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Is Gold Set To Hit $1,200 Within 24 Hours?
Early spot gold action indicates something is afoot in the gold market. Hitting an absolute record of $1,164 mere minutes ago, the momentum chasing algo funds are now in the picture, set to do to gold what they have been doing to the S&P futures and the SPY day after day for months now: if little volume will cause a move, look for the momentum chasers to crawl out of the woodwork. Yet the key factor determining today's gold price: Comex gold option expiration later today. Over the past several weeks, speculators have accumulated a 3 million ounce option position with a $1,200 strike. With gold flying on the tiniest gust of speculative mania, the possibility that we may see a 1,200 handle on gold seems less and less improbable.
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roasting up
gold
Hmm... how are tungsten futures doing?
The Rumor About London Good Delivery Gold Bars That Are Allegedly Filled with Tungsten
http://www.prisonplanet.com/the-rumor-about-london-good-delivery-gold-ba...
TOXIC DUMP ON BANK OF AMERICA...FYI
The Feds may be planning to dump all the toxic garbage on Bank of America
The desperate, cornered criminal rats who own the Federal Reserve Board are now planning to take all their toxic financial waste and dump it on Bank of America and make it the fall guy, according to a CIA source. That is why they have been unable to find a new CEO. However, that is not going to be enough to save the criminals.
Multiple, reliable sources including MI6 and the Chinese government now confirm that the Federal Reserve Board and the Bank of England were using gold-plated tungsten to “back up” their massive selling of gold futures. As the contracts came due for the delivery, the scam was unveiled.
This means that as long as the US remains under the control of fascist gangsters, it will be treated as a pariah state. Unless the Federal Reserve Board control of the United States ends, the United States is expected to be cut off from the international trading system in January. Sources both within the N.W.O. and MI6 and in China say the dollar will fall to under 6 cents by that time. In such an event, the Feds will try to implement martial law and detain millions of US citizens in concentration camps, according to CIA and other sources.
However, if the US returns to a constitutional democratic form of government, their debts will be paid off in gold and huge amounts of money will be invested in rebuilding the US economy. In that event, the US dollar should rise in value.
Meanwhile, the Feds have sent N.W.O. agent Dragi Emseriev (of Macedonian descent carrying a Swiss Passport) to Japan along with fellow Turkish and Bulgarian Turks and possibly 1 Turkish Intelligence Officer in an attempt to sabotage the Japanese economy. They are believed to be trying to cash the 134.5 Billion USD Kennedy bonds seized in Italy this summer. A Bulgarian Turk named Emroullah is possibly carrying the bonds. This group is notorious for running fraudulent Private program games(algos,software,etc.) in Switzerland and is now in Japan so we must stay alert. Some well known Japanese are also part of this but we will keep their names to ourselves for now. They know who they are and we know who they are so we suggest they surrender or face the consequences.
Wow, now that is an incredible amount of bullshit for a Monday morning!
Uh, this is extremely interesting - could be right outta a Tom Clancy novel - but you declare no source. Did you write this and if so, when is the book signing? :)
I do realize the parts based upon current events, by the way.
This sounds like something a guy known on the internet as Ferfal would say. Some claim he is accurate with his "inside info" but most of it has been way off.
Ferfal is an Argentinean who writes about that country's economic collapse. Perhaps you are thinking of FOFOA? FOFOA does write about various things related to gold and currency, but this little claim is beyond over the top for FOFOA.
Ferfal is a poser, who embellished his experiences or outright lied in order to gain internet fame.
Sounds more like Jim Willie to me, disregard at your peril as I've been a subsciber of his for years and he is quite accurate. If it's not him its someone with a similar set of friends.
The same Jim Willie who developed a cult of personality back in the 90s on Silicon Investor's QCOM board. Despite his PhD in Statistics, his technical analysis was extremely flawed and when NASDAQ reached the top he advised people to leverage into the dips.
The source: http://benjaminfulford.typepad.com/benjaminfulford/
Fulford has interviewed David Rockefeller. Otherwise Fulford is likely a cocaine addict.
Tin foil friday...runs into Monday!
Obviously you didn't realize that aluminum foil is utterly ineffective at blocking the NWO/CIA mind control signals.
