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Gold To $10,000?

Tyler Durden's picture




 

From deflationist extraordinaire David Rosenberg:

GOLD HEADING TO $10,000 AN OUNCE?

Peter Schiff thinks that is a real possibility — see page 45 of the current BusinessWeek. There is no doubt that when benchmarked against the CPI, money supply and GDP, gold can easily double from here. Demand is always difficult to forecast, especially for jewellery, but we do know that central banks have very deep pockets and bought more gold last year (425 tons) than at any other time since 1964.

The supply backdrop is also highly conducive to a sustained bull market. Mined production is no higher now than it was a decade ago and has fallen outright in 5 of the past 8 years. And, we know what the marginal cost curve is doing because there is so little cheap supply left in the ground that gold companies now have to drill as much as 2.3 miles to get to the yellow metal in South Africa (and all Bernanke has to do is press a button).

And a gold anecdote from a Rosie reader:

GOLD SAVES LIVES!

The letter below comes Matthew, a subscriber to our research, pertaining to our biblical bullion comment yesterday. I thought his email was worth a reprint:

“David, Interesting gold citation from the Bible. In 1904, my grandfather was conscripted by the czar to fight for Russia in its war with Japan. He escaped from the Ukraine and made his way to a port where the captain of a freighter to NY refused to accept the small amount of fiat currency he was offered. But he let my grandfather board in exchange for a few gold coins — although the few coins would sell for much less than the asking price for passage in local fiat. That captain knew all one needs to know about commodity currency.

Warm regards, Matthew”

 

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Tue, 06/01/2010 - 11:30 | 386599 boeing747
boeing747's picture

Ask Uncle Ben see if he is comfortable with such price?

Tue, 06/01/2010 - 14:36 | 387235 Johnny Bravo
Johnny Bravo's picture

Apparently not.

Do you remember all the people on zerohedge that voted that gold would be 2000 by June, the last time gold was at 1220?

Yeah, it's June.  And gold is still at 1220.

Now we got morons on here saying 50000.  (cheeky) 
LOL at zerohedge, and LOL at David Rosenberg, who has been bearish since Dow 7500.

Tue, 06/01/2010 - 14:43 | 387261 akak
akak's picture

Ah, here he is!  Our obsessive-compulsive gold-hating troll!

What took you so long?  You know your pay gets docked for every minute you are late to any gold-related conversation here, Johnny.

Tue, 06/01/2010 - 14:49 | 387287 Johnny Bravo
Johnny Bravo's picture

I just laugh at people that make stupid financial calls.

They are easiest to find in gold threads.

So... how'd that gold to 2000 by June prediction work out for you all?

(Hint: it's June.)

Tue, 06/01/2010 - 15:02 | 387332 akak
akak's picture

It didn't work out for me at all, troll, because I never made any such prediction.

And again, what motivates you to so obsessively and hatefully troll a forum only to attack the conversation and other people's convictions?  That, to me, is the sign of a disturbed and petty mind.

Tue, 06/01/2010 - 15:16 | 387377 Johnny Bravo
Johnny Bravo's picture

Well most of the people here DID make that prediction, and I was telling them they were wrong then as well.

Look, I had a long, hard day.  I knew that there'd be some moron on zerohedge saying gold to 80 million bajillion.  I came to laugh at them.  It makes me happy to laugh.  Other people like to shove bullion up their bumholes or whatever.  I just like to laugh at the people who cannot make financial calls that have a possibility of coming true.

I'm not even against gold, just extremely poor logic...
If people were like GOLD TO 1500 BITCHEZ, I might not come here and laugh so hard all the time.

Yet, there's always some friggin moron (David Rosenberg no less, who has been bearish since Dow 7500 and missed the entire rally) calling some absurdly high number for gold.

I just get finished with what I need to do for the day, and I'm like "Hmmm... I wonder what complete bullshit I'm going to read today?  Will gold be going to 3000, or 30000, or 3000000 or 96 million bajillion?"

It makes me happy to laugh at such absurdity.  Laughing is good for you.  Bullion up the butthole... not so much.

Tue, 06/01/2010 - 15:21 | 387397 akak
akak's picture

You're perverted and sick.  You admit you only come here to troll and disrupt the conversation.  You are beyond pathetic.

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qrs521's picture

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Tue, 06/01/2010 - 16:00 | 387525 BobWatNorCal
BobWatNorCal's picture

"Look, I had a long, hard day."

Yeh, I hear ya, Rahm. Wish you good luck keeping all them econ balls in the air.

Tue, 06/01/2010 - 18:07 | 387968 Mako
Mako's picture

Johnny,

I would have to pretty much agree with you.  The way some of these guys think is so backwards it's mind blowing. 

"I'm not even against gold, just extremely poor logic..."

Agree here as well. 

What is funny is this one guy I talked to like a year ago, he was like, I am going to buy a whole block in downtown Chicago with the skyscapers included with one gold coin.  I was like, well you can own parts of Detroit for almost nothing today. 

Funny shit. 

Then I was like, well so you think gold is going to trillions, what about houses, he was like, well those are going to lose alot more money.  I couldn't stop from laughing.

These people that think the system is gone and they will just cash out and be rich are funny bunch. 

 

Tue, 06/01/2010 - 18:10 | 387996 akak
akak's picture

Merely because there happen to be misguided and uninformed individuals within the pro-gold camp, as there are in EVERY possible group and subset of society, does not invalidate the many excellent and logical reasons to hold gold at this time.

You are making a strawman argument here, and it does not lend your own arguments any credence by attempting to do so.

Tue, 06/01/2010 - 21:04 | 388328 makeyoumiss
makeyoumiss's picture

I was like, and he was like,.....like wow.

Tue, 06/01/2010 - 21:27 | 388378 akak
akak's picture

It's like, Oh my God, like, fer shur, no way, like, you know?

