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Guest Post: When To Sell Gold
By Terry Cozon Of Casey Research
When to Sell Gold
By now you have plenty of reason to congratulate yourself for having boarded the gold bandwagon. The early tickets are the cheap ones, and you’ve already had quite a ride. The best of the ride, I believe, is yet to come, and it should be very good indeed. It should be so much fun that your wallet may start to feel a bit giddy – which can be dangerous. So it would be wise to consider, now, how things will be and how they will feel when the current bull market in gold reaches its “end of days.” Because it will end.
Buying at the right time is the key to building profits. Selling at the right time is the key to collecting them.
The 1980 Peak
In 1980, gold briefly touched the then record price of $850 per ounce. In terms of purchasing power, that would be $2,400 in today’s dollars. And for the value of the world’s entire gold stockpile to attain the same share of the world’s total wealth that it represented at the 1980 peak, the price would need to reach $5,800 per ounce.
But so what? Before you can look to those numbers for guidance about what the peak in gold’s bull market will look like, you need to consider how the process that drove the earlier bull market compares with what is happening today.
The earlier bull market was driven by price inflation in the world’s reserve currency, the dollar, that reached an annual rate of 14%. The more expensive it became to use dollars as a store of value (i.e., the more rapidly the dollar’s purchasing power was declining), the more attractive gold became as an alternative way to store value.
The dollar is still the world’s reserve currency. (And not just for central banks. Among individuals and private businesses that want to diversify out of their home currency, the dollar is still Number One.) And the force driving the bull market in gold is once again price inflation. But this time it isn’t actual price inflation that is on the mind of gold buyers around the world. It is the potential for price inflation that is building up. That build-up is coming from:
- Rapid expansion in the U.S. monetary base through the Federal Reserve’s asset purchases. Most of that expansion has yet to be reflected in a growth in the U.S. money supply. It is still sitting, like a charge in a capacitor, waiting for something to set it off. There was no similar liquidity bomb stored in the U.S. economy's closet during the years leading up to 1980.
- Unprecedented growth in federal government debt, which adds to the political attractiveness of price inflation. There were federal deficits during the 1970s, but nothing like today's – just enough to give the party out of power at any time something to talk about.
- The accumulation of U.S. Treasury debt and privately issued dollar debt in the hands of foreign investors. U.S. debt to foreigners wasn't a factor in the years leading up to gold's 1980 peak. This time around, it could be a powerful force for accelerating inflation. Even moderate inflation could spook foreign investors. Their sales of Treasuries and other dollar-denominated IOUs would push down the foreign exchange value of the dollar, which would raise the cost of imports coming into the U.S., which would further stimulate price inflation. A nasty feedback.
And foreign holdings of U.S. debt operate as a second vector feeding the political attractiveness of dollar price inflation. Depreciation of the dollar can be framed as a clever way to shortchange foreign creditors. "It hurts THEM, not US" would be the slogan.
All those factors are working to make price inflation distinctly more severe than it was in the 1970s, which argues for a higher peak price for gold. When the metal does surpass its 1980 peak in purchasing power, the event is likely to be widely reported in the press. I suggest that you not attach any significance to the event. It won't be time to sell.
Sell Signals
But the time to sell will come. Here are the signs I'll be looking for.
Gold and gold-related financial products will be commonplace.
Even today, most financial institutions still hold the "barbarous relic" attitude toward gold. Yes, you can get GLD through any stockbroker, but with a few exceptions, the brokerage firm's heart isn't in it. They offer GLD for the same reason even the best seafood restaurants have a steak on the menu – they know someone will ask for one, even though that's not what they are in business to serve.
Before the bull market is over, that attitude will change. Mainline brokerage firms won't just have gold-related products available, they will advertise them. They will boast about them. They'll claim to specialize in them. And it won't be just the brokers. Your local bank will offer gold-related CDs. Your insurance company may be offering life insurance denominated in ounces.
Gold going mainstream won't mean that the bull market is over, but it will be a sign that it's getting long in the tooth. An early warning signal.
You'll be hearing gold chatter wherever people talk about investing.
The inhabitants of Financial News TV Land will be talking about gold approvingly, and each of them will be trying to suggest he was early in recognizing the gold bull market [TD: such as Jim Cramer who now has gone apeshit over gold - if there ever was a sell signal, this is it]. You won't be able to get through a golf game or a cocktail party without someone talking about gold. Even your brother-in-law will want to explain it to you.
The gold standard will become respectable.
Today advocates of the gold standard are seen as standing to the good side of whacko, but not by a big margin. But as gold attracts more converts in the investment world, the politicians will want to associate themselves with it by proposing some brand or other of gold convertibility for the dollar. Respectability for the gold standard will be a sign that a majority of the people who are going to buy gold already have.
Other things will look cheap to you.
When gold nears its peak, even if you suspect that that's what's happening, you won't feel certain about it. But when you start seeing investments – probably conventional stocks – that look like strong bargains, treat those sightings as a sign it's time to start selling gold. You know the reasons that led you to buy gold. If you are tempted to sell part of your holdings to buy something whose low price seems to give it better prospects, then you probably will be selling at the right time. You could be selling to the last new buyer.
