Another day, in another time, gold had plunged to a 20-year low, plumbing the depths of $250 an ounce at the same time as the Dow was hitting a new all-time high of 11,300, even as astute followers, just like some that I have today, were then following Another and FOA. Some threw in the towel in disgust, some turned on the messenger, and everywhere you could cut the tension in the air with a knife.
I was following the thread of a particular (unrelated) discussion in the old USAGOLD forum archives (I do that occasionally) and I came across a few comments that reminded me of some of the recent comments here. So I picked out a few of them that I thought you might find interesting.
I want to note a couple of things. The first is that I don't think we are seeing quite this level of desperation yet. I think another $100 lower and we might start seeing more of this kind of towel throwing. Also, note that these few days below marked the last time that physical gold would ever be that cheap. So the very time at which some who had been following A/FOA in real time were throwing in the towel was perhaps the best buying opportunity in all of history. If you understand why I, personally, welcome the recent decline, then that's something to keep in mind if the falling price of gold ever starts playing tricks on your mind. If you don't understand, then please feel free to ask in the comments and I'm sure that someone will direct you to some of the posts that explain my view.
All of these comments came from this page, and they are just a few selections that I picked out especially for you today. :D
Skip
Overcoming discouragement
#11907
8/23/99; 22:59:27
I've avoided posting for some time because of discouragement. As of right now, I am regretting that I ever invested in gold or gold stocks. Something that is worse than losing hope and cutting your losses is losing hope and capital and then to have someone lift your hopes...only to have those hopes trashed, again and again and again and again and again and...endlessly trashed.
If I think of all the growth I could have had in the stock market rather than the losses in gold and gold stocks, it is almost sickening and totally depressing. Somehow I know that I'm not alone in feeling EXTREMELY depressed at this latest attack against the POG by the rich big boys. Somehow it seems very unholy to keep getting financially bled to death simply for making the right decisions at what SHOULD be the right time. Maybe I'm over-reacting, but I sure hope that GATA can help bring the POG back to at least its 20-year average. This current price level of gold and gold stocks is totally absurd and complete discouraging.
Long have many of us ardent goldbugs waited and waited and waited, witnessing almost every reason possible to trigger an upturn in the price of gold...only to see apparent collusion drive it down further.
I'm in too deep to sell, and too scared to buy anymore. Somehow I can't help but wonder whether I'll someday die in my old age with tens of thousands of worthless gold stocks and many ounces of worthless gold coins. Am I being somewhat paranoid? ...actually, I'm just plain TIRED of losing!!!
Can someone out there provide some GENIUNE hope for us disillusioned gold bugs? I'm so tired of the misinformation that prevails on both the internet and the news media that it's impossible to know WHO OR WHAT to believe anymore. Some of us would love to start overcoming discouragement, and I'm one of them.
--Skip
The Stranger
Skip
#11909
8/23/99; 23:09:10
Boy, are you going to get a whole wave of responses on this one. I, for one, would be happy to address your predicament in the morning if you like, but, right now, I have to go to bed. For starters, however, let me suggest this: tell us more about what you have been through. Just how bad has it been? What do you own, and how long have you owned it? Don't worry about giving yourself away. Nobody here knows who you are. When I get up tomorrow, I hope to hear more about what you have been through. You will get lots of help here, but first, you need to talk.
Aristotle
Response to FOA
#11917
8/24/99; 4:22:15
[…]
Some people prefer to disregard the fact that the Gold market has spent 20 years coming to this point in time and price--a price that could NEVER exist now except under the special circumstances that have been put forward in many carefully considered posts. Some of these same people might suffer a bruised ego because their own careful and astute choice of Gold as an investment has yet to pay off huge in a timely fashion. Or else they might feel that Gold should be performing for them with obvious gains each and every day. Don't these people ever go home from work and sleep, or must they always be on the job and getting paid? My point is that "productivity" need not be an around-the-clock affair. As ANOTHER has said, "Gold will be repriced once in life, and that will be much more than enough." The bottom line is that you will either HAVE Gold when events turn, or you won't. It's that simple. As Beesting recently reminded us (or was it Turbohawg or ET?), this isn't just a showdown between the dollar and Gold. There's a whole world of currencies that have been suffering at the hands of their national dollar-debts.
[…]
Gold. Get you some. ---Aristotle
PS. for Skip: I don't know if this will help you out. Maybe it'll make you smile if nothing else. I had a chat with a friend the other day who was second guessing his Gold bullion investments after watching the price fall while the DOW powered upward in half frustration. He asked "What if I die with a drawer full of coins before the price of Gold goes higher?" (He's under 50 years) I laughed and said, "Then, congratulations!" I suggested to him that anyone who checks out with Gold coins remaining in his drawers (at any price) obviously had adequate means with which to meet his life's needs. Only a deathbed ego would consider any distinction between the remaining Gold weight and the Gold price during one's last breath. He laughed loud and hard and said that was for sure.
Aristotle
Skip, another thought for some additional perspective
#11932
8/24/99; 8:43:41
You said, "If I think of all the growth I could have had in the stock market rather than the losses in gold and gold stocks, it is almost sickening and totally depressing."
I don't believe a particularly infamous trader who was actively IN the markets had a single Gold investment. His name was Mark Barton, he lost half a million, and killed a dozen people. Just because you see the DOW index climb is no guarantee that your particular choice of stocks will be gaining too (unless you bought into an index fund.) I can't even begin to recall the vast number of times that I've heard the financial reporters announce decliners outnumbering advancing issues despite a higher DOW on the day.
Further, try to recall your original rationale for choosing your current suite of Judy's. (As in "Punch and Judy" shows...taking a beating. A term-use I coined to lighten my own dismay over a mistaken purchase of a mining stock years ago that went south and now vies with postage stamps in value.) Chances are that whatever compelled you to make those decisions would constantly act to sway you to do so again, and are probably more compelling now than they were then. If you couldn't resist Gold or Gold stock purchases before, could you resist them now? Hopefully, as time has passed, you've come to see a distinction between owning a world class asset (Gold) versus stock in companies that try to earn a paper profit by mining for this world class asset. Don't get me wrong...I love mines (I have a professional attachment to them), but I'll never again make the mistake of investing in a paper generator when there is real money (Gold) to be claimed. As a productive person, I invest in myself and make (earn) my paper directly. Then I cash it in for Gold, month after month. It's a One Way Street for an enjoyable life. I never did enjoy fretting over whether IBM or AT&T would be the better performer. I AM the performer, and all that I ask of my money is that it really be money--payment-in-full.
Unlike some people that are fully invested in stocks, with Gold you actually have real savings. You are a sovereign individual, immune to the fiscal mismanagement of your nation's leaders. Also, think of the sector of the population that lives paycheck to paycheck, unable to dabble in the stock market, and unable to save either paper or Gold. Is their life for naught because they aren't "in" the stock market? Wouldn't they be thrilled to have an all-Gold savings? Travel to some other countries and your perspective will change in a hurry. Adopt the larger view, my friend.