Tue, 06/01/2010 - 16:18 | 387607 dumpster
dumpster's picture

 just laugh at people that make stupid financial calls

 

well get ready to look in the mirror and gaffe at your pretentious calls on gold.. yes its june and gold is 1230  ,, you said at 1500 if it got back to 2200 you would eat your hat..  

speaking of stupid market calls  

Wed, 06/02/2010 - 10:21 | 389271 Johnny Bravo
Johnny Bravo's picture

What are you talking about?  Gold never made it to 1500.  I did say if it made it to a very high number I would eat my hat, but it surely never made it to 1300, much less 1500.

Do you know how to read?

Tue, 06/01/2010 - 15:50 | 387493 imaginalis
imaginalis's picture

JB is bought and paid for me thinks

Wed, 06/02/2010 - 10:22 | 389272 Johnny Bravo
Johnny Bravo's picture

I wish!

Tue, 06/01/2010 - 15:00 | 387328 Johnny Bravo
Johnny Bravo's picture

I know, I know.  I'm wrong.  Gold made it to 1225!!

Don't spend your 5 dollars an ounce all in one place!  LOL!

Tue, 06/01/2010 - 16:20 | 387616 dumpster
dumpster's picture

bought at 300 dog butt

Tue, 06/01/2010 - 21:26 | 388375 johan404
johan404's picture

Since buying my gold I'm up about 15k, in nominal fiat terms. I'm pretty happy with my financial call.

Tue, 06/01/2010 - 19:04 | 388120 Spitzer
Spitzer's picture

yes I do and the majority voted that it would NOT get to $2000.

Priced in gold the DOW is below 7500

Tue, 06/01/2010 - 15:25 | 387405 Inspector Asset
Inspector Asset's picture

Im thinking 12 gold coins around my necklace.

Them maybe some gold coins, maybe 24 around my waist.

Maybe a gold plated bong and rifle.

STeve jobs should launch the gold plated Ipod.

yeah it would be heavy, but at least you would know it's real.

And gold plated teeth, which they couldn't take from you.

 

 

Tue, 06/01/2010 - 16:25 | 387632 George the baby...
George the baby crusher's picture

You would want to rethink the gold teeth thing, which you think they won't take.  You know how much it hurts when they do? Go for a bigger gold bong.

Tue, 06/01/2010 - 16:37 | 387687 Kali
Kali's picture

Jawohl mein Kapitan!

Tue, 06/01/2010 - 11:32 | 386603 Turd Ferguson
Turd Ferguson's picture

$10000 is nothing!

Wait until its public knowledge that over half of the known "reserves" are actually gold-plated tungsten. And wait until its admitted that proxies like GLD are a fraud. And wait until the world demands a new global, gold-backed currency.

Gold $50,000!!!!!!!!!!!!!!

Tue, 06/01/2010 - 11:37 | 386621 silvertrain
silvertrain's picture

I hope silver tags along for the ride and closes the ratio some..

Tue, 06/01/2010 - 13:30 | 387010 hound dog vigilante
hound dog vigilante's picture

 

"I hope silver tags along for the ride..."

It will.

 

"...and closes the ratio some..."

And, it will.

 

Historically, silver has ALWAYS done both... tagged along and chased the Au/Ag ratio.

 

Personally, I have a hard time thinking of a new/old hard currency paradigm in which silver does not benefit equally (or more) than gold.

 

Tue, 06/01/2010 - 13:57 | 387095 carbonmutant
carbonmutant's picture

Monex is certainly pumping it...

Tue, 06/01/2010 - 15:34 | 387436 DosZap
DosZap's picture

Well, thje Mkt damn sure isn't, their treating it like a Commodity...morons.

Tue, 06/01/2010 - 15:52 | 387499 SecretGoldfish
SecretGoldfish's picture

don't care for monex . . . personal reasons

 

 

Tue, 06/01/2010 - 18:13 | 387999 Hephasteus
Hephasteus's picture

Did business with them once. Won't happen again.

Tue, 06/01/2010 - 15:15 | 387372 Inspector Asset
Inspector Asset's picture

Ive been very bullish gold the last few years, but I think it's time to play devil's advocate. Two reasons make me some what hesitant about the gold trade.

1. Warren Buffet coming out with a buy opinion.  Generally the worlds richest dont share their trade ideas with the world. Unless they are trying to sucker them.

2. With no other bubbles left to exploit (minus t-bonds)  the bankers are eager to find a bubble to exploit, and the gold market, is getting their on it's own steam.  It is possible that we will never back to any gold standard again. 

3. What ever happened to the Amero?  I wonder if we were ever serious about it to begin with or were we just selling Europe again for it's Euro.  Now it appears that Amercia will gain, by the death of the Euro, making `it the last currency standing, except for the Chinese, but they can be bullied along.  After all we taught them these games. 

In the end, there will be just the dollar, hyper inflated, blood stained, etc. 

Maybe that's when they introduce the chip, so people dont have to deal in blood stained currency notes.  Anyway, getting off point.

My point is , IM out GOLD, because Buffet is in Gold! 

Bricks of medical grade marajunia? Im in!

 

 

Tue, 06/01/2010 - 15:19 | 387389 Johnny Bravo
Johnny Bravo's picture

After gold plunges, medical marijuana and gold will be the same price!

I'd rather have the former.  It least it does something... LOL

Tue, 06/01/2010 - 18:49 | 388081 dumpster
dumpster's picture

can you say groin bag ,, hell you are like a little puppy licking your nose

richard russell  50 years in the business , you two months

Russell’s current obsession — to get my subscribers OUT of stocks and into cash and gold bullion. Puleeze — so don’t just think about it — DO IT!!

Russell warning (again!) — Even the bears have no idea of how bad this primary bear market is fated to be. And with the stock market will go the US economy.

Tue, 06/01/2010 - 19:09 | 388126 Spitzer
Spitzer's picture

Ok, we have your prediction.