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I am of very modest means. With the nature of this monetary crisis as it is, the only way I'm selling is if it reaches a point when it will completely pay off my mortgage, or for some other vital tangeble asset. Moreover, for anyone to even consider converting to any other speculative investment, not only should the cost be crazy-cheap, you had better make sure that the prospect for overall stability and predictability in our leadership is a paradigm shift away from the absolute insanity of the past 10 years.
Gold for Cars.
I can see Gold-4-Cars being the next stage of trade that might draw the interest of the federal gov.
1) two mobile assets 2) understood by everyone, 3) a necessity 3) can be bought/sold without much trace.
Cramer tonight:
Gold for junkers...boo - yaah cramerika
the consensus on gold is like the consensus on money. everyone likes it, because it's money.
lasted 01:01... beer please!
Good one. I forgot why I used to watch Cramer once in a while, entertainment...Cramer says …don’t pay attention to the G-20…buy gold. Under Cozen’s scenario it’s almost time to sell.
that would be too intuitivie. it makes too much sense to 'say sell everything crammer likes'
Where is he from? I have trouble understanding some of what he says and his voice hurts my ears.
Hmmph. Good question. I thought he had a little bit of that speaking with a mouthful of food quality that I hear in the Chicago accent, but perhaps reformed for television. (Swerzki's sportscoats! Hey, that's a great sports coat!) Alas, wikipedia says he's from Pennsylvania.
Now Cramer says I should buy gold. Gonna be hard to explain to the wife why after spending every spare nickel on it (and silver) for the last four years that I'm selling it all of a sudden.
Sorry Robo, I can't take this goofball, even if he is saying to buy gold...
I think he did the whole bit so he could mention Mandy. A sale is a sale for Cramer.
The quote, "I watch the gld, that's what I watch" made me laugh, this after he defended Fed policy by lamenting that everyone else was doing it, but failed to mention that was precisely why; the Fed did it first. The history lesson really set up the tell while he smiled his way through his usual shtick, as he has been long gold for a long time. Once Beck was hawking it the fix was in: if you do not buy it then too bad, you were told what it is.
If I remember correctly, Mr. Kramer stated to hold onto Bear Sterns that it was a good investment. No?
Ouch.
Novagold's property is in NA, yes; Canada. Is it just me or did Cuhramer fail to mention that?
He also failed to mention that NG once had an operating mine (Rock Creek) on that 'big-big money property', but they had a helluva time extracting the gold due to ore/soil type and so shut their only operating mine down.
To my knowledge it hasn't started back up since.
They also refused a buyout offer of 16CAD/share a couple of years back. Have they had any since?
Otherwise: helluva run since early 2009, and no mistake.
On the other hand, Cuhramer finally gets down to completely discreditting himself by pumping the GLD-license-to-shoot-yourself-in-the-foot ETF. Oh Cuhramer wouldn't bother with 'foreign' ETF's like Sprott's, oh no, but from the same country a non-Au-producing gravel-miner like NG is one of his top picks?
What a buffoon, seriously. But I guess that is the role he gets paid to play, so you can't really blame him.
Regards
I think gold (Au) has an affinity for Au. Thus it wants to be in ever greater lumps. Carbon (people and oil) has a role to play in Au's plan.
What an interesting observation Acidtest, I have not run into that one before, thanks.
Sorry my lump of Au, you will not leave to join another lump. Perhaps more Au could join mine...
Thanks for your interest Do Chen! I am eager to share this theory, even if perhaps it doesn't directly address the question of when to release the meager amounts of Au that we have captured.
I think if he would have said "excess gold" it would have had more merit.
It (excess) can be converted to anything, homes, land, business venture, hookers & booze...LOL.
However, most of mine will never be "exchanged" by me.
The hookers and booze thing perked me up though. Can I get an eight-ball too? Might just be time to live it up for a couple months and then ingest some of my lead hoard.
my philosophy, is homicide before suicide
"Can I get an eight-ball too?"
;-)
I reckon so...but for me the chewing on the tongue & the what, it's 6 A.M. already???...got a little old...even in the best of company...LOL.
And of course then, there's no hangover as bad as drinking & snorting all night.
3 B's for fiat, baby!
http://en.wikiquote.org/wiki/Bad_Santa
Sell when gold is trading 10x cost of mining one ounce.
Thunder,
That would be approx $5k per ounce...............on average.
You have a specal reason for that logic?.
As to my previous post, WHAT is available, that is worth the security of Gold as a store of value.
Nada,Zip, Zilch.
If it's paper it's TP. Personally if this plays out the way I see it, the earth will be losing a few hundred million folks soon, and a Man will appear, that has ALL the answers..or will appear to.
When that happens,if your still here, best get your house in order post haste.
What to buy with your gold when it comes time?
Start your own bank!
Don't know if you're being serious or not, but given that most local banks do NOT have any sizable holdings in Gold or Silver, someone with such holdings could indeed be the new banker for a small community!
.
