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79 Protons Meltup Counter: $1,224/Oz

Tyler Durden's picture




 

Gold is now the primary beneficiary of any and all dollar weakness (much more so than stocks or any other asset class) and any and all incremental excess liquidity. We hope members of Senate who read this post present the charts below and ask the Fed Chairman at what point will his debasement of America end.

 

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Wed, 12/02/2009 - 23:01 | 150168 nicholsong
nicholsong's picture

I'm thinking gold, long term, is skyward. But I don't think it's now. I think we are embarking in a trend, but I'm sensing something bubbleicious and expecting a near term pull back (some of the reasons I give above).

Wed, 12/02/2009 - 23:08 | 150171 lsbumblebee
lsbumblebee's picture

Take it easy there little stickperson thing.

Thu, 12/03/2009 - 01:13 | 150308 Hephasteus
Hephasteus's picture

Hey. Stick person understands writing on the wall.

I'm totally down with stick person. LOL

Wed, 12/02/2009 - 22:58 | 150165 gookempucky
gookempucky's picture

HeHe nice DH rough dore ingot--but as an aside dont use charmin as it does not dissapate/breakdown as scotts does---thus this TP secret will keep your pipes clean.

Thu, 12/03/2009 - 03:05 | 150383 faustian bargain
faustian bargain's picture

scotts...you may as well just use your hand.

Wed, 12/02/2009 - 22:20 | 150099 Anonymous
Anonymous's picture

Can anyone tell me whats up with silver? Why doesnt it catch up with the pace of gold?
And as i didnt get on the train when i wanted to (at goldprice around 900) would you prefer me to invest most of my humble money in silver at this time? Btw i have to buy in Euro.
Thanks for that awesome blog and sorry for my weak english skills...

Thu, 12/03/2009 - 02:19 | 150352 chumbawamba
chumbawamba's picture

Silver is tracking gold in relative terms.  Unless you mean you want $1,222/ozt silver?  Me too!

There is no bad time to get into gold.  The key is to get into it.  With the US Mint halting production of Eagles again, another shortage is potentially imminent.  There might come a day when gold will be unavailable at any price.  Especially if some of these tungsten rumors turn out to be true (I still want actual proof of this before I drink that Kool Aid flavor).

But silver is good too.  It has more upside potential.  I'd still get at least some gold and plow the rest into silver.  I love silver.  I just got another handful today.  Mmmmmm, silver.

I am Chumbawamba.

Wed, 12/02/2009 - 22:28 | 150115 koaj
koaj's picture

thoughts on silver? historically gold and silver has traded btw 13-1 and 16-1. now its 63-1 roughly...and silver has a little more utilitarian usage whereas gold sits in vaults and safety deposit boxes

 

full disclosure - long silver since 13ish when QE started last march

Wed, 12/02/2009 - 22:37 | 150127 deadhead
deadhead's picture

lots of hot, hot money out there. it'll find its way to silver, don't you worry.

hopefully, it comes out of the pai gow palace formerly known as the NYSE.

Wed, 12/02/2009 - 22:38 | 150131 Project Mayhem
Project Mayhem's picture

I think silver will be how some people become very rich.

Wed, 12/02/2009 - 22:40 | 150137 koaj
koaj's picture

the Hunt Brothers approve of this message

Wed, 12/02/2009 - 22:43 | 150140 Project Mayhem
Project Mayhem's picture

haha.  you'll only become rich if you hold the real stuff.   

 

then again, what good is it if you can trade your silver for $100,000  Ben Bernanke spacebucks...

Wed, 12/02/2009 - 22:57 | 150157 nicholsong
nicholsong's picture

What good is it?

It's good because it will buy the same amount of eggs, socks, wood, flax, chickens, soup, hammers, and shoes as it did, per ounce, as it did around 1921 or so. And believe me (or as you probably know) when you plunk it down in their palm, people can feel its value.  I don't think we'll have much problem spending silver on the street.

Here's my favorite exercise to reset idealist minds:

I take a 1$ FRN, flip it into their hand, then I flip a 5$ FRN into their other hand. I point at their hands and I say, "That's One.   That's Five." They look at me with a blank expression.

So then I plop a silver dollar in one hand and their eyes light up.