Tue, 06/01/2010 - 21:38 | 388397 goldfreak
goldfreak's picture

I guess using your name Jon NAdler won't scare anyone away from gold will it?

 

Where's your gold 600?

Tue, 06/01/2010 - 11:38 | 386631 sheeple
sheeple's picture

Gold $50,000!!!!!!!!!!!!!!

 

y stop there?

Tue, 06/01/2010 - 11:41 | 386648 if
if's picture

$50k ?  That's nothing.  I'm waiting till I can buy all of lower Manhattan with my 2 ounces.

Tue, 06/01/2010 - 12:48 | 386874 Truth
Truth's picture

Awesome.  Can I then buy it from you for 3 ounces of gold so I can then blow it out into the Atlantic ocean with coordinates set for the Bermuda Triangle!?

Tue, 06/01/2010 - 13:31 | 387012 DaveyJones
DaveyJones's picture

it's been bought for jewelry before

Tue, 06/01/2010 - 14:28 | 387196 akak
akak's picture

Excellent! LOL!

Tue, 06/01/2010 - 15:42 | 387459 if
if's picture

Yup  ;-)

Tue, 06/01/2010 - 11:50 | 386687 Missing_Link
Missing_Link's picture

Pffft.  I can add WAY more zeroes than you.  Watch this:

GOLD $50,000,000,000,000,000,OO0O0O,OO10O1O,!!!!,,,100O!!,/!OOOO!!!

Tue, 06/01/2010 - 11:57 | 386721 Turd Ferguson
Turd Ferguson's picture

Still too low. Gold to infinity!!!

So there.

Tue, 06/01/2010 - 12:44 | 386862 Anonymouse
Anonymouse's picture

Gold to infinity.... +1 !

Tue, 06/01/2010 - 13:29 | 387008 Pat Hand
Pat Hand's picture

To infinity... AND BEYOND!

Tue, 06/01/2010 - 11:57 | 386720 DoChenRollingBearing
DoChenRollingBearing's picture

Well, if FOFOA is right, then we have a BIG PARTY (at $50,000) due (assuming society stays intact).  You, sir, Mr. Turd are welcome as well.  Logistics will be worked out later.

We will be in the very best of company, I just have to remember all the of us who like gold and have said so.

$50,000!!!  That would make me rich!  Vamos!

Tue, 06/01/2010 - 11:58 | 386731 Turd Ferguson
Turd Ferguson's picture

Can we be like Spicoli and blow all the dough by hiring Van Halen to play at the party?

Tue, 06/01/2010 - 12:00 | 386739 Temporalist
Temporalist's picture

Best idea of the new decade!

Tue, 06/01/2010 - 12:12 | 386780 TBT or not TBT
TBT or not TBT's picture

But can David Lee Roth still sing with them?

Tue, 06/01/2010 - 12:42 | 386856 Turd Ferguson
Turd Ferguson's picture

For $50,000,000,000,000,000,000,000 I imagine anything is possible.

Tue, 06/01/2010 - 12:45 | 386865 Anonymouse
Anonymouse's picture

I'll do it for half that....

Tue, 06/01/2010 - 13:05 | 386930 John Self
John Self's picture

Sadly, no, because David Lee Roth can no longer sing.

Tue, 06/01/2010 - 14:41 | 387255 A_MacLaren
A_MacLaren's picture

Can he lip synch at least?

Tue, 06/01/2010 - 15:02 | 387333 Johnny Bravo
Johnny Bravo's picture

"Can we be like Spicoli and blow all the dough by hiring Van Halen to play at the party?"

I'd say we save a few bucks and hire a band with some talent.

Tue, 06/01/2010 - 21:11 | 388347 DaveyJones
DaveyJones's picture

You're right Johnny, no guitarists have any respect for Eddie.  

Tue, 06/01/2010 - 11:58 | 386732 Good To Great
Good To Great's picture

It will never be admitted.

Tue, 06/01/2010 - 14:33 | 387219 anarkst
anarkst's picture

Yo Turd, in case you have not been informed, the entire system is a fraud.  

Tue, 06/01/2010 - 14:38 | 387240 Johnny Bravo
Johnny Bravo's picture

50000?

LOLOLOL.  Keep smoking that hopium, after you're done smoking dope, and it still won't make it to 2000 anytime soon.

Tue, 06/01/2010 - 17:56 | 387954 Treeplanter
Treeplanter's picture

Once the manipulation of the market is busted, there is no telling how high silver and gold will go in a free market.  High enough for sure, for the many reasons given repeated every week.  They say get in on the ground floor.  Hell, we're still down in the parking garage.

Tue, 06/01/2010 - 11:32 | 386605 MsCreant
MsCreant's picture

Bravo Bait. Hey Jory. JayBayBeakerWhatever. Here boys. Come and get it.

Tue, 06/01/2010 - 12:03 | 386742 DoChenRollingBearing
DoChenRollingBearing's picture

YO, GOLD HATERS!

Please tell me why it is NOT OK for us to have 5% - 10% of what we own in gold.  We're listening.

Disclosure: approx. 6% of what I have is in gold.

Tue, 06/01/2010 - 12:19 | 386799 ranrun
ranrun's picture

hah i'm 50 percent.

Tue, 06/01/2010 - 13:52 | 387076 chumbawamba
chumbawamba's picture

110% bitches.

I am Chumbawamba.

Tue, 06/01/2010 - 13:58 | 387099 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

You and Yogi Berra.

Tue, 06/01/2010 - 14:23 | 387167 MsCreant
MsCreant's picture

I love that avatar for you. Purple Haze Kitty!

Tue, 06/01/2010 - 14:49 | 387285 Hephasteus
Hephasteus's picture

Margin call Bitches!!

LOL

Tue, 06/01/2010 - 15:04 | 387340 Johnny Bravo
Johnny Bravo's picture

If I were you all, I'd mortgage everything you own and buy gold, like some other ass did.  That way, you can lose money with extreme leverage!