USDJPY
Possible dollar breakout tonight out of a long-term Falling Wedge.
http://99ercharts.blogspot.com/2010/11/usdjpy_11.html
http://www.zerohedge.com/forum/99er-charts
The authors education in the Western World's Public Fool System has him still thinking as desired.
You dont buy gold to make money, you buy gold because you have money.
But if you wanted to move to a better performing asset class, then start selling when the gold:dow ratio approaches 3:1 and be out at 1:1.
What to move into? - Who knows? - probably what everyone else does not want and scornes you for even considering.
That's when you buy what were, and still could be Blue Chips.
I like it:
Ready for the scorn.....I reckon Chocolate!!! Why?
1. Half of the worlds population at least, will NEVER stop buying it!
2. It uses a R'M' whose worldwide supply is 85% grown in 4 African countries....i.e Nigeria, Ivory Coast, Ghana and some other dodgy African place...
I just asked my bankster if there was anyway to invest in the rising price of COCOA and he said: (I can't believe he didn't just laugh)
So there you go! After gold I am going to become a chocolate bug
haha :)
In the last few months a couple of wealthy investors have attempted to corner the chocolate market. There have been articles on ZH.
Additionally, how long will this gold bull last and will your thoughts about chocolate be the same at that time?
there was a news item on the other day saying a chocolate bar could be as high as $7 because the shortage of cocoa..
I guess Terry Cozon believes that we are in just a normal economic cycle. I happen to believe that this time is different. The collapse of the usd, the reserve currency of the entire earth will be quite atypical. Only a retard or a very desperate person will dump their gold based on some perceived indicator like brokerage firms selling gold.
When a top in the paper/spot gold market does happen, and the price does collapse - it will be because the market has broken down and gold will no longer be available to buy! Yeah, you might sell your gold at 5 or 10 thousand and watch the price crash down to $300 and then smugly pat yourself on the back, but try finding anyone that will sell to you!
Freegold, bitchez!
The only issue we have here is thinking when Gold is at 3k-5k we are ahead, nope, we're just staying even.
It's the other poor SOB's that didn't own any, that are truly screwed.
Gold is money, and Gold is held long term for one reason, Insurance.
Robbob, DosZap,
There ARE circumstances where I think it would be OK to sell (some) gold, see my post close to the top (you know, where I cut in line!).
Since the Bearing does not KNOW what will happen, selling your (physical) gold would depend on individual circumstances and risk-tolerances as I mentioned above.
I am NOT selling mine. Ever.
There is another metric I've read about: the dow to gold ratio. When balanced, 4 to 5 oz should buy one share of the dow. Right now it's around 8, meaning the dow is expensive relative to gold. If memory serves, when gold was at it's height the ratio was closer to 2 or 3. That'll be one more indication to diversify some gold into a cheaper asset class. Assuming a market still exists.
The oracle Richard Russel has stated 1-1.
The only gold I have is in my mouth... A 10K gold molar...
I will use this molar to gnaw the fingers off of any hand that touches my silver though...
I like my silver, I see the look in friends eyes when they glimpse my shiney pile of loot... They want it BAD.
That tells me all need to know.
Keep buying... And NEVER SELL.
I do trade it for services... Just got a real molar drilled and filled for 2 OZs of Silver. My Dentsit acted like I was giving him black tar herion or something... Bring it in the back office... Dude, it's just an envelope... Jeez...
Would have cost me 75$ cash or so... Wow.
Thantos,
"I see the look in friends eyes when they glimpse my shiney pile of loot"
Better hope you have a FEW friends,and they are building their own piles.
A man with many friends,comes to ruin quickly.
And thats true without a world coming apart.
Hey DosZap,
Thanks for the brotherly advice.
My friends... Both of em... Known em for 20 years... Know me so well that they would be afraid not to kill me... Before they stole my loot.
So no worries!
Besides, one has a small farm and is a doctor and the other does things for outfits with letters for names down here just north of Juarez (where I sit) that i'm sure he'd rather not be discussed.
I kinda round out the Three Amigos, as I overlap in a little of everything :)
They have some stashed, but I have been the "True Believer" in Silver for several years and it is relfected in my holdings.
So, I will haul my Silver out to the farm (Girlfreind can come if she wants) and work the 'stead with my amigos... We have a half-ass pact.
I couldnt agree with you more about your point!
Keep showing your "friends" your pile of silver, and you're liable to find out who your true friends really are. The others are just as likely to cut the liver out of your firstborn child to get you to tell them where it's stashed.
You'd do yourself a service by learning to keep your mouth shut. Save your bragging for places like this. I might think you're a dumbass, but at least I can't kill you to take your shit.
Call me a prick if you want, but if you learn a little OpSec you might live a little longer.
I recognize that name from somewhere... Hmmm...
Hey not a prick.
I appreciate your input. It sounded like I was crowdsourcing opinion on my loot pile!?!
If anybody round here is cutting livers out... It will be me that the local authorities visit first...
I am fully aware of and constantly practice Opsec, Counter-Surveillance, etc. on a daily basis for reasons much more precient than keeping my piddly ass silver safe! It's part of my JOB!
:)
Thanatos
Silver will be in need when the Werewolves take over.