Gold. Don't work for anything less. ---Aristotle
FOA
Reply
#11935
8/24/99; 8:57:04
[…]
From my standpoint, most of the gold paper market will revert to forced cash settlement at the last trade! That's for long investors only because it's the inability of the shorts to deliver that will precipitate this. They will be taken out and shot because the CBs will be clearing the deals. If it's dropped to $100 and established trading markets halted worldwide because of sudden delivery demands, everyone will settle at $100 cash and walk away! People that are waiting to sell their hedged gold into their counterparties (mines included ABX?? to the BBs) would have to sell their gold at the new settlement price. Remember, when big international bankers are in trouble on this grand of a scale, the rules are changed into the banks favor. Always has been, always will be.
Understand, that the BIS clears all trade in CB gold. If that gold is tied up in private Bullion Bank deals, it will come under their rule. The BIS tells the Government what needs to be done and the Governments tell the mines. In perspective, this will be happening in every industry, worldwide, not just gold. Everyone will lose some skin…
FOA
Comment
#11943
8/24/99; 9:47:21
---CoBra(too) (8/24/99; 9:08:34MDT - Msg ID:11936)
Endgame among not so clearcut adversaries?!?---
CB2,
Good point. I have one view for what you write:
-----So why hold on to bad debt paper scrip if the endgame between $/IMF and Euro/Bis was so clear-cut policy as FOA feels, all along.---------
There is no possible way that the CBs could ever sell or unload all of those dollars. Presently they are held in the form of US treasury debt. It's owned by the CBs not their public / private interest. So, the CBs would not be looking to "spend" these reserves in the usual sense. They obtained these reserves as their local economy generated excess sales to the US (for them a trade surplus) and their private citizens wanted to hold local currency assets, not dollars. The Cbs printed Marks (example) and traded with their citizens for these excess dollars. Then they traded these dollars for US debt so as to earn interest.
Now, exactly what good are these debt holdings as long as their country continues to carry a trade dollar surplus? Not much, if the locals don't want to hold dollar assets. In the end, if the CBs were to sell these treasury holdings it would crater the US debt markets long before any value was received. And, to add further, that value could only come from using the dollars to buy something. Now what does a Cb use its reserves to buy, cars, TVs, other currencies??
No, the only avenue to balance currency value is through the age old asset of gold. Indeed, if you already hold enough gold, one just uses the dollars to bid for gold until the dollars become worthless (price of gold spikes to the sky). Usually only the intention to bid is enough?
Yes, No? FOA
FOA
Reply
#11947
8/24/99; 10:20:59
---- Al Fulchino (8/24/99; 9:12:26MDT - Msg ID:11939)----
------what I was grasping for is the connection with this analogy to the gold industry is how the industry wasn't wary like OPEC with their own product. This manipulation could have been prevented had they OPEC'ed themselves. Do you agree?------
Al, it's true that the mining industry could have done a better job of managing their product. But, would they have been allowed to? Just prior to OPEC and the 1971 gold window close, all the major nations were still trying to work out a common ground with respect to gold. The price was so low that few mines were making anything more than subsistence. The governments were finding that they could no longer use gold as money because they needed to cheat on the currency. The US wanted the price of gold to run up so as to spike the oil price and obtain more local production. Something they couldn't do competing against the nickel a barrel ME producers. As gold rose, the mines didn't need any production agreements so no one sought one. Throughout the 80s everyone was expecting gold to regain its trend, so again , no need for collusion. It's only been in the 90s, especially during and right after the gulf war that the industry began to smell a rat. Hell, even two years ago, Another's Thoughts about manipulation were dismissed as crazy. Now, the industry sees they are in a battle for their lives as their asset is at the center of a realignment of world currencies.
Truly, if gold is repriced high enough, as a competing currency, the falloff in jewelry demand will negate the need for any additional supply. At extreme prices, the CBs could supply the market for years to come without impairing their asset reserves. Production curbs on the mines could again restrict them to minimal profits even if gold was in the tens of thousands. A mess indeed.
FOA
Canuck
Sorry to all, I quit.
#11987
8/24/99; 18:40:45
Sorry to all, FOA, Aristotle, Aragorn, ET, Steve H., Gandalf, Peter A., The Scot, canamami. I'm done.
We talk of an upward swing that I don't think is going to happen. We endless surmise on the possibilities, Sachs is 'working' 15 mt. and BOE is selling 25 mt. in 4 weeks, yadda,yadda. The USA gas 7,500 mt., BOE still has 680 mt., the IMF, the Swiss, many other CB's. The 'overhang' is monstrous compared to this 15mt. and 25mt here and there. Who is really going to control gold?? I don't understand the 'paper' end of it but I will take your word for it that it will blow up, and then 'physical' will rule. So then, you controls the 'physical', the holders with thousands of onzes or the one with thousands of tons? Did the 59 page article not allude to the fact that CB's WILL sell down the price of physical. Gold has been dropping for 20 years, if I am a country in need of quality, value-oriented reserves, given that it is 1999, do I want gold or do I want the currency of choice. Fifty years ago, gold was a 'reserve currency', today it is not. With today's global infrastructure I can 'switch' my reserves very quickly. Investors are 'switching' investments into Japanese equities, and tomorrow it might be England or Germany. Tell me why a federal bank needs to hold gold? Why does a central bank hold gold? For a few years now CB's WANTED USD as reserves because it represented stability and wealth.
And it is as plain as day that CB's want out.
In regards to the message above, I have read it 10 times and two phrases stand out, "all that I ask of my money is that it really be money--payment-in-full." I'm investing in gold and I'm not getting paid in full, I feel brutally sorry for for the folks who have been investing in golds for years and years. I wish gold a turnaround for their sake. Secondly," Adopt the larger view, my friend" confuses me. I think the CB 'overhang' is the larger view.
Again, I apologize to all, I am throwing in the towel, I wish all gold investors multitudes of luck and fortunes, I won't be there; perhaps I am scared, short of time, impatient, 'fiat' hungry, I don't know. But again best of luck, sincerely.
Canuck
SteveH
Canuck
#12003
8/24/99; 20:58:06
You will be missed. We all feel your pain. I would offer that the pain is most always the greatest before change, but we all live our own lives to our own rythm.
Good luck. Keep in touch.
FOA
I'll be back later.
#12004
8/24/99; 21:06:47
----Cavan Man (08/24/99; 20:06:51MDT - Msg ID:11996)
FOA
I see there are a couple of posts here this evening that are not pro-gold and perhaps for good reason(s). Do you have a repartee?-----
CM,
Yes, it is sad when someone gets hit without a clear knowledge of why. Unfortunately there will be more of this because investors are unprepared for the times ahead. We could see gold go through tremendous swings as this is unwound.
Long term booms (20 years +??) always die with major losses inflicted on the most leveraged positions. Add to this a once in a century destruction in the most popular currency, and we produce an economic earthquake the likes of which no one has ever seen.