Margin call, bitchez, indeed!

Tue, 06/01/2010 - 12:40 | 386845 Mako
Mako's picture

I think the gold bugs take it too far.  I could well be very true that someone may exchange something for your gold once the credit system goes but it's not going to save anything.   The world you live in functions and give you what you want because of a functioning credit system. 

The people that think they are going to just cash out and be rich are in for a rude awakening.  

Is there anything wrong with putting some in gold and silver, sure if that is your thing, when the shit hits the fan trust me it will have limited use. 

There will be 100s of millions in India that will have to go and they have the highest level of ownership in the world.  Sorry, someone is going to have to go.

Humans have put together a great scheme, it works great until it hits it's peak than people have to be liquidated.  I expect billions to have to go, whether they have gold in their pocket or not. 

Tue, 06/01/2010 - 12:46 | 386870 trav7777
trav7777's picture

This is godawful bullshit.

Most of history did not function on a fucking creditmoney system, dude.

Real Bills lasted for centuries and did not require central banking, only that banks serve a clearing function.

The Bank of England figured out that lending to the sovereign was far more profitable, because it gave them control of the money supply.

Tue, 06/01/2010 - 12:50 | 386880 Mako
Mako's picture

Sure did, people have been lending and borrowing since the dawn of civilization.  This scheme is the exact same as the scheme before it,  and the one before that, etc.

You don't need a bank or a central bank, what are you talking about? Lay off the bong.

 

Tue, 06/01/2010 - 13:36 | 387021 BumpSkool
BumpSkool's picture

The cycle of lending and borrowing is not a flat curve. There are wide divergences over huge periods of time. Your implication is that the current and recent level of finance capitalism has always existed. That is certainly not true. There was no significant credit to the general population in the 1869-1898 period. There was in the 1920-29 period. Try getting credit now or in a couple years time...It will be nothing like it was in 2005.

Tue, 06/01/2010 - 14:10 | 387121 Mako
Mako's picture

Credit creation expanded exponentially... to fuel the equation.

I never said what you said I said.

Getting a loan is not a problem right now... I can go out and probably get a million dollar line on a house today with no problem.  System is unable to expand at the rate needed.

 

Tue, 06/01/2010 - 15:31 | 387429 trav7777
trav7777's picture

And you cannot seem to figure out why and that this SYSTEM is not coextensive with CREDIT in the absolute, can you?

Tue, 06/01/2010 - 15:06 | 387345 tip e. canoe
tip e. canoe's picture

i would gladly give 2 pieces of eight to see a Mako/Trav cage match at the event horizon.

Tue, 06/01/2010 - 15:34 | 387440 trav7777
trav7777's picture

Trav by armbar 2:12 round 1

Tue, 06/01/2010 - 15:30 | 387422 trav7777
trav7777's picture

Then your original statement about credit was an UTTER and complete non sequitur.

I imagine you have no clue why...

Tue, 06/01/2010 - 17:23 | 387867 Mako
Mako's picture

No, I know precisely that you don't know much. 

Tue, 06/01/2010 - 15:34 | 387435 trav7777
trav7777's picture

This is absolute and complete bullshit.

THIS system is one where credit IS money.

Former systems functioned on pure fiat, metals standards, Real Bills, etc.

Credit-based money IS THE ABERRATION.

Even in a contractionary aggregate climate, there will still be lending and borrowing, moron.  The entire INSTITUTION of credit is not ending.  What has reached its terminal inflection is the institution of creditMONEY, or to state it another way, UNreal Bills Doctrine.

Tue, 06/01/2010 - 17:24 | 387869 Mako
Mako's picture

"there will still be lending and borrowing, moron."

Never once said you what you are saying I said.  You don't read well.  Never once said or hint at the above.

Tue, 06/01/2010 - 12:40 | 386852 equity_momo
equity_momo's picture

That makes you rather anti gold.  Alot of the momo funds suggest 10% as de rigeur to be "diversified". And they are serious index hugging momo tards.

 

As a rule of thumb im not sure you can be classed a gold bug unless 50% or more of your NAV is tied to the metal.

 

I'm at about 10% and looking to increase (as conditions dictate)

 

ps: dont strike me down , but i get the impression alot of gold bugs here are way below that 50% threshold and lets face it , a few dozen ounces here and there isnt "wealth preservation". If youre long gold and still paying rent or a mortgage you need to have a quiet word with yourself.

 

Tue, 06/01/2010 - 12:54 | 386889 DosZap
DosZap's picture

E_M,

I look at it as Insurance...........

Positions IMHO, should be at least enough to replace your total net worth,of course that depends on the price............

But, unless something HUGE changes, we will see $3k/$5k...........easy.

The other issue, is WHAT currency is one to swap out of $$$ into?.

At 86+ USD Index, now, according to a lot of big names, NO One should still be holding dollars, just enough to do day to day business, and live on.

Going to be a lot of SICK wealthy folks, when they wake up in CLOSE to a Weimar situation.( the deval will happen just like Bank closings, at night, or on a weekend).

A 3 for 1, 5-1, 10-1, 100-1.............ANY of those is unacceptable to me, and for sure people on fixed incomes(retired and in good shape, able to live when SS goes to hell).

Tue, 06/01/2010 - 13:02 | 386917 equity_momo
equity_momo's picture

Im not a critic  , im just saying someone protecting 50k because they expect a monumental shift in our economic system is frankly pssing in the wind.

I said along time ago here , if youre part of the common people - of which i am - , and i dont think im going out on a limb here saying 99% of folk here are just that (albet with higher average IQs than the general populace) , then making sure you are debt free , live in a good community , with friends you can trust , with access to food etc , and spend that last 50k on a decent 4x4 and fuel supply , is probably a better investment that cheering the demise of fiat paper.  Because frankly if gold goes from 1k to 5k and you bank a "paper profit" of 500% on your 50k , it dont matter , youre still getting fked up in the grand scheme of things if you havent taken care of the rest.