Anonymous - 139215
After all that has occurred, if BAC management is so clueless that they allow a toxic dump beyond what they already have then they should be allowed to go under.
On an earlier topic:
Anyone who wants to find out if there is tungsten in their gold bar should read the attached link. There may be better links but I'll leave that little task to those who really want to learn. Bruel & Kjaer is another high quality source but PCB is just as good.
http://www.pcb.com/techsupport/tech_hammers.php
Of course, instead of a beam as shown in the link, we want to check a lot of gold bricks. PCB has some 45 pages of accelerometers of different configurations, sensitivities and functional features. Most of the available configurations have a small thread stup that allows the accelerometer to be firmly attached to a mount. Consultants at either PCB or B & K will be available. I won’t waste your time discussing the possible arrangements for the mount that we would place the gold brick upon for a tap with the hammer.
How much would it cost? I don’t think they make gold bricks that small.
And for those who haven’t figured it out from this recital, readers should know that I have to believe that stories of large numbers of gold bricks spiked with tungsten are highly suspect. It would be too easy to detect by anyone who really wants to know.
But I must admit that I have been astounded by the combination of audacity and cluelessness of many of the in our upper reaches of government. .
Tugsten has a different magnetic signature than gold. Its really easy to test for.
Would be greatly interested to know where
I can find resources to back up this story.
Would be nice if you gave a website/source
to this claim for verification. I do know
there was a controversy with the Kennedy
Bonds recently. Please give more details
to support your claims.
Thanks
sure, why not? with all that tungsten found in bars (done by the Clinton boys) sold to HK, supply could be hammered while the demand is certainly up.
next stop $1650 EASY by Jan/Feb.
The US economy will be spiraling out of control in the coming months and will reach critical point by the end of the 1st quarter 2010 and implode by the 2nd quarter.
The massive US$ trillions of dollars stimulus has failed to turn the economy around. The massive blood transfusion may have kept the patient alive, but there are numerous signs of multi-organ failure.
There will be another wave of foreclosures of residential and more importantly commercial properties by end December and early 2010. And the foreclosed properties in 2009 will lead to depressed prices once they come through the pipeline. Home and commercial property values will plunge. Banks’ balance sheets will turn ugly and whatever “record profits” in the last two quarters of 2009 will not cover the additional red ink.
Given the above situation, will the Fed continue to buy mortgage-backed securities to prop up the markets? The Fed has already spent trillions buying Fannie Mae and Freddie Mac mortgages with no potential substitute buyer in sight. Therefore, the Fed’s balance sheet is as toxic as the “too big to fail” banks that it rescued.
In the circumstances, it makes no sense for anyone to assert that the worst is over and that the global economy is on the road to recovery.
damn it, what are they gonna do? keep the tungsten bars as if nothing happened? HK is going to be re-embursed with the
loss (or have them replace with pure gold bars) right?
Dude, WTF???
totally possible.
btw. wondering if anyone thinks we're due for the (much-anticipated by gold bugs) parabolic rise or not. gold's been traveling out of & above the channel for a while.
IMO we're still quite a way away from that. Bernanke is trapped, in a prison he built with his own hands. The only way to save the dollar is to raise rates, killing the economy and crushing tax revenues, ultimately raising debt service to an unacceptably high percentage of GDP: the debt trap.
[summons best Swiss accent]: "Mister Bernankee is a money printer, that is all he is good at and he is very good at that."
Do a survey at your (non-financial industry) workplace: ask your coworkers what hthe price of gold is, and how they woulod buy some if they wanted to. You will get 98% blank stares. When 98% know the answers and talk about buying more, brag about their juniors, and when the water-cooler talk is about majors doing buyouts, then you're in the parabolic rise.
Dewd, shut up I still love the 49ers. Dewd, I dunno, Johnny Depp is pretty cool but I don't know about sexiest man alive. What the hell are people thinking these days? Dewd, have you tried that new black taco at Taco Bell. Hell yeah, but I heard it's not that great.
That will be the time to jump off the train.......but into what?