Most investors retain their life savings in a fully invested mode and would not get off these train tracks if they saw two engines coming. They will stay there because it's impossible for them to believe they occupy the wrong position! Who can lay blame or call them fools? These typical western savers have been educated to believe in a money system that serves no purpose, except a medium of exchange. Yet, they perceive that all of their assets are correctly valued by this system.
The gold market suffers the same fate. The same ideals that hold us in bank accounts, using credits to indicate what is on deposit, also drive us to invest in gold assets that must be sold to realize a profit. Modern gold bugs travel from bank accounts into paper gold and back into the same bank accounts. All the while pointing out the weakness of the system, yet needing the same system to keep score. Without the modern paper gold market, gold bugs, as we know them are lost to place a value on their holdings. That is why they gravitate into familiar gold holdings. Ones that still retain some connection to their paper currency. Mine stocks (and various option / futures) are a likely choice as they sit squarely upon the financial system we know most.
Great swings in asset preference always bring monumental profits. However, these profits will be shared by only a very few. And those few will have to endure gut wrenching blows to their assets when this storm hits. Gold will by no means be safe and it will not be secure. But in comparison to every other form of wealth, it will be the most well-known and sought after asset on the planet.
I think, many will be weeded out from this market as events unfold. Most of them never expected the fluctuations occurring now and they would be horrified at what may come. However, what they retreat into will be completely cleaned out. Completely! As for those that are sharp enough to buy when the proverbial blood is running in the streets? Time and events will prove that they were not as smart or quick as they thought.
Having said that, paper gold may rally, gold stocks could storm up and physical could just sit there. But that won't be the end of it and such an action would simply draw more into the fire. I remain steadfast to what Another once said:
"when a thousand hungry lions fight over one scrap of food small dogs should hide with what's in their belly"
This dog is well fed with gold and hidden deep in its history. Thanks FOA
The Stranger
The Post With No Name
#12005
8/24/99; 21:34:29
Last night, somebody calling himself Skip posted a sad commentary of his experience in the gold market and issued a plaintiff call for reassurance from this Forum. Tonight, Canuck, in an act hardly anybody could fault him for, suddenly jumped up and made a run for the exits. The last time we were at these price levels (and after years of pie-in-the-sky forecasts) ANOTHER and FOA suddenly reversed themselves and announced that the POG was very likely to collapse. And now, just to be sure we are all scared as hell, Farfel shows up tonight to remind us that the world economy is about to slip down a blackhole, taking gold with it, of course. (Needless to say, I think such pronouncements are as looney as they are facile.) But there must be something about $250/oz. that brings out the fear in even gold's most devoted enthusiasts.
Forgive me for being presumptuous, but I think times like these are apt to be hardest on those who have the least confidence in their own research. I doubt anybody here has a higher proportion of his own assets in gold or gold-related investments than I do. Yet, I have absolute confidence in my position. There is a worldwide reinflation taking place. It is quantifiable here in the U.S. It is, in fact, quantifiable in many countries around the globe. It is the very reason, in fact, the FOMC raised rates today (despite having committed three coupon passes in the last month). One doesn't need to be a PhD. in economics to understand the meaning of these things. But, because it takes time for the masses to come around, one needs to have patience.
I think it was Ben Franklin who advised never putting all of one's eggs in the same basket. But somebody else must have said, if you ever want to get rich, putting most of your eggs in one basket is just about what you're going to have to do. The trick is to watch the basket. I don't know who might have said that, but, whoever he was, he convinced me. Apparently, he also convinced Bill Gates, Aristotle Onassis, Michael Dell, J. Paul Getty, etc., etc. etc... None of those guys ever gave a darn about classic portfolio theory, and, frankly, neither do I.
I have always been a "plunger". When I find the right thing to do, I just can't bring myself to do much of anything else. But, over the years, my efforts have paid off handsomely. That's why, as much empathy as I feel for someone like Skip, I also feel respect. No, I don't know what he owns or when he bought it. I also don't know how much homework he did before he risked his money. But I know this: Skip had a dream once that I can relate to. He wanted to be rich and he had the courage it takes to get there. Now, that's my kind of guy.
Skip, if you are still out there, remember these simple words: If at first you don't succeed, try, try again. You may be having a low moment, buddy, but the future belongs to people like you. You will learn from this and go on to do great things with your investments. Believe me.
And as for you, Canuck, get a good night's sleep, my friend. Tomorrow is another day!
Skip
The Stranger
(08/24/99; 21:34:29MDT - Msg ID:12005)
#12020
8/24/99; 23:26:52
I'm still out here, and have frequently lurked on this forum although I rarely post.
True, gold approaching the low $250 range struck fear in my heart, as I've been bleeding financially all the way from the high $300 range down to the present pits of despair. Nonetheless, my concern is how much lower gold will go before it finally turns, and whether or not I can hang onto what stocks and coins I currently own before the POG returns to at least normal levels. I'm building a cash account through working two jobs and very long hours in case such a slush fund is needed to get me through the next few months without having to liquidate at great loss.
I'm sorry for Canuck that he threw in the towel. Also, I do appreciate your praise of my courage... and I once heard that the TRUE test of courage is having the ability to do the right thing during a time of fear. Right now, I believe that keeping my gold and gold stocks IS THE RIGHT THING TO DO.
My thanks to all who have responded to my posting from last night.
Sincerely, Skip
FOA
Comment
#12064
8/25/99; 11:29:26
---------The Stranger (08/24/99; 21:34:29MDT - Msg ID:12005)
The Post With No Name
Last night, somebody calling himself Skip posted a sad commentary of his experience in the gold market and issued a plaintiff call for reassurance from this Forum. Tonight, Canuck, in an act hardly anybody could fault him for, suddenly jumped up and made a run for the exits. The last time we were at these price levels (and after years of pie-in-the-sky forecasts) ANOTHER and FOA suddenly reversed themselves and announced that the POG was very likely to collapse. And now, just to be sure we are all scared as hell, Farfel shows up tonight to remind us that the world economy is about to slip down a black hole, taking gold with it, of course. (Needless to say, I think such pronouncements are as looney as they are facile.) -------------
(to see the rest, read his post)
What do we conclude from the above post? Stranger, I appreciate your presenting your thoughts and perceptions. They validate my own perceptions of how westerners feel about gold. I also used to read Another's Thoughts as an observer when they were presented by someone else. The one common thread in all of them was his council to buy only gold, physical gold. Yet, it never failed to impress me that every time those considerations were given, all discussion immediately turned to buying gold options, futures and mine stocks. It was like an automatic response that was ingrained in investor psychology from years of indoctrination. Your conclusions fit the same pattern.
Why is it that professional brokers and investment councilors in this country lead the public to this end? Is it because they have no depth of history to draw from or is it that they have "no fear" of losing others' money? Mention that gold may rise and could become a bedrock for your life savings and not one paper pusher tells his clients to buy real gold. Yet, we let the facts speak for themselves. The gold price having fallen from manipulation has literally destroyed a large percentage of portfolios invested primarily in gold stocks. Some of these mine stocks have gone to zero and are in bankruptcy, never to return.