Hey Gully,
I live pretty close to Mexico and I have learned over the years that the Mexicans know and love Silver... They have for 100's of years. It's a Cultural Standard to them. Which brings me to my point:
When being held up (and not just flat gunned down) by any Cartel or Freelance Banditos (I can see the eyeballs rolling now... Google earth the areas around Juarez and see for yourself how possible this is... I can fwd local news acticles if needed) they ALL say the same thing:
la plata o la vida -- "Your Silver or Your Life"
Historic data indicates they mean it.
Your silver (Not Mine... As I have lead and antimony and copper and brass to feed those bastards) may just save your life if you encounter these godless heathens... Now if you live in Minnesota, Please laugh out loud! But if you live near Mexico, Silver is a friend.
I saw part of Cramer tonight. Did make me consider getting my collection appraised for sale. But, without the metals, I'm stuck with what? Dollars? Euros? Yen? Francs (not so bad). Real estate? Commodity ETFs?
You have to be aware, however, that all the smart and dumb money likes gold, for the obvious reasons--dollar devaluation, central banks printing money, lack of confidence in governments, and, financial institutions.
So it's a fear trade, to a degree. On the other hand, it's hard to believe that the inflation adjusted price for gold from 1980 is only two thousand bucks. Must be using government figures. My guess would be that the inflation adjusted peak in gold is more like $5000 per troy ounce. Just a guess.
John Williams has stated its closer to $7,500
Are we really allowed to mention selling gold on this site?!
I will be selling a bit of mine, if it holds these prices for a another few days.
David Goldman (just a coincidence) had a blog post about the world bank head saying a reserve currency should have a gold reference that would have to consider the cost of mining which would be 6 to 7 hundred/ oz.
That would kick the the shit out of gold 5 thousand, don't you think?
Whether gold is $2 per ounce or $50,000 per ounce, the cost to mine the gold is basically the same. The GREAT thing about it though is that money itself will circulate based on supply and demand. To see gold rise you would also need to see productivity rise equally. Until the king starts taking gold out of the coins and replacing it with tungsten the new economy should be prosperous under a gold standard.
they'll revalue the new currency at a rip-off rate of gold and then once it's converted they make the price skyrocket. that's one of the main reasons to hold physical. it's the wealth they can't destroy in a currency conversion. so it doesn't surprise me they would begin talking how gold would need to be valued cheaper.
Correct!
And that cost is measured in?
How about kCal (or any other metric) of Hydrocarbon expended to produce X amount of Au?
Without machinery Au can still be had... But...
Because without that Hydrocarbon, you could never grow the food to feed the workers to dig the mine so deep by hand!
Without Hydrocarbon you WOULD NOT be able to produce 10% of todays production and most of what we access today would be cut off from us. We can only get to the easy stuff without the power of Oil.
Thus the TRUE cost of Au, Ag and all of the components of the nice modern alloys we enjoy is not calculable in anything but Hydrocarbon.
Keep yer FRN shit tickets, When the time comes, I want something soft to wipe my ass on...
Not entirely true. For a while there the miners were making little profit with gold up, but not up enough to keep up with petroleum prices. Modern mining is usually rather energy intensive and they prices of each don't always move as binars.
Zimbabwe anyone? My dyslexia got in the way on my old post....when the Fed starts issuing paper money with 10 zeros, will gold still be in a bubble?
speaking of a basket a currencies +....sorry , too terse
Gold; yeah great; but at 1000s per ounce, you save it for the farmland and necessary equipment; you will need silver for the serfs to work it, and the women to warm your bed at night.
That's why Burl Ives was singing about "Silver and Gold" He was truly a man ahead of his times.
I heard that line of thinking just yesterday from a guy at work.
Burl Ives Silver and Gold:
Silver, silver and gold
Silver and gold, silver and gold
Ev'ryone wishes for silver and gold
How do you measure its worth?
Just by the pleasure it gives here on earth
http://www.youtube.com/watch?v=oMlqn_Hjyi8&feature=related
I dont think we are bubbled yet but there will be a time to sell. The problem with this never before situation we are in, it makes forecasting difficult. I think when everone is talking and buying, it may be time to reduce 50%. Remember, the dollar no matter what the value, is accepted. If gold plunges and the dealers go broke, there are no buyers and you WILL have trouble trading it.
With the criminal manipulation by the banks and goverments, dont ignore any possibility.
On the other hand, I called my dealer today to buy some half dollar Kennedy clad. He said he had none and was not expecting any. I used to buy at .60 to .80 a coin. he says now it about $4.50------ if he could get any.
Why would you buy clad Kennedy halves? You talking about the 40% silver?
Only the 1964 issue is 90% silver. Just wondering....
When I started to buy silver I bought silver rounds and then found I could buy Clad for 55 cents. It went to 60 cents. I bought most of it at a nickle over what I could spend it for in the store. I figured it was the best hedge buy in metal, that was real currency. If silver went to nothing, I still had 50 cents. Clad is now $4.50. Last time I checked, clad was still the best silver buy, but I will look at 90% and check it out.