Easy... silver. J6P will soon be priced out of gold and will absolutely want to get some shelter from the dollar storm. The demographic numbers on that move would be staggering. There are analysts saying that selling gold to buy silver now might be the ultimate power play. I am not doing that, but find it an interesting argument.
we're definitely not in a gold mania. i keep tabs on the people around me for the reason you suggested
they're hosting/attending gold parties where they sell everything thing they've got. some seem vaguely aware of pricing because of that. one person had a treasury department employee co-host a gold party with her. i've yet to get more details on the why's & how's of that oddity. anyways, my thinking is that they're SELLING it, not buying it at these parties. another aquaintance runs a vintage shop & also buys gold/silver. he often has a line of people coming in to sell. he claims he's got a couple of local people who buy all of his junk silver as soon as it comes in and that he's got a fairly brisk business in coins. the rest of the metals go to the melter. aside from these groups, there are few who mention gold as an investment or protection.
No complaints here, AUM doubled in 12 months thanks to p.m.s
All the hedgies are trying to lock in their gains before Black Friday and US T-Bill for negative interest isn't that attractive.
That, and the Chinese watched SNL and didn't think the truth was so funny.
Wouldn't it be funny if the Chinese just said, "what the f&*k, lets dump UST for Gold"
The Chinese may be injured but we will suffer far more grievous damage.
Regarding the Chinese and their UST holdings: A few years ago a top Chinese general said in effect, "We don't care about a nuclear war as if we lost 300 million persons it would not make any difference to us."
Look for a revaluation of the Yuan soon, at the latest Mar 2010.
If the yuan is revalued, USA will be relegated to third world status in short order.
A large portion of the US is already in third world status. Half the people in this country do not work for one reason or another.
The prospects for industries to materialize to absorb the indigenous and immigrants-to-come with the addition of a budget busting national health care program, are only going further erode the living standards of the steadily declining middle class.
We may have to invent an internal-only negotiable currency, limited to the USA to handle the movement of survival goods and services required by 500,000,000 people.
How does China maintain domestic order after revaluing the Yuan and thus crippling their export industry? Just curious.
Rumor (from a credible source) has it that Bundesbank is a BIG buyer.
Not to worry. The IMF will simply sell a bunch of gold like its been threatening to do for years.
Oh, wait...
It will be the 12th time the IMF has sold 1/8th of their gold reserves. Gold bears are about to get massacred, thanks to the Helicopter Ben show.
ROTFLMFAO!
I understand the point attempted to be made here, and I'm only trying to be moderately annoying when I point out that there's nothing mathematically incorrect with selling 1/8th your holdings for the 12th time.
Correct to the Nth degree! Look how many times the Brooklyn Bridge has been sold. And, I just bought some of that Florida swampland, too -- you know, they don't make any more of it so it must go up in value.
LMAO.
That rumor started with Max Keisers weekly television show where a high level source told him that the Bundesbank was buying.
Max Keiser usually tends to have impeccable sources.
With all due respect Max called a COMEX default for Dec'08, still waiting for that one.
Perhaps you aren't familiar with the meaning of the word "usually".
With all due respect Max predicted a COMEX default Dec '08 I am still waiting on.
I could have sworn that I read a story detailing that the COMEX would have defaulted were it not for a last minute emergency shipment of gold from Germany. Didn't I read that somewhere? Correct me if I am wrong. Thanks.
1. Bama China trip a bust. Emperor has no clothes. SNL is doing skits on it.
2. Iran engaged in military practice for an attack.
3. Uncertainty over Timmay and Benny.
4. Another bullshit stimulus courtesy of the printing presses.
over/under is noon
I'm just waiting for the introduction of the Super Dollar™:
"Like the USD, but Super."™
Do you mean us having to hand over our $1150.00 gold bullion for the 50 super dollar face value?
Hmmm....Maple Leafs too?
Dewd, exactly.
And for those of us without gold there's stimulus II.0 - I heard they're gonna have more jobs this time around. Big infrastructure projects. But you gotta get on Buffet's trains to get there - just like Tom Joad, except on trains. They put you in this camp and train you with new skills. They give you free food, free vaccinations, free movies - what more could you want!
Sweet. Don't forget the showers!
http://forums.wallstreetexaminer.com/index.php?showtopic=826971&pid=8482...