All the way down Another (and later myself from association) said to buy gold for the long haul because in the long term it may go very high. Then in typical like form, traders said buy gold stocks for the long term also. Don't listen to Another, it will never go that high and with these paper items you will get rich if it only goes up $100 bucks! Indeed, leverage ruled the day all the way down with little regard to the fact that the "little guy" could lose it all with no hope to run for the final payoff. Now, here at $250 gold, Another presents a case for the destruction of the pricing market mechanism and still says, buy gold for the long haul. A concept, I might add that fundamentally offers the most bullish case for physical gold, while posing a worst case scenario for mine stocks. Yet, intelligent thinkers and admitted white collar investment professionals, such as yourself, lay the blame of loses to mine stock investors at the doorstep of physical gold advocates.
The whole philosophical reasoning for buying physical gold was always to negate the possible total loses to ones assets from a breakdown of the world's modern derivatives pricing system. A system that spans our entire financial structure, not just gold. Even with this risk in mind, I submit that it is still the current system advocates that present a "pie in the sky" council to new, unseasoned savers. Just as you use Bill Gates and other "risk takers" to portray an "American Spirit" of "plunging in", it hides the hideous failure rate inherent such accomplishments. Had Skip not listened to the sirens song of great wealth, he would still have had a chance today to benefit from a centuries old investment, real gold. So consider this, the next time you drum the march for the average person's savings to the tune of "paint your wagon and come along". For myself and many others, long term playback and asset safety are more important to our family than the bragging rights of day traders.
Please continue. (frown) FOA
The Stranger
Sorry, FOA
#12068
8/25/99; 13:46:23
I didn't make the point to offend you. My intent was merely to share my confidence in the gold market at a time when people were obviously getting nervous.
As to your comments about white collar professionals and "westerners", I suppose you mean well. I would emphasize, however, that, out of respect for our host, I have specifically avoided discussing the merits of stocks vs. coins. I intend to keep it that way.
Finally, as to who is misleading whom, all of our (your's and mine) posts are a matter of record. I hope I need say no more.
Farfel
Five Lessons I Have Learned Late in Life as a FORMER Goldbug
#12069
8/25/99; 13:47:35
1) With the exception of Barrick Gold, ALL gold mining companies are run today by maleducated, sub-moronic, good ol'boys from Hicksville. After all, just take a look at all the formerly unhedged gold producers who finally decided to hedge today some $200 an ounce below Barrick's hedges. True idiots! Talk about shooting yourself in the golden foot! Oh, well, what the hell, might as well tank the gold price another 100 bucks or so.
[…]
2) Unlike other commodity producers (like OPEC), there is ZERO co-operation amongst gold producers... and so they are doomed to die their own individual respective, deaths (except for Barrick Gold).
These guys couldn't get together to throw a birthday party, let alone figure out how to coordinate a de facto cartel designed to curtail gold production and enhance the gold price...
3) All Gold mining company managements operate on automatic pilot, following a pre-determined path to oblivion (excepting Barrick Gold)…
4) There is NO notable difference between South African golds or North American golds or Antarctica golds, for that matter. They all share one thing in common: a plunging gold price below 200 will ultimately bankrupt the entire lot of them (except for Barrick Gold)…
5) There are NO gurus in the gold market (except Peter Munk). It is impossible for any single technician, chartist, fundamental analyst, astrologer, etc. to predict the arbitrary path of gold in the short-term with any scintilla of success, although it is a usually a pretty safe bet to say "It's going down!"
Gold's arbitrary behavior stems from its oligopolistic control by the Central Banks. Upon any given day, there is at least a 50% chance that some Central Bank will pre-announce its decision to dump its entire gold reserves in order to MINIMIZE its profits on the sale.
FOA
Comment
#12083
8/25/99; 16:45:26
------The Stranger (8/25/99; 13:46:23MDT - Msg ID:12068)
Sorry, FOA I didn't make the point to offend you. My intent was merely to share my confidence in the gold market at a time when people were obviously getting nervous.------
Sir Stranger,
no need to be sorry and your post did not offend me. I felt the offense was directed towards intelligent physical gold advocates. When you publicly interpret my posts as a reversal of thinking, you are wrong and send a false signal. To say that I expect the (physical) price of gold to tumble, is a misleading statement that subordinates my reasoning by talking out of context.
I understand how our gold market presently trades as a paper derivative and in physical form. Every day, new evidence comes out to confirm this concept. TownC offered the excellent work of John Hathaway to further explain this evolution. When Another pointed out that the derivative side could fail and be discounted in price from the effects of that failure, you obviously did not grasp it. Others did. If you had then you would have noted that I expect the physical gold price in the dealer community to explode as its supply falls. A process of rejecting the current price setting methods.
--------As to your comments about white collar professionals and "westerners", I suppose you mean well. I would emphasize, however, that, out of respect for our host, I have specifically avoided discussing the merits of stocks vs. coins. I intend to keep it that way.-----
Again, I present a balanced observation that helps to account for the much larger percentage losses to investors that have followed the "established paper rout". Nervous people have a more pressing need to learn why their strategy has failed. Without balanced input, we often repeat our mistakes. I learn from my mistakes also.
As for merits of stocks vs. coins? There is no valid comparison. Apples and oranges have never had the same taste. The percentage of loss for one or the other is but a function of the risk one takes when placing savings into that vehicle. Coins will never be as risky as stocks of any kind. Nor will gold bullion in one's hand. The very simple laws of nature dictate that gold cannot fall to zero as stocks have and often do.
-------Finally, as to who is misleading whom, all of our (your's and mine) posts are a matter of record. I hope I need say no more. ------
I believe we come to this forum to offer our Thoughts for everyone to view and discuss. No one is right, wrong or misleading as only events can and do prove all things. To date, cash invested in gold bullion has lost value much less than if it was placed in mine stocks. All of us can grasp that fact. Indeed, no more need be said.
Thanks FOA
AEL
ha ha ha
#12085
8/25/99; 17:07:52
did anyone catch the unintended double entendre in FOAs latest? --- "... the much larger percentage losses to investors that have followed the "established paper rout"
i.e. rout, or route?
:)
FOA
Come what may?
#12506
8/31/99; 16:15:01
ALL:
I do thank everyone that have voiced support for the continued sharing of my insights. Anyone of you that have been alive for a while must also understand the frustration of explaining a difficult topic. Truly, I (like all of you) am not a machine and the process of walking a fine line between two worlds of thought is a major energy drain. This unique forum gives all readers an opportunity to expand their viewpoints by observing the "real world of money" through different eyes. As such, I deplore any direction that takes us into the ego world of "traders calling the market". It is an accepted fact that many aspire to make that role their life's work as there are plenty of other net sites and forums to confirm it. As popular as this may be, it offers little in the way of gaining insights to the perspectives that drive world investments. As a group, the trading society often loses the concept that feelings and viewpoints are the driving forces that shape those little chart patterns so many follow. Because many give up in trying to decipher the meaning of these forces they degrade themselves to a level of "follow the leader investing". True, it works sometimes, but one's spirit of understanding develops little from the process. As a result, when a major change does impact world thought, people are lost to grasp why the trend reversed, and more importantly, cannot change their strategy with it. Perhaps, something we have seen in the gold market these last many years? So, "let the world have its way, come what may", I will try to present my insights as seen through others. I hope many will join us on this journey.