Then I plop five dollars in their other hand and they gasp as it sinks under the weight and that awesome CHa-CHING sound, and I say simply "Five dollars of silver is five times as tall and five times as heavy as one dollar of silver. What you are looking it is 'just weights and measures'."

Then I drop the 5$ FRN back on their hand with the coin stack, and I say "THAT is Fiat", and they wrinkle their nose.

PRESTO! A new silver buyer.

Wed, 12/02/2009 - 23:53 | 150226 nabi
nabi's picture

I'll pay off my house with 3 oz. and still have quite a pile left (although I may need to sell 4 oz. to pay the capital gains taxes)...

 

Thu, 12/03/2009 - 00:17 | 150248 Anonymous
Anonymous's picture

Is that a prophecy, navi?

Thu, 12/03/2009 - 00:45 | 150283 SWRichmond
SWRichmond's picture

You forgot the interest and late charges, which brings it to 1 million spacebucks.

Wed, 12/02/2009 - 23:18 | 150179 Unscarred
Unscarred's picture

By my back of the envelope figures, Gold is up 38% YTD while silver is up 71%.  Gold/Silver ratio has declined from the beginning of the year at 78 to currently 63.  Gold Jun'14 contract priced at $1339.6 vs. front month $1223.3.  Silver Jun'14 $19.903 v. front month $19.375.

Over the next 5 years, would prefer to play the Gold/Silver ratio to converge, silver LEAPS, or would you just buy the metal and sit on it?

Wed, 12/02/2009 - 23:18 | 150185 koaj
koaj's picture

outside of holding the real deal, you'd have to sell the leaps/slv etf in worthless Federal Reserve Notes or some sort of SDR

the currency of the next 100 years will be decided by the free market and will be barter for a while. why would i want a gold bar when i'm hungry?

i figure i can get more gold with guns and ammo than i can guns with gold

welcome to Lord of the Flies. thanks ben

Thu, 12/03/2009 - 02:25 | 150355 chumbawamba
chumbawamba's picture

Great, I'll be there on the other side of your trade with a loaf of bread for your gold bar, which I was able to acquire using the purchasing power that my gold and silver preserved for me.

Guns are good as gold is good as guns.  But keep your hands off my stack.

I am Chumbawamba.

Thu, 12/03/2009 - 00:50 | 150286 ghostfaceinvestah
ghostfaceinvestah's picture

agree, silver will do well, the gold/silver ratio has always been volatile and caused problems for dual metal currency systems, but at the end of the day it is still a good store of value.

"Gold is the money of kings; silver is the money of gentlemen; barter is the money of peasants; but debt is the money of slaves." Money and Wealth in the New Millennium, by Norm Franz, copyright © 2001

Thu, 12/03/2009 - 02:01 | 150343 lookma
lookma's picture

Bimetallism is sexy, its a government trying to fix the exchange ratio between gold and silver that is the buzzkill.

Thu, 12/03/2009 - 07:05 | 150450 Anonymous
Anonymous's picture

There was a post on GIM yesterday positing that gold does well in deflation, silver in inflation.
FWIW
Subscribing to that theory one would hold onto AU into spring '10 or so and then make the switch into AG just when the Zimbabwean Ben bucks bust a move into the stratosphere.

Wed, 12/02/2009 - 22:44 | 150143 MsCreant
MsCreant's picture

I wonder if we have a clue just how dire this really is?

We imagine things, speculate on strategy; if DH is right, that China is trashing gold to get the price down, whoa! I don't hear that and think "cagey." I hear that and think "desperate."

Wed, 12/02/2009 - 23:55 | 150229 deadhead
deadhead's picture

the abacus keeps coming up with the same number on their Treasury holdings: that number would be chinese for "shit".

Thu, 12/03/2009 - 00:26 | 150256 Uncle Remus
Uncle Remus's picture

*snort* +100

Thu, 12/03/2009 - 00:56 | 150290 MsCreant
MsCreant's picture

Hey UR,

Scathing verbage on the GS/gun thread. Loved it!!

Thu, 12/03/2009 - 02:28 | 150356 chumbawamba
chumbawamba's picture

My dear MsCreant,

I'm afraid it'll be worse than you can imagine.

I am Chumbawamba.

Wed, 12/02/2009 - 22:47 | 150148 Hondo
Hondo's picture

Gold is rising in all currencies...at a faster rate in some than others but in all for sure.