 

Now , if you have MILLIONS to protect , then go for it , load up on gold and diamonds and fine art.

 

Tue, 06/01/2010 - 19:21 | 388145 Al Gorerhythm
Al Gorerhythm's picture

The question is, what currency is one you would swap out of $$$$ into? No, the question is: WHAT CURRENCY is one that you would swap out of gold into, and in the process, destroy your capital base?

Tue, 06/01/2010 - 13:37 | 387024 MrSmith
MrSmith's picture

 

No, gold bugs should maintain a very high mortgage.  

Buy a lot of real estate and use a 30yr, fixed rate mortgage if you expect higher inflation.  This is not complicated.  

 

Tue, 06/01/2010 - 14:20 | 387157 ATM
ATM's picture

Exactly. Why would I want to pay off debt in today's dollars when I am 99.9999% sure I can pay off those cheap rate loans inthe future with worthless pieces of paper in the future?

I maxed out my home equity loan (currently at prime less .75%) and bought a bunch of junk debt yielding close to 12% and some more shiny gold. If I'm right the yield pays for my borrowing costs + cash flow and the appreciation of gold v. the $ pays off the second mortgage in the future.

Tue, 06/01/2010 - 14:40 | 387251 Johnny Bravo
Johnny Bravo's picture

So what are you going to do when gold declines?

LOL.  That's gotta be the stupidest idea I've heard.

"I mortgaged my house to buy an asset at the peak!"

What's next... askjeeves.com stock at 300 a share?

Tue, 06/01/2010 - 15:31 | 387424 dumpster
dumpster's picture

johhny bravo eats a big zit ,, as he sets unemployed  and pizzes in the wind

China Loses Taste for the Dollar, Looks to Lock-Up Gold Supply

By Jim Amrhein
Tuesday, June 1st, 2010

With the Eurozone looking about as stable as a burning deepwater oil drilling platform — and the partisan American media propping up President Obama's jobless domestic "recovery" — the U.S. dollar has seemed to get a temporary stay of execution in the court of global economics...

But let's not allow the buck's spring bloom to erase the memory that for years now, as the dollar declined against the euro and other currencies, many have been gunning for its replacement as the de facto world reserve currency — and the monetary unit in which oil, gold, and other commodities are priced.

In the heat of the dollar's descent in 2007, our own beloved (not) Alan Greenspan said that it was "absolutely conceivable that the euro will replace the dollar as reserve currency, or will be traded as an equally important reserve currency."

His voice presaged or echoed the sentiments of many important nations, among them well-known dollar-bashers China and Russia — but also to varying degrees India, Iran, Brazil, Venezuela, and others...

And let's not forget that the U.N., IMF, OPEC, and G20 have all recently pondered or publically called for some form of decoupling of the U.S. dollar from commodities — or its replacement as the gold standard (no pun intended) of world reserve currencies.

None of these bode well for the buck.

One doesn't have to be economist, monetary historian, or even an investing ace (I'm none of these, to be sure) to see that nothing about America's current monetary policy could arrest the dollar's ultimate decline against other currencies of the world.

Tue, 06/01/2010 - 16:47 | 387724 equity_momo
equity_momo's picture

99.99999% huh. Nothing like going ALL IN i guess. You been watching too much PKR son.

Let me know how you do when house prices take their second monumental leg down and Bernanke gets bored of pushing on a string. Id hedge against some outright depressionary deflation , just as a hedge , all im saying. Unless youre single with a couldnt give  a fk attitude , then of course go for it - but you may aswell do it properly and use some derivatives.

 When the boys come calling to take the plasma , hiding in your basment with a sidearm and bag of nuggets is going to seem pretty pointless.

 

Tue, 06/01/2010 - 16:51 | 387734 equity_momo
equity_momo's picture

Ya great idea.Seriously. Why dont you short some Treasuries too , get long some Aussy Dollars , a few commodity miners , heck may aswell buy some blue chip Dow constituents like Mc Ds , they will retain pricing power come what may.

 

Your portfolio is more lopsided than Long Jonh Silver at high seas.  Dont go all in unless you can afford to lose everything.

Tue, 06/01/2010 - 14:57 | 387317 ColonelCooper
ColonelCooper's picture

With all due respect..... WRONG. 

For years I did the right thing.  Paid extra on my mortgage, and didn't borrow against it.  No longer.  I make my payment, on the first of each month, and if the day comes where I can't make it any more, I'll walk away, telling the world to kiss my hairy ass.

So, should one put his monthly set aside savings into the market?  CD's? Passbook savings?  Good luck with that.  Since the money I put into PM's is "extra", I really don't give a shit what the "value" of it is.  If I ever need it, it'll be worth something. 

Wealth preservation is relative.  If your retirement savings adds up to 150K, and you have a "few dozen ounces here and there", then you have preserved something. 

I really NEED very little money to live on.  If I can't pay the mortgage, I'll go back to the farm, and my pitiful handful of gold and silver will at least pay the taxes, and buy me a few gallons of gas/diesel/kerosene every year for a while.  Or get to see a doctor a little more quickly.  Or buy seed.  Or, Or, Or.

Believe me, I have way too many quiet words with myself.  I apologize for being one of the unwashed average, who pays his bills and sets the extra aside each week.  I didn't know I needed an invitation to come to your party.  I'll go before I do something crass like piss all over your carpet.  Here's a half eagle for your trouble.

Tue, 06/01/2010 - 16:40 | 387702 equity_momo
equity_momo's picture

CC , im one of you , im on your side. Im just being rationale.

All this talk of getting 30 yr fixed mortgages then walking on the loan whilst stashing an ounce each month is just childish.  Seriously.

Tue, 06/01/2010 - 20:10 | 388239 ColonelCooper
ColonelCooper's picture

Cool.  Sorry I got my hackles up.  After I posted, I read your followup about the 4x4.  We're on the same side.