Further:
I completely understand (as do you) that many people become upset when someone attacks the validity and purpose of their favourite investment strategy. Indeed, if most of your savings are installed in said discussed vehicle, the urge to find a flaw in the reasoning becomes overwhelming. Often one does not have a factual explanation, but we do have the ability to "think out loud" in the form of a rambling discussion. Perhaps, this is how many view my posts? I offer that this form of "rebuttal" is preferable to just stating "he/she is faceless and doesn't have the facts"??? If I do this, I apologize and will try to change. I think Mr. "PH in LA" had it very right when he observed how some internet writers, "come wading in with both barrels blazing" as they present their thoughts! I add that this could be an offshoot of our modern society. Hope we can get past this, soon! Thanks PH.
Onward:
Most investors that have assets in this broad arena called the gold market, have also come to appreciate just how large an "impact area" gold has had. Not only throughout history, but right up to today. The ongoing battle over the "gold concept" has won and lost fortunes, built and destroyed empires and in general has warped the human senses about what money and savings should be. This conflict continues today, even onto the pages of this forum. As the stress builds on our world financial system, the lines of thought concerning gold are becoming more clear. Let's examine some of what I perceive to be some of those lines.
Of course there are those that do not even consider gold as a viable contender on the world money / investment scene. The have lately been a major vocal class that have prospered in the realm of the current financial system. Myself nor anyone else should blame them, as they follow their reality in a world that presently benefits their ideals. I think few of them have given themselves a full study of how world currencies have come and gone throughout the years. If they had, the fact that they "have lived in a period of little change" should hold for them that things can reverse without notice. History is full of recounts that describe the rise and fall of entire social groups at the hands of a sudden rethinking of what has economic value and what doesn't. In any event, ingrain monetary ideals usually do not change during one's lifetime, so the past lessons may be worthless for some. As a result, a large mass of society must always return a great portion of their wealth into the hands of some "historical event".
Also included in the "gold perspective" are the true "physical gold advocates". They have seen through history how the destruction of various "money systems" always leads to the destruction of the "economic system" built upon the fiat concept. The efficient money system present in those fiat times, help to create the need (and therefore increase the value) for many real assets. The ensuing breakdown of the money always destroys the "efficiency" factor that society used to up-value the assets. Usually, any enterprise built upon the current functioning money contract system is impacted as it cannot change quickly enough to the evolving money system. It's hard to grasp that even real assets like houses, land, equipment, vital necessities and even food, can lose value as their trading pipeline is disrupted because no medium exists to fairly create "market value"! We have seen, time and time again, that real gold can gain value against "everything" during true money destruction. During these times, the human spirit need for using a familiar process is all consuming. The exchange of goods and services continues, with or without a valid medium of exchange to express it. Still, values become so conflicted and lost during this process that the marketplace reaches out for the most tradable of things that can act as a medium. In that need to replace "efficiency", lost with the medium value of paper money, it upvalues any store of value thing as the new "medium of exchange". Yes, within a large marketplace, the human need for trade gives any "efficiently" attribute more valuable than food.
This is why I smile when someone says, "how will anyone be able to know if the gold is real and what will they value it as"? I say, that the marketplace dynamic will ram this education home very quickly. The above question is asked by someone that accepts and uses paper dollars every day. Yet, these dollars are paper (how do you know they are real? as often they are counterfeit) and hold value only because the marketplace is using them. During a money breakdown, you will observe trading in the marketplace and quickly come to accept anything, ANYTHING, that even could be gold. Believe it!
Finally, we also have the "in-between gold advocates" in the "gold perspective". Usually, their view of the market is such that it is an industry built within the confines of the present monetary system. They do not hold an extreme view about paper money, and believe that today is different and our currency will only fail "somewhat"! So far, in concept they have been right for many years. Yet, in investment practice, their "gold perspective strategy" is failing. I say this in contrast, in that by holding physical gold, the "physical in your hand money insurance factor" is never lost, even as the quoted gold price falls. Especially, in today's new market dynamics we require the question:
"does the paper security in your hand give you an absolute claim to physical gold, or does it more so give you a "right" to receive dollars that match the increased value of gold?"
This "in between gold perspective" strategy, calls for placing money in various forms of paper gold. All based on the convenient factor of holding paper that gains in price as the demand for gold increases during a controlled slow burn of the world money systems. These paper investments are expected to all gain because their value is "derived" from the quoted price of gold on established major exchanged, London, Comex, etc. Whether you hold "gold certificates" , mining stocks, gold options or gold loans, an observer can readily correlate their increase and decrease in value to the world quoted gold price. They are derivatives by nature, because their very worth requires the observation of another price setting market.
It is here, in this "in-between market" that I believe most gold investors will first see the breakdown in the world money system. Yet, for them, this breakdown will bring the loss of performance to their paper holdings, because, from necessity, our financial structure cannot allow the established quoted price of gold to rise. To honour the present contracts, would require the supply of millions upon millions of ounces of gold that simply does not exist. In as much as these players expect a huge payoff on their holdings as the gold market must run skyward to balance delivery, the opposite action will most likely be delivered. Because all of their holdings are valued upon a marketplace that establishes a price with even more derivative trading, the expected failure of those contracts will crush the quoted price. Just as most men will not hang themselves with a rope, the shorts that actually create the quoted price of gold today, will not trade it higher. In fact, I believe they are trying to gather physical gold (taking delivery everywhere) while it still trades in relation to the low derivatives price. Unless you are a major entity in world affairs, holding something the world must have, I doubt any form of gold paper securities will escape the burn. Indeed, over time, in a up and down fashion, most of the paper gold holdings will be destroyed first, then the physical gold price will zoom in a matter of days if not hours!
How will mining shares respond to this "POSSIBLE" event?
More (sometime?) later. FOA
______________
I included portions of Farfel's comment above because I thought it was funny. In fact, gold mining stocks were sucking so horribly on 8/25/99 that I thought it would be interesting to take a look at how some of them are doing today after having almost 14 years to recover alongside a gold price that has risen 550%. Barrick (ABX) appears to be the worst of the bunch (at least of the ones that I looked up). It is one of the largest gold mining companies in the world, yet its share price is the same today as it was at gold's lowest bottom in 34 years. Barrick was $18.52 on the day that Farfel wrote that comment, and today it's $18.90. Why's that, you ask? Well, for one thing, in 2009 Barrick diluted its shares in order to essentially spend $5B of its shareholders' money to buy back those hedges that Farfel was raving about. ;D
Sincerely,
FOFOA
653 comments:
«Oldest ‹Older 201 – 400 of 653 Newer› Newest»Oh man, didn't know Adrian Douglas is no longer with us. Really sad to hear that. :-(
Saw several really good YouTube videos with him explaining gold. His views where very freegoldish in mine opinion.
http://www.bullionbaron.com/2013/04/gold-correction-1970s-vs-today-miners.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+BullionBaron+%28Bullion+Baron%29&utm_content=FeedBurner
@GrapeLimpBelandator
Regarding that article. If you have read the blog you realize that in FoFoA's opinion this won't play out like the 70s. You realize this Forum is at odds with the consensus view of the precious metals (and hard money community) pundits mostly expecting the 70's to repeat for Gold, Silver and the miners. I hope you also realize that these 'analysts' (from Jim "Never Go Below $1600" Sinclair, Eric "Decade of Silver" Sprott, Max "April 2013 Bond Bust" Kaiser, David "Silver will never go below $30 again" Morgan, Bo "Bottom is at $1325" Polny, Leeb, Maloney, Embry, Kirby etc. etc. etc.) have almost exclusively been incorrect in a huge way.... yet the Freegold/FoFoA/Forum view seems consistently moving to realization with things like the paper price decline, draining GLD (not to bother mentioning the mining sector issues or Silver's lack of necessity.)