Wed, 12/02/2009 - 22:55 | 150159 nicholsong
nicholsong's picture

Look at AUD in the central table here: http://www.goldprice.org/

 

Wed, 12/02/2009 - 23:41 | 150211 Hephasteus
Hephasteus's picture

The aud is anchoring for the other fiats. Hence all the interest rate hikes.

Wed, 12/02/2009 - 22:58 | 150164 Anonymous
Anonymous's picture

"...., I look for the Euro Zone to explode in the next 6-12 months when EUR/USD hits 1.55. "

I was in central Europe last month. They are still shopping pretty hard. No evidence of distress yet.

Thu, 12/03/2009 - 08:18 | 150467 Anonymous
Anonymous's picture

Of course, everything from US, China and middle east
becomes cheaper to them in terms of Euro. The cosumer
may as well BUY! BUY!

Wed, 12/02/2009 - 23:14 | 150176 SDRII
SDRII's picture

Maybe the recent commentary out of regional fed talkers may be a precurser to a pre-emptive decapitation strike. It would fall in the catagory of we had to destroy it to save it - the entire economy being the collateral damage of course. Epic fail

Wed, 12/02/2009 - 23:57 | 150230 deadhead
deadhead's picture

the regional fed guys do not appreciate the ny, dc fed guys getting their hacks in CONgress to start the ball rolling to eviscerate them.

 

 

Wed, 12/02/2009 - 23:18 | 150184 Anonymous
Anonymous's picture

China told its people to buy gold at around $1000/oz.

The Chinese central bank bought tons of gold at around that price, as did India and some other countries.

The floor for gold has been set.

Thu, 12/03/2009 - 00:36 | 150265 Unscarred
Unscarred's picture

I agree that we have a floor where Reserve Banks will start buying.  Do you have a link for your source on the $1000/oz. figure?

Wed, 12/02/2009 - 23:27 | 150198 SDRII
SDRII's picture

Q up the regioonal fed from St louis on CNBC today and watch as he squirms when Bartaroma asks him about gold and its price.

Wed, 12/02/2009 - 23:42 | 150214 glenlloyd
glenlloyd's picture

$1,225.90

Wed, 12/02/2009 - 23:48 | 150219 nicholsong
nicholsong's picture

I like how gold moved up and kissed 1200 one night, then totally molested it and moved on to 1225.

Thu, 12/03/2009 - 00:59 | 150293 Anonymous
Anonymous's picture

haha fantastic analogy.

Thu, 12/03/2009 - 02:32 | 150359 chumbawamba
chumbawamba's picture

Nice!

I am Chumbawamba.

Thu, 12/03/2009 - 00:10 | 150245 Anonymous
Anonymous's picture

at this rate gold will be 1400 at the end of dec

Thu, 12/03/2009 - 00:34 | 150263 laughing_swordfish
laughing_swordfish's picture

smooth sailing to 1700

I'm sooo glad i'm in at 840

Thu, 12/03/2009 - 00:44 | 150280 Anonymous
Anonymous's picture

gold up 13.20
es futures up 4.00

Thu, 12/03/2009 - 00:48 | 150285 Anonymous
Anonymous's picture

I can think of absolutely no reason why Bernanke would care if gold hits $5000oz. Now if the liquidity was going to oil, I can see serious concern at the Fed, but until they start taking gold coins at Walmart, a rising gold price does not in any way threaten the establishment.

Thu, 12/03/2009 - 01:36 | 150330 Anonymous
Anonymous's picture

I was thinking the same. 401K up, Gas prices stable, large flat screen TV's cheap as ever and the sheeple are happy.

Big O can get on TV and give one of his captivating speaches right before the finaly of American Idol.

The Grinch that stole Christmas is still a cartoon.

Thu, 12/03/2009 - 02:05 | 150345 Burnbright
Burnbright's picture

Uh... it should worry them because if people decide to use Gold instead of US dollars to trade with because a) Gold can't be inflated, and b) transactions are also far more difficult to tax because their is less of a evidence trail.

 

Thu, 12/03/2009 - 03:24 | 150392 Anonymous
Anonymous's picture

Not going to happen. There is no central bank that will want to go to a gold standard. No seriously if anybody can give me a good argument why the Fed would care please let me know. Because I can't think of any. In fact, I wouldn't be surprised if the Fed encouraged GS and company to pump up gold just to make sure that oil doesn't go up instead. Because if oil went to triple digits there'll be riots in the streets. Gold goes to $2000. Whoop dee doo.

