This page has been archived and commenting is disabled.
The End Of The Supercycle? Commodity "Capitulation" Arrives
In a note by BofA's Michael Hartnett titled "When Supercycles end", the bank looks at the latest EPFR fund flows and concludes that the wave of commodity "capitulation" revulsion selling has finally arrived.
Specifically, looking at fund flows, the most recent week saw the biggest outflow from precious metals in four months and emerging market fund outflows reaching $10 billion over the last two weeks leading Hartnett to conclude that "capitulation is beginning in EM/resources/ commodities."
This is what the most recent flows looked like:
The fund flow details indicate a "Great Rotation" out of commodities, Emerging Markets and, curiously, the US, and into bonds and continued flows into Europe, which has now seen 10 straight weeks of inflows with the latest one of $6.0 billion also the largest in the past 4 months.
Inflows into fixed income have been across the board:
- $1.9bn inflows to IG bond funds (first inflows in 3 weeks)
- $0.5bn inflows to HY bond funds (2 straight weeks)
- $0.3bn inflows to EM debt funds (modest inflows but largest in 11 weeks)
- $2.1bn inflows to govt/tsy funds (3 straight weeks)
- $0.2bn inflows to muni bond funds (first in 7 weeks)
While in equities it has been a tale of two flow directions: out of the US and into Europe (and to a lesser extent Japan):
- Japan: first outflows in 8 weeks ($0.5bn)
- Europe: $6.0bn inflows (10 straight weeks & largest in 4 months)
- EM: $3.3bn outflows (2 straight weeks)
- US: $3.7bn outflows (outflows from both mutual funds & ETFs)
By sector, inflows to secular growth areas of healthcare ($1.3bn) & technology ($0.4bn)
To be sure, the best example of the paper flow capitulation is where else but gold, where in the past week algo, 1% of total gold/silver AUM has been wihdrawn!
But while gold has seen its share of pounding in the past 5 years, it is modest compared to the revulsion experienced by companies that have economic exposure to Emerging Markets. As BofA notes "US companies with high economic exposure to Emerging Markets at close to 13-year lows vs broad US equities."
The last chart may also explains why Ray Dalio, after largely ignoring the bursting of China's three bubbles (as shown here previously) finally threw in the towel, became bearish on China and admitted that "There Are No Safe Places Left To Invest." It also explains why increasingly fewer are "buying the dip" across markets despite one-off superstars like GOOG and AMZN.
»
- 93733 reads
- Printer-friendly version
- Send to friend
- advertisements -
Don't fool yourself, this is the end game playing out.
Paper gold could go to $100 & paper silver to $1
The CRIMEX will then close its doors.
Looking moar like "decapitation" to me
The great China growth story has turned out to be nothing but a fairytale. Commodities are adjusting accordingly.
So China, Russia, and myself are buying gold....but we're no match for those two guys in New York.
No....I don't know who they are....and neither does the CFTC.
... meanwhile, Goldman Sachs alert: beast from deep freaks out Russian ... footage of an impressive goldman sachs filmed by Russian has emerged online, attempting to steal the catch ;) >>> http://www.rt.com/news/310634-giant-squid-russian-sailors/ ...
Wow, what a great way to get rid of banksters
Throw em overboard to be devoured by their own kind!
The next bubble will be.........W W #3
Paper gold will never go to $100 nor paper silver to $1. The bullion will be bought at all costs starting now. Likely a bounce for both is in short order.
Both paper Gold and paper Silver will trade at ZERO. (Of course the real McCoy will not.)
The price for a defaulted contract is NOTHING. It is WORTHLESS if it is unenforcable.
And as the Comex is levered at 92 to 1 on Gold and probably over 100 to 1 on Silver that eventuality will happen.
My Coin Dealer cannot buy Silver. He has none currently for sale. Whatever walks in that door is gone.
There is a PHYSICAL SHORTAGE.
Comex is not able to deliver at these prices so they will "Cash Settle". But what good is that when people demand product? So they will allow the paper price to decline as their cash settlements will be less. Or they will give the option for a delayed delivery?
And people are beginning to figure this out.
The contract is WORTHLESS without available product. The miners are not supplying at these prices as they cannot afford to produce.
The US Mint has run out. That demonstrates the restricted supply.
