest that will entice people to borrow.  

When real estate loans become that cheap, is it really incredible that cash flocked to it?  

Where would all the systemic meltdown of the mortgage securities market have come from, absent this rush to real estate?


----------



## DSGE (Apr 3, 2012)

Paulie said:


> DSGE said:
> 
> 
> > Paulie said:
> ...



Right, but that happens anyway. The "natural rate of interest" moves to equilibrate the demand for loanable funds with the supply of loanable funds. I'm saying, don't automatically equate 1% interest rates with "artificially low". It's entirely possible that the "natural rate" has moved that low because of changes in investment demand/savings preference. So in your model, how do you tell if the interest rate is "artificially" low or "naturally" low?




> When real estate loans become that cheap, is it really incredible that cash flocked to it?
> 
> Where would all the systemic meltdown of the mortgage securities market have come from, absent this rush to real estate?



There was a rush to real estate, obviously. I'm just saying it's from a different source. You're saying it's from artificially created credit. I'm saying it's from natural credit due to the perceived return on housing now being much higher.


----------



## TakeAStepBack (Apr 3, 2012)

> Well that's super dumb. Crazy super dumb. Gold is not remotely money. T-bills are closer to being money than gold. Gold used to be a medium of exchange. It's not any more. Austrians need to deal with it.



Gold is currently no longer money. That is correct. However, in the last fourty years after completely abandoning gold as the anchor to paper money, we've seen one catastrophy after another. These booms and busts get more and more uncontrollable every time they occur, and eventually the jig is going to be up on fiat money. Probably a whole lot sooner than most people think. Austrian scholars are already saying the next bubble is going to be the big one as the only place left for it to occur is in the dollar itself. I have no reason to not trust this prediction based on the credibility of those making the call.

Austrians will not abandon the liberty brought to exchange and markets accompanied by hard money, like gold. You can call them dumb all you wish (as if that hasn't been going on for years while cognitive dissonance from the callers prevails unabated), but they are not alone in this belief. China and Russia are already calling for a new gold standard, james Rickards, well known for his fed move predicitons and a 30+ year vet in capital markets says it too. Central banks hoard gold for a reason. And not bacause it has a long term investment return.

It'll come clear for you eventually, just like everyone else who snears at the idea this system isn't going to last. Only that will happen far to o late as per usual.


----------



## DSGE (Apr 3, 2012)

TakeAStepBack said:


> > Well that's super dumb. Crazy super dumb. Gold is not remotely money. T-bills are closer to being money than gold. Gold used to be a medium of exchange. It's not any more. Austrians need to deal with it.
> 
> 
> 
> Gold is currently no longer money. That is correct.



Good. Case closed. Whether or not we should return to it being money is another question.



> However, in the last fourty years after completely abandoning gold as the anchor to paper money, we've seen one catastrophy after another. These booms and busts get more and more uncontrollable every time they occur, and eventually the jig is going to be up on fiat money. Probably a whole lot sooner than most people think. Austrian scholars are already saying the next bubble is going to be the big one as the only place left for it to occur is in the dollar itself. I have no reason to not trust this prediction based on the credibility of those making the call.
> 
> Austrians will not abandon the liberty brought to exchange and markets accompanied by hard money, like gold. You can call them dumb all you wish (as if that hasn't been going on for years while cognitive dissonance from the callers prevails unabated), but they are not alone in this belief. China and Russia are already calling for a new gold standard, james Rickards, well known for his fed move predicitons and a 30+ year vet in capital markets says it too. Central banks hoard gold for a reason. And not bacause it has a long term investment return.
> 
> It'll come clear for you eventually, just like everyone else who snears at the idea this system isn't going to last. Only that will happen far to o late as per usual.



Actually read your post dude. You sound like a total crazy person. 

I'm cool with free banking. If free banks want to use gold as reserves, so be it. But despite how terrible it may be, the reality is that governments likely aren't going to stop enforcing their fiat currencies as legal tender. In which case, fiat notes are probably going to serve as the main form of reserves. If the government decides to back those notes with gold, all the better. The upshot is that nominal spending gets stabilized, any change in the demand for money or the relative demand for currency is offset endogenously, and we all live happily ever after.

Now let's add an extra layer of reality. For now, banks aren't allowed to issue their own banknotes. So for a given demand for money, when the public's relative demand for currency changes, banks can't convert one liability (demand deposits) into another (currency). They have to satisfy the change in demand for currency with reserves, which means they have to contract their liabilities and hence the money supply falls out of line with money demand and hence we get costly adjustments to the price level and other nominal variables. Now under a fiduciary standard, we can expand the quantity of reserves to offset this (whether we do or not is another issue). Under a gold standard this would result in monetary disequilibrium (and hence malinvestment). 

The upshot is, given that banks aren't allowed to mint their own banknotes, a gold standard is a ghastly idea. If that restriction is relaxed, then a gold standard would be acceptable (though I think fixing the quantity of high powered money would be better).


----------



## TakeAStepBack (Apr 3, 2012)

I'm well aware this sounds crazy to a monetarist. I except your opinion, as I've gone down this road for years. I just disagree. One thing is certain, a serious change to current policies and a "clean up" is needed or the current system is going to end quite chaotically.


----------



## TakeAStepBack (Apr 3, 2012)

DSGE said:


> TakeAStepBack said:
> 
> 
> > I'd have to go dig up what i read that far back. The talk of the time was that the federal reserve was creating a climate of moral hazard and malinvestment. Along with the signs of booming credit heading into both residential and commercial real estate. These guys have been getting it right for the last hundred years, right down to Mises qaccurately predicting both the great depression and the federal reserves reactions.
> ...



Congressman Ron Paul is a subscriber and scholar of the Austrian pursuasion. Here is a clip of him from 2003.




> During a speech on September 10, 2003, Congressman Paul said that the special privileges granted to Fannie and Freddie have distorted the housing market by allowing them to attract capital they could not attract under pure market conditions  like all artificially created bubbles the boom in the housing prices cannot last forever. When housing prices fall, homeowners will experience difficulty as their equity is wiped out.



Ron Paul didnt have a crystal ball. He just understands how the Fed creates business cycles, regularly occurring booms and busts in the economy. And he is not alone. The question is not in if, but when the next burst happens. The debate now, is whether that burst will be the one to end all the bursts and change the system, one way or another. 

His prediction came 5 years before the burst here. Here is Helicopter Ben's thoughts on it form an interview in 2005:



> Maria Bartiromo: Tell me, what is the worst-case scenario? We have so many economists coming on our air saying Oh, this is a bubble, and its going to burst, and this is going to be a real issue for the economy. Some say it could even cause a recession at some point. What is the worst-case scenario if in fact we were to see prices come down substantially across the country?
> 
> Ben Bernanke: Well, I guess I dont buy your premise. Its a pretty unlikely possibility. Weve never had a decline in house prices on a nationwide basis. So, what I think what is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I dont think its going to drive the economy too far from its full employment path, though.


----------



## Paulie (Apr 3, 2012)

TakeAStepBack said:


> DSGE said:
> 
> 
> > TakeAStepBack said:
> ...



I don't buy for a second that Bernanke believed a single word of that.


----------



## Toro (Apr 4, 2012)

Gold is getting crushed again this morning, down another $50 on the Fed minutes that QE3 may not be in the offing. This is what makes me nervous on PMs here. There have been some big gaps down over the past year, perhaps signaling liquidation, especially after the manic run up last summer. The long term trend is still up but there are some worrying signs of a possible top as well. Support is at $1550, which would be the bottom of the uptrend, and I will probably take a shot there. But everything right now in PMs is a trade IMHO.


----------



## TakeAStepBack (Apr 4, 2012)

Yeah, it should mean an increase in other markets as people rally around the promise for cheap credit/low interest rates. The problem is, what we don't see.

The up trend on metals will go down for now.

I read yesterday that the gold commision is pressing the fed for an audit of its metal holdings. I think people are starting the fire idea of a bubble in gold again created by the fed. I don't know that I buy that. We'll have to just wait and see, it appears.


----------



## Paulie (Apr 4, 2012)

TakeAStepBack said:


> Yeah, it should mean an increase in other markets as people rally around the promise for cheap credit/low interest rates. The problem is, what we don't see.
> 
> The up trend on metals will go down for now.
> 
> I read yesterday that the gold commision is pressing the fed for an audit of its metal holdings. I think people are starting the fire idea of a bubble in gold again created by the fed. I don't know that I buy that. We'll have to just wait and see, it appears.



Here's the thing about the idea of a bubble in gold...it isn't exactly NOT a bubble, in the sense that an over-inflated supply of money is finding its way into it and increasing the price to historic levels.  It's just a more RATIONAL bubble than the dot-com and housing bubbles, and the collapse will not start because people found a top.  The top in gold is almost solely going to be dictated by the Fed's policy.  

It's almost the perfect bubble, because we've known exactly when to start stock piling, and we'll know almost exactly when to start dumping.  All you have to do is watch the Fed's OMO's.

And I mean this in more of a longer term, not in Toro's trading scenarios.


----------



## Toro (May 6, 2012)

I have no position in gold right now, and have not had a long position other than a quick trade since about a year ago.

One big reason is because the price action sucks.  Take a look at a chart of the gold miners.  This chart is death (unless you are short, of course).  







There is an old adage in trading commodities in that the stocks lead the commodity price.  If the stocks are going down while the commodity is rising, that is a big red flag.  

This does not mean the bull market in gold is over.  However, I want to see some evidence that it is resuming its upward trend before reentering. I would rather not be dogmatically wedded to a thesis, or worse ideology.  Instead, I want the market to talk to me.  And right now, the market is saying stay away.


----------



## Toro (May 6, 2012)

Another reason why I am concerned about gold.






Safest Best Investment According to the Public? Gold | The Big Picture


----------



## Truthmatters (May 6, 2012)

Its ready fore a crash.

You can thank people like glen beck


----------



## KissMy (May 6, 2012)

The Fed has a dual mandate. With the failing jobs market the Fed can't seriously take QE3 off the table. The Fed is bluffing & people in the gold market know it. The OWS riots will grow stronger for the rest of the year. Since legislative branch has failed again, the Fed will have to come to the rescue.


----------



## KissMy (May 8, 2012)

The Plunge Protection Team had to be called in today to prevent the -200 close. They will have the DOW back near 13000 by the close. The global economy is in the shitter & sell in May & go away sounds good to investors.


----------



## KissMy (May 8, 2012)

GMAC is going Bankrupt again this weekend. They still owe the US Treasury $12 billion. Who is going to finance those GM new car sales????

Reuters: Bankruptcy may be best option Will Obama bail out GM again?????

7 million homes already foreclosed on. 5.59 million more homes are in default. We are only 55% through this mortgage disaster.

A select group of struggling mortgage borrowers is about to get an offer that sounds too good to be true. Executives at Bank of America say that they will begin mailing 200,000 letters offering certain customers mortgage principal reduction.


----------



## FireFly (May 9, 2012)

- Jobs market going down
- Stock market going down
- EU going down
- Euro going down
- Banks going down
= Likelihood of QE3 going way up that will make gold soar.


----------



## Toro (May 9, 2012)

Let's also note

- gold going down
- silver going down

And that's with both the LTRO and Operation Twist.


----------



## KissMy (May 9, 2012)

Ally Financial gets Treasury's OK to put ResCap mortgage unit into bankruptcy


> Detroit-based Ally Financial Inc., the auto lender majority-owned by taxpayers, has received U.S. Treasury Department approval to put its Residential Capital unit into bankruptcy as the government seeks to recover bailout funds.
> 
> Treasury will support directors at Ally and ResCap if they decide that filing for court protection from creditors is the best course for the mortgage unit, said an Obama administration official who asked for anonymity because the arrangements haven't been made public. The approval is conditioned on a review of terms, the person said Monday.



It is amazing that this does not make the news.


----------



## Valerie (May 14, 2012)

Valerie said:


> I pity the fool who bets against the US Dollar!
> 
> Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar - Forbes







> *
> 
> Commodities Sink as Dollar Reclaims Safe Haven Status*
> 
> ...



TFNN.com - Educating Investors


----------



## Toro (May 14, 2012)

Investors who treat gold and silver as a religion or ideology will get crushed.


----------



## uscitizen (May 14, 2012)

depends on when they bought at $1,600 I am still up by 200% or so.  Not too crushing.
and gold eagles sell for more than bullion price.


----------



## BakshisMouse (May 15, 2012)

And can you believe it, they're both down today as of yet.

*Gold: $1,552.50/oz

Silver: $28.02/oz*


----------



## BakshisMouse (May 15, 2012)

Damn, and in the past two hours, we have this:

*Gold: $1542.80/oz

Silver: $27.635/oz
*
I'm no gold nut, but even I'm wondering just what the hell is going on!


----------



## Toro (May 15, 2012)

Gold and silver are being liquidated.

Gold and silver are commodities.  Commodities are being sold because of worries about slowdowns in China and Europe.  So gold and silver are being sold.


----------



## Toro (May 17, 2012)

The RSI for gold hit 25 yesterday. There have been six prior occasions when gold fell below 30 since 2001. On five of those occasions, gold was higher 5, 10, 21 and 62 trading days later. Only once, after the 2008 meltdown, was gold lower over those time periods  It has always been higher 126 trading days (6 months) later. 

Gold bounced off support at $1530 and may be putting in a bottom here, or at least a near term bottom.


----------



## Mad Scientist (May 17, 2012)

Toro said:


> Gold and silver are being liquidated.
> 
> Gold and silver are commodities.  Commodities are being sold because of worries about slowdowns in China and Europe.  So gold and silver are being sold.


Worries? WORRIES? Confirmed with "Soft Landing" thesis written on toilet paper!:
Real Estate Crash in China Underway - Mike Shedlock - Townhall Finance Conservative Columnists and Financial Commentary - Page 1
Reason enough for you to buy Gold and Silver right here.
CNBC Joe Kernan:


> "The dollar is backed by the *full faith and credit of the US government* and a *powerful economy*."


----------



## Toro (May 17, 2012)

Bought gold today for a trade.  Will buy more if it falls and holds support.


----------



## KissMy (May 22, 2012)

Reuters - "China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury's first-ever direct relationship with a foreign government, according to documents viewed by Reuters."


----------



## Toro (May 23, 2012)

Dumped my gold for a small loss. Big downdrafts like today usually portend more losses to come. 

Rumor is that European central banks are dumping gold. 

I'm thinking about packing trading in until the Europeans get their shit together. This has been the hardest market I've traded by far, harder than the Financial Crisis. I'm tired of being bushwhacked based on what some obscure Greek politician has to say.


----------



## Valerie (May 23, 2012)

Toro said:


> Dumped my gold for a small loss. Big downdrafts like today usually portend more losses to come.
> 
> Rumor is that European central banks are dumping gold.
> 
> I'm thinking about packing trading in until the Europeans get their shit together. This has been the hardest market I've traded by far, harder than the Financial Crisis. I'm tired of being bushwhacked based on what some obscure Greek politician has to say.





I heard the technical gurus saying that Gold is heading to the 1100s.


----------



## Toro (May 23, 2012)

Valerie said:


> Toro said:
> 
> 
> > Dumped my gold for a small loss. Big downdrafts like today usually portend more losses to come.
> ...



Don't believe them.

Why?

They might be right.  However, they really have no idea what will happen.


----------



## KissMy (May 24, 2012)

" "As long as the U.S. economy continues to grow sufficiently fast to cut into the nation's unused economic resources at a meaningful pace, I think the benefits from further action are unlikely to exceed the costs," Dudley said in his prepared remarks. "But if the economy were to slow so that we were no longer making material progress toward full employment ... then the benefits of further accommodation would increase in my estimate and this could tilt the balance toward additional easing." 

Should growth in the U.S. decelerate, Dudley said the central bank can choose between extending the duration of its balance sheet, or add to it by buying more bonds." "


----------



## Mad Scientist (May 24, 2012)

That means QE III, which is what was planned all along.


----------



## KissMy (May 30, 2012)

Fed's Fisher: Jobs, not inflation, US' biggest economic problem


> The lack of job creation, not the threat of inflation, is the biggest problem for the U.S. economy, a top Federal Reserve official known for his hawkish views on inflation said on Wednesday.
> 
> "We have not been seeing a lasting inflationary impulse here," Dallas Federal Reserve Bank President Richard Fisher said at a community forum in San Antonio....
> 
> The economy is running "just above stall speed," he said, but is still moving forward. Uncertainty is holding back hiring, he said, adding it is up to Congress, not the Fed, to fix the problem.