Jul 10 2009, 11:08 AM Post #2
I closed my shorts yesterday because I had to work on dump trucks, couldn't watch 'em. I don't have targets, but the magic calculator says gold will be either 1225 or 551. Take your pick and get off quick if you're on the wrong side.
10044:
If Gold hits $1,500 by the 1st Quarter, buy yourself a drink on me and I'll do the same for you.
Something makes me think we, temporary gold bugs, might be in the majority on ZH, though a minority on Main St. and Wall St.
you're on Tommy.
I'll definitely do more than a drink btw!
before that, let me go weigh my eagle coins.
If Gold continues at this pace, well, let me just say I'll be able to retire at (what many would consider to be) quite a young age.
oh great. you have money and you are making more?????
maybe you can pay back that 25K you put on our credit card
and are now refusing to pay....
signed
citibank
Kiss my a--.
When do we get a short squeeze on the dollar?
when they need to sell some more treasuries
"when they need to sell some more treasuries,"
or vice versa when demand for treasuries is high during a rush to safe havens as everything goes down.
Repeat after me...THE DOLLAR AND THE TREASURIES ARE NOT SAFE HAVEN.
Except for the Greater Fool.
Screw dollars and government instruments. I'm long copper, lead, brass, and cold hammer forged steel.
Gold is passe...Silver is the new gold.
Kinda what I was thinking.
diddo
No silver is the new 1970's gold as that will be about the price of it.
If this is the case why is it not well north of 22 by now? I'm agnostic on both but that seems like quite a non confirmation to me.
JPMorgan Chase is shorting 190 million ounces of silver, which is obviously illegal because that number far exceeds above-ground supplies. So, when they have to cover those positions, silver will become liquid lightening. It'll move so fast and so high, you'll be breathless.
The silver-to-gold ratio is about 8 to 1, so silver could easily be worth several hundred dollars per ounce at some point.
If China wanted to crush the big U.S. banks, all they'd have to do is push up the price of silver.
without a hint of argument, history shows that they can ride out their shorts with their printing presses... That's why I don't know how to bet here...
Put 4% of your NW in Au,Ag
Consider it a disaster hedge
At least you will have something left
if we experience financial systemic collapse
Tale delivery on physical....
Silver is for barter, gold is wealth.
Bullets, tampons, and #10 cans of dehydrated food to exchange for a range of items for which you unwisely failed to foresee a need: dental floss, AA batteries, bullets for the gun you actually own.
20% of the total value of your precious metals stash should be silver for unusually 'expensive' barter needs such as to pay for a professional service like dentistry, setting a broken bone, and other needs requiring expertise you probably take absolutely-completely for granted at the moment - and no, not changing your oil - gasoline will probably be non-existent in most areas if not prohibitively expensive (and if you are hunting for gasoline you are wasting valuable time and resources for it - and suddenly you have a stolen car because now other people know you put gas in it).
The 80% (mostly gold) should not see daylight until you are ready to redeem it for 'full value' - like purchasing land, trading a local tribe leader for the hand of his daughter, or heck, you just want to party like it's 2006!
better be a good looking daughter, as I'm sure the feminine arts will be on sale dirt cheap...
Hyper-inflation dude. They may be cheap in real terms, but certainly not in nominal terms.
50 lewd acts for an ounce of Au, $50,000 for a blow-job, get it?
Wet dream over. When the people wake up you won't have the police and military as deterents to abuse. EVERBODY will be a deterent. Now talk about how you are going to make MissCreant, Sqworl, etc cheap when you got 7 billion people who will take truely responsible action not just lie. By sucking up the all the supposed responsibility it forces people into inaction and creates authority without respons-ability. If you think all the kings horses and all the kings men are a detterent. Have you talked to your neighbor lately?
When katrina hit. Who got there first. Authority or repsonsibility. When something bad is happening who's going to show up first. Authority or repsonsibility.
i believe your statement will be correct a lot sooner than most people think. as gold becomes more and more expensive, what are the chinese peasants and poor people worldwide going to do to whet their PM appetites? silver of course. the poor man's gold.
Try storing $500K+ in silver
5 Au contracts fits in a shoe box,size 12.
250 Ag contracts needs the back bedroom...
Just like equities - no delivering sellers.