No shortage of metals with my dealer. SilverSaver.com
Call them, they have almost everything I want and when I take delivery, it is to my door usually within 4-7 business days.
It seems spotty throught the country at this point.
The next bubble will be.........W W #3.
Everyone will be doing it.
Last man standing wins?
Glows.
There will be NO NEED for WWIII, all China & Russia needs to do is to go on a gold standard and they can CRUSH the West without one shot being fired. And the games that are being played in the Commodities Markets would end and I would NOT be shocked to wake up Monday finding that the announcement has been made. Granted there will be MANY black swans when it does happen, mainly here in the US.
Don't forget back in February IMF head Christine Lagard was mocked using astrology picking July as the month the collapse will happen. She has been very very vocal as of late saying just how underwater many countries are and the relief they need now.
Just saying, anything can happen. And it sure SMELLS like the time to pull the trigger.
That's assuming the West rolls over and dies.
Don't assume collectively the west is all good guys that wouldn't stoop so low as to start shit. Indeed I'd assume they will.
Then it's simple. China and Russia will be the capitalist pigs with a gold backed currency and we will be the commie bastards with lines for something but we don't know what it is the store is sellling but we're buying it.
Break it the mother fuck down
Shooting them in the face works, too.
why are you buying gold on the way down? paying 1100 for something that wil be worth 900 in 2 months? you're crazy
Channeling your inner Jon Nadler today I see.
At this point if someone doesn't see gold's value and they are writing on ZH they are trolls and nothing else.
i do own a lot of phyzz, but i'm nevertheless short gold miners right now. I think that guy (lost money) has a point: why not wait until the price for paper falls even lower and then start piling up on phyzz again? Id rather wait for the total capitulation in gold prices to re-stack
So you are assuming that as long as there is paper gold and silver there will also be Physical Gold and Silver, hehe.
Can someone pass the hookah to me next, please.
While you may be right about $900 gold in 2 months, you should ask yourself whether at that time you are able to withdraw your cash to make a gold purchase.
This totally depends on whether you're emphasizing the cash part or the withdraw part. USD has had a long run, so I expect there is still a fair amount of correction left. This correction should coincide with a bounce in gold after this capitulation. That could last several months or more, probably through the end of the year and drive gold much higher. After that, I think the slide may continue for another year or so before hitting a final low. Either way, now is a good time to buy gold, at least for the short term. If it doesn't have another drop after this coming bounce, then you'll have got in at a great time. Otherwise, you can liquidate and wait for the final low to come in. I expect we may have some difficulties in the withdrawal of cash from some banks once the banks come under pressure, which means it is good to have some hard cash stuffed away for a rainy day too. .. and never put all your eggs in one bank.
Correction against what? The euro or yen? Correction against assets? When everything is overpriced, cash is king. Deflation is the word until QE4 starts.
Banks sure seem touchy about withdrawls now, let alone durng the next crisis. Mine seems to be bending over backwards to not only not give me my money but sabotaging bill payments and transfers.
I'm trying to understand your comment. You're saying that, you know, Au will be 900 in two months... Dang, can you be my financial advisor, cuz you seem wicked smart and in the know... How bout this -- give me a ring and I'll show you how to get back your 'lost money' (fiat of course). :-)
Please tell me when the bottom is in, and I will buy all then.
None can predict when or how the spinning top will fall over.
Buy Gold now (maybe 50% of your overall purchases), then wait.
A reasonable "now-and-later" precious metals buying strategy:
50% now
50% later
The future is a little more difficult to predict than you imagine. Just because you have an opinion, does not mean that events will unfold this way. Also; the "future" goes on for longer than 2 months; suppose Gold is worth $900 in two months; and 4,500$ in two years ? YOu know very little.
I wish lost money good luck to buy at 900.
There are risks associated with buying physiscal. So to wait until the last moment to convert a large fiat amount into gold can be risky. You might think to save 200 USD/oz and lose the whole stack to criminal who noticed you were buying in size. Better to buy small amount spread over longer periods. That will also allow you to scale in at average prices instead of betting on a forecast of a lower price which might be wrong.
Besides that, it's better to buy two years too early at a price 20% above the low than being one day too late and not to buy at all.
Meanwhile, the banks have consistently stolen around 5% of savings, per year, since 2008.