Clad Kennedy halves are not silver. I'm not sure you were buying what you thought you were. Circulation grade Kennedy halves are worth 50 cents and you can get them at any bank by the roll.
Woa there Nelly! Clad anything means coated with, as in Armor Cladding. If your dealer is charging you that much you might as well by 90% silver coins. If you want a stop loss built in look into maple leaves. An oz has a face value of $5CAN. So the value of your coins will never be below $5 an oz. A one ounce Canadian is running about $31USD today. APMEX is out of decent 1/2 oz Canadians, but you could look into that. At a minimum you could do the 1oz. Sheesh!
The only factor worth considering in deciding when to sell gold is interest rates, because interest rates tell you whether or not the paperbugs are serious about defending the value of their paper. And that my friends is noooowhere in sight.
I think you start thinking about selling gold when the effective Fed funds goes over 10%. When gold peaked in 1980 the rate was over 16%.
Yes but in 1980 the world wide debt wasn't this high and neither was real unemployment so I'n not so sure you can just go by interest rates alone. Plus could you imagine what the national debt would look like with 10% interest rates? Gold may actually be more valuable then. I'm no expert I'm just putting out food for thought.
I agree. What I said was "start thinking about selling"
Here's a chart from the 70's looking at stocks, gold and fed funds:
http://static.seekingalpha.com/uploads/2008/6/17/saupload_mh1.jpg
The gold trend really took off after the Fed got to 10%, it didn't kill the trend until it went over eighteen. There's so many variables, I don't think you can pinpoint a number; I was just trying to say that's when you start paying attention.
We spend $1.80 for every dollar collected in taxes. What kind of interest rates do people that fiscally irresponsible deserve? Higher than 10%, that's for sure. Feeling the heat for that recklessness is the only thing that will stop the ponzi.
I hear ya, but I won't even start thinking about conversion as long as real interest rates are negative. And not based on the rigged CPI rates, either.
China markets getting clocked.
All risk assets getting pitched over the side in Asia tonight.
So buy gold and get out of risk assets. Or do you actually believe all the banks in the USA will be forced to deleverage again while the Fed has their back? LOL. I swear everyone always wants to fight the last battle over again. Every resource in the US gov is geared to stop the banks from selling anything, yet some people still think they are going to trade this market short. Shorting is the latest fad for noobs, like techstocks in 2000. Yes. Lets all pile into the dollar bubble.
Risk Overboard. Man the dollars! Jettison the euro! Wait...isn't there like 20 pomos this week? As you were, carry on soldier...
The heavies (dollar, euro, yen) are showing massive strength right before the selloff next week. Asia is positioning, as the US did today.
http://www.businessinsider.com/did-goldman-sachs-hammer-the-china-market-2010-11
Sell gold when you hear these comments in the mainstream media:
"They're not making any more"
"Shortages"
"It's a new paradigm"
"There's not enough to go around and the population is growing."
"A sure way to get rich"
and the ads on late night TV say:
"Send for this free package on how to make a fortune in gold."
In other words, remove the words "real estate" from all the ads in 2006 and substitute "gold".
And don't forget that old tried-and-true classic: "it's different this time."
Remember the "new economy"? Just wait till they call it the "new money"... that'll be a sell signal.
this isn't how it happened during the late 70's and early 80's. i was there, it just simply happened without hardly anyone noticing it.
The best time to sell gold? NEVER!
or better yet, you'll know when it's time to sell gold ... when you absolutely have to, otherwise never. for most people that part of the timing problem will vary according to each person's circumstances. each person will know when that time arrives. the hard part is to know when to buy, and the only thing one needs to consider is do you feel like you already have enough? if not then go buy a little more and hope you'll never need to let it go.
the time to sell gold is when interest rates finally rise to the level where they are "competitive." Greece is right now at 12%. That sounds pretty good to me relative to gold. Right now of course "europe is demanding the Greeks default" because "such large gains aren't right for investors in a sovreign backed by euros" apparently! At some point "the sovreign arb trade is going to work" in the meantime-it is OUR debt markets that matter most. What if QE fails? Is that good for gold? I am unclear because a "sudden spike in yields in treasuries" could be the start of something "global." It's hard because of the "interconnectedness" of everything right now and the fact that "treasuries are considered risk free." one thing is certain: as the return on debt increases it makes it increasingly easier to "compete" with gold.
The US will default on the debt before they pay competitive interest rates. Might as well wait till a new global currency comes into being before you sell.
I don't really know how to approach that one! Defining failure is the hard part. Are banks fully recapitalized? Are home prices at "normal" levels? Is the middle class finding jobs? Those would be the questions to ask for starters. Thanks for prompting me to think about that.
How about that flash crash in Platinum tonight right before the globex switchover?
C. E. in some characteristic demeanor: A man's got to know his limitations ...
I is po. Got limitationed means
Gold seems too concentrated to be practical;
Govt can find it easy to tax
The actual above ground mass appears to be concentrated amongst a few big controllers
Too much in one place for easy day to day use
Percent upside potential for argentum appears greater, certainly has been recently
I've traded all gold for silver
Cheers, Beers, and Jeers
"I've traded all gold for silver"
Odd...you did it exactly backwards without it even reaching a milestone...say 45:1.