"Fight Club" ten years later by HuffPo:
http://www.huffingtonpost.com/kim-morgan/fight-club-ten-years-late_b_364...
Disclosure: I'm a "Jeremiah Johnson" fan too (besides the obvious).
Commodity blow off top inidicating that the elevator down will fall hard and fast very soon... too many nonconfirmations in other metals. MANIA! Look at all of the commercials... WAKE UP!!!
i will take the other side of that trade.....
Commercials WANT the gold...how's that a mania?
Wait till LME and Commex longs look for delivery...
YAAAWN...
maybe they will try and take delivery from the comex...
ha ha ha
No doubt a big gap up on these:
15-min gold bar chart
http://www.youtube.com/watch?v=GWnY0riDfRo
this is the gld gap for tomorrow
...this is the big flush out of DZZ 2X short ETF.
to all goldman sachs employees, and anyone else for that matter. http://www.youtube.com/watch?v=mG7EStr8s3I
+ 1 bazillion
awesome
http://www.youtube.com/watch?v=pBhqrtMqrv8
this is one of his finest. thanks for the comment
I pity the fool who owns DZZ...especially if he decides to double down.
But don't worry too much as I'm sure the Fed is working on a bailout for gold shorts.
But the Fed (and all central bankers) say that gold is NOT money. Afterall, their paper is "real" money. Here they have a real conundrum...
couldn't happen to a bunch of nicer guys either....
woot! do it.
The reality is that gold is already above 1200$. I bought one coin last week for 1200$.
You got a good deal. Coins are usually spottin $90 above crimex.
That is a reasonable difference between electronic and physical gold. Shows people still have some sort of trust in the futures/ETF's. Noone is going to give you 100x leverage for buying physical so speculators are likely to prefer electronic version until the actual doomsday comes and everyone stops trusting everyone else.
American Eagles are $40 above bullion
Banks are hording dollars and not lending them
Are they smarter than the reatail gold horders?
How many dollars do you actually have in your hand any given week
Maybe a hundred -- 200
When the credit bubble bursts there will be no more credit
No more credit cards, no more loans
And dollars, the green rectangular things, you disdain will be very valuable.
http://europe.theoildrum.com/node/5917
Although we could initially see a large glut in energy supply as demand falls off a cliff, this is likely to lead to supply collapse as investment dries up, hence I expect energy prices to bottom early in this depression. Both financial and physical risks to energy exploration are likely to increase substantially in a destabilized and capital constrained world, and even maintaining existing assets could become very difficult. This is a recipe for much greater state involvement in ownership and exploitation of (probably deteriorating) energy assets, with increasing conflict over those assets as supply gets dramatically tighter with lack of investment.
As for gold, I expect it to fall initially as people sell not what they would like to, but what they can, in order to raise the cash they need for living expenses and debt servicing. Owning gold is likely to become illegal again (as it did in the Great Depression) in my opinion. This wouldn’t necessarily stop you owning it, but would stop you trading it (at least without taking major risks) for other things you might need. Owning gold now therefore only makes sense if one is confident of being able to sit on it for a very long time, as it will hold its value over the long term as it has for thousands of years.
and that my friend is why Silver is King.
Why would they outlaw gold?
In the Great Depression it made sense because the dollar was backed by gold. But they've been telling us for decades that gold has nothing to do with money, so outlawing would do nothing but admit to everyone that gold is in fact money and they've been lying to us all along.
Your reasoning is perfectly sound, as is that of other folks posting here. It would be financial (dollar) suicide to outlaw the possession of gold. BUT, you ignore (at your own peril) the fact that the government has made some pretty stupid financial decisions lately. Why not expect another one? A slight variation on Hanlon's Razor suggests that rather than a well thought out plan by the government, we would just be subjected to another inane idea. "Never attribute to malice that which can be adequately explained by stupidity."
Plan accordingly. Have an exit strategy!
what gold? - I don't have no gold... hell, i've been on unemployment for 513 weeks...
Also, during the depression, lots of ordinary folks owned gold as a savings account. People could go down the local bank with 20 dollars and exchange it for a shiny ounce of gold. When the call came to turn in all gold, that was the gold that they recovered. But it was only about 60 percent of the known gold out there. The rest just vanished or was driven underground.