Thu, 12/03/2009 - 02:34 | 150361 chumbawamba
chumbawamba's picture

That is an ignorant comment on so many levels that it refutes itself.

I am Chumbawamba.

Thu, 12/03/2009 - 02:41 | 150365 MsCreant
MsCreant's picture

Chumba,

Ya gotta go see the swag thread. They have coffee mugs you inspired. Go look for the plethora of swag thread.

Thu, 12/03/2009 - 03:05 | 150384 chumbawamba
chumbawamba's picture

Seen it.  My lawyers will be contacting Ms. Singer.

I am Chumbawamba.

Thu, 12/03/2009 - 03:43 | 150400 Unscarred
Unscarred's picture

ROTFLMAO!

Nice, Chubs.

Thu, 12/03/2009 - 02:54 | 150374 Anonymous
Anonymous's picture

Random question:

What if BB does care - or doesn't care but wants to send a "message" to make it appear that he does? In other words, what if BB et. al. decide it would be fun to preempt the IMF and sell US reserves (Au, not paper notes) to the Chinese at prices BB et. al. perceive to be inflated?

This hypothetical would line up with the concept of attempting to "prick the bubble" they perceive is growing in Au. Assuming today's WSJ article (http://online.wsj.com/article/SB125970281466871707.html) has some degree of accuracy, BB is coming around to the concept of preemptively pricking bubbles instead of his prior notion that its better to clean up the "suds" after the fact.

My Econ degree is coming in handy these days, but admittedly is a bit rusty. So I'm interested in feedback on the following (or above for that matter):

1) If US were to sell Au, assuming in meaningful quantity, would it serve to scare people out of Au and into $ / treasuries?

2) Would the sale of US Au reserves actually serve to weaken the $ on the basis of some perceived amount of implicit (obviously not explicit) link between US Au reserves and currency / debt obligations?

3) Assuming the answer to both #1 and #2 is yes, is there a way to quantify / project the extent to which the corresponding "strengthening" of the $ (as a result of the rush to the $) would be offset by a weakening of the $ from the implied reduction of unofficial gold back-stopping the $?

4) If answer to #1 or #2 is no, please enlighten me.

Great site Tyler, et. al. Fantastic insight / info here...

Thu, 12/03/2009 - 01:28 | 150316 Mark Beck
Mark Beck's picture

As per your question:

"We hope members of Senate who read this post present the charts below and ask the Fed Chairman at what point will his debasement of America end." 

Not sure they will bring this up directly. The FED has been very critical of the administrations failure at fiscal restraint. He could just argue that much of the "money printing" is due to funding the deficit, and he would be right. Also, he could bring up the health bill projected costs, and then the troop build up expense in Afghanistan. 

Separately, irresponsible fiscal and monetary policy is harmful enough, together they produce a positively miserable experience. 

Mark Beck

Thu, 12/03/2009 - 01:46 | 150336 dogbreath
dogbreath's picture

The squid is watching and waiting.  The fundamentals appear too strong at the moment with the comex handing out ETF toilet paper.  Thats why I'm taking delivery asshole! so you can give me Charmin for my Purex.  ya right.  Barrick went to the market to close their hedge book and everybody is making the news buying by the tonne.  So there is bit too much bullish news still.

Comex gold futures margin requirement is a mere 4300 frn's.  baiting the dumb specs big small wherever they are.  come here my little sweeties I won't burn you this time, I promissse whispers the squid. 

All the past rallies in gold and silver were counter attacted with margin increases and ETF mass selling when the momentum got weak and the spec violated their margin dicipline causing massive selloffs on market sell orders. I know I was in at 320 gold and 5.25 silver. 

I think this rally has some way to go and is safe to take some position, especially physical!!!!  The comex spec thing will be a bloody rout again but gold might go to 3500 before the squid can counter attack.

I am so surprised that the margin is still 4300 with daily 10-20 dollar moves.

I agree that 100frn a day moves will be coming

the squid retreats in the middle drawing in the cavalry, massed infantry will follow chasing the rearguard untill they find the bridges blown.  then the pincer will close and they pick off the specs by the gross.  the perception must be created and they have enough physical to sarfice short term to the strategy, they can buy it back later for a profit.