Keep us informed how that works out for you ;-)
I'll sell my gold when I see for-sale signs on houses that say, "no paper please, gold only". Then I'll buy a little house, one not too big or costly to heat/cool.
Sounds like they won't be giving you too many other options.
Jim Cramer was talking a lot about gold today on his show. Gee, Jim, why did you wait so long?
oh no, I like to use him as a contrarian indicator
My father sold his silver under $6 not too many years ago. He had bought it during the "end of days" decades ago. yes, he took a loss. When to sell the gold? When he wants to buy it again... I will keep you guys posted....
Now that's cold...if I ever find out my kids are using me as a contrary indicator, I'm leaving everything to the orphanage!
Of course, if your children are using you as a contrary indicator, "everything" is likely equivalent to "nothing."
My dad is one of the "little people" and a reliable supporter of the establishment's scams, financial and otherwise. He supported the bailouts. He has most of his wealth in bonds. He just sold a ring in a cash-for-gold scam so he could prepay his 4% mortgage. When he figures out what a chump he has been, I will consider selling.
When to sell gold - the first time you hear the president, somebody on the senate banking committee, or a federal reserve chairman say something to thte effect of . . . "some Americans are hoarding gold and that is bad for . . . ."
At that moment in time, you will have, maybe, a 6 month window to unload your gold and transfer it into a different tangible asset before private ownership of gold is made illegal.
I figure when oil goes to about 200 and gold to about 3,000 is about when you will hear the sell notion.
illegal? Why?
why not Spam caches? or liquor? or toilet paper, shoes or 4WD Trucks?
Our money is Fiat, not backed by gold as in the 30's....
absurd
I'll lean your way on this. Bringing attention to gold as even remotely important is not the goal of this government. There would have to be a complete change of attitude in our legislators, and some action to boot, for the confiscation scenario to develop.
Here are some reasons they'll come for the gold:
1. Gold is an alternative source of wealth storage, and they'll want to remove it when they introduce a new currency.
2. Gold makes currency look bad.
3. Gold has value, and if the govt. can force an exchange of value-losing paper for something of value, why not?
4. Gold is difficult to trace - they want to trace you.
They'll come for the gold, eventually. Listen for the words.
Why...it's almost as if they are forcing you to lie to them.
What gold? ;-)
Sure, but if they pass a law that says, "anybody caught using gold in trade of any kind will serve a minimum of 5 years in prison," then what's the point of holding on to it?
on Thu, 11/11/2010 - 21:46
#721048
The best time to sell gold? NEVER!
If you bought gold in 1979, adjusted for inflation, you are still underwater by 50%.
What a deal!
Bears make money, Bulls make money, Pigs get slaughtered.
Yes, that is highly relevant for both of the people who bought at the top in 1980 (not 1979) and still have it.
By the way, you forgot to mention that you can't eat gold.
Apple stock (despite sounding delicious), is also unfit for consumption.
And isn't it funny how everybody remembers $800 gold in 1980, like that's the only time anyone bought it?
Fun facts, paperbugs: $612.56 was the average price of gold in 1980, the highest monthly average was $675.
http://www.kitco.com/scripts/hist_charts/yearly_graphs.plx
They always seem to forget that 2000 NASDAQ top tickers are still taking a worse beating than goldbugs ever did.
Ahhh selective memory (it's so much easier than facing reality).
I see very few people here talking about 80s gold price, OIL, and the
Iran/hostage (1979-1981?) revolution/crisis; people (maybe for the first time
in a generation? I was not alive during WWII) having to make lines
that went around the block to fill the tank at a gas station; the US realizing
(for the first time?) it HAD to have an "oil reserve", i.e. there was no oil reserve
at the time = people were fearing the(ir) world would/could come to ... ?????????????????????????????????????????????????????????????????????????
It was a weird time but, if you had a job, your wages pretty much went up, with a lag, to attempt to keep up with inflation.
As I recall, the gasoline thing resolved pretty quickly to 10 gal per vehicle on alternate days of the week, depending on the last digit of your license plate number. Odd/even numbers?
I can't recall the exact, but it did work for most.
Lots of woodstoves installed in the Carter era!
Vermont Castings really took off as a stove manufacturer.
There was never a sense of 'it's all ending' as there is now, more an adaptive attitude.
In this "me first, where's mine, up yours world", I think that will be a tougher spirit to invoke.
Time will tell.
Judging by the action going on right now it appears a good time to sell some gold was before close today. I wonder what the government is doing to spark this selling over night? I would assume when the POMO buying starts tomorrow the selling will cease.
I'm guessing that the Euro is dropping, thus driving up the Dollar and the Yen and driving Gold wrt Dollars down in the process. Another opportunity to buy!
Seems a good time to buy some PM dips.
Can someone explain to me why gold "collectors" are call "bugs" Why a bug?
"bug" =older slang for "crazy"
i.e. "bug out"
I'm guessing that the moniker is related to a short story by Edgar Allen Poe: "The Gold Bug"
Can someone explain to me why gold "collectors" are call "bugs" Why a bug?