Now, most gold is held by strong hands that know the real value of gold in relation to the local fiat currency. How much gold do you think would actually find its way back to the government? Ten percent? Less? What would be accomplished, except to piss off a bunch of very savvy gold owners. "Gold? What gold? No gold around here. Nope, nada..." Meanwhile, the black market would grow organically by word of mouth, and the underground market would quickly dwarf the "real" economy.
Meanwhile, can you imagine the immense guffaw that would eminate from China and the Middle East and India and everywhere else where gold is revered as wealth? The rest of the world would immediately stop doing business with the US, if for no other reason than the UST and Fed were too stupid to exist. And, just for giggles, they may start to demand physical gold to pay for all imports: oil, crap from China, cars from Japan...
Thanks, Timmy and Benny. Got gold and silver?
This was a guest post on theoildrum.com from Stoneleigh of The Automatic Earth; lots of the usual deflationist arguments; I think it's largely misleading; we already had our deflationary episode, however brief; prolonged deflation not possible as long as we have government backed deposit insurance.
All these losses eventually end up on taxpayers backs via the depositors...perhaps even retirees (PBCG)
In making them whole, can/will enough be printed to counteract the debt implosion?
Mint went into damage control over missing gold
Charles Weinberg, a professor of marketing at Sauder School of Business at the University of British Columbia, said this is a serious crisis for the mint and that getting advice on its reputation is part of managing the situation.
"Part of the critical issues are how they deal with this crisis," Weinberg said.
"Losing $15 million worth of gold is a serious amount of money, no matter how profitable the Crown corporation is or what a small percentage of the amount of gold it has.
http://tinyurl.com/y8trfry
Boooyaaaah:
We live in a different global economic world then the 1930's, making confiscation much more difficult and less effective.
Most people don't own physical gold, but paper which was non-existent even 20 years ago. Combine that with the Chinese encouraging their citizens to own physical gold and numerous other Central Bank hoarding makes universal confiscation impossible.
Let's say they do "outlaw" gold with a confiscation date of, say, Jan 1 2010. I'm sure the Chinese will be the first to bid for any gold we stupid Americans are forced to sell.
Not to mention that any talk of confiscation will only serve to further inflame the gold market.
Of course, you may be right, which is why Gold isn't already much, much higher. While the gold shorts are being proven wrong we will see +$2k Gold, with the bubble of mass appeal bringing it even higher.
How much 401k and Pension money is in gold 1%, 10%? When it's at 25% I'll start to believe the Gold bubble talk.
The plebs can't be allowed to own gold. That would cause problems.
i don't think that pension funds have much investment in gold. gold and gold stocks simply are not a popular subject for most stock brokers.
Schiff: Roubini Doesn’t Understand the Fundamentals Behind Gold
http://wallstreetpit.com/12333-schiff-roubini-doesnt-understand-the-fund...
Damn... this is just such a damn battle of forces right now.... It's amazing how each asset class is probed for a weakness...
Since Equities didn't melt down, we got gold melting up. The zero duration assets are now going parabolic... awesome :) Finally the momos are doing something useful
The central banks are seriously fucked here as well as commercial banks, negative t-bill rates drawing liquidity out of the system, assets that were shorted are now being forced as delivery...., add that with the hemmin and hawin over the health care plan passing by a miracle.... just really wonder who's going bankrupt tomorrow and who went last week.
The Fed has been desperately trying to blow a bubble to deflect the attention from their insane money printing. But, much to their horror, one of the bubbles that they are blowing is a golden bubble. Only this bubble exposes their paper as worthless. How ironic!!
nobody has seen anything yet. wait until that stuff starts hitting the fan about those gold plated tungsten bars, if that rumor is indeed true. what are they going to do when they cannot even trust the banks to send them good bars?
Same as what they did before 'banks' existed. Gold existed [as money] before banks did ya know.
Gold to hit $1650 by late 2010
sinclair...
http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=93428&sn=Detail
The guy is a bit too conservative if you ask me - it WILL hit AT LEAST $2000 next year.
This is way to obvious a play GG. Don't bet on this. Our lovely USA gubermint won't let that happen.
The gubermint has vividly shown that there are some things that are outside their control. The only real control that they have is your flawed thinking that they DO have control.