The only thing that you should do is get PHYSICAL.  Spec is a game play at your own risk because the squid is the house.  The spec game is a Con for the dumb money.  Gold is worth the shadowstats.com # only it hasent gotten there yet.  

Be patient

regards all of you even the dork with spunk on his dress

Thu, 12/03/2009 - 02:39 | 150362 chumbawamba
chumbawamba's picture

+1,224

Can I friend you or something?

I am Chumbawamba.

Thu, 12/03/2009 - 02:44 | 150368 dogbreath
dogbreath's picture

er?  friend me??  whats that

Thu, 12/03/2009 - 03:06 | 150385 chumbawamba
chumbawamba's picture

Dumb joke.  Ignore me.

I am Chumbawamba.

Thu, 12/03/2009 - 03:08 | 150386 faustian bargain
faustian bargain's picture

zero hedge is the new facebook

Thu, 12/03/2009 - 03:12 | 150388 dogbreath
dogbreath's picture

I don't do any of those facebook, twitter et al.  I'm too anti-social. 

I discovered ZH by reading Denninger of all things.  ZH'ers rock

Thu, 12/03/2009 - 09:23 | 150502 Smokey
Smokey's picture

Looks like Karl & The Denningers are starting to feel the pain over there........mutiny ahead.

Thu, 12/03/2009 - 09:29 | 150511 SWRichmond
SWRichmond's picture

Karl kicked me off his site months ago, for persistently predicting....where we are today.  Karl does not like to be told he is wrong.

Thu, 12/03/2009 - 11:44 | 150698 dogbreath
dogbreath's picture

I wonder what name he lurks here under because he regularly gives credit to ZH for the scoop.

Thu, 12/03/2009 - 15:25 | 151155 MsCreant
MsCreant's picture

Karl is actually Chumbawamba, BITCHES.

Thu, 12/03/2009 - 09:35 | 150521 SWRichmond
SWRichmond's picture

db,

The only thing that you should do is get PHYSICAL.

Yep, just keep on buying.

  1. Gold is money
  2. USD is currency, a creation of central banking
  3. Central banking is the handmaiden of the Leviathan welfare/warfare state, central bank theft-by-inflation pays for it all
  4. = to restore the republic, defund the Leviathan state and discredit the central bank by buying gold.
Thu, 12/03/2009 - 10:10 | 150561 SWRichmond
SWRichmond's picture

See the future, courtesy of Argentina:

http://goldismoney.info/forums/showthread.php?t=429071

Thu, 12/03/2009 - 02:06 | 150346 Anonymous
Anonymous's picture

Anyone feel like sharing the names of some reputable silver dealers? Or how about a primer for actually buying physical silver for the noobs out here?

Thu, 12/03/2009 - 09:23 | 150503 Anonymous
Anonymous's picture

www.bulliondirect.com

All 1 oz coins, CDN Maples or US Eagles.

That's all you need to know (seriously, it's that simple if you really want to start.)

DON'T BUY FROM KITCO or GOLDLINE (Trust me, OK?)

Thu, 12/03/2009 - 09:27 | 150508 SWRichmond
SWRichmond's picture

www.apmex.com

If you like quantities, http://www.tulving.com

 

Thu, 12/03/2009 - 09:59 | 150548 Smokey
Smokey's picture

I do all of my business with Hannes Tulving.  High minimum purchase requirements but best way to net out that I've found.  Good service.

 

disclaimer: I am not associated with Tulving in any capacity whatsoever aside from being a customer.

Thu, 12/03/2009 - 02:40 | 150363 chumbawamba
chumbawamba's picture

I would like to point out that $1,224 is one of Jim Sinclair's oft-repeated gold price levels (on the march towards $1,650 and beyond).  Coincidence, no doubt...or is it?

I am Chumbawamba.

 

Thu, 12/03/2009 - 15:28 | 150367 MsCreant
MsCreant's picture
Duplicate.
Thu, 12/03/2009 - 02:48 | 150372 dogbreath
dogbreath's picture

I have learned much from Sinclair but he seems to be the guy calling "to the moon" at technical tops.  he never says "move your stops up" or "volume is getting thin" or  "SELL!!!!! SELL!!!!!"  

Keep the salt shaker handy.