Despite Mining newsletter writers 'packing it - I'm sure there are many other Forums where you can discuss how/what to invest - which miners to pick etc. and encourage mining investment. You don't seem to be getting much out of being here except a continuation of 'expectation' that the majority here have readily dismissed... and the market proves 'us' correct almost weekly. What I am trying to say is - you aren't getting any converts, IMO - and you don't seem to be learning anything. It is not that I am inviting you to leave - but I am running out of derivations of your screen name. Come back in X timeframe, having proven us wrong and I promise to use your correct name and congratulate you.
P.S. Personally; I luckily sold my Pretium, Abington, Hellix etc. in January 2012 when Freegold just started to sink in for me. I made a handsome profit and they are all down (the latter two about 1/10 the value they were), but I can't see myself ever buying a miner again. It was a gamble and I was fortunate. I don't need to gamble anymore - I accumulate/save-in Gold.
Peace,
I once considered to invest in miners, mostly because of Kingworldnews propaganda. I'm glad I never went through. Also, the graph posted by BeerHoliday was a big eye opener.
Just one example: Up north in Sweden, there is a operating company called "Northland Resources". Many locals invested everything they had in shares and were promised big fortunes to come. Long story short: Everyone went bankrupt. It's a penny stock today.
Stay away from miners and just accumulate physical. Can't get simpler and easier than that.
+1 to Gary
Grande Loon Blowhard?
Cheers
I get the impression from many here that they don't understand that price action may be the result of shorting, even naked shorting, and not only the result of longs leaving. The market may be proving you correct for now, but the game is to drink upstream from the herd, to be where the puck is going to be. Last year, I held back from deploying more into miners b/c I felt the ESF could engineer a massive takedown as it became apparent the status quo had to change--a shake the tree op so that big money could take a position in a very tiny space. What we've seen the last 75 days has been an engineered takedown in paper gold and mining stocks so that bullion banks could pawn off short exposure to the managed money idiots and set themselves up net long.
As for FG there is a very blaring blind spot the model ignores. It's like those crackpot perpetual motion schemes that fail to account for the laws of thermodynamics. FG ignores the laws of interest.
Used in the past...
GrapeLimpBelandator
GreatLakesBeerLemon
GruntLimpBlastoid
GrandLandBasel
GrampsLambBaster
GrandLampBartender
GrampsLampBeachBall
LandGrabBastard
GrampsLampBastard
Grumps,
Thanks for clarifying that one for us. Although, I don't think you have slightest idea what freegold is all about.
Because, freegold IS thermodynamics. At least in economical terms. Thermodynamics didn't needed to be invented in order to be discovered. Same goes for freegold. It was there all along.
And, you will not need to know all the details of freegold theory, in order to appreciate it. When it finaly reveals it self to the world. Just as with the most stuff and theories around us.
@GrilledLongBaskingShark
What we've seen the last 75 days has been an engineered takedown in paper gold and mining stocks
Never fear Grains, I have it on good authority that these evil bankster will be rounded up and held in a jail beneath the Caribbean Sea.
BTW, Grapes, I hope you were swift enough not to own this one. Or is this a sign to buy more?
Cheers,
Gary,Lake Shore demonstrates what is called a classic friday at the close stop-tripping bear raid in the final 2 minutes. I don't know the particulars in this company, but an equity offering is problem in the works. The boys knowing this will naked short the stock. The practice is widespread.
Does anybody here know what shorting is?
Grumps,
No.
We don't know what shorting is.
Now what?
Milamber
Legal shorting is borrowing a security for a fee and selling it, hoping the price goes down. Buying the security back is called covering the short.
Naked shorting is not even bothering to borrow the stock. It's blatant counterfeiting. You can see the evidence in the Regsho raw data as fail-to-delivers. It's amazing to see pink sheet miners get naked shorted b/c what's the point if it's already delisted? Once delisted a trading desk can cover and not have to report a gain. So naked shorting is being directed and encouraged from on high...THE MINERS MUST NOT BE SEEN AS A SAFE HAVEN.
Anyway, whenever you guys get into a raptured frenzy when the POG drops, it's not due to the withdrawl of support from the ECB. It's just a bear raid.
@ gary
I have been reading that there was some variation of freegold thinking back in the 80's too. Where do you think the Aden sisters were getting their $8000 an oz in 80's purchasing power prediction from ? They could have been right, if it all blew up which was close. But it didn't. Its obvious that it will blow up this time but Im just sayin....
Also, the gold miners went just as crazy high in the great depression as they did in the 80's.
We don't know what is going to happen. We can take our best guess. But its far from over and there is a chance that we will be wrong for awhile if the paper price goes right back up. Which it easily could do.
I am hedging for another rise in paper in a fairly big way. I wish I didn't have to.
Its healthy for the forum to have some Freegolders dabbling in the mining stocks now.
Dumb ass, we know what shorting is. Do you know what Freegold is? Please tell us.
Grumps,
OK. Thanks for the heads up.
Anything else we should know?
IE what are your calls for the HUI, etc?
POG of gold? IE How much and when?
Thanks,
Milamber
The boys knowing this will naked short the stock. The practice is widespread.
And what is to stop 'the boys' from doing this to your miners? if it is so widespread? Because you're a better 'picker'?
So, with Stewart Thompson logic - you just keep buying all the way down with your infinite money? Even in your conspiracy-based argument - you end up losing.
Why AUM decided to essentially pack-it-in was they were hemorrhaging money and either they shut down voluntarily - or be forced to. But here is the problem - they STILL have costs - even closed. And who is going to lend them money now or in the next dozen years? A hedge fund has lost 100 million in AUM. How do you think that is going over?
Again, this is all moot if you feel the gains of physical via a revaluation will dwarf paper profits from miners, stock in over-taxed miners or government Nationalized miners. If you don't grasp this about Freegold - then sell any physical you have and buy miners. Best fortune to you, but I suspect that one day you'll dearly wish you had that physical in your hands... when all your paper profits can't buy you even one shiny new Maple. You seem stuck in the groove of making dollars in the future, instead of ounces NOW.