To attach a pejorative connotation to people who own gold for a variety of reasons. Implies they are out of touch cranks, or worse, tin foil hatters.
Think "health nut". You've got to be a nut job if you eat food that is good for you. Try Captain Capitalist Crunch TM food like product instead.
Don't sell until further notice.
Chart: YM
Back below prior support. So much for the G20.
http://99ercharts.blogspot.com/2010/11/ym_32.html
http://www.zerohedge.com/forum/99er-charts
the clown i mean cramer admitted on erin burnetts show last week he had his entire retirement in gold. her jaw dropped didnt know what to say. he cant buy induvidual stocks so its in physical more than likely not mutual funds. not 90%...100 in gold-1
Cramer is an entertainer, like the late night hosts. He feels it is ok to lie to you because you should know he is just a schtick meister.
Ron Paul is a gold bug. Makes me wonder what his new found power may do to the price.
Well, I suppose he has a better pulpit to rag on HeloBenny, but thats about all it is. A little more exposure and transparency for the Boyz. He ought to be the Chairman of the whole House Financial Swervices Committee and it might actually be meaningful. Of course that won't happen unless the public sings out, and soon I might add, otherwise Baucus (R-AL) or Royce (R-CA) or some other shill for the bankstas will get it.
I am reminded of the Irish toast, "May your last check bounce".
Came with nothing, leaving with nothing. The trick is timing.
There was no internet in 1980, but there were plenty of newsletter writers. Fiat was dead. Gold and silver were the only real money. Less than 1% of the public owned gold. The US was bankrupt. It was all true then. It is all true now. Of course back then we had Volcker, and now we have Bernanke.
The trick is timing.
No doubt gold and silver are going to the moon, but after reading the myriad PM articles on this site and seeing the absolute consensus, it feels like deja vu all over again. Except for Bernanke.
This maybe the only site you see that consensus on. There are still more people that scoff at the thought of owning gold and silver. I don't personally know anyone that owns it other than myself. But I do hear plenty of folks on CNBC proclaiming toppiness and bubbles. Of course they were doing that at 800 as well so I'm not sure about their bona fides.
"gold is bubble" is going around a lot lately...but it has a "disseminated" feel to it
we had savings back in 1980 and raising rates benefited mostly americans we can't pay 18% to the foreigners. i'm more worried about gold going down at this point then up. I think its armag. if gold goes down not up. The only problem is oil which this country was built on besides the debt
who cares about what the dollar does the dollar index is against other currencies. They will all bounce off gold in the end not against each other as is now.
King dollar was to benefit the whole oil thing and we are not going to have rich ceos in the future we are going to have oligarchs
If it goes to 12 k overnight thats one thing....just watch the alf fields fibonacci retracement possible at 3-3500 could go back to 2300 at that point then on to its final destination
I am envious of those who are accumulating at this time. My sell signal started about 18 months ago when there was little food in the cupboard and the bills needed to be paid in order to stay warm and dry (Underemployment is the new American pastime). First the platinum went...then the gold...soon the silver will be a fond memory. What a bitch to be selling at this moment in time.
I would consider robbing a bank...but the only safe way to do that is to run one.
Oro y plata...y plomo.
quonk, you are not alone,i gave a third, i exchanged a third for bills paid and the remaining 3rd is shrinking. And i am very thrifty. It will only matter if we survive. So i kinda quit worrying about what i got or dont.
Sorry to hear of your troubles. You have demonstrated that PMs are a store of value to be tapped when needed. Things will work out for wise folks like you.
Chart: DX
Dollar futures now above upper boundary of up channel.
http://99ercharts.blogspot.com/2010/11/dollar_478.html
http://www.zerohedge.com/forum/99er-charts
What is FOFOA?
Friend Of A Friend Of Another.
"Another" is/was rumored to be a high-level European involved in designing the Euro and its relationship with gold. Another also used to comment on gold on a blog in that time frame (1998 and on). FOA was a friend of his (FOA rumored to be an American) who also commented on a gold blog.
FOFOA writes a very interesting gold blog, he seems to have introduced the concept of a plausible $55,000/oz gold to the general investing public. I have been reading his blog since 2008, it has helped me to better understand gold and buy more than I otherwise would have.
Check out his blog, but it will take a lot of time digging around in his archives to really understand his take on gold. It is unique and "Gold 102", if you will. Gold is a much bigger realm than I had thought before finding FOFOA.
fofoa.blogspot.com
D.C. if I may expand on your response. In 1997 a commenter by the pseudonym Another appeared at the kitco.com gold comment board. His flowery writing style made it clear that although his command of the English language is/was impeccable, English is not his first language. His commentary was quantum leaps ahead of what anyone had the right/hope to expect in an online forum. Clearly, the ultimate insider, Another taught using the classical (as in Greek) techniques of challenging thought and guiding you to your own conclusion. He taught (and still does years after he stopped posting) more about the relationship between gold, fiat and oil than anyone could ever hope for. FOA, was his friend on the board and regularly posted messages from Another or responded to questions posted using the same inside information although his writing was much more modern and less cryptic. If you want a doctorate thesis in gold, Another was the professor and FOA was his associate/intern. Sadly Another and FOA stopped posting around 2001. He became disgusted with the tone and level of incivility on the boards and instructed FOA to stop posting. We are all much poorer without his insight. To learn more go to:
Another and FOA: http://www.usagold.com/goldtrail/archives/another1.html
No question in my mind that gold is a "safe haven". If gold is at $900 what is the price of real estate in your neighborhood? Probably alot lower than it is right now I would think.