----------



## Toro (Jun 2, 2012)

Gold was up $66 on Friday after the jobs report.  

AM-PM Roundup with Jim Wyckoff

Gold held long-term support at ~$1530, and the price action on Friday was bullish.  Gold has to prove itself technically but it may be setting up for a significant move higher.


----------



## KissMy (Jun 7, 2012)

Fed&#8217;s Evans Says More Accommodation Would Help the Economy

Fed Charles Evans says goal is to get unemployment down to 7% & inflation up to 3%.


----------



## percysunshine (Jun 7, 2012)

KissMy said:


> Feds Evans Says More Accommodation Would Help the Economy
> 
> Fed Charles Evans says goal is to get unemployment down to 7% & inflation up to 3%.



Give a guy a hammer, then everything looks like a nail.

Screwdrivers are not an option.


----------



## Toro (Jun 8, 2012)

Gold was down nearly $50 yesterday on new news from the Bernank.


----------



## Douger (Jun 8, 2012)

Toro said:


> Gold was down nearly $50 yesterday on new news from the Bernank.


Trivial. Unless you're an old man like me.
Buy some(physical) gold and silver and in 30 years you'll be loaded.
I stick with things people can not survive without(food/copper/nickel). Govt's have a say so in regulating the prices but, overall, it works great(so far) in the short term.


----------



## KissMy (Jun 8, 2012)

Anyone know where each of these FOMC members stand in extending "Operation Twist" or "QE"?

*2012 Members of the FOMC Members*

Ben S. Bernanke, Board of Governors, Chairman
William C. Dudley, New York, Vice Chairman
Elizabeth A. Duke, Board of Governors
Jeffrey M. Lacker, Richmond
Dennis P. Lockhart, Atlanta
Sandra Pianalto, Cleveland
Jerome H. Powell, Board of Governors
Sarah Bloom Raskin, Board of Governors
Jeremy C. Stein, Board of Governors
Daniel K. Tarullo, Board of Governors
John C. Williams, San Francisco
Janet L. Yellen, Board of Governors

*Alternate Members*

James Bullard, St. Louis
Charles L. Evans, Chicago
Esther George, Kansas City
Eric S. Rosengren, Boston
Christine M. Cumming, First Vice President, New York


----------



## Paulie (Jun 8, 2012)

It's a head fake.  Bernanke's rhetoric has been that things are still fragile.  There's no reason to believe that they're just not going to do any more stimulus whatsoever.


----------



## KissMy (Jun 8, 2012)

I am thinking that the Fed will continue to buy government debt. They will continue to lock up these low rates by continuing operation twist. This will prevent the US debt payments from rising for 10 years. Then 10 years from now when the 10 year bond comes due we will have to refinance. At that point we will no longer be able to afford the interest on the debt just like Greece. Then the Fed will just write down the debt they own. That will cause deflation after any inflation they cause until then.


----------



## EdwardBaiamonte (Jun 9, 2012)

KissMy said:


> Then the Fed will just write down the debt they own. That will cause deflation after any inflation they cause until then.



why would that cause deflation???


----------



## KissMy (Jun 9, 2012)

EdwardBaiamonte said:


> KissMy said:
> 
> 
> > Then the Fed will just write down the debt they own. That will cause deflation after any inflation they cause until then.
> ...



Default on or non payment of debt causes deflation. Just like when people failed to pay their home loans. Money is created (inflation) when money is borrowed. Money is destroyed (deflation) when debt is wiped out or not repaid.


----------



## EdwardBaiamonte (Jun 9, 2012)

KissMy said:


> EdwardBaiamonte said:
> 
> 
> > KissMy said:
> ...



yes but the scenerio you describe has the Fed massively defaulting on Treasuries. In that case I assume they would merely inflate to avoid any deflation.


----------



## KissMy (Jun 9, 2012)

EdwardBaiamonte said:


> KissMy said:
> 
> 
> > EdwardBaiamonte said:
> ...



They are already inflating to cover for the deflation from bad sub-prime loans. Once those loans stop defaulting & the economy recovers, the Fed's inflation will show up. Then they will have to write down Treasury debt at the same rate. It may cause panic for a while. We know taxes collected will not be able to cover the interest on the debt once interest rates rise to prevent runaway inflation. They will have to write down debt. The "Baby Boomer's" will soon be drawing hard on the system & pulling money from the markets.


----------



## KissMy (Jun 21, 2012)

Paving Over Pension Liabilities


> Now Congress faces a June 30th deadline, having only been able to pass a 90-day funding extension at the end of March for the nation's transportation needs. As important as stable transportation spending is to the nation's crumbling infrastructure, this bill is not only about roads and bridges. Private corporations are using it as a vehicle to ask Congress to change how they calculate their annual pension contributions, which could create a huge unfunded liability for the American taxpayer.
> 
> Currently, the law requires corporate plans to measure their liabilities, and determine the annual contribution needed to fund them, by using the rate of return on corporate bonds - the discount rate. As historically low bond rates force higher contributions, corporations now want to reduce annual payments to their pension plans by lobbying Congress to change this rate. Not only is this misleading and addictive, but artificially lowering contributions today will add to future pension shortfalls tomorrow-possibly requiring further public bailouts.
> 
> ...


----------



## KissMy (Jun 21, 2012)

FT - Finance: Grinding to a halt


> America&#8217;s $8tn corporate debt market faces a liquidity drought as banks retreat from the trade... Last month, Boston&#8217;s leading asset managers called nine of Wall Street&#8217;s top banks to an emergency meeting in a skyscraper overlooking the city&#8217;s harbour. Over back-to-back discussions they tried to tackle one of the toughest problems confronting financiers and, potentially, the broader economy: America&#8217;s $8tn corporate debt market is running out of its lifeblood &#8211; liquidity...
> 
> If this liquidity crunch intensifies, some companies already battling a global downturn could find they will also face increasing costs in raising funds. This could then dampen growth in a US economy that appears once again to be straining to recover.
> 
> ...


----------



## Toro (Jun 21, 2012)

Comex silver down 5% today, the 14th worst day of the past 12 months. Such big down days are usually followed by more near term weakness. 

Gold has support at $1520-$1530. It must hold there. However, the technical picture is worrisome, particularly for silver.


----------



## Trajan (Jun 21, 2012)

KissMy said:


> FT - Finance: Grinding to a halt
> 
> 
> > America&#8217;s $8tn corporate debt market faces a liquidity drought as banks retreat from the trade... Last month, Boston&#8217;s leading asset managers called nine of Wall Street&#8217;s top banks to an emergency meeting in a skyscraper overlooking the city&#8217;s harbour. Over back-to-back discussions they tried to tackle one of the toughest problems confronting financiers and, potentially, the broader economy: America&#8217;s $8tn corporate debt market is running out of its lifeblood &#8211; liquidity...
> ...



dodd- frank , the gift that has only been half written and will 'keep on giving'


----------



## Trajan (Jun 25, 2012)

yea baby.....daddy needs a new pair of shoes


----------



## Zander (Jun 25, 2012)

Trajan said:


> yea baby.....daddy needs a new pair of shoes



SELL!!! SELL!!! SELL!!!


you'll thank me later.....


----------



## KissMy (Jun 26, 2012)

Public Pensions Face More Pressure Under Accounting Rules


> ...The Governmental Accounting Standards Board, which establishes requirements for state and local government financial reporting, will alter how liabilities are calculated and how assets are reported without affecting how much is actually owed to retirees. Under the new guidelines, to be adopted today, pensions in Illinois, New Jersey, Indiana and Kentucky may have less than 30 percent of assets needed for promised benefits, according to the Boston College Center for Retirement Research...
> 
> The magnitude of the shortfalls ranges from $900 billion to more than $4 trillion, depending on the assumptions used to account for benefits that aren&#8217;t due for decades. New criteria set by the Norwalk, Connecticut-based panel will &#8220;substantially improve&#8221; the accounting and financial reporting of public pension systems, according to a statement by the board.
> 
> ...



In other news - *Stockton, Calif., is set to declare bankruptcy tonight!*

Stockton, California is going to becoming the largest U.S. city ever to file for bankruptcy as the clock ticks down toward the midnight deadline of talks with creditors.

Stockton has already defaulted on about $2 million in debt since February, requiring it to surrender a building once slated to be its future city hall and three parking garages to the trustee for one its bond insurers.


----------



## Toro (Jun 27, 2012)

Silver is at a critical point here. For the past nine months, it has bounced at the $26 level. We are testing it again today. If it breaks below support, it could get ugly and fall back down to the $18-$19 range. If silver breaks down, gold will follow.


----------



## KissMy (Jun 27, 2012)

Toro said:


> No way!
> 
> I'm up to my eyeballs in precious metals.
> 
> You go, Ben!  Bail 'em all out!



Is that you John Paulson, President of Paulson & Co Hedge Fund?


----------



## KissMy (Jul 1, 2012)

Everyone is going to start printing again. Coordinated Central Bank action is on the horizon.

China June official PMI hits 7-month low



> China's factory downturn worsened in June as a key activity index hit a seven-month low, data expected to raise expectations the central bank may seek more policy easing to revive the world's second-largest economy.


----------



## Trajan (Jul 1, 2012)

Zander said:


> Trajan said:
> 
> 
> > yea baby.....daddy needs a new pair of shoes
> ...



Fri Jun 29, 2012 3:23am EDT

* Gold jumps more than 1 pct, erasing June losses
    * EU leaders agree to recapitalise banks from rescue fund
    * Gold could match last year's record above $1,920 -analyst



stand fast in the ranks!!!!!!!!!!!!!!!!


----------



## Toro (Jul 5, 2012)

I added to my silver short this afternoon. It's a small position that I will look to close if silver runs above $29. There are a lot of specs leaning against silver, or at least were before the Euro summit. However, the news since has been incrementally negative for silver since. ADP came in better than expected, the ECB said their eased collateral requirements had expired, Merkel backed away from last week's agreement a bit, and the BoE QE came in lighter than expected. If silver breaks $26, it could fall off a cliff pretty quickly given that the next level of support is at $17-$19. However, if it can hold at these levels, it could be putting in a base to move structurally higher.


----------



## KissMy (Jul 5, 2012)

I think the jobs numbers will be lower than expectations dispite the hot ADP jobs report today. This should boost Gold & Silver with more expectations of QE.


----------



## KissMy (Jul 6, 2012)

If you want to make some fast money in commodities - Buy Soybeans!

I bought several contracts over a month ago @ $13.65 when this dry heat wave began. Soybean crop has now failed or suffered major damage in the USA, Russia, Brazil & Australia this year. Corn has also had bad yields. The Government stocks & positions report is bogus claiming there is 8% more soybeans in storage this year than last year. Farmers have been buying back their futures contracts because they are not going to raise enough soybeans to deliver & fulfill those futures contract obligations.

Stock up your pantry people because food prices are going way up!


----------



## editec (Jul 6, 2012)

KissMy said:


> EdwardBaiamonte said:
> 
> 
> > KissMy said:
> ...


 
DEFLATION?????

If the US fails to pay its on its bonds as specified by contract, that will cause the largest INFLATION ever.

US specie would become entirely WORTHLESS


----------



## Toro (Jul 6, 2012)

KissMy said:


> I think the jobs numbers will be lower than expectations dispite the hot ADP jobs report today. This should boost Gold & Silver with more expectations of QE.



I think it will be higher. The previous three months were affected by weather.


----------



## Toro (Jul 6, 2012)

editec said:


> KissMy said:
> 
> 
> > EdwardBaiamonte said:
> ...



The Fed won't write down their holdings. There's no reason for them to do so. The Fed is going to keep nominal interest rates below nominal GDP to essentially monetize the debt.


----------



## Toro (Jul 6, 2012)

Toro said:


> KissMy said:
> 
> 
> > I think the jobs numbers will be lower than expectations dispite the hot ADP jobs report today. This should boost Gold & Silver with more expectations of QE.
> ...



80k v 100k expected, so KM was right and I was wrong!  

Gold popped $10. This will be forgotten by Monday.


----------



## Trajan (Jul 6, 2012)

KissMy said:


> If you want to make some fast money in commodities - Buy Soybeans!
> 
> I bought several contracts over a month ago @ $13.65 when this dry heat wave began. Soybean crop has now failed or suffered major damage in the USA, Russia, Brazil & Australia this year. Corn has also had bad yields. The Government stocks & positions report is bogus claiming there is 8% more soybeans in storage this year than last year. Farmers have been buying back their futures contracts because they are not going to raise enough soybeans to deliver & fulfill those futures contract obligations.
> 
> Stock up your pantry people because food prices are going way up!



corn up 40% in the last year..


----------



## Toro (Jul 6, 2012)

Gold is down nearly $30 since the NFPs came out, so this was forgotten in about 10 seconds.  PMs going back to test support.


----------



## Trajan (Jul 6, 2012)

stand fast!!!!!!!!!!


----------



## KissMy (Jul 6, 2012)

Toro said:


> editec said:
> 
> 
> > KissMy said:
> ...



The fed can't let rates on the debt rise or we will not be able to make the debt payment. But they will have to raise interest rates to stomp down gold & tame inflation. Last time Paul Volcker had to take rates to 21% to kill gold. The only way to do this & not miss a debt payment is to sterilize the debt by having the fed buy long bonds at near zero interest or to write down the debt they own. When debt is written down it causes deflation. Sterilized debt write-off may not cause deflation or inflation. Inflation is caused when debt is created. Operation Twist is the set-up for just such action. Central banks have also bought a lot of gold so they can dump it every time gold starts to rise. It is a big game that they are planning on winning because the population is not sophisticated to figure it out & house always wins.


----------



## Toro (Jul 6, 2012)

KissMy said:


> Toro said:
> 
> 
> > editec said:
> ...



Writing down debt isn't deflationary per se.  Withdrawing reserves from the system is deflationary.  Those are two different things.  Theoretically, if the Fed wrote down its debt by any significant amount, it would make the Federal Reserve System technically insolvent.  That's why they'll never do it under any circumstance.  The Fed doesn't mark to market its assets so there is no need to mark it down.  If the Fed wants to tame inflation, it can do so by withdrawing liquidity from the system.  If the Fed wants to reduce its balance sheet, it will just let its debt holdings run off without replacing them.


----------



## Trajan (Jul 6, 2012)

50, 100 year bonds anyone?Screw my great, and great great grandchildren, I won't even know them...

this shit is so tired. the political system even if we deferred all of our short term debt. that far out, would just see any gain there by, as an excuse/opportunity to keep spending, our debt to GDP is pretty much at the point where,  IF we don't start 18.5% of a robust economy soon, I don't care if they have a millennium bond.....we start eating ourselves despite any yield curve.


----------



## Toro (Jul 6, 2012)

The plan is a simple one.  The government is monetizing the debt.  They intend to keep nominal interest rates below nominal GDP, just like they did for years after WWII.


----------



## Trajan (Jul 6, 2012)

and the downsides of monetizing  debt. and spending at a 25% to gdp?


----------



## Toro (Jul 6, 2012)

Trajan said:


> and the downsides of monetizing  debt. and spending at a 25% to gdp?



Well, that's why we are in the Gold and Silver thread, aren't we?


----------



## KissMy (Jul 7, 2012)

The low rates are killing the Social Security Trust Fund making that  mandate even further under water & will add to the debt problem.

Bernanke &#8211; My Goal is to Wreck Social Security


----------



## Trajan (Jul 7, 2012)

Toro said:


> Trajan said:
> 
> 
> > and the downsides of monetizing  debt. and spending at a 25% to gdp?
> ...


----------



## Trajan (Jul 7, 2012)

KissMy said:


> The low rates are killing the Social Security Trust Fund making that  mandate even further under water & will add to the debt problem.
> 
> Bernanke  My Goal is to Wreck Social Security



wow.....depressing.


----------



## KissMy (Jul 7, 2012)

Trajan said:


> KissMy said:
> 
> 
> > The low rates are killing the Social Security Trust Fund making that  mandate even further under water & will add to the debt problem.
> ...