Cheers,
I am hedging for another rise in paper in a fairly big way. I wish I didn't have to.
I don't see why you do. You hedge in case of losses in single direction market move, right? Well, there has never been a better time to be a Freegolder. As FoA tells us - we save in Gold for when we are a net spender instead of a net saver. So, I own Gold - why do I need to hedge? - if you are correct and Gold rises dramatically? Use Rickards numbers, from the past, -> $2000?, $3000?, $7000? (or other numbers that mean the paper market is still alive and functioning <- this will NOT happen, BTW!) Physical Gold holders will be hurt, how?
gary,
+100
Holding only physical scenario
Freegold happens: Your wealth increases 40 times.
Freegold doesn't happen: We take another round on the paper round-about -> your physical follows paper to $3500 short term
Holding paper (miners, paper long, silver etc.)
Freegold happens: You lose everything
Freegold doesn't happen: Your paper longs goes to $3500 short term
The only reason to hold miners at this time is some sort of belief in the propaganda that paper will leverage your gain compared to holding physical. If you have read anything of this blog, nothing could be more wrong IMHO...
But gamble on friends, it's not my money...
@ Gary
"Physical Gold holders will be hurt, how?"
Homestake Mining stock rose continuously from $80 in October 1929 to $495 per share in December 1935 - which represents a total return of 519% (excluding cash dividends) during the devastating bear market period.
Im not saying this will necessarily hurt but if you are acutely aware that this could happen, why wouldn't you allocate some capital toward it ?
We might be in for another 10 year long paper gold bull market before we get freegold. Could easily happen. If these stocks go stupid (like everything does) then the guys who bought shares here will make fortunes and will be buying a more physical then you.
Wow, Grumps, you really thought you had to explain to us what Shorting is?
You are just playing along right?
@Wil
even legs of structural support have their mathematical limits. If for some reason there is still political support for the dollar (which I believe as of 2010 there is not) this derivative game cannot and was never meant to continue forever.
Each time the dollar has been saved from imminent death (seems like an average of every 10 years) it has expanded further and further into the depths of which we have never seen. Each time it was the ROW that saved us not the FED or some behind the scenes power. At this point the dollar has already hyper inflated well beyond what any of us can imagine. The TIME and the CIRCUMSTANCES for zero use value for the dollar is already here. That is why we wait patiently by the window. The smallest of triggers will result in the end game.
Legal shorting is borrowing a security for a fee and selling it, hoping the price goes down. Buying the security back is called covering the short.
Grump, how do you call this kind of activity, all this "shorting" and "longing" and whatever more strange things there are "to be done"? How do you call it? Work? Productive work, yes? Helping mankind in any way, yes? Being usefull for others, yes? Being a good man, yes?
No, my dear. This is all rubbish. Artificial nonsense. Nuisance of life. Has nothing to do with anything man held high in the past. Be aware: All this ridiculous "activity" will get faded away, sooner or later.
Turn, turn, turn. Become human again. Do something worthwhile.
And stop bothering people who may like many different things on earth, but definitely not this: speculating, betting, playing around with numbers and gambling with wealth.
Sorry, you’re on the wrong party here.
guys who predicted freegold was about to happen at the time the comments copied into this post were made, as mere 14 years ago. They were wrong, totally wrong, about paper gold and the miners
You're right. The paper price is not in serious decline, GLD is not draining, QE never happened and is not happening now, the miners are flourishing as we can all see, no country to monetizing debt, and the world monetary system is as steady as a rock. Now please crawl back into your cave and leave human beings alone. Thank you.
I think M has it right... Bill Murphy categorically doesn't believe in Freegold just like Schiff. They kind of think freegold is just the busting of the paper markets.. which will lead to hard money. If they studied it, and got to about 80% understanding (where I see myself) they might realize that GIANTS don't hold wealth in paper, and even more won't after the "event." They think demand for phys will break the paper market, and usher in hard money.
I think we lean more toward a physical market going into hiding. Think like a trader... Freegold is not overwhelming bids... it's ALL OFFERS LIFTING!
@ Wil...
And this is where I think you're a little off... the MoE function of dollars and other paper will still exist. It's the SoV function that will go to zero. People will still keep cash on hand to pay rent and buy groceries (maybe not in the midst of a 2 week hyperinflation event), but certainly after. They just won't keep their nest egg in paper. I do wonder what Wall St. will do without all that captive money in 401k's, etc, but I'm sure FOFOA could tell us.. Again, I put myself at about 80%.
Sugar,
you’re absolutely right. Those of us who are desiring most would have some hard ride if the inevitable would develop in a startling manner no one was thinking about today.
But one thing is for sure: Those who believe in Freegold have managed at least one thing very well. They took their wealth out of a idiotic, criminal, destructive money system and invested it into something humble and real.
They rescued the result of honest work and saved it for the future.
This unnatural, highly life damaging system of modern »economy« will die out. This generation, next generation, whenever. And then something real in our or our children’s hand will remind us or them of a time when man had a choice: to support life damaging behaviour or to support honesty.
Yes, Reality Show, I was serious. In my profession I have to deal with people from all socioeconomic levels, I can't assume what level of knowledge they possess whatever the appearance. If they have a question I'll help with no judgement. I think for some that this blog was their first venture in financial matters and like an impressionable schoolboy this is their first crush.
There is something else to consider for all you diehard believers. What will be the tax liabilty landscape? Dividend and long term cap gains tax rate might still be favorable to collectibles tax.
@SugarLover:
If you have better theory or suggestion, please by all means, start your own blog.
I'm sure we all will be delighted to participate and contribute.
Follow in the footsteps of Art. Or was it Ash? Hm...
I invested in miners and like others made a lot of money quickly, but only while the hype lasted. Turns out it's best to buy the rumour and sell the news because these guys sell their mine potentials the same way kingworld news sell their info, all hype and no substance. They raise money not from profits but from increasing the number of shares. Think about it. The mine boss's don't actually know whats under the ground and hence have no accurate ways to determine cost per oz or obstacles encountered, let alone machinery breakdown, flooding, officialdom, environmentalists and the worst of all would be a death in the mine.
The markets for me were a mixture of elation and anger, constantly needing to be checked and keeping up with company announcements. Even though I was making money I had to pull the pin. Scam artists they were, fool I am not!
P.S - The run up in gold price to $1900 and subsequent pull back showed me that the BIS doesn't want gold to high above its production cost.
If they have a question I'll help with no judgement.
So you’re a slave of your company? You must hide your judgement? You have to function in tune with their target specifications? You can’t act in accordance with your innermost being?
Sorry for that.
@M...
"Homestake Mining stock rose continuously from $80 in October 1929 to $495 per share in December 1935 - which represents a total return of 519% (excluding cash dividends) during the devastating bear market period.
Im not saying this will necessarily hurt but if you are acutely aware that this could happen, why wouldn't you allocate some capital toward it ?