For the US-based, it's better to regularly exchange fiat for those wonderful, shiny products from the Royal Canadian Mint, so you have the option of legally moving them into Canada with no tax being due, or even a customs declaration.
Sure, in the Big Picture, Canada is merely USA-lite, and no reportable financial event in Canada is a secret from the US Government. However, not all financial events in Canada are reportable, specifically not the export of personally-owned .999 PMs of Canadian origin.
Sorry, the price of the coin products that the Canadian mint sells are about double the value of gold in them, hardly a good "investment". But if you want to subsidize an inefficient Canadian government business, be my guest.
Personally, although living in the States, I've found RCM coins to be more competitively priced relevant to the underlying PM value and to me, more preferable when comparing their higher degree of fineness: .9999 vs. .999 typically produced by other mints. Btw, from what I read about the Canadian government, I believe the US government could take some tips from them.
There will not be any left at 900$
disciplined dollar cost averaging, which of late is akin to financial masochism
Crazy is also the time frame you're applying to this.
The CFTC couldn't find a whore in a whorehouse, and that's why they're so well paid.
@ND
Really? I normally agree with all your posts but not this one, China has a population of 1.6 BILLION and POSITIVE reserves in Gold and some Green Paper, the latter alone representing over 1.4 TRILLION. China's debts are entirely INTERNAL so its defecits are entirely manageable. Unlike some other countries. Russia also is "Isolated" with a Debt to GDP ratio of about 14%.
China for sure has many problems but building infrasturcture is a better long-term investment than pissing money away in the TBTF Banks and their "Investments"? Eventually, families will occcupy the empty apartments in empty citiies but the financial "Investments" by Wall Street will be lost forever in the Caymans?
That may well be, but gold is getting hammered down along with every other commodity right now. And that's because China's growth story of 7% CAGR has been shown to be a fairytale. I'm not saying gold deserves to be hammered, I'm pointing out that it IS being hammered just like everything else that gets dug out of the ground right now. It may not deserve it, but that's what's being done to it.
China's past "investments" are what's killing them right now. They weren't investments at all. They were government mandated works projects- buildings that nobody inhabits of works in, stadiums where no teams play, airports with no flights and bridges to nowhere. They were classical mal-investments. I'll point out that it takes a lot of steel and concrete to build steel and concrete plants, too. It was self-feeding in that way. Now it's coming to a screeching halt, just as centrally-planned economies always do at some point. And the debt they incurred for these "investments" was heaped on municipal and regional governments (internal to China, as you rightly point out).
All this has conspired to hobble their growth rate. They aren't doing 7%, despite their claims. I have my doubts about whether their actual growth rate is even positive at all. Not that our growth rate is positive, but it's about EXPECTATIONS. We know the US is dead in the water, but a lot of people put a lot of chips on China hitting a real 7% growth rate. When you expect the world's 2nd largest economy to do 7% and you get 0%, commodities are going to get ass-raped. Yes, including gold.
They can hold all the reserves they want- in gold, in USTs, in RMB.... it doesn't matter. If you can't turn that into real productivity and growth, you're fucked. They are fucked.
When the "click" gets their "buy signal", they'll deploy their free/cheap fiat reserve war chest and gobble up commodities & distressed assets. Once they've blown their wad into the economy acquiring hard assets, they'll
bide there time waiting on the wad to wend it's way through the system, picking up velocity, priming the pump---till the "sell signal" is given. Wax on , wax off. Riding the wave of credit boom manipulation through the
ages. Inflation & disinflation, the millstones used to grind our bones to make their bread.
.
Everything is getting hammered; therefore, this is the end-game.
There must be a lot of pucker'd investors out there.
A good metals strategy is to short the stock market, then buy a bunch of metal later, while holding sufficient physical.
I would venture to say that those who are in the US will be fucked even more.
Everything and I do mean EVERYTHING that we as a Nation were taught to believe in has been a complete and total FRAUD/LIE. The ONLY thing that has allowed us to be where we are at today is that we currently have the reserve currency which that too is going to end, which by what I am seeing could come at any DAY, Seriously.
The people in the US have not a clue as to just how bad it can be, there is a reason there are now 400 +/- FEMA Camps scattered all over the US. I truly hate seeing where we are as a Nation and feel there will be very hard times ahead. My main concern will be if the same pieces of shit will hold the control after the downfall happens. I just hate the thought of being more of a Slave than what I am now. The young generation have no idea of the freedoms and liberties that they have already lost as it is now. I look forward to my next life, yes my faith is very strong.