It's likely doing the same to all the federal, state & local pension funds that are backed by us tax payers. We are also on the hook for private pensions through the Pension Benefits Guaranty Corp (PBGC).


----------



## Toro (Jul 8, 2012)

A massive Risk On rally occurred on June 30 when the EU leaders surprisingly announced an agreement which would allow the ESM to recapitalize the banks, i.e. EuroTARP.  However, as with all of these Euro summits, cracks are now appearing.  



> Euro-zone countries would still have to guarantee the loans their banks receive from the region's permanent bailout fund, the European Stability Mechanism, even if it directly recapitalizes them, a senior European Union official with direct knowledge of the situation said.
> 
> The remarks Friday cast doubt on what was seen as a breakthrough at a euro-zone leaders' meeting last week, where it was decided that once a central euro-zone bank supervisor was in place, the ESM would be able to directly recapitalize banks.
> 
> ...



Doubts Emerge in Bloc's Rescue Deal - WSJ.com

EuroTARP is a promising start to a possible resolution of the European crisis but I remain very skeptical.  If it appears that the agreement is unlikely to pass, or if it is not as investors thought, then the market will turn to Risk Off.  This would most likely cause a sell-off in gold and silver, threatening to break support levels.  

FTR, I am short silver a bit here, so I'm talking my book.


----------



## KissMy (Jul 8, 2012)

editec said:


> KissMy said:
> 
> 
> > EdwardBaiamonte said:
> ...



Why would you believe that? They did it in 1933 when they confiscated gold & again in 1971 when they took the dollar off of the gold standard. All they have to do is write down the "US Treasuries" held by the "Federal Reserve Bank" & then raise interest rates back up to stop inflation.


----------



## KissMy (Jul 11, 2012)

Fed trio move closer to QE3 Sound alarm on outlook



> A trio of influential Federal Reserve officials on Monday sounded the alarm on the economy, and suggested that the central bank is close to starting another round of asset purchases.
> 
> In a speech to a bankers&#8217; convention in Idaho, John Williams, the president of the San Francisco Federal Reserve Bank, said progress on bringing down the unemployment rate is now running at a &#8220;snail&#8217;s pace,&#8221; and perhaps even stalled.
> 
> ...


----------



## Toro (Jul 24, 2012)

I have covered more than half my silver short at a slight loss.  I may close the position out.

Clearly, someone is not letting silver fall below $26.30.  A fall below $26 and there is nothing but air down to $17-$19.  However, despite the stress in the market, and the generally negative technicals, it can't break support.

The reason is because of the market's belief of another round of QE.  My own opinion is that QE is becoming less and less effective.  Frankly, I've heard "QE" so much, I want to puke my fucking guts out.  It's appalling the amount of market manipulation that is going on.  It signals a desperate Fed.  But the market doesn't give a rat's derriere what I think.  I'm in this to make money.  And if the dummies in Washington want to play this ridiculous card again, I can either bitch and complain about it or make some money off it.


----------



## KissMy (Jul 25, 2012)

Gold & Grains is where people need to be. I have made 35% on grain recently. Corn is going to top $9 a bushel & Soybeans will top $18.

The fed is going to pump more money into the economy. It may not be the same way they did it with QE 1&2 but they are going to find a way to get it done. Fed strives to replenish depleted toolkit


----------



## Toro (Aug 1, 2012)

A bit of a disappointment from the FOMC today, causing an initial sell off in precious metals.  The FOMC did not announced additional QE measures, apart from extending two current programs to the end of the year.  The market was pricing in at least some probability of the Fed announcing an expansion in QE but it did not happen.  The Fed did leave the door open for future actions.  Here is the paragraph from the FOMC statement that matters.



> The Committee also decided to continue through the end of the year its program to extend the average maturity of its holdings of securities as announced in June, and it is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities. The Committee will closely monitor incoming information on economic and financial developments and will provide additional accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability.



Federal Open Market Committee Aug. 1 Statement: Full Text - Bloomberg


----------



## TakeAStepBack (Aug 1, 2012)

Operation twist will be extended indefinitely. They will just never sell it that way. It's abou the flow, not the stock now. At the long end of the curve, the returns are negative. It isn't going any where.

Someone must have slapped Heli-Ben into some sort of reality. That man fears deflation with a phobic intensity Ive never seen. The idea of more money flowing into the economy must give him a raging boner.


----------



## stars (Aug 1, 2012)

I don't have money for stocks but I'm a woman so I bought like really expansive chunky gold and silver jewellery in case I need to trade it in someday, like the expansive hard to find variety. It's worth surprisingly a lot and if you keep it in good condition it's worth the same as you bought, I checked a few weeks ago.


----------



## KissMy (Aug 5, 2012)

Gold coins are the easiest to sell, assay & verify their gold content.


----------



## Toro (Aug 20, 2012)

I added small positions in gold and silver today.  I am still very wary ahead of the next three weeks, but with the strength in the stock market and what appears to be a pretty good bottom in precious metals, I've established a small starter position. 

Everything is going to turn on politics, however.  The important dates are

August 31 - Bernanke's speech at Jackson Hole
September 12 - Germany's Constitutional Court will rule on the constitutionality of the ESM
September 12-13 FOMC meets

I believe the market is baking in QE and EuroQE.  Any backtracking from either could lead to a sharp reversal in risk assets and precious metals.


----------



## Plight (Aug 20, 2012)

Toro said:


> I added small positions in gold and silver today.  I am still very wary ahead of the next three weeks, but with the strength in the stock market and what appears to be a pretty good bottom in precious metals, I've established a small starter position.
> 
> Everything is going to turn on politics, however.  The important dates are
> 
> ...



Worry not, long term gold and silver are going up regardless of the printing presses. Continue to add to your position and dont worry about these mettings...they can't do anything besides lower rates and print money. That's all they believe in anyway.

From WSJ: Eric Rosengren, president of the Federal Reserve Bank of Boston, called on the Fed to launch an aggressive, open-ended bond buying program that the central bank would continue until economic growth picks up and unemployment starts falling again.


----------



## Mad Scientist (Aug 20, 2012)

Plight said:


> Toro said:
> 
> 
> > I added small positions in gold and silver today.  I am still very wary ahead of the next three weeks, but with the strength in the stock market and what appears to be a pretty good bottom in precious metals, I've established a small starter position.
> ...


Which will be never.


----------



## Toro (Aug 21, 2012)

Plight said:


> Toro said:
> 
> 
> > I added small positions in gold and silver today.  I am still very wary ahead of the next three weeks, but with the strength in the stock market and what appears to be a pretty good bottom in precious metals, I've established a small starter position.
> ...



One day, gold will collapse.  That is the history of all commodities, including gold.  Today is no different.

However, it might go to $5000 first.


----------



## editec (Aug 21, 2012)

Looks to me like precious metals will be (has already) losing ground in price comparison to food commodities.

Basically gold's value has been closely mirroring the world price of oil for decades.

*



Gold-Oil Ratio = Price of Gold (per oz.) / Price of Crude Oil (per barrel)
The gold-oil ratio helps us to identify overbought and oversold opportunities for gold. The chart below shows solid support between 8 and 10 barrels/ounce of gold over the last 30 years, with occasional spikes carrying above 20 but seldom holding for any length of time.
		
Click to expand...

 
source*


----------



## william the wie (Aug 21, 2012)

editec said:


> Looks to me like precious metals will be (has already) losing ground in price comparison to food commodities.
> 
> Basically gold's value has been closely mirroring the world price of oil for decades.
> 
> ...


Great chart but it ignores advances in drilling technology. With fracking and off-shore drilling the supply of oil and especially natural gas is exploding worldwide. I would also use the DJIA vs. Gold.


----------



## KissMy (Aug 21, 2012)

"36 times as many municipal defaults over the past 40 years as the conventional wisdom suggests."..."Moodys Investors Service has reported that from 1970 to 2011, there were only 71 municipal bond defaults. But the Fed report counted 2,521 defaults in that time." 

 I guess all that bond paper will keep you warm for a couple of minutes when you light them on fire. Maybe you can eat them for fiber althought the ink on them may not be so good.


----------



## Mad Scientist (Aug 21, 2012)

Toro said:


> *One day, gold will collapse*.  That is the history of all commodities, including gold.  Today is no different.


Not if yer holdin' Dollars. 





Toro said:


> However, it might go to $5000 first.


Please outline even ONE plausible scenario where Gold will go to $5,000 then drop back to pre (as you call it "Commodity Bubble") days of say 250-300 dollars(US).

Just one.


----------



## Toro (Aug 22, 2012)

Mad Scientist said:


> Toro said:
> 
> 
> > *One day, gold will collapse*.  That is the history of all commodities, including gold.  Today is no different.
> ...




When the Fed normalizes interest rates.  That will happen one day.

I don't know if gold will ever go to $250 again.  But an 80% drop from $5000 is $1000, and a 90% drop puts it at $500.  

Gold isn't a religion.  Gold Bugs act like it is.  The True Believers in gold will ultimately suffer the same fate as the True Believers did during the Tech Bubble and during the Housing Bubble.  That's the history of financial markets.  That's the history of commodities.


----------



## Plight (Aug 22, 2012)

As I mentioned previously...there little to nothing the government can do...gold is soaring again today...They're broke, so keep interest rates low...propping up small businesses who produce things of little value because the consumer is broke...indefinite inflation...dont trust your government buy gold and silver


----------



## Toro (Aug 22, 2012)

Analogies to Weimer Germany, Hungary and Zimbabwe are false.  A better analogy is modern-day Japan.  Public borrowing in the United States has replaced the collapse in private sector borrowing.  Total debt has remained roughly constant in the United States as the private sector deleveraged and debt transferred to the Fed's balance sheet.  As one would expect in an asset bubble collapse, velocity has collapsed as banks have chosen to keep reserves at the Fed rather than lend them out into the private market.  Weimer Germany, Hungary nor Zimbabwe were characterized by a balance sheet recession caused by an implosion in asset prices, as happened in Japan and the United States.  The only way we would ever get hyperinflation is if velocity accelerated, something that isn't remotely occurring.  If it starts, then the hyperinflationists will have an argument.  We'll wait until consumer price inflation rises above 5% first before we worry about 5,000,000% inflation.

I added to my gold and silver position after the Fed minutes were released.  My position is still small but the minutes were an incremental positive for gold and silver.  It also appears that precious metals have put in a bottom.  Gold appears to have broken out of the downward technical pattern.  It has a lot of work to get back to $1920 but $1750 is feasible in the near-term.  However, if the Fed disappoints at either Jackson Hole or at the FOMC meeting, or the German constitutional court rules against the ESM, gold and silver will be vulnerable.  They will also be vulnerable as we approach the fiscal cliff.


----------



## Toro (Aug 22, 2012)

Plight said:


> As I mentioned previously...there little to nothing the government can do...gold is soaring again today...They're broke, so keep interest rates low...propping up small businesses who produce things of little value because the consumer is broke...indefinite inflation...dont trust your government buy gold and silver



Gold is NOT soaring today.  Gold is basing.  It soared to $1920 then collapsed to $1530.  Today it is at $1650, the same price it was in May.


----------



## Toro (Aug 22, 2012)

Mad Scientist said:


> Plight said:
> 
> 
> > Toro said:
> ...



It will start in earnest when the excesses in the housing and mortgage markets are finally expunged, which, if you do the math, will be around 2014, give or take.  That's how balance sheet recessions work.


----------



## EdwardBaiamonte (Aug 22, 2012)

Toro said:


> Mad Scientist said:
> 
> 
> > Plight said:
> ...



This depression may feature Barry at the helm in 2014 so there is no knowing that part of the future for 3 months.


----------



## william the wie (Aug 22, 2012)

Toro said:


> It will start in earnest when the excesses in the housing and mortgage markets are finally expunged, which, if you do the math, will be around 2014, give or take.  That's how balance sheet recessions work.


How do you account for the big spike, over 200% in CT if memory serves, in first time late/missed payments on mortgages?

Real estate price writedowns as opposed to mortgage writedowns are a step function with treads of 24-36 months and is driven by the lack of funds to bulldoze abandoned buildings. With inadequate municipal, county and state budgets CA, IL and most of the Washington Boston corridor are headed for another downturn in 2014. The exodus of jobs and homeowners from the affected areas will be the big story in 2014 and really help the rest of the country recover.

So, while like you I expect most of the country to see rising or at least stable real estate prices from 2014 on the pricey areas will see continuous price declines until they revert to the price trendline and if they can't get rid of the abandoned buildings they will keep on dropping.


----------



## Toro (Aug 22, 2012)

william the wie said:


> Toro said:
> 
> 
> > It will start in earnest when the excesses in the housing and mortgage markets are finally expunged, which, if you do the math, will be around 2014, give or take.  That's how balance sheet recessions work.
> ...



We are building about a million homes a year below the intrinsic demand for houses through normal demographic and depletion trends.  Months in inventory - which is depressed due to low sales - is at the long-term average of six months.  There is about two years of shadow inventory when you calculate the number of delinquencies and expected defaults.  Homes are cheap and rents are rising.  By 2014, this will have worked through and the economy will grow at trend again, though probably higher given the pent-up consumer demand that has accumulated over the past several years.


----------



## KissMy (Aug 22, 2012)

Toro said:


> william the wie said:
> 
> 
> > Toro said:
> ...



Consumers may demand houses but they will not have good enough credit to purchase them. Housing demand will be from landlords who will rent them out to all the sub-prime renters.


----------



## KissMy (Aug 23, 2012)

*Of course there is no inflation!* 

The London Olympics of 1908 cost £20,000. The budget for the austerity games of 1948 was £750,000. The current estimate for the cost of the Olympics in 2012 is £11bn.

The earliest underground railway lines in London &#8211; and the world &#8211; cost half a million pounds a mile to build. Roughly, you can assume that average prices in Britain multiplied by 10 between the Victorian era and 1960, and by another factor of 10 in the 50 years following. The cost of the Victoria line, built in the 1960s, had risen in line with general inflation and came in at about £7m per mile. 

This, however, now seems an astonishing bargain. A decade later, the Jubilee line cost £36m per mile to build and its extension in the 1990s 10 times as much. The tunnels for Crossrail, the newest underground railway connection in London, are budgeted at almost £1bn per mile.

The Forth Bridge, an engineering marvel that connects Edinburgh with Fife, was completed in 1890 at a cost of £3.2m. The parallel road bridge erected in the 1960s cost £19.5m &#8211; broadly in line with general inflation. The budget for a third crossing is currently £1.6bn.


----------



## KissMy (Aug 23, 2012)

KissMy said:


> "36 times as many municipal defaults over the past 40 years as the conventional wisdom suggests."..."Moodys Investors Service has reported that from 1970 to 2011, there were only 71 municipal bond defaults. But the Fed report counted 2,521 defaults in that time."
> 
> I guess all that bond paper will keep you warm for a couple of minutes when you light them on fire. Maybe you can eat them for fiber althought the ink on them may not be so good.



  Warren Buffett is paying early termination penalties to exit the muni bond market!!!


----------



## Toro (Aug 23, 2012)

KissMy said:


> Consumers may demand houses but they will not have good enough credit to purchase them. Housing demand will be from landlords who will rent them out to all the sub-prime renters.



That will right itself over time.  Credit is starting to loosen in the mortgage market, albeit slightly.  But as the banks repair their balance sheets, and as the bad debt is expunged, credit will become more available.  Not as available as it was in the Housing Bubble but it will normalize.


----------



## editec (Aug 23, 2012)

william the wie said:


> editec said:
> 
> 
> > Looks to me like precious metals will be (has already) losing ground in price comparison to food commodities.
> ...


 
That a VERY valid point, William.

AS the composition of hydrocarbon energy sources changes, the historical linking of the price of gold to crude oil will probably uncouple.

I wonder if anyone has ever tracked the price of gold to the average cost of energy _per ERG?_

I'll bet _that_ price relationship is even more cloely aligned than the price of crude to gold.


----------



## KissMy (Aug 24, 2012)

The gold standard has returned to mainstream U.S. politics for the first time in 30 years, with a &#8220;gold commission&#8221; set to become part of official Republican party policy.


----------



## Toro (Aug 24, 2012)

Just to deviate a bit.  New home inventory is at the lowest level on record.  Existing homes swamp new homes, but this is another data point demonstrating that the housing market is repairing itself.