I was raised by parents that I'll call (for lack of a better term) "left wing academic minimalists".  As a young teen, I spent a couple of years living completely off the grid.  We built our small house with hand tools, pumped water, drug firewood on a toboggan, raised nearly all our food.  This experience had two effects on me: One, it taught me to be very self sufficient, and ingrained a strong work ethic.  Two, by the time I left the house, I was as "far right" as my parents were left.

As an adult, once I realized the farce our economy is built upon, I started making moves to minimalize again.  Believe me, for every dollar I have racked up in PM, I have two in tools, construction equip., and other "usefuls".  I have no illusion of being anything other than a small timer in the investment game. (microscopic) But I have become frugal, and have begun to save over the years.  My aquisitions are small but regular.  As far as investments go, I simply have no faith in ANYTHING I can't hold myself; be it a gold coin, a Morgan dollar, or a chainsaw.

If Gordon Gekko is right, I've got a pretty good safety net when applied with practical skills.  If Johnny Bravo is right, then my pension will be fully funded when I need it, and someday my grandkids will have fun opening their crazy old grandpa's safety deposit box.  If Mako's right then we're all fucked anyway.  Regardless of who's right, there isn't much I can do about it.  Either way, splitting firewood keeps me in shape, and weeding peas is good therapy.  I don't see much of a downside.

Tue, 06/01/2010 - 14:53 | 387305 Johnny Bravo
Johnny Bravo's picture

"Please tell me why it is NOT OK for us to have 5% - 10% of what we own in gold."

Dammit, didn't I answer this same question yesterday?

Because you don't buy fire insurance after your house already burns down!  The insurance will be worthless, and you will pay a premium for it on top of it.

That is what goldbugs are doing.  They're buying insurance for the economy to crash AFTER the economy already crashed.  And they're paying one hell of a premium for that insurance!

THAT is why it's a bad investment.  If you're making 6% of your portfolio gold, that's not such a big deal.
Yet, there are people putting their entire savings into it, and buying physical, so it is illiquid.

Tue, 06/01/2010 - 15:05 | 387342 akak
akak's picture

What a ludicrous dumbshit!

The crash has barely even STARTED, you fucking asshat troll!

Good luck sitting in your pile of fiat crap when our unsustainable and tottering debt pyramid comes crashing down on your sorry thick skull.

Tue, 06/01/2010 - 16:27 | 387646 Shrimp Head
Shrimp Head's picture

What he said.  Except I wouldn't even wish him good luck since he is willfull.  Let's save our luck-wishing for the cluess basterds.

Tue, 06/01/2010 - 19:13 | 388133 DoChenRollingBearing
DoChenRollingBearing's picture

Sorry, JB I missed that.  Thanks for answering again.

I have bought gold from about $400 until today for decades (small quantities obviously).  I like the insurance, as the "house" has NOT burned down yet.

I like diversification, I have my money in all kinds of things and places (all legally).  Gold for me is great diversification.  It will be hard, but I am going to try to get to 10%.  That will be enough for me.  Nada mas!

Please carry on...

Tue, 06/01/2010 - 11:33 | 386607 bugs_
bugs_'s picture

Deflationist?

"Gold Saves".  LOL!

Tue, 06/01/2010 - 17:05 | 387796 nope-1004
nope-1004's picture

+1

 

Tue, 06/01/2010 - 11:39 | 386613 Whizbang
Whizbang's picture

I will be happy to sell you gold right now at a cheap price of 3,000 an oz rosey. Interested? No? Perhaps you also realize that when the dollar drops to the extent that gold correlates at 10,000 that all gold will have already been confiscated to pay for the war. Get serious.

...Anyways, what's causing movements in the dollar now? Is it CHF or EUR distorting the markets today? I can't tell which CBs are winning and which are losing anymore. 

Tue, 06/01/2010 - 11:59 | 386734 downrodeo
downrodeo's picture

Lisa, I'd like to buy your rock...

Tue, 06/01/2010 - 11:36 | 386619 EscapeKey
EscapeKey's picture

Gold $36,000, as a result of large amounts of bond investments flowing into the precious metals sector.

Seriously, though, considering how the market behaves - is there a better thing to keep your money in at the moment?

Tue, 06/01/2010 - 11:38 | 386632 Whizbang
Whizbang's picture

yes

Tue, 06/01/2010 - 11:41 | 386647 tmosley
tmosley's picture

What?  Kibble?

Tue, 06/01/2010 - 12:16 | 386788 e_goldstein
e_goldstein's picture

soylent green

Tue, 06/01/2010 - 14:42 | 387259 Johnny Bravo
Johnny Bravo's picture

I'll believe gold has a legit chance of making 36000 RIGHT AFTER it makes the 2000 dollar level all the zerohedgers said it would be at by June.  That was the last time it was at 1220.

Now... it's June.  It's still at 1220.

But oh wait, you can just move the target back a little further, or like 36 times further.  That's realistic.

Tue, 06/01/2010 - 15:22 | 387376 akak
akak's picture

You do love a good joust with a strawman, don't you?

Your ability and willingness to logically and rationally debate are SO pathetic, you simply must be a business school graduate, am I right?

Tue, 06/01/2010 - 15:45 | 387474 dumpster
dumpster's picture

akak

Johnny boy is an unemployed going to school ,, zit head ,, never raised a family never started a BUSINESS .  never had any experience other than passing 25 then 29. ,, his claim to fame is his lap top and a crib sheet

his extension of reality is based on a flagrant ignorant view of his world .

at 1500 gold he stated if gold got back to 2200 he would eat his hat .. already his little charade is coming to an end .

what will this worthless dab of zit material do when gold hits 1500,,

he believes he is the better of richard russell 50 years in the business

jim sinclair 50 years in gold and international trading houses

jim Dines mr gold ,, and a student of the market

Armstrong ,, owner of princeton economic forum . with cycle studies read by heads of state.

sprott with 500 million on the line for gold

and so many others that this dim whit thinks he is an equal and much more in tune ,

and numbskull believes his childish rants will earn him a place as a laughing stock of the sophomore class at the community college he attends ,, out of work . longing for position that only time and experence will grant ,

 

 

Tue, 06/01/2010 - 16:57 | 387718 Kali
Kali's picture

Oh snap!  REally, you should invest debate time with JB for entertainment purposes only.  Don't waste your energy.