Chinas growth is a fairytail? Do you honestly think a country with 3.5 trillion in foreign reserves is a fairytale?
Yes. At least their claimed growth rate is for sure. More to the point: if you can explain to me how FX reserves have a damned thing to do with their demand for commodities, I'm all ears.
That IS what this story is about- commodities.
This is just going to move on down the line into bonds, stocks followed with pitchfork armed mobs in the streets.
In America? I doubt it, there already is a gun in every household and they do nothing.
Cut off SNAP and cash benefits, you'll see people in the streets.
Correct. And not a moment sooner than that.
Of course, they'll turn off their Obozo phones first.
How can Soros coordinate the riots if they turn off their phones?
With smoke signals from the burning fires in the 'hood.
Or, that timeless device, the jungle drum.
"What do those drums mean, Tarzan?"
"It mean white hunter and Jane in trouble!"
"Help us, Tarzan! Please!"
Correct. But they won't be fighting for liberty, only for more free shit.
Productive Americans are on the decline. They'd better hope that the collapse comes while most of the police and military are white, and that those groups side with them. Otherwise, the free shit army of minorities will deem that it's their right to steal everything white man has left (to make up for past injustices).
48 years ago today, George Romney(Mitt's dad) had a backbone.
http://en.wikipedia.org/wiki/1967_Detroit_riot
You'll see pavement apes in the streets.
Hat-tip to greenskeepercarl.
definitivly agree, big mouths for spanish and blacks problems, but against gov abuse, everybody is panty shitting about the black copters above the house...
they gonna ban guns, and eveybody will give em to the gov, some will go mad and go illegal market to get back a handgun or two, but nothing serious.
eventually to break it they'd announce a reward to anybody reporting any gun possession from neightborhood...
I'm afraid that your understanding of American culture is lacking.
What you describe would probably happen in the big cities, and the heavily leftist areas.
The rest of us? Molon Labe, muthafuckas. Come and take 'em.
I am also afraid you do not live in redneck country, in the country.
Taking won't be too hard if they outnumber you 100 to 1 and have organized gangs, militia, and abundant weapons at their disposal.
Right, because non-gold holders are super organized people that know what they're doing with arms and combat.
Leaders with military training will rise up to organize them, seizing the opportunity for personal power and gain.
Wrong. They are outnumbered. There are 100M gun owners in the US. There are less than 1 million soldiers, police and Feds in total - and some of those two sets intersect.
Good luck disarming America.
"eventually to break it they'd announce a reward to anybody reporting any gun possession from neightborhood..."
I have a few relatives brainwashed enough to squeal. Luckily, they live in other states, closer to the hoards that will eventually overrun them.
Possible ... or, we could just bounce strongly again from just below the 200 DMAs, and the only pitchfork mobs you'll see will be collegians at the mall armed with cellphones, all reading Pitchfork.com (which has a nice Miles Davis review today, by the way).
shortages will be seen WAY before then.
I'm ok with that. Just means I could stack more. I really don't see much else out there to store what little wealth I have. Currently, however, I am using all my extra dollars to pay off my student loans. If the prices keep falling, I'll have to start buying physical metals again. How low can they go?
Like some other markets i believe ZERO is the lower bound.
possible, yes, but I don't think anybody will give you even one ounce of physical for that official price. that's the problem with market fundamentalism, it obscures what markets are, and how they really function, in favour of a cargo cultism that opens the door to further cargo cultism, like the matra of broken windows being as good as martian invasions
You fucking moron; are you completely dis-connected from reality ? bullionvault.com / headquartered in London / all the /Silver and or Gold you want "at that official price". HOw can anyone so out of touch with reality even type ? Just fuck off; please.
Hey, thanks for the link. However, you need some reading comprehension practice, as he was not talking about buying PMs at current prices. He replied to a comment which said that ZERO was the lowest possible price.
RIF, bro.
That is what happens when you're fully literate rather than semi-literate like the rest of us.
I don't always put a username on the "never read another post by this person" list, but when I do, it's usually, as in the case of Model T, when they have been a member for a few short weeks, and begin a post with something like "You fucking moron".