Thu, 12/03/2009 - 03:08 | 150387 chumbawamba
chumbawamba's picture

Because as he has explained time and time again, quite explicitly:

GOLD IS NOT A TRADE.

GOLD IS PROTECTION.

GOLD IS SECURITY.

I AM CHU...er I am Chumbawamba.

Thu, 12/03/2009 - 03:20 | 150390 dogbreath
dogbreath's picture

I agree, and he has said to have physical and the comex would default at some point.  For all his expertise and wisdom, he never cautions when the markets are rallying and the risk of retracement and LOSS is likely. 

 

after the carnage he comes out with his technical analysis of the battle of waterloo.  where the fuck were you 3 days ago JIM!!

 

I have read his stuff for too long and he's stale.  Dan Norcini has the dope though.

still, keep the salt shaker handy. 

Thu, 12/03/2009 - 03:27 | 150393 chumbawamba
chumbawamba's picture

Hmmmm, how can I put this?

***===> GOLD IS NOT A TRADE <===***

I am Chumbawamba.

Thu, 12/03/2009 - 03:33 | 150395 dogbreath
dogbreath's picture

lol

Thu, 12/03/2009 - 02:48 | 150371 John McCloy
John McCloy's picture

Gold being at these levels pre-confirmation hearing is a setup for Ben too look foolish under questioning. It reminds me of the Dafoe under the bed scene from family guy.

Senate: Inflation yet Ben? Gold is up another 50 buck today.

Ben: Uhhhhh..Noo??

Senate: Just Checking.

 

 

Thu, 12/03/2009 - 04:15 | 150409 Apocalypse Now
Apocalypse Now's picture

There was news that the Chinese did not want BB to be chosen and communicated that to Obama (irresponsible devaluation hurting their treasury investment).  They probably read the gold paradox by Larry Summers, and this is their way of showing their dissappointment - also asking their citizens to buy gold.

Thu, 12/03/2009 - 04:32 | 150417 Anonymous
Anonymous's picture

Oh I just replied a moment ago, that the whole rumor of China asking its citizens to buy gold is a complete crock. It's nothing but a Chinese-whisper.

That's not to say gold is not attracting the interest of large swathes of Chinese each day, because it is...but the reality is it's even more bullish that that particular rumor is a crock as there are still multiple millions yet to get onboard.

Thu, 12/03/2009 - 11:43 | 150695 Anonymous
Anonymous's picture

Ben Bernanke is forbidden by the Chinese from being on Chinese soil.

Thu, 12/03/2009 - 15:29 | 151168 MsCreant
MsCreant's picture

What, they are finally trying to do something about pollution?

Thu, 12/03/2009 - 03:41 | 150399 Anonymous
Anonymous's picture

I also think that this is not a bubble. Granted,there will always be gyration,but one has to understand the fundementals too. Irrelevant of other asset classes,I believe big trade surpluses countries are running to gold. Just think of it this way;you are an export based country,but your currency is pegged to the dollar to ensure high employment at home,and at the same time you don't trust the cbs of your trading partners which means you don't trust their currencies. So naturally you convert any excess cash of those forign currencies into gold,simply so that you don't have to worry about the consequences. Gold will always give a peace of mind,since even if it drops,you are have at least kept the value of your holding.

Thu, 12/03/2009 - 05:22 | 150425 Neophiliac
Neophiliac's picture

Gold is not a trade? Yet everyone is trading it - start making sense ppl.

The obsession with gold prices is getting to be obscene. Give me a real reason why I should care how much of a useless metals my dollars are able to buy? Is it a signal of future inflation in prices of other goods? - not really. Is it a "piece of mind" kind of thing - again, not really, especially when you consider the up and down moves over the past year. It's rising now, and may rise for a while, but at some point it will come crashing down and there will be some who bought at the top of the bubble.

I say, for a thing that does not really get consumed and therefore has very little actual demand, gold is way overhyped. If this blog complained as much about the price of aluminum I'd be far more interested. Gold is indeed a sideshow. Wake me up when they make something out of it other than jewelry.

Thu, 12/03/2009 - 05:27 | 150427 Apocalypse Now
Apocalypse Now's picture

Masonic avatar-

Put your apron in your mouth.

If you are not interested, why lurk and post?

Perhaps you should just invest in silver as your precious metal, it has more industrial uses.