> Sales of newly built homes rose briskly in July, and inventory fell to the lowest level on record, suggesting the housing market is showing continued signs of recovery and that builders may need to ramp up construction in the coming months.
> 
> The Census Bureau said Thursday builders sold a seasonally adjusted annual rate of 372,000 homes in July, up 26% from the same month last year. Inventory of new homes available for sale fell to 142,000 units, the lowest level recorded since the government started tracking the figure in 1963.



New-Home Sales Jumped 26% in July - WSJ.com


----------



## KissMy (Sep 13, 2012)

QE3 Baby!!!


----------



## Truthmatters (Sep 13, 2012)

buying gold now would be stupid


----------



## Plight (Sep 13, 2012)

They were saying that at gold $500, 750, 1000, 1250, 1500...golds going to 4-5K an ounce...the criminals at the FED are bankrupting this country


----------



## Truthmatters (Sep 13, 2012)

buy at the high if you want to stupid.

it will make others very happy and rich


----------



## Plight (Sep 13, 2012)

ive been buying since $600/ounce...people like you were mentioning how its too expensive at that price...yeah, it could pullback, but it wont pullback much...golds going higher


----------



## Truthmatters (Sep 13, 2012)

your fine if you bought that long ago.

Now if you dont sell at the right time it wont make any differance when you bought it will it?


----------



## Truthmatters (Sep 13, 2012)

Gold goes down when the economy is doing well.


people need to free up their assets for other investments.


You going to eat that gold if you dont have money to buy groceries?


----------



## Plight (Sep 13, 2012)

Ill start selling some at 3K an ounce..youll probably still be on the sidelines yapping how its too expesnive at that price as well


----------



## Truthmatters (Sep 13, 2012)

Guess what the wealthy do.

they buy low and sell high and tell you the whole time to keep buying because it means they get a higher sell price.

Your ass will be the last to know when you are supposed to sell.


----------



## Truthmatters (Sep 13, 2012)

Plight said:


> Ill start selling some at 3K an ounce..youll probably still be on the sidelines yapping how its too expesnive at that price as well



what makes you think it will reach 3000?

idiot


----------



## Plight (Sep 13, 2012)

I have more wealth than you do. Much more. Im an educated doctor who trades futures/options/stocks/bonds...when gold gets to that price, ill come back and laugh in your face...how does that sound?


----------



## Truthmatters (Sep 13, 2012)

come on tell us your reasons that you forsee a move to the height of 3000 for gold?


----------



## Truthmatters (Sep 13, 2012)

Plight said:


> I have more wealth than you do. Much more. Im an educated doctor who trades futures/options/stocks/bonds...when gold gets to that price, ill come back and laugh in your face...how does that sound?



wow you must be about twelve to think internets claims like that are taken seriously.

tell us what economic conditions you forsee that will place gold at 3000?


----------



## Plight (Sep 13, 2012)

Because the FED CPI reports are *grossly* understating the amount of inflation that's been going on. When your report doesn't include energy or food prices, you are not accurately depicting actual inflation. The same BLS standards used in the 1980s shows that Gold has a long way to go.

The TRUE inflation-adjusted price of gold


----------



## Trajan (Sep 13, 2012)

KissMy said:


> QE3 Baby!!!



 a few of us here had predicted by October, back in Jan/ feb. ,  no great shakes. 

the market would have fallen flat without it, so he had to do it after tall the lead up hints etc....its all BS by now, 2 had less affect than 1 and this will less effect than either,  money velocity is at a 15 year low and the banks will as they did before,  send this back to the fed as excess reserves.......they already have 1.6 Trillion sitting here.


and this 2 million jobs thing? hes drunker than shit.and  the fed is nothing more than a hedge fund with no capital costs......Yet...


----------



## Toro (Sep 13, 2012)

Truthmatters said:


> Gold goes down when the economy is doing well.
> 
> 
> people need to free up their assets for other investments.
> ...



Gold has gone up 10 years in a row regardless whether the economy was expanding or contracting. 

I don't own any gold here. I have been buying stocks heavily over the past few days, but that's only because the technical picture looks better. But gold and silver have the wind at their backs.


----------



## Toro (Sep 13, 2012)

Truthmatters said:


> come on tell us your reasons that you forsee a move to the height of 3000 for gold?



I don't make predictions but $3000 an ounce for gold is certainly possible.


----------



## Trajan (Sep 13, 2012)

Toro said:


> Truthmatters said:
> 
> 
> > come on tell us your reasons that you forsee a move to the height of 3000 for gold?
> ...



well, in any event, UNLESS something very unlikely were to happen, my new chicken shit number is 1850.00.


----------



## Toro (Sep 13, 2012)

Trajan said:


> Toro said:
> 
> 
> > Truthmatters said:
> ...



In the near-term, yeah.  If gold is going to hit $3,000, it won't be this year.


----------



## EdwardBaiamonte (Sep 13, 2012)

Trajan said:


> Toro said:
> 
> 
> > Truthmatters said:
> ...



I'd say you're about right. It was heading straight to $2000 but then the world didn't descent into depression and it stalled. From here out it seems the US and Europe will use their central banks to prevent  disaster and to keep stumbling forward at a snails pace.


----------



## Mad Scientist (Sep 13, 2012)

Truthmatters said:


> Plight said:
> 
> 
> > Ill start selling some at 3K an ounce..youll probably still be on the sidelines yapping how its too expesnive at that price as well
> ...


Infinite Rehypothication from Ben Bernanke at the Federal Reserve.

Idiot.


----------



## Trajan (Sep 13, 2012)

Toro said:


> Trajan said:
> 
> 
> > Toro said:
> ...



oh heck no and I have some tax implications anyway( especially if they don't do a deal on the present tax structure) that may force me to sell ahead of my drop dead price....


----------



## Toro (Sep 13, 2012)

The technical picture looks better for stocks than for gold and silver, however.  Doesn't mean precious metals can't go up, of course, but I've bought stocks heavily over the past few days in anticipation of the printing presses cranking up rather than precious metals.  Stocks just look cleaner to me.

I didn't think Ben would push the printing presses as hard as he did today, though!  w00t!


----------



## uscitizen (Sep 13, 2012)

Why would I need to sell my gold?
I can buy stuff with it just like paper money.

Well Mcdonalds might not know what to do with a gold eagle though 

I bought a lady friend a new car with gold eagles a few years ago.
The dealer was happy to do it.

I bought some cattle with gold eagles a few years ago.


----------



## KissMy (Sep 13, 2012)

Truthmatters said:


> Gold goes down when the economy is doing well.
> 
> 
> people need to free up their assets for other investments.
> ...



I can buy more gas, food & property with my gold than you can with your worthless government bonds.


----------



## Toro (Sep 14, 2012)

Oil over $100 this morning.  Some of that is because of the Mid East but QE is also pushing it higher.


----------



## KissMy (Sep 21, 2012)

Gold is at 1776 today & begging for a revolution.


----------



## Toro (Sep 21, 2012)

Money printing, w00t!


----------



## KissMy (Sep 21, 2012)

US Dollar "Petro Dollar" is no longer primary oil currency. Now China's Yuan is "Petro Yuan"

Got Gold???????????

"On Thursday, Sept. 6... just a few days ago, China made the official announcement. China said on that day, our banking system is ready, all of our communication systems are ready, all of the transfer systems are ready, and as of that day, Thursday, Sept. 6, any nation in the world that wishes from this point on, to buy, sell, or trade crude oil, can do using the Chinese currency, not the American dollar...

Ironically, since Sept. 6, the U.S. dollar has fallen from 81.467 on the index to today's price of 79.73. While analysts will focus on actions taking place in the Eurozone, and expected easing signals from the Federal Reserve on Thursday regarding the fall of the dollar, it is not coincidence that the dollar began to lose strength on the very day of China's announcement...

On Friday, Sept. 7, Russia announced, that as of today, we will supply China with all of the crude oil that they need, no matter how much they want... there is no limit. And Russia will not sell or trade this crude oil to China using the American dollar."


----------



## EdwardBaiamonte (Sep 21, 2012)

KissMy said:


> US Dollar "Petro Dollar" is no longer primary oil currency. Now China's Yuan is "Petro Yuan"
> 
> Got Gold???????????
> 
> ...



can someone explain why QE is pushing up commodities but not causing general inflation? It seems initially it might not cause general inflation but by this time you'd think it would have??


----------



## KissMy (Sep 21, 2012)

EdwardBaiamonte said:


> can someone explain why QE is pushing up commodities but not causing general inflation? It seems initially it might not cause general inflation but by this time you'd think it would have??



Slowing Velocity of Money & Low Lending (Money Multiplying) is masking the currency printing.


----------



## Toro (Sep 21, 2012)

The Chinese banking system is a complete mess.  Yuan oil-trading is a non-event.


----------



## Toro (Sep 21, 2012)

KissMy said:


> EdwardBaiamonte said:
> 
> 
> > can someone explain why QE is pushing up commodities but not causing general inflation? It seems initially it might not cause general inflation but by this time you'd think it would have??
> ...



Write.  Plus, that money has to go somewhere, and it has bled into the commodities markets.  Same as the 00s when we didn't get CPI but got a housing bubble.  The excess cash went into mortgages and housing.  That's why modern general equilibrium economics is a heap of epic fail.


----------



## KissMy (Sep 24, 2012)

Morgan Stanley: QE3 Not Enough to Help Equities, Look For QE4

MORGAN STANLEY: We Could See QE4 By The End Of The Year

Japan launches QE8 as 20-year slump drags on


> Japan has launched an eighth round of quantitative easing to weaken the yen and cushion a slide back into recession. The Bank of Japan (BoJ) is to buy a further 10 trillion yen (£79bn) of bonds, bringing the total accumulated so far in its battle against deflation to 80 trillion yen, or 20pc of Japanese GDP.



Paul Krugman says we must print more than $85 Billion a month. State pensions are underfunded by $Trillions.

Could Municipal Bonds Be the Next Financial Titanic?


> The Federal Reserve Bank of New York just found that municipal bond defaults are in fact much greater than rating agencies have reported. For example, Standard & Poor&#8217;s reported 47 defaults between 1986 and 2011, but according to the New York Fed, there were in fact 2,366. After a two-year study, the Securities and Exchange Commission released a report at the end of July that properly emphasized the need for improved disclosure of municipalities&#8217; finances and pricing transparency.


----------



## Toro (Sep 25, 2012)

Toro said:


> KissMy said:
> 
> 
> > EdwardBaiamonte said:
> ...



Of course, I meant to say "Right."

lol

dummy


----------



## KissMy (Oct 4, 2012)

Does anyone know if the Fed can roll over it's government bonds 10 years from now at near zero interest even if the going interest rate at that time is 10+%?


----------



## EdwardBaiamonte (Oct 4, 2012)

Toro said:


> KissMy said:
> 
> 
> > EdwardBaiamonte said:
> ...



I see how you can create a mortgage bubble because Fed money often enters the market as mortgage money but not how you create a commodity bubble.

I heard a Brazilian Fed official say he was going to defend against QE3. Maybe he meant raising raw material prices out of a certainty that QE3 was ultimately inflationary??


----------



## FireFly (Oct 18, 2012)

KissMy said:


> The gold standard has returned to mainstream U.S. politics for the first time in 30 years, with a gold commission set to become part of official Republican party policy.




Romney Says No To Gold In Monetary Policies


> I know that in the past when we had a gold standard, the idea that somehow it was detached from or free from any interference by Congress was simply wrong because even with the gold standard someone has to decide what is the conversion rate between the gold and the dollar...
> 
> And Congress can inflate the dollar simply by changing the exchange rate, as was done in the past. So I don't think there's any, if you will, magic bullet substitute for economic restraint, for not spending more money than you take in, for having the nation that's the most productive in the entire world. That's how you get wealth for the middle class is making America a more productive nation with high savings rates and a government that only spends what it takes in...
> 
> I'd like to appoint my own person. If I became president of the United States, I'd like to have a Fed chairman that shares my views and that I have confidence in. And there are things that, obviously, in the past, I think the Fed has made a number of mistakes. I don't know that you're going to avoid making mistakes, but I'd like to have someone new in that position.


----------



## Mr. H. (Oct 18, 2012)

First-Time Treasure Hunter Discovers Trove of Roman-Era Gold Coins | ABC News Blogs - Yahoo!


----------



## Mad Scientist (Oct 18, 2012)

FireFly said:


> Romney Says No To Gold In Monetary Policies
> 
> 
> > If I became president of the United States, I'd like to have a Fed chairman that shares my views and that I have confidence in. And there are things that, obviously, in the past, I think the Fed has made a number of mistakes. I don't know that you're going to avoid making mistakes, but I'd like to have someone new in that position.


That's funny! He *knows* that The Fed Reserve System sends him names that *they* want and that he'll have no say in the whole process.

The Gov't is set up like the Mafia with the Banking "Godfathers" on top issuing orders and appointing people. Mitt Romney is like a "Don", he has power but he's not the top of the food chain.

The big scam is that the American people (who know more about Sports than Politics) think he's "The Godfather" and has all the power when he's really just a puppet. That's how he can get away with telling a lie, that if he actually tried to implement, would get him "JFK'd" or Arkancided".


----------



## Toro (Oct 18, 2012)

I'm wondering if gold and silver are trading shorts here.


----------



## EdwardBaiamonte (Oct 18, 2012)

Mad Scientist said:


> The Gov't is set up like the Mafia with the Banking "Godfathers" on top issuing orders and appointing people.



Another liberal conspiracy nut job!! 

Bernanke is a mild mannered college professor; as such he can be easily controlled by the dark forces- right! Pity he wasted his entire life studying monetary policy when the puppet masters are in control. But, then again, it's the perfect cover too!! I'm sure if Bernanke let's on he's doomed for sure!!

Liberals lack the IQ to understand monetary policy  but do have a accurate feeling it is sort of foundational to the entire economy. Hence, nut job liberal conspiracy theories abound.


----------



## KissMy (Oct 19, 2012)

Dick Cheney said to Treasury Secretary Paul O'Neill: "You know, Paul, Reagan proved that deficits don't matter. We won the mid-term elections, this is our due."

Japan has also proven that deficits don't matter.

Cheney Was Right About One Thing: Deficits Don't Matter


----------



## EdwardBaiamonte (Oct 19, 2012)

KissMy said:


> Dick Cheney said to Treasury Secretary Paul O'Neill: "You know, Paul, Reagan proved that deficits don't matter. We won the mid-term elections, this is our due."
> 
> Japan has also proven that deficits don't matter.
> 
> Cheney Was Right About One Thing: Deficits Don't Matter




too stupid!! Cheney is not an economist and does not pretend to speak for Republican/libertarian economists and if he did everyone would laugh!!!

See why we are positve a liberal will be slow???


----------



## Gadawg73 (Oct 19, 2012)

Investors today are going big time on the US dollar over gold on fears of Europe again. Bro in law said his orders just now after the close for Monday are top heavy on US dollar. 
Get ready for the gold nose dive.


----------



## EdwardBaiamonte (Oct 19, 2012)

Gadawg73 said:


> Investors today are going big time on the US dollar over gold on fears of Europe again. Bro in law said his orders just now after the close for Monday are top heavy on US dollar.
> Get ready for the gold nose dive.



with Europe and/or the US facing a possible economic implosion I see no reason for gold to nose dive versus currency when implosion will almost certainly trigger currency inflation.

Let's not forget its far easier for the Fed to expand its balance sheet than contract it, especially now that it is full of junk mortgages!

THe Europe/USA divide is hard to call since they face a EU breakup but they also have more incentive to balance their books than we do. We can merely print money while austerity or fiscal responsibility is their first option! When you see riots there you know they are doing the right thing. Don't look for them here. In a real sense their riots demonstrate they're more conservative than they are


----------



## Trajan (Oct 19, 2012)

I'm watching it.....


----------



## EdwardBaiamonte (Oct 19, 2012)

Trajan said:


> I'm watching it.....



why bother, as a liberal you'll have no idea what you're seeing


----------



## Trajan (Oct 19, 2012)

holy shit, I am a liberal? 


I gotta ask my wife about this


----------



## elvis (Oct 19, 2012)

Trajan said:


> holy shit, I am a liberal?
> 
> 
> I gotta ask my wife about this



this guy says you are.