8 years. I keep getting kicked off by know-nothings like you.
If I had an unruly guest in my house then I will invite him to leave as well.
You are NOT ENTITLED to post on Zerohedge. Neither am I for that matter.
But insulting your hosts, being asked to leave the venue, over an 8 year time span, and then coming back repeatedly, uninvited, for 8 years, is rather narcissistic of you.
If I had been asked to leave over the span of 8 years repeatedly...well I would have gotten the message well before that, much sooner than that, as I am not a stupid fuck...like you are. BUT NOT YOU.
(I will bet that you are alone and have some real issues about stalking. That is what your behavior is. YOU ARE A STALKER.)
If the internet had tresspassing laws then you'd be in violation. In our society that is a CRIMINAL OFFENSE. Stalking is also a CRIMINAL Offense. But it is EVIDENTIAL that you are just another narcissistic psychopath as well as being a sociopath.. You care not for the rights of your host as you choose to spread your venom as a sick and twisted form of revenge.
So you are a predator?
If you were to invade my home, after I had asked you to leave, then I'd just shoot you and be done with it...the FIRST TIME you violated it. You'd not be given a "second chance" to ever violate me again.
This Entitlement Mentality is endemic to most. These people are not entitled to ANYTHING I OWN, or the space which I PAY FOR and occupy. The Entitlement Mentality is both Narcissistic and Psychopathic and is the leading cause of the degeneration of the Nations and the entire fucking Socialist World.
Fucking Socialist.
People once thought "zero" was a lower bound for interest rates.
"Hello, Barry here for GM cars! Ever thought of owning one but could not even come up with a junk loan? No more! I'm here to introduce the new GM Negative! Uncle Sam pays you to buy a car! That's right. So swing by a GM dealership and drive off with a pocket full o' cash from Uncle Scam, err, Sam, Comrades!"
Hi I'm Ants-in-my-Eyes-Johnson and boy do I have a deal for you! I can't see anything! I've broken toes against big bars of gold bullion three times this week! I'm desperate! Someone help! I'll pay you! I'll pay you two, three, no four... as many as five dollars per bar just to get these things out of my warehouse!
for paper - well, what maybe 5 U.S. cents for a sheet of paper with some ink on it? or maybe 5 cents for the disc space on a computer - Ok - 5 cents - not 0
playing the end, my ass... they always find something else to be done to keep it going
They didn't find something else in 2008. The whole thing blew up in their faces. They were scared, really scared, and they immediately set about laying the legislative groundwork to allow themselves another bubble/bust without risk to themselves.
That legislation is now in place, the bubble is blown. The smart money has evidently left the market with their profits and the pressure cooker is whistling again.
If these guys were half as smart as people give them credit for they'd stop what they are doing immediately before the torches and pitchforks come out.
I think there is some of that going on. But it isn't the complete picture. The game is being played on multiple levels.
I've maintained for some time now, that the whole point of what the financiers are doing is to collapse the entire financial structure of the world. All of it. The idea is to force the entire planet into financial default - and then foreclose on it.
Presto! The financiers own the entire world.
This has never been about anything but power and control. We're dealing with psychopathic dynasties whose power lust has no limits whatsoever.
I agree. Then, the Masters of Finance will fight between themselves.
(Haha, imagine Soros trying to swing a broadsword around- 'there can be only one-and then falls over from the sword's weight!)
to me a man, or men, playing in billion scale about earning, are totally disconnected with reality of small hands making the reel world working.
i mean, if soros want to read WST, someone buy for him and bring it to him. you realize soros forced to go town 100 floor in elevator, cross the street, using COINS ! OMG ! COINS ! then go back to its lair above the clouds ?
i'm pretty sure he do not even know driving a car.
seriously, fuck them.
... and the the IMF is pissed they won't/can't make any further unsustainable bailout loans. (their new policy, of course, choosing now is the time)
The international easy money window has now closed.
Now all the majors are getting pissed-off and into their locally mined physical tangibles, and without finance will mean stuck in the ground or low volumes...sh*t meet fan.
A parasite that kills its host? How does that benefit the parasite?
The goal is to wipe out 90% of us, enslave the other 10% and live like gods above the rabble.
Good article. But it's pearls before swine. None of the semi-literate fools on this comments page are anywhere near being able to understand it.