Thu, 12/03/2009 - 07:47 | 150459 Neophiliac
Neophiliac's picture

Thx, gold bug. And I don't lurk. I'm interested in many - most - things that this blog has to pay. Gold isn't one though.

Thu, 12/03/2009 - 15:13 | 151116 chumbawamba
chumbawamba's picture

Sucks for you, dude.

I am Chumbawamba.

Thu, 12/03/2009 - 05:59 | 150433 nevket240
nevket240's picture

Correcto mondo. Gold is not a trade. It is a currency. Rather annoying to see commentators refer to it as a commodity. Ignorance is bliss.

When the paper you hold is rejected, most likely, particulary in Asia, the Gold you offer will be exchanged.

Gold is for that day.

regards  

Thu, 12/03/2009 - 07:45 | 150458 Neophiliac
Neophiliac's picture

Right then. And buying gold futures gets you bullion how, exactly?  Also, by the time things are bad enough that gold coin is once again a medium of exchange, there won't be much to exchange them for - you won't be buying an iphone with it anyway. Worse yet, I fear if things go so bad, people will skip straight to barter and it'll take another few decades to few centuries to build up a uniform monetary system again. So best of luck with that theory. 

Thu, 12/03/2009 - 15:15 | 151121 chumbawamba
chumbawamba's picture

Seriously, you have a fundamental ignorance of markets and currency.  And perhaps history, too.

I am Chumbawamba.

Thu, 12/03/2009 - 15:31 | 151173 MsCreant
MsCreant's picture

Agreed, that post is very scrambled.

Thu, 12/03/2009 - 11:50 | 150706 SWRichmond
SWRichmond's picture

Wake me up when they make something out of it other than jewelry.

Go ahead and wake up now, the, because they are making something else out of it: coins; these are being hoarded and not circulated, but that doesn't diminish their value.  And there isn't "very little actual demand", there is huge demand, which is reasonably well documented by the WGC et al. 

The obsession with gold prices is getting to be obscene.

RESTORE TO ME A SOUND MONEY THAT IS NOT MERELY A VEHICLE FOR THEFT-BY-INFLATION VIA CENTRAL BANKING, AND I WILL GLADLY STOP TALKING ABOUT GOLD.  It's really quite simple.

Thu, 12/03/2009 - 13:52 | 150947 faustian bargain
faustian bargain's picture

You can't consume FRNs either. The reason they are more worthless than physical gold, long term, is that they are not a real thing, just a note from the Fed that doesn't promise anything. FRNs are on their way out.

Physical gold has value because it is in demand. Not the other way around. People want it, they have wanted it for thousands of years, and they will continue to want it. It will have value in any kind of economic system. (Confiscation schemes and other large-scale manipulation will not gain traction this time around.) Just because you don't understand its use as a currency, doesn't mean it is actually useless.

The goldbugs you see saying 'gold is not a trade' are not trading gold. They are buying and holding it.

Thu, 12/03/2009 - 15:49 | 151223 MsCreant
MsCreant's picture

Yup. I made peace with buying PMs because it is a political gesture. I am saying "I don't have faith in the US Dollar, long term. I am going on the sidelines with this stuff that I know, historically, has held its value." I am saying, "When you fuckers get it figured out, let me know, and maybe I will come back and play."

I am tired of being cheated.

I have checked out.

That is also how I made peace with it that the price may go down short term because of a carry trade unwind. Let the dollar and gold go up and down. By participating in the dollar system, stocks, etc. I am a allowing myself to be victimized and support the system. I need a little cash for essentials, but I don't have to support them by being totally invested in the system. They will rob me. At least if my gold is robbed, I can try to hunt that fucker down. 1 fucker, 1 hunt. Not an overwhelming system of cheats who do not care about me and will not listen to me.

And as I see the price of gold going up, I know that around the world, others, maybe using different words, are voting the same way with me. Together, we have strength.

PMs are political, PMs are a social movement. We don't need to agree on specifics, but we agree we don't trust the current fiat system. The ultimate vote with your pocketbook. With enough of us plowing into PMs (real ones, not paper) WE SHUT THEM DOWN.

Thu, 12/03/2009 - 05:34 | 150429 Anonymous
Anonymous's picture

Private ownership of Gold may simply be banned by governments the day it really becomes an existential threat to fiat currencies. It will, however, remain as the only credible currency between governments for international trade.