----------



## Trajan (Oct 19, 2012)

elvis said:


> Trajan said:
> 
> 
> > holy shit, I am a liberal?
> ...



well, lets hope I don't end up like he did....


----------



## elvis (Oct 19, 2012)

Trajan said:


> elvis said:
> 
> 
> > Trajan said:
> ...



don't worry.  he was already dead before they hung him upside down and played piñata with him and his girlfriend.


----------



## Trajan (Oct 19, 2012)

man am I relieved.....



not!


----------



## Toro (Oct 19, 2012)

HEY!

No FUCKING liberals posting in my thread, YA HEAR!


----------



## Gadawg73 (Oct 20, 2012)

EdwardBaiamonte said:


> Gadawg73 said:
> 
> 
> > Investors today are going big time on the US dollar over gold on fears of Europe again. Bro in law said his orders just now after the close for Monday are top heavy on US dollar.
> ...



And the evidence of FED policy to date supports your thesis.
Good post.


----------



## Toddsterpatriot (Oct 20, 2012)

EdwardBaiamonte said:


> Gadawg73 said:
> 
> 
> > Investors today are going big time on the US dollar over gold on fears of Europe again. Bro in law said his orders just now after the close for Monday are top heavy on US dollar.
> ...


*
Let's not forget its far easier for the Fed to expand its balance sheet than contract it, especially now that it is full of junk mortgages!*

Those mortgages are guaranteed and trading well over par.
If they need to, they'll have no problem contracting their balance sheet.


----------



## Trajan (Oct 20, 2012)

Toro said:


> HEY!
> 
> No FUCKING liberals posting in my thread, YA HEAR!


----------



## EdwardBaiamonte (Oct 20, 2012)

Toddsterpatriot said:


> EdwardBaiamonte said:
> 
> 
> > Gadawg73 said:
> ...



Yes, guaranteed by Fanny Freddie which is deep in bankruptcy. If Fed sells it risks driving interest rates up on $16 trillion in government debt , killing housing market, and entire economy. I'd say have some gold in you portfolio


----------



## Toddsterpatriot (Oct 20, 2012)

EdwardBaiamonte said:


> Toddsterpatriot said:
> 
> 
> > EdwardBaiamonte said:
> ...



*Yes, guaranteed by Fanny Freddie which is deep in bankruptcy.*

Guaranteed by the US Treasury.

*If Fed sells it risks driving interest rates up on $16 trillion in government debt*

How much do you want them to reduce their balance sheet?
If the economy recovers, rates go up regardless of Fed action.
They can let the sheet shrink by doing nothing.
How fast do you want them to shrink?

*I'd say have some gold in you portfolio*

When rates go back up, I'm afraid gold will plummet.


----------



## EdwardBaiamonte (Oct 20, 2012)

Toddsterpatriot said:


> *Yes, guaranteed by Fanny Freddie which is deep in bankruptcy.*
> 
> Guaranteed by the US Treasury.



fedreserve.gov: With the target federal funds rate at the effective lower bound, the FOMC sought to provide additional policy stimulus by expanding the holdings of longer term securities in its portfolio, the System Open Market Account (SOMA), including large-scale purchases of fixed-rate, mortgage-backed securities (MBS) guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae (referred to as "agency MBS"). The purchases were intended to lower longer-term interest rates and contribute to an overall easing of financial conditions.


----------



## EdwardBaiamonte (Oct 20, 2012)

Toddsterpatriot said:


> How much do you want them to reduce their balance sheet?
> If the economy recovers, rates go up regardless of Fed action.
> They can let the sheet shrink by doing nothing.
> How fast do you want them to shrink?


 
The balance sheet grew to lower interest rates and thus create mal- investment or  to avoid austerity or fiscal responsibility. The faster
it shrinks the better!


----------



## EdwardBaiamonte (Oct 20, 2012)

Toddsterpatriot said:


> *I'd say have some gold in you portfolio*
> 
> When rates go back up, I'm afraid gold will plummet.



i'd say if rates go up because of real growth you're right but if they go up because  the fed can  no longer hold them down artificially with liberal gimmicks then you're wrong.


----------



## Toddsterpatriot (Oct 20, 2012)

EdwardBaiamonte said:


> Toddsterpatriot said:
> 
> 
> > *Yes, guaranteed by Fanny Freddie which is deep in bankruptcy.*
> ...



While debt from Fannie and Freddie does not carry an explicit government guarantee, the Treasury has taken numerous steps to reassure investors that the government will keep the companies running. *Late last year, the Obama administration pledged to cover unlimited losses through 2012 for Freddie and Fannie.* So far, the companies have needed $126 billion in taxpayer aid.

"As we said in December, there should be no uncertainty about Treasury's commitment to support Fannie Mae and Freddie Mac as they continue to play a vital role in the housing market," Treasury spokeswoman Meg Reilly said in a statement.


----------



## Toddsterpatriot (Oct 20, 2012)

EdwardBaiamonte said:


> Toddsterpatriot said:
> 
> 
> > How much do you want them to reduce their balance sheet?
> ...



So if they shrink 50% a year, that would be good?


----------



## Toddsterpatriot (Oct 20, 2012)

EdwardBaiamonte said:


> Toddsterpatriot said:
> 
> 
> > *I'd say have some gold in you portfolio*
> ...



The Fed can't hold rates down with gimmicks, except the overnight rate.
If the market wants higher longer term rates, those rates will rise.


----------



## KissMy (Oct 20, 2012)

You must pay 3% + $0.50 transaction fee more for items using a credit or debit card. Gold is 2% or less. You can buy gas, food, etc with gold at many places. You can't drive through any business district & not find a gold dealer or business selling goods for gold.


----------



## Toddsterpatriot (Oct 20, 2012)

KissMy said:


> You must pay 3% + $0.50 transaction fee more for items using a credit or debit card. Gold is 2% or less. You can buy gas, food, etc with gold at many places. You can't drive through any business district & not find a gold dealer or business selling goods for gold.



*You must pay 3% + $0.50 transaction fee more for items using a credit or debit card.*

I've never paid a fee to use my credit card.

*You can buy gas, food, etc with gold at many places.*

Where?
*
You can't drive through any business district & not find a gold dealer or business selling goods for gold.*

I've never seen a business selling goods for gold.
Where are these fictional businesses?


----------



## KissMy (Oct 21, 2012)

Toddsterpatriot said:


> KissMy said:
> 
> 
> > You must pay 3% + $0.50 transaction fee more for items using a credit or debit card. Gold is 2% or less. You can buy gas, food, etc with gold at many places. You can't drive through any business district & not find a gold dealer or business selling goods for gold.
> ...



You pay the credit fee because it is added into the price. Stuff would be a lot cheaper if business was not secretly charging you for credit card fees. I always ask for a cash discount. If they don't give me a discount then I don't buy from them.

That Mobil station pictured that sells automobile repair services, gas, fuel, food, drink, etc. is located at: 2928 East Fowler Avenue, Tampa, FL 33612


----------



## Toro (Oct 21, 2012)

I've started to see gas stations that charge extra for credit cards.  It's not common but it's beginning to pop up.


----------



## editec (Oct 21, 2012)

I just took a look at 2928 East Fowler Avenue, Tampa, FL 33612
on Google Earth.

Looks to me like the signage is for TWO DIFFERENT businesses.

One that sells GAS and another that buys and sells gold.

There's also a sandwich shop in that building.

Do we suppose one can buy their gas with sandwiches, too?


----------



## KissMy (Oct 21, 2012)




----------



## Toddsterpatriot (Oct 21, 2012)

KissMy said:


> Toddsterpatriot said:
> 
> 
> > KissMy said:
> ...



Charging an extra $1 per gallon to use credit, their customers must all be liberals.
How much gas can you buy for a gram of gold?


----------



## expat_panama (Oct 21, 2012)

KissMy said:


> ...You can buy gas, food, etc with gold at many places...


I'd say we could buy stuff with gold virtually anywhere.

All we have to do is convince the vendor the gold's real and that they'd be able to dump the gold without losing time or money.  Most people don't want to buy stuff with gold and are glad we haven't had to for decades.  

Here's how gas prices in gold compare to dollar prices since 1980:





Sure, gold peddlers say the gas/gold price is almost as low as it was 30 years ago.  That's true, it's a fluke, it's almost always a lot higher, and month/month changes with gold are much worse than changes in dollars.


----------



## expat_panama (Oct 21, 2012)

Huh.   Looks like I ruined all the fun when I burst the 'bubble' everyone was playing with.



Sorry about that.


----------



## EdwardBaiamonte (Oct 21, 2012)

Toddsterpatriot said:


> EdwardBaiamonte said:
> 
> 
> > Toddsterpatriot said:
> ...



except the point of QE2- infinity and "operation twist" is to hold down long tern rates. Under section 13 (3) the Fed can do anything it wants!!!


----------



## expat_panama (Oct 21, 2012)

EdwardBaiamonte said:


> ...the Fed can do anything it wants!!!


--except control the free market. 

OK, so they can _'affect'_ market interest rates when they buy/sell debt, but so can you and I; and sure, the Fed's got more to spend than either you or I but you, me, and the rest of the world have got a _lot_ more power than any gov't.  


Just ask the Bank of England about Soros.


----------



## Toddsterpatriot (Oct 21, 2012)

EdwardBaiamonte said:


> Toddsterpatriot said:
> 
> 
> > EdwardBaiamonte said:
> ...



*Under section 13 (3) the Fed can do anything it wants!!! *

They can try.


----------



## EdwardBaiamonte (Oct 22, 2012)

Toddsterpatriot said:


> EdwardBaiamonte said:
> 
> 
> > Toddsterpatriot said:
> ...



who would stop them? Who even feels qualified to know what they do? They are free as a bird I'm afraid. Chuck Schumer told Bernanke that Congress was gridlocked and the Fed was the only game in town!!


----------



## EdwardBaiamonte (Oct 22, 2012)

the Fed can do anything it wants!!!




expat_panama said:


> except control the free market.



they can do that too!! They caused the Great Depression, 21% interest rates in 1981, and the current housing depression.


----------



## Toddsterpatriot (Oct 22, 2012)

EdwardBaiamonte said:


> Toddsterpatriot said:
> 
> 
> > EdwardBaiamonte said:
> ...



*who would stop them?*

The market.

They can flap their arms and try to fly, doen't mean they can.


----------



## Toddsterpatriot (Oct 22, 2012)

EdwardBaiamonte said:


> the Fed can do anything it wants!!!
> 
> 
> 
> ...



*the Fed can do anything it wants!!!*

It wants to get the economy moving again.

How's that working out?


----------



## expat_panama (Oct 23, 2012)

EdwardBaiamonte said:


> the Fed can do anything it wants!!!
> 
> 
> 
> ...


Huh.


Did the Fed also cause the prosperity before and after the Great Depression, win two world wars, defeat the USSR, and create America's wealth totaling $60T?


----------



## FireFly (Oct 23, 2012)

Europe&#8217;s debtors must pawn their gold for Eurobond Redemption


----------



## KissMy (Oct 27, 2012)

There Is No National Debt Unless You Want It

IMF Economists: &#8216;We Were Wrong.&#8217; Will Someone Please Tell The Press And The Politicians.


----------



## Mad Scientist (Oct 27, 2012)

expat_panama said:


> EdwardBaiamonte said:
> 
> 
> > the Fed can do anything it wants!!!
> ...


Looks like "The Fed" had a hand in creating 1,500 Trillion in Derivatives.


----------



## Toro (Oct 27, 2012)

Mad Scientist said:


> expat_panama said:
> 
> 
> > EdwardBaiamonte said:
> ...



They did?  How?


----------



## expat_panama (Oct 28, 2012)

Toro said:


> Mad Scientist said:
> 
> 
> > expat_panama said:
> ...


The Fed controls everything.  Remember when Bush was doing everything?




Now it's the Fed.


----------



## KissMy (Oct 31, 2012)

It's been 5 days since you were able to last sell your stock. Even if the stock market opens the price will be down & you will have to wait 3+ days for the trade to clear & 2+ more days to get cash in hand. If you are in the north east & need cash right now due to the frankenstorm disaster & your money is tied up in stock, you are SOL. You are 2+ weeks away from getting any money.

If you have gold, already you have a hot meal, a warm place to stay, TV, computer, power & transportation.


----------



## expat_panama (Oct 31, 2012)

KissMy said:


> ...your money is tied up in stock, you are SOL. You are 2+ weeks away from getting any money.  If you have gold, already you have a hot meal,


Let's separate fantasy from reality and piece together what's real.  I'll start a list of points I imagine we could agree on, and you tell me where and if we diverge.


Some buy stocks, some land, some metals.
People go for what they're comfortable with.
Just because one person says his "x" is easier to buy and sell doesn't mean it's that much easier for anyone else.
Individuals decide for themselves what's best to suit their own needs.
Nobody ever convinced anyone else by strutting and running off at the mouth.


----------



## Mad Scientist (Oct 31, 2012)

Toro said:


> Mad Scientist said:
> 
> 
> > expat_panama said:
> ...


By printing money for banks to play in Casinos (Stock Market) with. 
The total world GDP is roughly 60-70 Trillion, The Derivatives Market is *at least* 1,600 Trillion.


----------



## Mad Scientist (Oct 31, 2012)

expat_panama said:


> KissMy said:
> 
> 
> > ...your money is tied up in stock, you are SOL. You are 2+ weeks away from getting any money.  If you have gold, already you have a hot meal,
> ...


Which is exactly what YOU do.


----------



## KissMy (Oct 31, 2012)

expat_panama said:


> KissMy said:
> 
> 
> > ...your money is tied up in stock, you are SOL. You are 2+ weeks away from getting any money.  If you have gold, already you have a hot meal,
> ...



I was not talking not about your list. I was stating a fact about gold usefulness in the event of an economic collapse, currency crisis, natural disaster, peak oil, war or political unrest.


----------



## Toddsterpatriot (Oct 31, 2012)

Mad Scientist said:


> Toro said:
> 
> 
> > Mad Scientist said:
> ...



*The Derivatives Market is at least 1,600 Trillion. *

Yes, the nominal value is very high. So what?


----------



## william the wie (Oct 31, 2012)

Haven't posted lately just been lurking at times. Me, I am going with GLD, REITs amd cash until the current confusion ends.


----------



## Toro (Nov 1, 2012)

Gold and silver look interesting here. Both appear to have put in a near term bottom and may be ready to assault this years highs. 

I'm wondering if the PMs are forecasting an Obama win. A Romney win would signal at least a near term perception of a more hard money policy going forward. PMs topped out around the first debate and fell when Romney surged in the polls. Now, with polls showing an Obama win more likely, PMs are moving up again. I would expect a Romney victory would lead to a sharp drop in prices.


----------



## KissMy (Nov 1, 2012)

Toddsterpatriot said:


> Mad Scientist said:
> 
> 
> > Toro said:
> ...



When the derivative loser can't afford to pay the derivative winner, there will be a problem.


----------



## Mad Scientist (Nov 1, 2012)

KissMy said:


> Toddsterpatriot said:
> 
> 
> > Mad Scientist said:
> ...


See what's happening in Greece? That's coming here.


----------



## Paulie (Nov 1, 2012)

Toro said:


> .
> 
> I'm wondering if the PMs are forecasting an Obama win. A Romney win would signal at least a near term perception of a more hard money policy going forward. .



Why would you think that though?  Because he made a few statements about the Fed in the primary debates?

Smart money knows Romney isn't touching monetary policy.


----------



## KissMy (Nov 1, 2012)

Mad Scientist said:


> We won't be like Greece. It will be different. We have a printing press. Weaker currency will slow job outsourcing & may create in-sourcing which changes the dynamics. We will have many problems but other government's telling our government not to pay benefits, employees & basic services will not be one of them.



Inflation of imported product will be the problem we face. Currently we import a lot of product, that will be a problem until we import the manufacturing of many of those products.


----------



## Toro (Nov 1, 2012)

Paulie said:


> Toro said:
> 
> 
> > .
> ...



Rumours were floating around the markets a week or two ago that he would not reappoint Bernanke and instead appoint John Taylor.


----------



## Paulie (Nov 1, 2012)

Toro said:


> Paulie said:
> 
> 
> > Toro said:
> ...