FOFOA was looking at the $700 price point as the final runout point of capitulation, but I agree, there really isn't a bottom. Reval could hit ~$64K/oz.
$875/oz. = 61.8% retracement of '99-'11 bull.
$100 seems like a lot for paper gold ;)
As the noise gets louder the buy gets closer.
Anyone taking anything out of the ground should be sold right now. Even people who make equipment to help them take stuff out of the ground. THE GROUND IS LAVA!!!!
Gold and silver is not an investment stupid!! It is a hedge against calamity
Got AK-47's/Ammo/Food/Water....some dope or whiskey for bartering?
It is a hedge against calamity
Wait for it.....almost here.
All of the above and more.
it isn't that either. cause no one will take your gold as payment because they have no way of proving its real. a $20 gold piece will get you 20 bucks worth of stuff, the face value, not the intrinsic value.
Actually, there is no way of proving you're real.
http://www.wikihow.com/Tell-if-Gold-Is-Real
https://search.yahoo.com/yhs/search;_ylt=A0LEVryuSbJVjBYAqWUnnIlQ;_ylc=X...
sorry. 2nd video down
https://www.youtube.com/watch?v=xYdSEAm-7uI
here ya go
Quite possibly the dumbest statement I've heard this week - and I am the father of three teenagers..../
I have read that if you can bite into it, if is gold.
heh. same w chocolate
Same difference
What is the "same difference" to which you are referring? You ar being junked out here. Fight and defend your "clever" oxymoron reply.
Ever have the experience when you jump into a bull fighting ring and the bull isn't looking at you so you start yelling to get the bull's attention and finally the bull turns around and stares at you? The world is in that kind of bull market. Let the trampling begin.
Aw man, it seems like that happens EVERY TIME I jump in a bull fighting ring.
Tranny's warned copper would end up like a penny on a rail road track
"and into bonds"
That's going to work out real well.
If gold and silver are hated that much and plentiful, why don't we just mix our coins with silver or gold instead of keep on mining nickel and copper.
Barely any copper left in the coins. Pennies haven't been copper since '81.
I thought it was 83, but your're right. You can cut a new fake penny in half with a pair of Kleins.
Interesting, why do phone guys insist on testing their Klein snips by snipping pennies in half?
blue,orange,green,brown,slate===white,red,black,yellow,violet======bitchez
Awesome. Monster boxes are still above $7,500.
The more paper precious metals fall below $1,200 say, the faster physical metals are vaccummed up, and more resolute strong hands become.
Pushing metals too low means physical disappearing, and as i said, winding the spring very tight on gold/silver.
Given that the people/entities buying physical silver and gold are not trading, they are de-risking, they are aware of the geopolitical and global economic environment, and is why they are in the metals. Thus they are not going to sell having bought in at say $1,400 - $1,200 sell at $1,000, they would be probably buying. Many would also be aware of the fake nature of the COMEX.
So those wishing to reduce the price of paper metals ought to watch out. When physical dries up too much, some needing to cover with physical wont find it in volume, and either have to offer a proper price. AND if you get an event when a number need the physical to cover, and have to compete for it, the system breaks, and the spring uncoils.
If paper gold went to $100 good luck finding any, and you wont because I would have bought all that was available at that price.
i've saved up enough dry powder (paper, fiat) to keep buying all the way down little by little - keep jackin' it down you jack-offs! pretty please!!!
Spot silver 14 bucks, online dealers at ~$18. 20% margin built in from cost. Ah, to be a salesdude.
99 cents over spot;
http://www.apmex.com/product/69643/100-oz-silver-bar-secondary-market
My eye caught that yesterday.
What is the time for DELIVERY???
Are deliveries being DELAYED due to lack?
It reminds me of the story of the two Gas Stations where one was selling Gas at $ 1.65 per Gallon and the one selling at $4.00 per Gallon.
Business was booming where it was $4 and the place across the street had NO CUSTOMERS
The reason that the $1.65 station had no customers is that they HAD NO GAS FOR SALE AT THAT PRICE, OR ANY PRICE.
Does Apmex have coin for immediate delivery?
What is the time delay? If there is one then it demonstrates LACK of CURRENT SUPPLY.
They ship for free and delivery is quick for in stock items. They clearly state what's in stock & what isn't. Also delivery time depends on how you pay. Checks have to clear first before being shipped.