Tue, 06/01/2010 - 19:18 | 388140 DoChenRollingBearing
DoChenRollingBearing's picture

Au contraire Kali!

dumpster is one of our treasures here at ZH (no sarcasm).  His writing is not only poetic, but at least 50% of his posts have me laughing so hard that spittle is all over my monitor.

dumpster!  Always a great pleasure to read your stuff.

Tue, 06/01/2010 - 11:37 | 386622 sheeple
sheeple's picture

yeah, on the way to 100000

Tue, 06/01/2010 - 14:46 | 387270 Johnny Bravo
Johnny Bravo's picture

Why stop at 100000?

It'll be 10000000000000 next week!  The United States will be Zimbabwe!  Canned hamz bitchez!!!  The sky is falling!  Cheeky said so!

I'm going to buy loaves of bread with my gold eagles right after you all starve when the hyperinflation of the weimar republic kicks in!  Then I'll be the shit and you'll be begging me for my shiny yellow metal!  Ahahaha!!!
Buy physical, cause if you don't hold it in your hand, you don't own it!  All other gold on the planet is tungsten!  Goldman Sachs is shorting gold because they plan to become the "Goldman" literally!  "They" just want to buy all your gold!

Canned hamz bitchez!!!  The sky is falling!  We will all eat maggots and grow potatoes while the rest of the Earth dies in a fiery cataclysm of Zimbabwe style money printing! 

GOLED BITCHEZ!!!!!

Tue, 06/01/2010 - 11:37 | 386623 Pladizow
Pladizow's picture

Suspicion toward a currency, once awakened, develops insomnia. - James Dines.

Tue, 06/01/2010 - 15:43 | 387466 WaterWings
WaterWings's picture

Please change your avatar.

Tue, 06/01/2010 - 17:02 | 387779 Kali
Kali's picture

He likes looking at himself. :)

Tue, 06/01/2010 - 11:37 | 386626 Gully Foyle
Gully Foyle's picture

Next year the news will be " Gold peaks $1750". The day after " Gold sell off largest in History" followed by " Gold now at $150 time to buy".

Tue, 06/01/2010 - 11:48 | 386679 jeff montanye
jeff montanye's picture

you would know because you are ... clairvoyant.

Tue, 06/01/2010 - 12:08 | 386768 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Clairvoyant AND obsequious!  ;-)

Tue, 06/01/2010 - 14:33 | 387216 akak
akak's picture

"Gold now at $150 time to buy".

Interesting, Gully, that you seem to believe that the price of gold will and can fall to a fraction of its basic production cost.

Some would call that profoundly ignorant.  I just consider it revealing.

 

Tue, 06/01/2010 - 14:47 | 387272 faustian bargain
faustian bargain's picture

The only way gold would ever be priced at $150 is if everything else in the economy were also priced at 10% (or less) of its current price. Which ain't gonna happen.

Tue, 06/01/2010 - 14:48 | 387276 Johnny Bravo
Johnny Bravo's picture

Don't forget, the overwhelming majority of zerohedgers voted that it would be at 2000 by June in a poll the last time it was at 1220.

And now... it's at 1220.

But don't fret!  It'll be 3600000000000 million bajillion next week!  Right after the United States becomes Zimbabwe...

Tue, 06/01/2010 - 14:52 | 387301 Hephasteus
Tue, 06/01/2010 - 14:56 | 387313 Johnny Bravo
Johnny Bravo's picture

Yeah, well this isn't Malaysia, buddy!

Tue, 06/01/2010 - 15:42 | 387460 Hephasteus
Hephasteus's picture

Ya but don't you find it strange that it's heading or 1000 in euro's. Seems like relative value currencies have gotten themselves anchored to gold again. Oops.

Boatrides over.

http://www.youtube.com/watch?v=avaSdC0QOUM&feature=channel

Paddle bernanke paddle!!! You're economic engine just threw every rod into the ocean. Quick goose the momo's and make the engine noises!!!!

Tue, 06/01/2010 - 16:27 | 387642 dumpster
dumpster's picture

well some may have ,, not the dumpster ,, gold goes up and down ,, 1500 by christmas

in the mean time eat yor hat .. gold is 1230

Tue, 06/01/2010 - 11:38 | 386627 DeweyLeon
DeweyLeon's picture

And poor Silver will still be stuck sub 30.

Tue, 06/01/2010 - 13:20 | 386979 silvertrain
silvertrain's picture

 All of those Solar panels have to have Silver, they can keep it down until the supply runs out, then it will shoot off like rodium..

Tue, 06/01/2010 - 14:59 | 387320 Johnny Bravo
Johnny Bravo's picture

I think it'll shoot off like a goldbug with some tweezers picturing gold going to 500000 an ounce!

Tue, 06/01/2010 - 15:08 | 387350 akak
akak's picture

Your incessant trolling is simply fucking sick.

Tue, 06/01/2010 - 20:37 | 388282 Al Gorerhythm
Al Gorerhythm's picture

See his name, scroll down. 

Tue, 06/01/2010 - 17:43 | 387910 Hephasteus
Hephasteus's picture

They don't have to have silver. They just use a high silver tabbing material to get maximum throughput because there's so much resistance in a panel anyway. There's nothing that says the panels have to be as thin as possible. They could install cells on super thick etched copper boards and raise 80 volt panels to 88ish volts. But I think you'll find the use of silver falls out of favor once it hits 35ish and ounce if copper is below 8 bucks a pound. Which is doubtfull because then they would have chosen the death by inflation road.