(Not your flawed thinking in particular, Mr. Anon, that was meant to be the general populace.)
But it's supposed to stop and spend the day in the park at 1178.
No time to stop.
It's just been ordered to do laps in an Olympic sized Dark Pool.
Alright, I'm no financial genius... just learning what I can from what I'm reading here at ZH and all your comments (it is astonishing how much knowledge this website and its readers possess)! But my question...
What is the argument of gold possibly plummeting? It just doesn't make sense to me that the dollar would strengthen and gold would plummet. We are printing money like there's no tomorrow... how does the dollar strengthen? And who in their right mind would sell their gold for US monopoly money?
No. Gold is no longer just a dollar hedge but rather a hedge against all paper currencies now since all central banks are printing, although most are not as diligently as helicopter Ben. The Friday price action was very telling when gold finished higher together with stronger dollar. From now on, Gold goes up no matter what until central banks around the world stop their printing machines.
gold and dollars are commodities. commodities correct. fact of life. it will happen. happens every year.
If one owned precious metals, and we had inflationary prices, one could get rid of debt -- if the metals were sold to get dollars (or the currency du jour) to pay off those debts. Certainly. But one would be giving up the security that prompted the accumulation of the assets (gold and/or silver) in the first place. If one could pick the "top" of the metal prices and cash in, good! If not, what's the reason for belaboring the process?
When gold had it's dip, around November of 2008, the folks who needed money were cashing in. That only points up the nature of having precious metals as "a store of value". Gold was a store of value, indeed. Tapping that value to dig out of the financial situations many traders found themselves in only proves that gold did what it is supposed to do! What better illustration could we be given than that?
The price of gold (dollars you gotta pay for it) would decrease and the dollar strengthen if enough fear is in the market. And, yes, gold/dollar correlation can disconnect. Fact to keep in mind: It's the dollar that fluctuates relative to gold, not visa versa. Gold is inert, the dollar is volatile.
Awesome, thanks for both replies! I just don't see why there are some who are still saying "gold is a giant bubble about to crash." The way I see it, if the "bubble" does pop, it will be only for a moment and then gold will skyrocket again, right? The only reason for gold to go down, other than people wrongfully thinking it's peaked, is if our central bank (and all the other, for that matter) decide to turn off the printing presses and start reeling in debt.
If so, we still head to a deflationary depression. If not, we head to hyper-inflationary depression with gold and all other tangible assets skyrocketing.
Someone tell me why this thinking is wrong, if you have another opinion.
To me, the whole gold narrative is too simplistic. It's like the Peak Oil narrative that had everyone in the US believing they needed to rush out and buy a hybrid car during the spring/summer of 2008. I still laugh out loud every time I see some dumb fucker driving a Smart car--the dumbest car ever made! It's the Wolves leading the Lambs to dinner, in other words. They dine on you! Deflationary depression or not, the narrative here was created for suckers.
I totally love my electric motorcycle. Fun and 10 cents a day to go to work. Some of the numbers on this stuff does work. My car sits except for the winter. I only use a couple hundred dollars of gas a year. It's a cheap Chinese bike, so I already got back much of the purchase price in savings.
I hope you all followed my advice and maxed out your credit cards on Gold and Silver (prior to defaulting on them, of course).
Nobody is telling you to sell ALL your Gold and Silver to pay off your [credit card] debts...just enough so you can get credit again so you can buy Gold and Silver and default on them again...HAHAHAHAA!!!
"I hope you all followed my advice and maxed out your credit cards on Gold and Silver (prior to defaulting on them, of course)."
Trying to get the guy arrested for credit card fraud? Very classy.
Let's define "default". To me, what the Fed is doing is enabling a default by the U.S. Treasury. Clicking into existence vast sums of (devalued) fiat to pay off U.S. sovereign debt IS default. So if I go along for the ride, buying gold now and paying off loans later with devalued fiat, in essence I, too am defaulting. Hence GG's "HAHAHAHA".
No one actually prosecutes that dumbass. To late, but the trick would have been to follow GG's advice, wait over 2 years and declare bankruptcy.
Does anybody else smell a bank minion?
I thought that was bacon frying. Oh. Thanks Gordo.