I know I am no professional, but I have always viewed Gold as a STORE OF VALUE during inflationary times, not really a hedge. I view it as a hedge against deflation.
"money is gold, and nothing else"
-JP Morgan
Gold isn't even a store of value anymore. It's not much better than fiat, because it's value depends strictly on desire for it. It's not a necessity, nor does it produce any revenue. But it is shiny, and that's what draws people to it.
It is simply a medium of exchange, and one that's being seen as less relevant. Just as seashells and beads were once considered valuable and used as a medium of exchange.
During the crash of 2008, what happened to gold? It went down. Why? Then it went up, becasue people were simply going to what they THOUGHT was "safe". Now, the frenzy is over, and gold is going back down again. It's likely to remain down for the next couple decades, until a new crop of "believers" drives up the price again.
Exactly. Gold is only valuable as a basis for the medium of wxchange. If it's not the badis it is not a store of value.
You are either a troll, or ignorant of the facts.
Although it has declined in USD about 6% since I crunched these numbers on July 4, they still illustrate the ignorance of the claim that gold isn't a store of value.
The percentage change in the value of gold against these currencies for the two year period ending on July 4, 2015:
Euro +11%
Danish Kroner +11%
Japanese Yen +18%
Swedish Kroner +20%
Norwegian Kroner +22%
Turkish Lira +29%
Brazilian Real +37%
Argentine Peso +58%
Russian Ruble +62%
Ukranian Hryvnia +140%
You are either a troll, or ignorant of the facts.
He's both, Tinky.
don't underestimate the power of "shiny." also, you're being short-sightedly western-centric in your views re: the "frenzy," and ignoring the paper derivatives vs. physical distinction.
The initial down in a heavy speculated market is people selling the one asset that doest crash first to cover there gambling depts. The smart money buys on this dip, and the average intelligence buys after. The truyly wise invester will be stacking all the time. Gold is for the long term. Gold isn't fake 1,0's created by luciferian cabalists.
"Just as seashells and beads were once considered valuable and used as a medium of exchange."
http://www.cecilsseashellcorner.com/rare-gems/
http://www.garudashop.com/Ancient_Rare_Beads_s/2.htm
Check out how much fiat it takes to acquire these beads & shells, and their rates of appreciation over time. You see it boils down to rarity, as being the driver of value through time.
So in chart 6 this Bof A asset manager had 1% of their "gold" under management outflow this past week? I'd venture to say it very well could've been those folks that realized their paper holdings through this yahoo weren't as secure as they would like and decided to take his straw and turn it into the real stuff.
jm .02
If you want to see what pain looks like in print, just poke around the Calgary Alberta (Canada) web sites a bit. The Oil Sands folks are feeling like the Dinosaurs after the meteor hit...
Go buy their precious items at fire sale prices.
I think gold was hammered in a preplanned event, 13 tons in 4 seconds in the thin market, a deliberate attmept to trash the gold.
Commodities may well be dumping because of reasons more aligned to economic downturn. Gold is 'trading' in a whole differnt way.
13 tonnes is peanuts. Worldwide production is 7 tonnes per day.
According to the World Gold Council the amount of Gold mined, since the beginning of civilization, is over 175,000 Metric Tonnes with 90% already mined.
That means that there is 194,000 Tonnes total, with 19,000 Tonnes still in the ground.
Mining that at a rate of 7 Tonnes per day would take 27,777 days, or, 76 YEARS.
Goldmine Resource Depletion is forecast at just 20 years from now.
So your figure is a gross UNDERESTIMATION of the rate of Worldwide production if linearity of the growth of Gold Mining operations is assumed as the working model.
So it is likely that your information is VALID. So where did you get it?
Sourcing it would be better as then you are just reporting information, information that is not convenient to Gold advocates as myself, but valid information nonetheless.
Then I will counterargue the point that the 13 Tonnes dumped was not sold to optimize gains.
And I will also have a VALID ARGUMENT, won't I?.
And that leads to HONESTY...HONEST DEBATE, doesn't it?
That is what I want to engage in.
And the reason that you are JUNKED is that you are NOT WILLING TO ENGAGE IN HONEST DEBATE BUT ARE HERE TO PUSH AN AGENDA.
i AM ALSO AWARE OF THE POLITICS you are stupidly attemptinting to employ here.