But, the dollar is a safe haven also - under the right circumstances. With the dollar a rip does "somebody" see trouble ahead?
I wonder - - -
The Gold price will follow the exponential growth of people realizing their dollars are toast.
x = y^2
Starts out flat and with every incremental increase grows faster and faster. If my 2 friends tell their 2 friends....
So people don't be surprise if you wake up and Martha Stewart starts to recommend Gold. That will be the BEGINNING of the parabolic rise in price. Gold and Silver will start to move up %2 - %5 per day occasionally when the Mathematics of Crowds starts to take over. They ain't a lot of Gold and Silver out there (unlike internet stocks or 3 bedroom ranch houses).
OOPS - Correction - dollar "on a rip"
I'm heading down to the Holiday Inn this weekend to sell my gold. Gonna take the cash and head to the "Tribute to Tony Bennett" show at the Inn lounge. Splurging on the Surf and Turf 'cause nothing's too good for the Mrs.
+1 I don't know if it's the weed but I found that extremely witty.
It's the weed, dude.
Make no mistake, the diehards will be riding the gold religion all the way down the toilet, no matter how high it goes before then.
I started purchasing gold (as ETF) when it was around $850 per ounce. That was to prepare for my marriage (I live in India!). Now the price of gold brings shivers to my spine and squared off all my positions. I now invest in Fixed Deposits and write index put options (our govt has guaranteed that there will be no more stock market crashes - crazy guys no doubt but they control the country's insurance companies and I trust them to buy in times of crisis). I have been making decent amounts of money on monthly basis. Here the opinion in India is that Gold is expensive, though people may still buy gold when it crashes once or twice but later they may quickly relate it to the real estate market and realize that nothing in the world can be in a perpetual bull run.
about 6 hours ago would have been alright
NO you fool! Number one rule of the club: you don't talk about selling gold. Gold to goldbugs is a religion.
I'm not planning to sell my gold other than for living expenses. I expect to spend it, not sell it.
By the way, I'm almost certain it is "Terry Coxon" (Harry Browne's longtime associate), who is the author of that article, not "Terry Cozon".
Gold looks extremely strong as it trots across the globe. It is ok to anchor in around $1390. There could be a $50 gain on the back of predominant buying and dollar weakness tomorrow. Get yer popcorn ready.
http://seekingalpha.com/article/236237-what-should-the-price-of-gold-be-...
In dollar terms we could see any number.
sell.. you're what crasy ???
you guys still dont get it.. no way out of this..
WHOLE MOTION OF FREE TRADE, NO REGULATIONS, TOO FUCKING BIG 2 FAIL IS
FRAUD.......... PERIOD
current political system is not capable of solving problem but when people will wake up
its ALREADY TOO LATE.. look ar recent elections in US.. same people, same shit..
only now its called Repuiblicans.. people in USA became too fuckign stupid ..
insanity is doing same and expecting different results..
NEXT president is gonna be Sara Stupid bitch, of Glenn Beck Moron,, or whatever..
SYSTEM WILL BE CLEANSED ONLY THROUGH HYPER INFLATION.. all debts forgetten,
free trade ahlted, trade barriers will be erected.. ITS GONNA BE industrial revolution
again..
alx
ps
keep gold/silver forever and stack up food/ guns/ liquior/sigareters
Great discussion tonight...
In more than one way I have been unhappy with the bubbly nature of the gold price lately, because to me it has been a nice safeguard, a decent dollar hedge over several years.
Now with all the talk and the dollar in more real trouble, gold seems less stable and yet another thing to have to manage and watch out for visa vi the bubble, then drop.
Questions: How far will it drop, and from how far up?
How much would I hold, just to pass through swings to the other side as many have suggested?
I do have the fear that it is beginning to move from an asset to "real money" to a "speculation" in a huge hurry these days...not really a positive development. This is the sense I have from reading all the comments tonight: "Is gold changing its function in my life?
Thoughts?
The Government's Series Of Awful Decisions Are Creating More Bubbles That Could Pop At Anytime
What Should the Price of Gold Be in the New Gold Standard?
Given these trends, I would conclude that to reestablish a new gold exchange standard probably would require a gold price of about $5,000.
http://seekingalpha.com/article/236237-what-should-the-price-of-gold-be-...
That's good stuff, sub Z.
And despite all the people who will tell you "you're crazy" about $5,000 gold, I'd say that's a minimum. I did some back of the napkin calcs before all the bailouts and came up with $9,000.
Hippies out to make it rich ....and keep it http://www.offshore.hsbc.com/1/2/international/expat/expat-survey/expat-...