There's not enough distance between him and Bernanke to really make much of a difference at the end of the day.  

In my opinion.


----------



## william the wie (Nov 1, 2012)

As to PM predictions overlay Sandy induced flooding and D voting districts in VA, PA and OH. If propensity to vote stays the same Obama may have been defeated by Sandy.


----------



## Toro (Nov 1, 2012)

Paulie said:


> Toro said:
> 
> 
> > Paulie said:
> ...



There is a pretty big difference. There wouldn't be QE infinity under Taylor.


----------



## Toddsterpatriot (Nov 1, 2012)

KissMy said:


> Toddsterpatriot said:
> 
> 
> > Mad Scientist said:
> ...



So what? Nobody owes 1,600 trillion on those derivatives.
I bet $10 on a football game. The nominal value of my bet was over $2 billion.
Is there a problem if the counterparty fails to pay?


----------



## Toddsterpatriot (Nov 1, 2012)

Mad Scientist said:


> KissMy said:
> 
> 
> > Toddsterpatriot said:
> ...



Derivatives aren't debt.


----------



## william the wie (Nov 1, 2012)

Toddsterpatriot said:


> Mad Scientist said:
> 
> 
> > KissMy said:
> ...


But with the Euro zone banning speculative CDSs the liquidity of debt markets in Europe is likely to sink and interest rates rise.


----------



## Toddsterpatriot (Nov 1, 2012)

william the wie said:


> Toddsterpatriot said:
> 
> 
> > Mad Scientist said:
> ...



It's true, when governments react to a crisis, they often make things worse.


----------



## percysunshine (Nov 1, 2012)

The unwinding of titles to debt will take a decade. Sit back, relax, and enjoy it...


----------



## KissMy (Nov 2, 2012)

Toddsterpatriot said:


> KissMy said:
> 
> 
> > Toddsterpatriot said:
> ...



Yes it is. When bankers use those derivatives bets to counter real bets with deposits they lost.


----------



## EdwardBaiamonte (Nov 2, 2012)

Paulie said:


> Toro said:
> 
> 
> > Paulie said:
> ...



Huge difference!! Taylor would run a much more restrictive monetary  policy!! Bernanke is flooding the markets with money seemingly unaware of the the huge mal-investment he is creating; not to mention the $400 billion in lost interest on savings. The economic world is now so artifical  no one can tell where we're going, but it cant be good. At best we'll have a lost decade.


----------



## Toddsterpatriot (Nov 2, 2012)

KissMy said:


> Toddsterpatriot said:
> 
> 
> > KissMy said:
> ...



But my $10 bet has a $2 billion nominal value.

How will I pay that off if I lose?


----------



## Toddsterpatriot (Nov 2, 2012)

EdwardBaiamonte said:


> Paulie said:
> 
> 
> > Toro said:
> ...



*Bernanke is flooding the markets with money seemingly unaware of the the huge mal-investment he is creating*

$1.4 trillion in excess reserves. Where is the malinvestment?


----------



## EdwardBaiamonte (Nov 2, 2012)

Mad Scientist said:


> Toro said:
> 
> 
> > Mad Scientist said:
> ...



here's  a way to understand it for a liberal . There are $11 trillion in homes in the USA so in effect $11 trillion in value is insured. If others want to speculate or invest in that market they can.The value of the insurance or deriviatives can go to 22 trillion or 44 trillion or 88 trillion but in the end if every house disappeared only $11 trillion is at risk, not the 22 or 44,  or 1600 trillion. Liberals act like tomorrow someone has to come up with $1600 trillion. Nothing could further from the truth.


----------



## william the wie (Nov 2, 2012)

EdwardBaiamonte said:


> Mad Scientist said:
> 
> 
> > Toro said:
> ...


Wait a minute that should read home mortgages. Total real estate value is 5-8 times GDP and a huge hunk of housing close to half is owned free and clear.


----------



## EdwardBaiamonte (Nov 2, 2012)

william the wie said:


> EdwardBaiamonte said:
> 
> 
> > Mad Scientist said:
> ...



yes but each house is still insured so each house means someone is on the hook for full value of 175K


----------



## Toro (Nov 2, 2012)

Gold and silver took a beating today.  The jobs number came in better than expected.  More jobs means less potential QE, and the precious metals were crushed.


----------



## KissMy (Nov 9, 2012)

Gold is up because there is no capital gains tax on gold.


----------



## expat_panama (Nov 9, 2012)

KissMy said:


> ...there is no capital gains tax on gold...


You may want to read page D-11 of this IRS publication that includes this--





--and then pay up that 28% you've been evading plus fines and penalties.


----------



## KissMy (Nov 9, 2012)

expat_panama said:


> KissMy said:
> 
> 
> > ...there is no capital gains tax on gold...
> ...



Only if you are stupid enough to tell them. There is no record when I buy or sell gold. No one ask for ID or SSN. You will however have to pay higher taxes on your gains in Apple stock over the past 9 years if you don't sell before the year end. That is why all the high flying stocks are tanking & gold is rising.


----------



## william the wie (Nov 9, 2012)

KissMy said:


> expat_panama said:
> 
> 
> > KissMy said:
> ...


And the IRS doesn't check out sites like this?


----------



## KissMy (Nov 9, 2012)

william the wie said:


> KissMy said:
> 
> 
> > expat_panama said:
> ...



When they get around to those offshore tax havens, tax haven charities, Swiss accounts, Nevada corporations, etc. I may think about hiding it a little better.


----------



## KissMy (Dec 5, 2012)

The looming fiscal cliff is killing Gold's MoJo. If we go over the cliff, the debt will contract & gold will dive until Bernanke unleashes a tsunami of money. Gold will move in both directions in advance of the events. It's going to be a wild ride.


----------



## KissMy (Jan 6, 2013)

KissMy said:


> editec said:
> 
> 
> > KissMy said:
> ...



This plan is gaining traction. Why not mint a trillion-dollar platinum coin? 

They could mint the $Trillion coin from the  isotopically pure platinum-190 which is the most precious metal in the world & cost a billion dollar an ounce. "Robert A. Freitas Jr., author of Tangible Nanomoney in Issue 2 of the Nanotechnology Industries Newsletter, speculates a figure for 190Pt of $1,347,960 per gram for 4.19% enrichment. This would come out to $32 million per gram in its pure state, or about $1 billion per troy ounce."


----------



## Zander (Jan 6, 2013)

KissMy said:


> The looming fiscal cliff is killing Gold's MoJo. If we go over the cliff, the debt will contract & gold will dive until Bernanke unleashes a tsunami of money. Gold will move in both directions in advance of the events. It's going to be a wild ride.



Gold prices tend to rise when the economy is expanding,  they tend to fall when the economy contracts. With the bevy of new taxes being levied on Americans, we'll be lucky to see tepid or no growth in 2013 (economists are saying 1-2%).  That leads me to believe that Gold prices will fall.


----------



## Toro (Jan 6, 2013)

Zander said:


> KissMy said:
> 
> 
> > The looming fiscal cliff is killing Gold's MoJo. If we go over the cliff, the debt will contract & gold will dive until Bernanke unleashes a tsunami of money. Gold will move in both directions in advance of the events. It's going to be a wild ride.
> ...



There's no correlation between economic growth and gold prices.  Counter-intuitively, there is no correlation between consumer prices and gold prices either.

I don't know what gold is going to do.  What I do know is that since gold hit its all-time peak at $1921, it has acted poorly.  It may be consolidating or it may be breaking down.  In the near-term, it appears to be breaking down.  

On the other hand, the dollar may be putting in a bottom, at least against other fiat currencies.  The DXY has been continuously bouncing off 78.  I am long the dollar.

The fundamentals continue to favour gold.  However, I am ultimately a chartist for commodities.  I don't know if gold has topped, but it will one day.  And when it ends, it will be very ugly, and will go to levels the biggest gold bulls would totally disbelieve today.


----------



## Zander (Jan 6, 2013)

Toro said:


> Zander said:
> 
> 
> > KissMy said:
> ...


I said that Gold prices do TEND to rise in economic expansions and fall in contractions. If you look at the 2008 crisis  Gold fell 34% and Silver fell 61%. If you expect another crisis, then you should expect a decline. The only thing that gives me any pause is that the Daily Sentiment Index shows Gold bullish sentiment at only 6%......

Happy trading!


----------



## Toro (Jan 6, 2013)

I agree that a crisis will cause gold prices to fall.  That's why I wouldn't hold it in front of the debt ceiling negotiations.


----------



## EdwardBaiamonte (Jan 8, 2013)

Toro said:


> I agree that a crisis will cause gold prices to fall.  That's why I wouldn't hold it in front of the debt ceiling negotiations.



I'm lost, a crisis ought to make it rise, not fall.


----------



## Toro (Jan 8, 2013)

EdwardBaiamonte said:


> Toro said:
> 
> 
> > I agree that a crisis will cause gold prices to fall.  That's why I wouldn't hold it in front of the debt ceiling negotiations.
> ...



You're right.  It might go up.  It did go up when the debt ceiling didn't get lifted in 2011.  But that was in the midst of a buying frenzy that had been going on for a few months.

Gold has been acting more as a liquidity barometer than a fear indicator the past 10 years.  It fell 25% when Lehman collapsed.  If liquidity is pulled from the market, which is what would happen if we fail to lift the debt ceiling, asset prices will fall.  My guess is that gold would fall with it.  But maybe I'm wrong.


----------



## Gadawg73 (Jan 8, 2013)

Toro said:


> Zander said:
> 
> 
> > KissMy said:
> ...



I am long on the dollar also.
Bond funds which have expanded dramatically with low interest rates will take a hit when rates go up but possibly not as bad as expected with the dollar where it is and staying.


----------



## EdwardBaiamonte (Jan 9, 2013)

Toro said:


> EdwardBaiamonte said:
> 
> 
> > Toro said:
> ...



I don't know it seems to me the world can count on the Greenspan PUT more than ever thanks to Ben.

If we fail to lift the debt ceiling the world may take us seriously about our determination to live within our means, although in the very short term there might be panic.

Lehman I'd guess is past history since we are now in bailout heaven, whereas then we had no idea what might happen or even if we knew how to bail out a company so thoroughly integrated into the economy.


----------



## william the wie (Jan 10, 2013)

Toro, I may be wrong but I thought junk gold conversion rates were keeping gold prices low. As that source of supply dries up I would expect gold prices to rise.


----------



## EdwardBaiamonte (Jan 10, 2013)

william the wie said:


> Toro, I may be wrong but I thought junk gold conversion rates were keeping gold prices low. As that source of supply dries up I would expect gold prices to rise.



and evidence to support that position??


----------



## william the wie (Jan 11, 2013)

EdwardBaiamonte said:


> william the wie said:
> 
> 
> > Toro, I may be wrong but I thought junk gold conversion rates were keeping gold prices low. As that source of supply dries up I would expect gold prices to rise.
> ...


McAlvaney and a few other hard currency newsletters I follow have been making that claim:

What is known is that the rates of junk gold purchase have been slowing down for about a year.

The purchases of bullion and coins have not been slowing down and gold mining employment is increasing more slowly than purchases.

What is unknown are the trigger prices for reopening abandoned mines and total junk gold inventories.


----------



## EdwardBaiamonte (Jan 13, 2013)

william the wie said:


> EdwardBaiamonte said:
> 
> 
> > william the wie said:
> ...



the housing scare and obama scare is over so gold is stuck in place and not likely to move much except slowly with the economy as it moves up or down.


----------



## Toro (Apr 15, 2013)

In April 2011, silver hit $49.76 and gold hit $1921.  Today, silver is trading at $23.19 and gold $1395.  Silver has since fallen by 53% and gold 27%.

Gold and silver are commodities.  They aren't a religion.


----------



## editec (Apr 15, 2013)

Gold and silver work as excellent indicators for public confidence regarding the economy.

At best they are a lifeboat for those with spare capital who are confident that inflation is eroding purchasing power for their money.


----------



## KissMy (Apr 15, 2013)

China just blew up the worlds biggest property bubble. Chinese Government is imposing a new 20 percent tax on profits from housing sales of second home. Chinese people are rapidly selling homes ahead of the tax. Divorce filings shot up across China after rumors spread that one way to avoid the new 20 percent tax on profits from housing sales was to separate from a spouse, at least on paper.

NYT: In China, Checklist for a Home Seller: First, Get a Divorce

All the rush to sell second homes in China is crashing the housing market. This has crashed the commodities market globally. Government's can't print enough money to stop the deflationary spiral that is now taking hold. Gold & Silver are correcting just like all commodities did here late 2008. Then they will bounce when the spiral hits bottom.


----------



## editec (Apr 15, 2013)

KissMy said:


> China just blew up the worlds biggest property bubble. Chinese Government is imposing a new 20 percent tax on profits from housing sales of second home. Chinese people are rapidly selling homes ahead of the tax. Divorce filings shot up across China after rumors spread that one way to avoid the new 20 percent tax on profits from housing sales was to separate from a spouse, at least on paper.
> 
> NYT: In China, Checklist for a Home Seller: First, Get a Divorce
> 
> All the rush to sell second homes in China is crashing the housing market. This has crashed the commodities market globally. Government's can't print enough money to stop the deflationary spiral that is now taking hold. Gold & Silver are correcting just like all commodities did here late 2008. Then they will bounce when the spiral hits bottom.



Molly bar the door if China's economy goes down!

No I am not shitting here, I am agreeing with you.

What this world surely does not need right now is a CHINESE government at risk of the people rising up because their economy is fibrilating.

The Chinese, unlike we Americans, understand the concept of REVOLUTION


----------



## KissMy (Apr 15, 2013)

European banks are also selling a lot of gold to remain solvent. This & China pressure is a double hit to Gold recently.


----------



## Oddball (Apr 15, 2013)

Market correction....Buy!


----------



## hjmick (Apr 15, 2013)

Oddball said:


> Market correction....Buy!



Wait...


----------



## CrusaderFrank (Apr 15, 2013)

editec said:


> KissMy said:
> 
> 
> > China just blew up the worlds biggest property bubble. Chinese Government is imposing a new 20 percent tax on profits from housing sales of second home. Chinese people are rapidly selling homes ahead of the tax. Divorce filings shot up across China after rumors spread that one way to avoid the new 20 percent tax on profits from housing sales was to separate from a spouse, at least on paper.
> ...



The Chinese, unlike we Americans, are unarmed.

You might also want to Google "American Revolution" you might learn something


----------



## Oddball (Apr 15, 2013)

hjmick said:


> Oddball said:
> 
> 
> > Market correction....Buy!
> ...


The ratios still make silver the better buy.


----------



## Mad Scientist (Apr 15, 2013)

Toro said:


> In April 2011, silver hit $49.76 and gold hit $1921.  Today, silver is trading at $23.19 and gold $1395.  Silver has since fallen by 53% and gold 27%.
> 
> Gold and silver are commodities.  They aren't a religion.


See, there ya' go calling Gold and Silver "Commodities" again!

Massive $20 Billion Paper Gold Sell Orders Trigger Stop Loss Selling And Unfounded Panic | Max Keiser


> Investment banks and hedge fund speculators can manipulate the paper or  futures gold price in whichever direction they want in the short term  due to the massive 20 to 1 leverage they can utilise and that is what  was clearly seen on Friday.


Mish's Global Economic Trend Analysis: Marc Faber "I love the Fact that Gold is Finally Breaking Down"; Gold vs. Apple; Patience, Gold, Japan


> I love the markets. I love the fact that gold is finally breaking down. That will offer an excellent buying opportunity. I would just like to make one comment. At the moment, a lot of people are knocking gold down. But if we look at the records, we are now down 21% from the September 2011 high. Apple is down 39% from last years high. At the same time, the S&P is at about not even up 1%from the peak in October 2007. Over the same period of time, even after todays correction gold is up 100%. The S&P is up 2% over the March 2000 high. Gold is up 442%. So I am happy we have a sell-off that will lead to a major low. It could be at $1400, it could be today at $1300, but I think that the bull market in gold is not completed.


----------



## Toro (Apr 15, 2013)

Oddball said:


> Market correction....Buy!



Did you?


----------



## Toro (Apr 15, 2013)

This is a market crash for precious metals.


----------



## KissMy (Apr 15, 2013)

The US raised taxes & cut spending. This lowered the annual deficit. = Bad for Gold.