If someone were to be stupid and counterargue your fact then you will source yur fact, as you did not do so initially, and then use that to discredit him.
People like you are the reason why I fantasize about blowing up Bank Buildings.
In a note by BofA's Michael Hartnett titled "When Supercycles end", the bank looks at the latest EPFR fund flows and concludes that the wave of commodity "capitulation" revulsion selling has finally arrived."
Supercycle?
Look...there is NOTHING cyclical about the irreparable damage 40+ years of outsourcing has caused western middle class, consumer-based economies.
To the extent such cycles ever existed, they most certainly haven't anything to do with what's culminating in major turmoil ahead soon. There were many stages to the train wreck that dimwitted, shortsighted western corporate behavior set into motion, and early on, the eventual calamity could have been seriously slowed down, if not halted. But few listened to the growing warnings, and I well remember people like Ross Perot being labeled a kook for his pronouncements.
If you, as some hot shot money manager/racket analyst, want to do something productive, read an old copy of his campaign book, "United We Stand", and see for yourself.
While you're at it, read other truth-telling works from David Stockman and Paul Craig Roberts.
And if you maintain contact with any of the corporate creeps directly involved in all those years of dismantling the American middle class economy (that took GENERATIONS to build), I'd suggest you warn them to prepare for one helluva lot of pain and strife their short-term greed caused.
They just might be the first to be hunted down when it finally blows up.
m
it means the commodity supercycle
Gold and Silver are not commodities and if you look at how deep they have both been hit you cannot possibly look at these markets as real. This is what the bankers did in Germany and the result will be the same in the US. No one with any brains could possibly believe this article or its writers. This is propaganda and fraud to shake loose more commodities for the Tribal members to gather up at cheap prices. This sort of fraud was once illegals when we had laws that mattered in America. Naked shorting is illegals but now part of American business and no big deal when caught!
Indeed gold got into a real market for a while, up to $1,900 then TPTB shit themselves, and trashed it over and over down to todays level. Just as the other day, 13 tons in 4 secnds. cute.
So yeh gold under a heavy manipulated hand. Would be freakng interesting to see where gold would be now without the super hammering it got at $1900
remember the Fed dropping 400 tons of gold in a day? Or someboyd dropping millions of oz of silver in the quietest markets, in minutes. (this is paper gold and silver we are talking about)
In a market not controlled by TPTB BIS/Fed etc, in a more genuine market gold would be as it was, shadowing in M2, remember that.
That is the real current value of gold. So when it reverts to mean, thats where gold goes.
And for refelction again...the purchasing power of gold over 400 years. (just line that up with any currency, lol the USD in 100 years lost 98%). Gold has in fact increased its purchasing power in the last few decades, despite the heavy trashing.
http://i.telegraph.co.uk/multimedia/archive/01494/PF-gold-price_1494468c...
In 2011, at the top, gold was about 45% over valued vs. US debt. Not parabolic by any means. The debt showdown in DC slowed the rate of growth of US debt and that helped cool US demand. Now, gold is about 34% undervalued vs. US debt (somewhere near $18,25 Trillion). A 50% discount, like 1976-77, isn't far fetched. After that it went parabolic. At $800/oz. in 1980, it discounted a US debt of $9 Trillion, a level we didn't reach until 2007. That's when gold again hit $800/oz.
Go ahead "crush" commodities, please!!! Would love to see diesel back at 20 cents per gallon. If you have possession of physical commodities then you can do and build real shit.
There is no cycle.....Super or otherwise.
It is ALL controlled & manipulated by the few......at the expense of the masses!
THE REFUSAL OF ZH TO INVESTIGATE OR EVEN REPORT IN EIA & IAE "TRILLION $ SWINDLE" ON UNDERESTIMATING OIL DEMAND AND OVER SUPPLY IS UTTERLY AMAZING..I HAVE REPEATEDLY REQUESTED THEY REACH OUT TO CORNERSTONE ANALYTICS WHO HAS DOCUMENTED ALL OF IT AS DID I AND OTHERS
Certainly I have my cash spread between banks, some in bullion, some hard cash, some property.
I am careful about not putting too much into bullion, else you leave yourself exposed to changes in Govt regulations, taxes.