Tue, 06/01/2010 - 11:42 | 386635 Temporalist
Temporalist's picture

Bloomberg TV just did a segment on gold, asking if it's in a bubble and comparing it to stock and housing bubbles (proving that it is not in a bubble), used a clip from David Rosenberg saying it is going to $3000, said central banks are net buyers recently, mentioned the decrease in mine productivity, the whole time treating it like a commodity not once mentioning it is money.

When the currency meme grows for gold it will shoot up higher and faster than any time before (in comparison to fiat money).

Tue, 06/01/2010 - 12:09 | 386770 Bolweevil
Bolweevil's picture

And I ask, if gold is a commodity then why are the CB's not snatching up tallow and cattle skins like its 1988?

Tue, 06/01/2010 - 17:56 | 387950 akak
akak's picture

Yes, the gold-haters can NEVER answer this question either, can they?

Gold is the magnifier of monetary ignorance and irrationality.

Tue, 06/01/2010 - 11:40 | 386640 boeing747
boeing747's picture

We can never go back to gold standard just like we don't want to fight with knife today when we have gun. But we do need a system which creates money from thick air.

Tue, 06/01/2010 - 11:44 | 386657 Temporalist
Temporalist's picture

If you are being serious that is a stupid comparison.  Paper fiat is nothing new, and not technologically advanced.  A better comparison would be cola and water.  Cola is new and is making people fat, water is old and keeps you alive.

Tue, 06/01/2010 - 11:44 | 386658 hedgeless_horseman
hedgeless_horseman's picture

We?  The knife can often be the better choice inside 7 feet.

Tue, 06/01/2010 - 11:47 | 386668 Temporalist
Temporalist's picture

That was just mentioned on ZH the other day...and it's now 21feet according to the poster.

Tue, 06/01/2010 - 12:01 | 386698 hedgeless_horseman
hedgeless_horseman's picture

The reactionary gap can be as short as 7 feet, or as long as 21 feet, depending on the scenario.  Inside 7 feet there really is no debate. 

The bad guys like the knife because it is silent, and scares the crap out of the victim.

The good guys like the knife because it can, and should, always be there when you need it.

It is good advice to take a tactical folding knife class taught by a true expert BEFORE one buys a knife.

Tue, 06/01/2010 - 12:59 | 386911 DosZap
DosZap's picture

That 21' was from a person (LE/CCP holder), drawing from holster, waistband etc..........

If the perp has a knife, and is in 21' of you, them, YOU WILL get the blade.

You cannot react fast enough( no one), to not get nailed.

Test after test has confirmed this.

Tue, 06/01/2010 - 13:18 | 386973 hedgeless_horseman
hedgeless_horseman's picture
  1. Choose to not be a victim.
  2. Understand martial arts are mostly arts, like dance.
  3. Live where you can carry a weapon.
  4. Learn from an expert how to identify & respond to threats.
  5. Practice.
  6. Vigilance.
  7. Relax and enjoy life as a sheep dog, not a sheep.
Tue, 06/01/2010 - 13:22 | 386984 silvertrain
silvertrain's picture

8-security in numbers

Tue, 06/01/2010 - 13:47 | 387001 hedgeless_horseman
hedgeless_horseman's picture

One can't always have 8, but you can always live your life with 1-7.

Tue, 06/01/2010 - 16:37 | 387688 Ragnar D
Ragnar D's picture

It's called the "Tueller Drill", and it was 21 feet (7 yards) for someone fully prepared, waiting for the signal, with his pistol openly carried.

 

Make that pistol concealed like for 90% of citizens, and walking around day to day rather than poised at the starting line, and it's obviously going to increase.

 

But it doesn't mean you can't react and not get cut--you just can't get your pistol on him in time.  Practical classes teach you to meet the attack like you would any other while unarmed, then go to gun (knife, etc) once you've stopped the initial charge.  Still no guarantee, but better odds.

Tue, 06/01/2010 - 11:47 | 386671 dumpster
dumpster's picture

why can't we go back to a gold standard ,jaundiced thinking , nothing changes you still have a fist full of paper.. but backed by gold

so when you exchange at bank you get true value in gold or silver

now you go in with a twenty they give you back 2 10's

Tue, 06/01/2010 - 12:00 | 386737 DoChenRollingBearing
DoChenRollingBearing's picture

Good to see you dumpster.

In my eyes, we do not even have to back to a gold standard, gold will take off anyway.

But, if they do decide to back the currencies with gold, well, so much the better.

Tue, 06/01/2010 - 13:04 | 386927 DosZap
DosZap's picture

Can't happen, physically impossible, to go back on the Gld/Slvr 1-1 std.

Not enough metals on the planet.( Unless you ask Nadler, the Scrap MIGHT make up for it..LOL).

China, and Germany etc, are said to be thinking, planning a 1-2% backed currency, and dumping the dollar............without advance notice I might add.

This is IN the works supposedly.

Tue, 06/01/2010 - 13:43 | 387037 akak
akak's picture

Ah, the old "there's not enough gold!" non-argument.

(Aren't you forgetting here to tell us that "you can't eat it!" too?)

Well, since you seem to think you know, I want you to tell us all, just how much gold in your estimation WOULD be "enough" to make feasible a return to a gold standard?

( ... crickets ... crickets ... crickets...)

I will not of course expect any reply on your part, because as your premise is illogical, there is no logical answer to my question. 

For the record, there is ALWAYS enough gold --- it's just a question of its valuation.

Tue, 06/01/2010 - 14:26 | 387187 Bay of Pigs
Bay of Pigs's picture

Yes, it is a question of "price" vs "value". Many do not seem to grasp this important point.

James Turk explains,

http://goldmoney.com/is-gold-in-a-bubble.html

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