China imposed taxes on second homes popping the worlds biggest housing bubble. = Bad for Gold.

Cypress & other European Banks selling gold to remain solvent. = Bad for Gold.

The large move in Gold has triggered a margin increase / lower gold leverage.  = Bad for Gold.


----------



## EdwardBaiamonte (Apr 15, 2013)

KissMy said:


> The US raised taxes & cut spending. This lowered the annual deficit. = Bad for Gold.
> 
> China imposed taxes on second homes popping the worlds biggest housing bubble. = Bad for Gold.
> 
> ...



good government  is bad for gold. The mystery is why so many think the world has better government now than a few years ago. I suppose conservatives ought to be buying gold with the USA now as liberal as Europe.


----------



## Toro (Apr 17, 2013)

The technical play book says to short all rallies in precious metals up to $1520 in gold and $26 in silver.


----------



## editec (Apr 17, 2013)

Shoot folks.

If you have some spare lucre, put a couple more tanks for heating oil or propane.

Better still, invest in getting you home  off the grid or making your lifestyle more energy efficient.


----------



## EdwardBaiamonte (Apr 17, 2013)

editec said:


> Shoot folks.
> 
> If you have some spare lucre, put a couple more tanks for heating oil or propane.



you make perfect sense, as usual,  given the that we just disovered 200 years supply on our own continent!! You may be the only person on earth not to know that!


----------



## Trajan (Apr 17, 2013)

KissMy said:


> The US raised taxes & cut spending. This lowered the annual deficit. = Bad for Gold.
> 
> China imposed taxes on second homes popping the worlds biggest housing bubble. = Bad for Gold.
> 
> ...



Paulson is shitting bricks....hes got to hang in there.....hes stuck.


----------



## Oddball (Apr 17, 2013)

Toro said:


> Oddball said:
> 
> 
> > Market correction....Buy!
> ...


Junk silver, yes....I'll continue.


----------



## KissMy (Apr 29, 2013)

Swiss may soon be backing their currency with Gold!



> Swiss National Bank, has revealed that 70 per cent of the country&#8217;s gold was stored in Switzerland, 20 per cent with the Bank of England and 10 per cent with the Bank of Canada.
> 
> A week ago, the Swiss Cabinet announced the nationalist Swiss People&#8217;s Party had gathered enough signatures to force a referendum that would ban the central bank from selling off any gold reserves or storing them abroad.
> 
> ...


----------



## Toro (Apr 29, 2013)

The SNB sold their gold back in the 1990s. 

Sell at the bottom, but at the top. Typical central banks.


----------



## william the wie (Apr 29, 2013)

Toro said:


> The SNB sold their gold back in the 1990s.
> 
> Sell at the bottom, but at the top. Typical central banks.


Hey Toro, could you check my math?  Looking at inflation numbers I'm getting a gold price of just under 15 (1913 dollars) when it sold at $20.50/oz. at that time.


----------



## Toro (Jun 20, 2013)

Gold broke $1300 and is down nearly 6% overnight.


----------



## Toddsterpatriot (Jun 20, 2013)

Toro said:


> Gold broke $1300 and is down nearly 6% overnight.



Holy crap. It's a good thing silver and gold are the only real money. LOL!


----------



## Toro (Jun 20, 2013)

Silver went through $20. 

I wish I had the cajones to have stuck with my short!


----------



## OohPooPahDoo (Jun 20, 2013)

MY July 130 GLD PUT that I paid $6.25 per contract the last time gold crashed is now worth $6.25 per contract again. That was a hell of a ride, as it was down to <$2.00 a one point.

Now I will ride this gold crash down with you bitches picking your pockets along the way. I got ONE MONTH left!


----------



## Toro (Jun 26, 2013)

Gold is down another $50 and silver $1 this morning.

OPPD is getting rich!


----------



## OohPooPahDoo (Jun 26, 2013)

Toro said:


> Gold is down another $50 and silver $1 this morning.
> 
> OPPD is getting rich!



Ya ya ya ya!!!!


----------



## Toro (Jun 27, 2013)

Gold is trading at $1199.


----------



## KissMy (Aug 18, 2013)

Gold is climbing because people are finally waking up to the fact the Fed can't taper. Detroit filed bankruptcy even as the Fed was printing $85 billion to buy government debts. If the Fed tapers we will see 100 cities bankrupt like Detroit. If that ever happens, run for the hills. Deflationary depression gold & stock market crash will surely follow.


----------



## Toddsterpatriot (Aug 18, 2013)

KissMy said:


> People are finally waking up to the fact the Fed can't taper. Detroit filed bankruptcy even as the Fed was printing $85 billion to buy government debts. If the Fed tapers we will see 100 cities bankrupt like Detroit. If that ever happens, run for the hills. Deflationary depression market crash will surely follow.



*If the Fed tapers we will see 100 cities bankrupt like Detroit.*

How does the Fed taper make Chicago's bankruptcy more likely?

If the Fed doesn't taper, does that somehow fill the holes in Chicago's pension systems?


----------



## TakeAStepBack (Aug 18, 2013)

Gold has been rising since 71 with few lulls. This is one of those lulls and can be explained by easy M2, sell offs of large entities (created the closest thing to a natural correction we get) and a manipulation with ETFs.

It's rising again, and will rise even further when the federal reserve begins to "taper" off of its easing policies (I dont believe they will or can and know it). That is, if they ever actually do it. With the long end of the curve yielding negative, they know what will happen if they do. I think Ben is just waiting to leave before it happens so his "legacy" isn't tainted by those who believe the fed is doing a good job.


----------



## KissMy (Aug 18, 2013)

Toddsterpatriot said:


> KissMy said:
> 
> 
> > People are finally waking up to the fact the Fed can't taper. Detroit filed bankruptcy even as the Fed was printing $85 billion to buy government debts. If the Fed tapers we will see 100 cities bankrupt like Detroit. If that ever happens, run for the hills. Deflationary depression market crash will surely follow.
> ...



A third of the federal stimulus went to plug holes in city & state debts. The fed buys these bad debts & holds them at zero interest. This is back door monetization (sterilizing debt) that has been filling Chicago's debt holes. When it stops, bankruptcies begin.


----------



## Toro (Aug 18, 2013)

TakeAStepBack said:


> Gold has been rising since 71 with few lulls. This is one of those lulls and can be explained by easy M2, sell offs of large entities (created the closest thing to a natural correction we get) and a manipulation with ETFs.
> 
> It's rising again, and will rise even further when the federal reserve begins to "taper" off of its easing policies (I dont believe they will or can and know it). That is, if they ever actually do it. With the long end of the curve yielding negative, they know what will happen if they do. I think Ben is just waiting to leave before it happens so his "legacy" isn't tainted by those who believe the fed is doing a good job.



Gold fell 70% over 20 years.  I'd say that's more than a "lull."


----------



## AmazonTania (Aug 18, 2013)

Plenty of blame of the sell off in the stock market is attributed to the notion that the Fed is going to taper. There might be some people out there who believes that the fed is going to taper. I'm not one of them. The Fed knows if it tapers it'll throw the economy right back into recession (officially, anyway) which will cause them to un-taper. Tapering today just plants the seeds for more QE tomorrow, which is why I believe the Gold market is rallying.


----------



## Toddsterpatriot (Aug 18, 2013)

KissMy said:


> Toddsterpatriot said:
> 
> 
> > KissMy said:
> ...



*A third of the federal stimulus went to plug holes in city & state debts.*

Yes. I remember the wasted Obama spending from 2009.
We're talking about a 2013 taper. Stay focused.

*The fed buys these bad debts & holds them at zero interest. *

The Fed doesn't buy Detroit or Chicago paper. 

* This is back door monetization *

The Fed buys US Treasury and Fannie and Freddie securities, not munis.

*that has been filling Chicago's debt holes.*

Obama gave Chicago money recently? Link?


----------



## KissMy (Aug 18, 2013)

Toddsterpatriot said:


> KissMy said:
> 
> 
> > Toddsterpatriot said:
> ...



The Fed bought federal stimulus debt. Stimulus money filled holed in city & state budget debt. The current $85 billion monthly Fed QE3 is buying government bonds holding interest rates on munis way low. This dramatically cut debt payments for city & states, and Detroit failed & had to file bankruptcy. The federal government is also handing lots of healthcare money to the states. Through Federal roads, bridges, military, homeland security, TSA, etc. they are funneling money over to cities & states any way they can.


----------



## Toro (Aug 18, 2013)

FTR I believe there is a good chance the precious metals bull market of 1998-2011 is over.  It may not be, IDK, but the top in 2011 looked like a classic commodities top, and silver subsequently fell by 60%.  Stocks soaring and PMs collapsing makes me think the bull market is done.


----------



## AmazonTania (Aug 18, 2013)

Toro said:


> FTR I believe there is a good chance the precious metals bull market of 1998-2011 is over.  It may not be, IDK, but the top in 2011 looked like a classic commodities top, and silver subsequently fell by 60%.  Stocks soaring and PMs collapsing makes me think the bull market is done.



I disagree. With Hong Kong and China being net sellers of Treasuries and the Fed with it's taper talks, this is bad for the US Dollar and Strong for gold. Gold has already sold off on the anticipation of a taper that hasn't happened yet. The metal is due for a rally anyway, as the sell-off was extreme and led by speculators. Now that we've cleared off some of the resistance, I think we can easily have a $150 - $200 rally in the price of gold very quickly. It may or may not happen before we have another serious pull back towards the next level.


----------



## KissMy (Aug 18, 2013)

For decades the Federal Government has been taking from the SS windfall. Now they have to start paying it back. They can't afford to stop printing money. They may have to increase the printing. Gold will not fall if Tapering does not start in September, which it most certainly wont.


----------



## Toro (Aug 18, 2013)

AmazonTania said:


> Toro said:
> 
> 
> > FTR I believe there is a good chance the precious metals bull market of 1998-2011 is over.  It may not be, IDK, but the top in 2011 looked like a classic commodities top, and silver subsequently fell by 60%.  Stocks soaring and PMs collapsing makes me think the bull market is done.
> ...



Gold has been selling off for two years, including into the last round of QE, whereas stocks have been rising.  I've always thought of QE as positive for gold and ultimately negative for most other things, except maybe for inflation.  Again, IDK the future, but gold falling and stocks rising is telling me that I may be wrong and Bernanke is right. 

Most people who are trading gold have never traded a bear market and don't know what one looks like. Most will not recognize a top either. There are too many who view gold as religion or ideology. They are useless. Sites like Zero Hedge cost people money. 

If I'm wrong, I will trade gold to the upside. But there is massive technical damage in PMs. And until proven otherwise, rallies are to be shorted. 

IMHO.


----------



## whitehall (Aug 18, 2013)

Silver hovered around $32 per oz for a pretty long time and it dropped like a rock to around $18. Now it languishes at around $23. Gold is too expensive so what's the point.


----------



## AmazonTania (Aug 18, 2013)

Toro said:


> AmazonTania said:
> 
> 
> > Toro said:
> ...



Too many people have strayed away from Gold as there are too many bidders who are considering it in anticipation of a recovering economy. As positive news about the economy appears, Gold sells off more. The expectations of inflation has not really caused a rally, as there is plenty of news out there about inflation being nearly non-existent. The shorts are looking for confirmation of a recovering economy. Gold is going to take off as the market sees QE as indefinite. The gold traders (or at least the Gold Buyers) see through this.


----------



## KissMy (Aug 18, 2013)

James Bullard, president of the St. Louis Fed, said "It is possible if you pull back too quickly you put more downward pressure on inflation and end up with inflation running below 1 percent. And then I think at that point, deflation possibilities would start to arise.... We're not in that situation right now, but that is one scenario that I would worry about."

"There has not been much indication, so far, that it has been ticking back up toward target... There are a lot of ways this could go. You could do a small amount of tapering versus a larger amount."

"I would be happy to claim that there has been substantial improvement in labor markets. I think the bigger question marks are on growth and on inflation."

The Fed's "committee has set a target. They've set it at 2 percent," Bullard said. "Once you've set it, you had better have some credibility that you are going to hit it."

Bullard, a voting member of the committee this year, dissented at the June meeting, saying that the Fed should have signaled more strongly its willingness to keep its stimulus in place out of concern inflation was not heading higher.

Bullard has been particularly outspoken on the issue, and released an unusually sharp statement to explain his dissent, although he voted with the majority at the July meeting after the inclusion of a low inflation warning in the statement.


----------



## JWBooth (Aug 18, 2013)

Toro said:


> FTR I believe there is a good chance the precious metals bull market of 1998-2011 is over.  It may not be, IDK, but the top in 2011 looked like a classic commodities top, and silver subsequently fell by 60%.  Stocks soaring and PMs collapsing makes me think the bull market is done.



Fine by me. I hope it tanks. I'll load up.


----------



## KissMy (Aug 18, 2013)

Rick Santelli started the Tea Party with a rant. Since then he has been going after the Fed.

[youtube]ZEJ4jSXF2d4[/youtube]
[youtube]9jhXMB3bXMk[/youtube]
[youtube]bPCTvXlGE3o[/youtube]


----------



## TakeAStepBack (Aug 19, 2013)

Toro said:


> TakeAStepBack said:
> 
> 
> > Gold has been rising since 71 with few lulls. This is one of those lulls and can be explained by easy M2, sell offs of large entities (created the closest thing to a natural correction we get) and a manipulation with ETFs.
> ...



Where do you get that from?

In 1971, gold was $44.60 (FRN rate annual close)
In 1974 it hit $183.77
In 1980, $594.90
In 1990, $386.20 (showing the good standings of the 1980s confidence)
In 2000, $342.75
In 2012, $1,664.00


I bought my first lot in 2001. I've only gained significantly since then.


----------



## KissMy (Aug 19, 2013)

The Fed will not "Taper" or "Tighten" in any way any time soon.

Bernanke said the 7.6 percent unemployment rate probably "overstates the health of the labor market" and that inflation remains below the Fed's 2 percent target. Moreover, fiscal policy remains "quite restrictive"..."Highly accommodative monetary policy for the foreseeable future is what's needed"


----------



## TakeAStepBack (Aug 19, 2013)

the longer it continues, the less likely, or even possible it will be to tighten it back up. Goldman-Sachs paper about the long end of the yield curve turning negative already should be an indicator. The Fed will have to pull out some serious magic regarding its balance sheets in order to stem what would be essentially cardiac arrest from a raise in interest rates.


----------



## Toro (Aug 19, 2013)

TakeAStepBack said:


> Toro said:
> 
> 
> > TakeAStepBack said:
> ...



Gold peaked at $850 on January 21 1980. It bottomed at $252 on August 26 1999.  That's a decline of 70%.  That's a bear market. 

Silver peaked at $49.79 on April 25, 2010. It hit a subsequent low of $18.23 on June 28, 2013. That's a decline of 63%. That's not a correction. That's a brutal bear market. 

I think it's a good idea to have a bit of gold and silver in a well diversified portfolio. But right now, there is no reason IMO to load the boat on either.


----------



## TakeAStepBack (Aug 19, 2013)

You're looking at peak, not annual close out. That's the difference. There are wild fluxuations in markets, as Im sure you are aware. But choosing the peak/bottoms over a ten year spread doesn't really tell us anything. Last/current year alone, looking at those indicators would say that gold is absolutely a "hands off" commodity. yet, it's not really giving the full story.


----------



## Toro (Aug 19, 2013)

KissMy said:


> The Fed will not "Taper" or "Tighten" in any way any time soon.
> 
> Bernanke said the 7.6 percent unemployment rate probably "overstates the health of the labor market" and that inflation remains below the Fed's 2 percent target. Moreover, fiscal policy remains "quite restrictive"..."Highly accommodative monetary policy for the foreseeable future is what's needed"



The Fed has bought a trillion dollars in bonds, yet gold has gone down. When anything goes down hard on fundamentally bullish news, that's usually the market telling you that it's over, at least in the near term.  When the market talks, it pays to listen. 

I think every single commodity is trading well below its peak. Many have been cut in half or more. There is plenty of reason to believe that the bull market in commodities that started in the 90s is now over, and that includes gold and silver. 

BTW, in 401k accounts, Apple was the largest holding, the GLD was second.