Thu, 12/03/2009 - 13:54 | 150948 faustian bargain
faustian bargain's picture

To my mind, the day governments ban gold ownership is the day they become totally irrelevant.

Thu, 12/03/2009 - 15:20 | 151139 chumbawamba
chumbawamba's picture

Really?  That day came long ago for me.

I am Chumbawamba.

Thu, 12/03/2009 - 15:20 | 151140 chumbawamba
chumbawamba's picture

Really?  That day came long ago for me.

I am Chumbawamba.

Thu, 12/03/2009 - 06:30 | 150441 Anonymous
Anonymous's picture

Tyler, please advise all to contact Senator Bernie Sanders today! Let's give him our support in stopping Benanke today at the confirmation.

My message to Senator Sanders exactly as I have sent it!

'I salute you for having the personal integrity to represent us on the issue!'

Let's show Senator Sanders he has our support!

http://sanders.senate.gov/contact/index.cfm

Thu, 12/03/2009 - 07:25 | 150454 nevket240
nevket240's picture

http://www.kitco.com/ind/stansberry/dec022009.html

an article to ponder over a cup of tea & a scone.

regards

(if you have already read it, sorry. but have the tea & scone anyway)

Thu, 12/03/2009 - 08:24 | 150472 zhandax
zhandax's picture

Wow, my kind of crowd, with a thread going all night!  See how free gold sets you?  No pesky need to watch equities open.  But I digress...somewhere near the top of the thread (if ya missed it in the last few week's posts) is a link which summarizes the perfect hedge.  Buy physical, then buy OTM GLD puts when the oscillators look toppy.   Trade those until you feel that gamma goodness when GLD finally craters as the idiots realize they been financing more of their new master's crap.

 

Thu, 12/03/2009 - 09:04 | 150492 Anonymous
Anonymous's picture

In the event of a currency collapse, gold might go to the moon but the reality is that people with a net worth of less than a few million won't be able to hold onto it for very long.

Either you will get killed for your few nuggets (remember there are more than 6 billion on this planet), either you will find out the ounces of gold won't be in your ETF when it comes time to split up the loot, either you won't be able to use it because the person at the other end will prefer goods or services...

And I'm willing to bet that most people who've invested in gold don't have enough assets to be able to sight tight on their gold stash until the market recovers.

Whatever.

Thu, 12/03/2009 - 15:22 | 151144 chumbawamba
chumbawamba's picture

Wow, what a buzzkill you are.  Totally uncreative and myopic.

I am Chumbawamba.

Thu, 12/03/2009 - 09:13 | 150495 Anonymous
Anonymous's picture

People are not being pragmatic and that's why gold is in a bubble. And past bubbles have shown us that people will refuse to see the facts and the bubble will probably get bigger.

Unfortunately, once again all those who can't afford to lose money will lose again.

Thu, 12/03/2009 - 13:57 | 150954 faustian bargain
faustian bargain's picture

once again all those who can't afford to lose money will lose again.

 

...and that would be: everyone who is holding dollars.

Thu, 12/03/2009 - 09:18 | 150499 SDRII
SDRII's picture

The arrogance of Geithner is just jawdropping. In response to whether they will pull back stimulus he was defiant and said it is not going to happen and "we control" it. Let's see how that works out.

Thu, 12/03/2009 - 09:31 | 150518 arcturius
arcturius's picture

Why debasement of America? I think it is obvious that the US will be something similar to Latin American countries within next 30-50 years. Why? Well, Americans forgot how to produce something, everything is outsourced, new generations are helpless. This is IMHO. So it is just a reality, that they gonna face with. But I noticed that they are big fans of wishful thinking..

Thu, 12/03/2009 - 10:12 | 150564 OhBaldOne
OhBaldOne's picture

A Man without Q is right…Investing (and life) is a balancing act. The Intellect filters and assesses the logic of an action. It weighs Needs over Wants. It pushes thrift, savings, and product reliability. It emphasizes Essentials. To appeal to the Intellect, you must satisfy these demands.

To complete any transaction, you must strongly appeal to the emotional, balance-seeking side of the brain. In this economy, people crave emotional justification for their actions. Emotions add relevance. Emotions reinforce the essence of people's self-worth. Emotion integrates. Intellect alone isolates.

The Emotional Brain breaks the rules that the Intellect seeks to impose.

Do NOT follow this link or you will be banned from the site!