Was he able to make you respond with your higher self while running a financial system that blows legs off of 14 year old girls in foreign countries.
Do you ever get the feeling that the highest ethical offerings available to "The Bank" are getting more and more drastic. More and more harsh. More and more brutal with each passing day? Each bid refusal of compromise supposedly expected to be met wtih a larger offering is actually decreasing and making the possible outcomes worse.
Worry not. It's not likely that Swami Gordon will sway my trading techniques. True contrarians don't follow blindly, no matter how utterly charming and convincing a guy like Gordon is. As a matter of fact, a real contrarian is always looking for ways to find him in error. It offsets the ubiquitous cognitive bias that besets the common man.
Gordon, the time is not quite ripe yet for maxing out and defaulting. (I'll pick up the agricultural metaphor later here.) There is still too much consumer mentality, although that is rapidly dissipating. The "debt" I had in mind was that of the traders who had to dump gold to meet their financial obligations incurred in the markets, not the ordinary debts of J6P. To default on ordinary debt right now draws too much attention from TPTB. One must wait until the mass exodus from debt by default and sneak out undetected with the crowd.
Anecdote: I have a "friend" whose wife wanted some doo-dad or other. He found it on Amazon and it qualified for free shipping. There was a notice from Amazon to apply for their credit card and get a $30 credit immediately. My "friend" filled out the on-line application and had the credit card in hand about 10 days later. The doo-dad arrived much sooner, and the total cost for the crappy item was about $10 instead of the $40 list price. The credit card line was $25,000. Go figger. My "friend" buys a lunch or some such about once a month with the card just to keep it watered and fertilized for the ultimate harvesting. This credit card is one of several in the credit card farming operation. Harvest time will be soon, but not quite yet.
Watching CNBC this morning. Boy, are they beating the gold meme into the ground. The next move will be reporting the gold price along with the usual quotes on NPR when they do the hourly news updates. This will mean that the quiche-eating crowd is into PM's. A good sign!
"What is the argument of gold possibly plummeting?"
Anon, the simple answer is a collapse of the 'carry trade'. Since Bernancke cut interest rates to zero, every speculator in the world has been borrowing dollars at zero percent interest. They then invest those borrowed dollars in stocks, bonds, gold, oil, etc. Hence the rise in all asset classes lately and the decline in the dollar (everyone is selling those dollars to buy all the other stuff...the more dollars floating around....the less they are worth).
When these same folks see the dollar start to rise just a little (remember they don't want to pay back those loans in more expensive dollars) they are going to reverse those trades. They will sell everything they bought and buy dollars to pay back their loans before they take a currency hit. The demand for dollars will go through the roof as they scramble to find dollars to pay back the loans, and all asset classes will plummet as a result of this selling. Or that's the theory anyway.
TurboBob:
Excellent analysis. I still think gold could go down (way way down, in fact) as a result of the end of the US$ carry trade.
However, the end of the carry trade does not mean the end of the economic problems of the USA - far from it. The enormous, crushing debt of the USA would still be there and economic growth would still be anemic (at best).
Therefore, any "plummeting" in the price of gold would only mean one thing, in my opinion: buy, buy and buy more physical gold (and silver) as soon as possible, as long as the prices are low(er) than today. Because as soon as the dust settles, most people in the world (think of all the billions in US treasury owned by China and India) will take a long hard look at the US economy and conclude the situation is still hopeless.
And, yes, I do own gold bullions and I am looking into buying large quantities of silver bullions. Luckily for me, owning gold and silver is legal and easy where I live.
Excellent and succinct. If the carry tarde unwinds, the U.S. economy is dead meat, which means the empire is dead meat, which means the dollar is dead meat.
See these charts presented to us by the White House.
http://i45.tinypic.com/10si1qu.jpg
Debt as a percentage of GDP!
2.5+ Trillion of Treasury debt coming due(within 1 month - 1 yr)!
It's not too late to buy gold. If you haven't done it do it soon.
There is none.
Quite an exhaustive and rigorous argument there, GG.
Now please, on behalf of everyone here, shut your pom-pom ass up.
Why are all the Prechterite cockroaches anonymous?
http://nowandfutures.com/images/cot/GC.png
Just fuel for further melt-up.