----------



## Toro (Aug 19, 2013)

TakeAStepBack said:


> You're looking at peak, not annual close out. That's the difference. There are wild fluxuations in markets, as Im sure you are aware. But choosing the peak/bottoms over a ten year spread doesn't really tell us anything. Last/current year alone, looking at those indicators would say that gold is absolutely a "hands off" commodity. yet, it's not really giving the full story.



Bull and bear markets are annotated by price, not time.  Time is end point sensitive, price is not.


----------



## Toro (Aug 19, 2013)

BTW, QE may not be ending next month, but the market is sniffing it out. QE began in 2008. It is now 2013. QE will most likely begin to be unwound next year or 2015, probably the latter. If it is 2015, then we are in year 5 of a 7 year operation.  Gold rose by 660% from the bottom to the $1921 top in 2011, which is a massive return.

The run is probably done.


----------



## FireFly (Aug 19, 2013)

Toro said:


> BTW, in 401k accounts, Apple was the largest holding, the GLD was second.



It is hard to believe the GLD is that widely held. Where did you get that info?

GLD holders must be getting scared of paper because I have been hearing physical demand is through the roof.


----------



## TakeAStepBack (Aug 19, 2013)

Toro said:


> TakeAStepBack said:
> 
> 
> > You're looking at peak, not annual close out. That's the difference. There are wild fluxuations in markets, as Im sure you are aware. But choosing the peak/bottoms over a ten year spread doesn't really tell us anything. Last/current year alone, looking at those indicators would say that gold is absolutely a "hands off" commodity. yet, it's not really giving the full story.
> ...



Right. so going by that logic, there was also a ~500% increase over 20 years except in a selective price interpretation. From June. 1 1992  to June 1 2012.


----------



## TakeAStepBack (Aug 19, 2013)

FireFly said:


> Toro said:
> 
> 
> > BTW, in 401k accounts, Apple was the largest holding, the GLD was second.
> ...



As they should be. ETFs are absolutely manipulated.


----------



## FireFly (Aug 19, 2013)

TakeAStepBack said:


> FireFly said:
> 
> 
> > Toro said:
> ...



Yup! - "just as we have seen unprecedented drops in COMEX inventories, we are now seeing this ratio reach levels that have not been seen before in recent COMEX history "


----------



## Toro (Aug 19, 2013)

TakeAStepBack said:


> Toro said:
> 
> 
> > TakeAStepBack said:
> ...



You are correct. If you use those two endpoints, there was a rise from $343 to $1597. That's an argument for holding gold over a very long period of time as a diversifying asset in a portfolio. It's not an argument for why QE is going to destroy the value of the dollar, which is the argument of most gold bugs.


----------



## Toro (Aug 19, 2013)

FireFly said:


> Toro said:
> 
> 
> > BTW, in 401k accounts, Apple was the largest holding, the GLD was second.
> ...



I was surprised by that as well. 

Physical demand is through the roof. But I wouldn't necessarily view that as a positive. What matters is the total demand for gold, not just physical. If paper selling overwhelms physical demand, the price is going to go down regardless. Paper buying is what drove up the price in the first place. The GLD became one of the largest holders of gold in the world. Physical demand tends to come from retail clients, who are generally less sophisticated than institutional investors, and tend to be worse buyers and sellers than professionals.


----------



## Toddsterpatriot (Aug 19, 2013)

KissMy said:


> Toddsterpatriot said:
> 
> 
> > KissMy said:
> ...



*The Fed bought federal stimulus debt. Stimulus money filled holed in city & state budget debt. *

Yes, the Fed bought Treasuries and Obama threw money at states and cities in 2009.
We're talking about the Fed tapering in 2013. 

*The current $85 billion monthly Fed QE3 is buying government bonds holding interest rates on munis way low. *

You have any charts for this claim? Any for Chicago and Detroit?

*they are funneling money over to cities & states any way they can*

Yeah, they waste a lot of money. You think they'll spend less after the Fed tapers? I wish!!!


----------



## KissMy (Aug 19, 2013)

Toro said:


> You are correct. If you use those two endpoints, there was a rise from $343 to $1597. That's an argument for holding gold over a very long period of time as a diversifying asset in a portfolio. It's not an argument for why QE is going to destroy the value of the dollar, which is the argument of most gold bugs.



The value of the dollar was destroyed at an 8.5% annual rate from 2000 to 2008 when all the bad mortgages were made. The deflationary snap back did not occur because the Fed bought them up with minted money making that prior dollar erosion permanent. On top of that they are also trying to cause additional 2% annual inflation. If we ever truly recover, the velocity of money will tank the dollar.

Fed, state & local pensions, SS, Healthcare, Unemployment insurance, etc., were all baby boom government windfalls over the last 45 years. Now they have become government debts that must be repaid. The Fed can't stop printing for 20 years.


----------



## TakeAStepBack (Aug 19, 2013)

Toro said:


> TakeAStepBack said:
> 
> 
> > Toro said:
> ...



Yeah. i thought it was common knowledge that gold and silver were hedges against inflation. Which is, of course, also an argument against QE. Which is simply a hidden inflation. The Fed has finally come out publicly that it acknowledges that "tapering" and other methods to "cool" will result in burst trends. This is iniflation, just not the mandated version of 2% against CPI.


----------



## KissMy (Aug 19, 2013)

TakeAStepBack said:


> Yeah. i thought it was common knowledge that gold and silver were hedges against inflation. Which is, of course, also an argument against QE. Which is simply a hidden inflation. The Fed has finally come out publicly that it acknowledges that "tapering" and other methods to "cool" will result in burst trends. This is iniflation, just not the mandated version of 2% against CPI.



QE is not as hidden as governments implied backing of shadow banking mortgages. That caused massive panic inflation.


----------



## Toddsterpatriot (Aug 19, 2013)

KissMy said:


> Toro said:
> 
> 
> > You are correct. If you use those two endpoints, there was a rise from $343 to $1597. That's an argument for holding gold over a very long period of time as a diversifying asset in a portfolio. It's not an argument for why QE is going to destroy the value of the dollar, which is the argument of most gold bugs.
> ...



*when all the bad mortgages were made. The deflationary snap back did not occur because the Fed bought them up with minted money *

The Fed didn't buy bad mortgages. Only guaranteed ones. 

*Fed, state & local pensions, SS, Healthcare, Unemployment insurance, etc., were all baby boom government windfalls over the last 45 years. Now they have become government debts that must be repaid. *

Unfunded mandates are not debts.


----------



## KissMy (Sep 7, 2013)

The jobs numbers are down. The economy has not achieved escape velocity. Fed Taper will be pushed off again.


----------



## editec (Sep 7, 2013)

If you are counting on GOLD as a reserve for value?

You'd best have that gold in your possession.

Word to the wise, eh?

there's more gold promised out there than I think exists.

Not sure if silver is in the same boat.

But I certainly have my doubts about the veracity of companies that are storing GOLD for investors.


----------



## Toro (Sep 7, 2013)

Someone asked me if gold was being repressed by central banks.  I don't know, to be honest, but I doubt it.  Central banks have been net buyers of gold over the past several years.

In the 1990s, it was in vogue for central banks to sell gold as it became viewed as an archaic relic that had a cost of carry, compared to bonds which earned interest.  Central banks like those in Switzerland and Canada sold all or almost all of it and bought bonds.  The Bank of England bottomed ticked the gold market by selling much of its gold at around $260.  In some years, central banks were selling up to 1000 tons of gold a year.  In a market where supply and demand is in balance somewhere around 3000 tons a year, that is immense supply.  The selling was so intense that the gold industry rounded up the central banks and they signed The Washington Accord, which limited the amount of gold that could be sold by central banks to 500 tons a year.  

Now, about 10 years ago, a gold trader on a Wall Street desk told me that the central banks were repressing the price of gold, so I don't want to dismiss it completely out of hand.  But if gold is being systematically suppressed by central banks, selling at the bottom and buying at the top seems like an odd way to do it. 

Rather, I see central banks as run by people who have the same human emotions we all have.  And after seeing bonds earn a lot of money in the massive bull market in the 80s and 90s while gold fell by 75%, they sold their gold and bought bonds, moves that were supported by modern theories of monetary policy.  Then, with gold rising by several hundred percent in the 00s, they bought gold.  This is typical investor behavior.  Central banks have other motives besides profits, but they are run by humans who are susceptible to human emotions just like the rest of us.


----------



## Ropey (Sep 7, 2013)

Toro said:


> Someone asked me if gold was being repressed by central banks.  I don't know, to be honest, but I doubt it.  Central banks have been net buyers of gold over the past several years.
> 
> In the 1990s, it was in vogue for central banks to sell gold as it became viewed as an archaic relic that had a cost of carry, compared to bonds which earned interest.  Central banks like those in Switzerland and Canada sold all or almost all of it and bought bonds.  The Bank of England bottomed ticked the gold market by selling much of its gold at around $260.  In some years, central banks were selling up to 1000 tons of gold a year.  In a market where supply and demand is in balance somewhere around 3000 tons a year, that is immense supply.  The selling was so intense that the gold industry rounded up the central banks and they signed The Washington Accord, which limited the amount of gold that could be sold by central banks to 500 tons a year.
> 
> ...





Modern paper theories (futures and bonds) have the their own market weaknesses that sway to the beat of too many drums in the long term, imho.

 I'm short on paper and long on metals.


----------



## Toddsterpatriot (Sep 7, 2013)

Ropey said:


> Toro said:
> 
> 
> > Someone asked me if gold was being repressed by central banks.  I don't know, to be honest, but I doubt it.  Central banks have been net buyers of gold over the past several years.
> ...



That hasn't done too well over the last 2 years, has it?


----------



## Ropey (Sep 7, 2013)

7





Toddsterpatriot said:


> Ropey said:
> 
> 
> > Toro said:
> ...



Long, baby. Go long.






My father started me on this path of going long back in 1973.


----------



## Toro (Sep 7, 2013)

Gold topped at $880 in 1980.  It then proceeded to fall 70% over 20 years.

Gold topped at $1921 in 2011.  I don't know if it has put in a generational top but it looks like it has.


----------



## KissMy (Sep 15, 2013)

Bloomberg: "The dollar weakened against all its major peers while Asian stocks climbed with U.S. index and Treasury futures as Lawrence Summers withdrew his bid to become Federal Reserve chairman."


----------



## Toro (Sep 26, 2013)

The CFTC finds no evidence of price manipulation in the silver market.



> U.S. commodity regulators closed a five-year-long investigation of silver-market manipulation claims without filing charges, the latest setback for authorities cracking down on alleged trading abuses.
> 
> The Commodities Futures Trading Commission said there is no "viable basis" for a case that had its roots in emails commissioners received from investors amid market volatility in 2008. The decision to close the case amounts to a victory for J.P. Morgan Chase & Co., a large silver trader that was the subject of manipulation allegations.



CFTC Closes Silver Price-Manipulation Probe - WSJ.com


----------



## Toddsterpatriot (Sep 26, 2013)

Toro said:


> The CFTC finds no evidence of price manipulation in the silver market.
> 
> 
> 
> ...



So buying an ounce of silver won't drive JPM into bankruptcy?


----------



## Toro (Sep 26, 2013)

Hard to believe, I know. 

Back in the day when I ran an equity fund, I used to talk to the JPM gold analyst. He told me to buy gold. That was 10-11 years ago. A funny recommendation if you want to keep the price down.


----------



## Valerie (Aug 2, 2018)

Toro 



critical juncture right now...  what do you think??


----------



## Valerie (Aug 2, 2018)

precious metals are retracing and testing support right now...

watching like a hawk.  




*Is That Yellow Metal A Sitting Duck Or A Golden Goose?*


Aug. 1, 2018

https://seekingalpha.com/article/41...g-duck-golden-goose?source=all_articles_title


----------



## Toro (Aug 2, 2018)

Valerie said:


> Toro
> 
> 
> 
> critical juncture right now...  what do you think??



I owned a bit a few weeks ago, but the price went through my stops and I blew it out. 

The long term technicals are interesting but the near-term fundamentals are headwinds.


----------



## Valerie (Aug 2, 2018)

yeah, i got stopped out too...

but now i am tweaking!!  


the trend is your friend, so i'm just waiting for the technicals to finish lining up.

makes me nervous they could completely break down again but imo the precious metals are about to have a YUGE bounce next week as the dollar backs off a little...

thanks for responding!  i kept thinking, i wonder what toro thinks!

full disclosure i bought some USLV this afternoon and am waiting for UGLD maybe tomorrow or next week I HOPE!


----------



## Toro (Aug 3, 2018)

What I like about gold is that sentiment is extremely negative.  The last time it was this negative was when it bottomed at the end of 2016.

But I’m going to wait for it to bounce first.


----------



## Drecandlere (Aug 15, 2018)

I used to like gold more, but silver is the my favorite metal now


----------



## KissMy (Aug 15, 2018)

States are starting to TAX every transaction! Big tech data companies are selling them all the financial info they ask for. Most of US now getting Consumption Tax Due demand letters from the States. Bit-Coin tracks every transaction for government to view, therefore it is the opposite of money free of government! People will not tolerate that for long & unload Bitcoin for Gold!


----------



## Valerie (Aug 15, 2018)

holy capitulation today!  


Following Our 'Sell Gold' Call, Precious Metal To Remain Weak | Seeking Alpha


----------



## Valerie (Jan 31, 2019)

wooooooot!  precious metals are on the move!


----------



## Valerie (Feb 17, 2019)

_"From mid-November until late January, USLV rose from $55.31 to $83.61 or 51.1%"_


https://seekingalpha.com/article/4241518-consolidation-silver?source=all_articles_title




you're welcome


----------



## KissMy (Feb 17, 2019)

Gold always goes up during republican administrations because they are not fiscally responsible. They have never reduce the debt.


----------



## Toddsterpatriot (Feb 17, 2019)

KissMy said:


> Gold always goes up during republican administrations because they are not fiscally responsible. They have never reduce the debt.



Is that why gold peaked at around $800 an ounce under Carter and dropped to the $300s under Reagan?


----------



## Paulie (Feb 17, 2019)

KissMy said:


> Gold always goes up during republican administrations because they are not fiscally responsible. They have never reduce the debt.


Jesus Christ man there's no difference between the 2 the democrats just tell you they're going to increase the debt and the republicans pretend they aren't. How is there still people in this world who think there's a difference


----------



## EdwardBaiamonte (Feb 17, 2019)

KissMy said:


> Gold always goes up during republican administrations because they are not fiscally responsible. They have never reduce the debt.


 they have tried to make debt illegal 30 times and Democrats have killed each effort. Could happen tomorrow if Democrats would support, but they cant because  buying votes with new programs is their subversive philosophy. Do you understand?


----------



## Picaro (Feb 20, 2019)

I don't speculate in gold, I buy it and sit on it, until I need to buy something else, in which case I wait for a price bump to sell, buy what aIO want, and then look to replace what a sold later at a lower price. I buy in wholesale Kg's, not coins or stocks, and I'm happy with the price relative to dollar inflation, since my base buy price average is still in the low $330's to $410's for later buys. I ahven't bought any large quantities since the late 1990's.


----------



## Picaro (Feb 20, 2019)

Toddsterpatriot said:


> KissMy said:
> 
> 
> > Gold always goes up during republican administrations because they are not fiscally responsible. They have never reduce the debt.
> ...



Oil crisis, all kinds of political unrest around the world, etc. Had nothing to do with who was President. There was also a global food shortage most people seem to ignore which had more of an effect on inflation than the oil crisis did. In any case, Reagan merely copied Carter's policies and got credit for them kicking in while he sat on his ass and tried to stay awake. Volcker did the heavy lifting; Reagan just made speeches and took  long naps.


----------



## Valerie (May 16, 2019)

buy, buy, buy!


----------



## Picaro (May 16, 2019)

Valerie said:


> buy, buy, buy!



It's certainly going up; add some $120 to the price listed in the futures market, since that is the closer to the street price around here. I'm thinking about financing a new truck if the price keeps climbing.


----------



## Valerie (Jun 30, 2019)

Gold Price Chart


Gold Cash Futures Interactive Chart - Barchart.com


----------



## Valerie (Jul 30, 2019)

Valerie said:


> buy, buy, buy!




you're welcome!


----------



## Deplorable Yankee (Jul 30, 2019)

Gold and silver both have hit a bullish stride again


----------