We might be in for another 10 year long paper gold bull market before we get freegold. Could easily happen. If these stocks go stupid (like everything does) then the guys who bought shares here will make fortunes and will be buying a more physical then you. "
The tradeoff is that who knows when it will happen... If it takes 10 years, and paper gold goes up, those that are in the miners as you mention, will have more cash to buy gold.
But what if it happens before 10 years, and you're stuck with dollar denominated shares of a newly heavily regulated industry and can't buy anywhere near as much gold as you could have with those dollars before?
Dividend and long term cap gains tax rate might still be favorable to collectibles tax.
At least not here in Germany. Not after 12 months. You buy, you hold 12 months, you sell (if you have to). Tax free. And you are allowed to buy anonymously. With 14'999,- per day.
Grandstanding LooseBlatherer,
Of course I know what shorting is. It's the step right before mooning.
Cheers :D
Good night everybody.
Next two weeks will be interesting: ECB’s Mark to Market Reporting date June 28th, Publication date July 3rd.
Interesting. Not more.
ein, I don't have time to have an ego or judge others. I have to be accurate and help people solve a problem and move to the next and hope I haven't hurt anybody.
Am I a slave? Yes, I'm American, so my energy is taxed to finance the Roman Cult's cudgel, our armed forces.
ECB’s next press conference will be July 4th.
»A few hours after the event the on-demand version becomes available under the same link below.«
I ask myself. Why would the ECB hold its number 1 reserve asset at a free market price and then allow that price to be taken down. I can only conclude that the price was managed up and is no now being managed back down with the ECB's blessing. So why are some participants expecting another bull run in the gold price? Does the ECB change its mind again and return to its previous incremental price increases each quarter? Do they completely lose control of the paper market?
This gold market has changed again, a lower paper price and a faster physical flow.
"They raise money not from profits but from increasing the number of shares"
That's true of the junior explorers, but not the well managed majors. Of course there are knuckleheads like Kinross who overpay for acquisitions. An established producer is a different animal from a non-cash flowing explorer. Yes, I agree there is great risk in the junior sector. I tend to invest in the established producers. Frank Holmes has a fund that concentrates on the juniors that are survivable. It is true that probably 90% of the explorers will fail but who says you have to invest in them.
http://www.theglobeandmail.com/globe-investor/inside-the-market/junior-mining-stocks-see-record-insider-buying/article11638717/#dashboard/follows/
GRUMPS,
Miners are not always good judges of their own business. They were the last to be bullish when gold started its bull market. They were so entrenched in the old paradigm of 300-450 gold that they didn't think higher prices would last. They don't necessarily have better insights on where the market is going in the next couple years than their shareholders do. They assume the POG will go back up, that the economic and political conditions in the world are stable, and environmental regulations won't change. But the whole global financial system is changing and the world they knew and based their business model on is changing.
Polly,
Things have changed for the producers. The knucklehead management has been swept away. With this pullback they are are getting leaner, more efficient, and shareholder friendly. Like big oil, big gold has ties to the real power behind government. The spectre of nationalization is a faux threat. Just imagine what a clusterf*ck a government run mine would be. Nothing would come out the ground. There will be kicking and screaming but in the end most of the mines will be in private hands. The stout of heart will be greatly rewarded.
With his endless stream of ideational excrement, a certain poster who has acquired many well deserved bowdlerized names seems content to repetitively spew endless quantities of unwelcome piffle about mining shares, short selling, wild eyed postulations and predictions from crack pot internet sources, and, last, but not least, to cast judgement on a theory with which he has demonstrated time and time again to have a less than adequate familiarity with. How can one describe, in a word, someone who has nothing new to say yet keeps on saying it in the face of numerous requests to cease and desist. Hint: It's a four letter word that rhymes with goal.
And what is the best way to deal with such types?
Grumps.
There is enough gold above ground to serve its purpose. All the rest can stay under.
Grumps,
Don't forget please. I am waiting (patiently) for you to post:
What are your calls for the HUI, etc?
POG? IE How much and when?
And last but not least, explain freegold & what aspects you disagree with.
Thanks,
Milamber
and thrown in your top 10 miner picks ;)
Grumps,
I think a lot of miners curse the day they got into this business and there certainly are legions of shareholders who curse the day they bought mining shares. I give you credit for remaining polite in your discussions here, but I think you have adequately covered all the reasons you think mining stocks may be profitable some day, and we have covered all the reasons we think they are better avoided. We have not convinced you, and no one is forbidding you to invest in miners. I think it is pointless to try to convert the readership here as we have heard all the issues you bring up and long ago dismissed them in favor of holding physical. A few funds placed in shares as a gamble could pay off if a person is so inclined, but most here would rather sink extra funds into more gold which of the two choices is a sure thing.
I'm right there with ya milamber. I'm still waiting for him to explain what Freegold is. I suspect it will be a fascinating lecture.
Michael3c2000: "extensive case for gold vs silver in the main sections and the comments."
What is the main section you are talking about? While I have a very basic understanding of Freegold, I still see silver as having a place in the future. The 62:1 ratio will eventually self correct back to historical average, if not overshoot that slightly in favor of silver until it corrects. I know silver is not part of the Freegold theory, but it could have its own place. If anything, buying when the ratio is this high will allow one to trade silver in for gold when the ratio drops. Is there anything wrong with that thought process? This is in reference to also purchasing gold.
"The 62:1 ratio will eventually self correct back to historical average"
Why do you believe this gull_mann? What is it that makes this outcome inevitable? If you want to have more than a very basic understanding of Freegold, start with that one question.
Why do you believe "The 62:1 ratio will eventually self correct back to historical average"?
To point you in the right direction, I'm guessing your conclusions draw on the glory days of a hard money bimetallic monetary system, amirite?
The 62:1 ratio will eventually self correct back to historical average, if not overshoot that slightly in favor of silver until it corrects. I know silver is not part of the Freegold theory, but it could have its own place. If anything, buying when the ratio is this high will allow one to trade silver in for gold when the ratio drops.
I find this a common theme of the Silver advocate. The Silver-Gold ratio gamble.
The 62:1 ratio will eventually self correct back to historical average, if not overshoot that slightly in favor of silver
You speak with such confidence... with maybe a little parroting of Sprott. Will it 'self correct'? (an odd term) When will this happen, do you think?
In 1923 (Wiemar) in one week the SGR went from 15:1 to 160:1 / From 1929 to 1930 SGR rose from 29:1 to 63:1 in one year, in 1932 it was 81:1. Depths of the 1991 recession it peaked at 100:1. SGR rises in a recession but shrinks in a Bull market. So where are we? and where are we headed, gull_mann?
Of course when, the expected, FG revaluation transpires (who sounds confident now?) the ratio will go to the moon and may never return. So what you are doing is gambling on timing. Gambling that Freegold won't 'happen' until after you trade your Silver for Gold - assuming, of course, there is any gold to be had <-- hmmmmm another gamble.
So you lie in bed at night thinking "Should I trade it at 65:1? wait till it goes to 50:1? but what if it goes to 70:1? What if there is no Gold to buy?" or you could be content with the eventual revaluation wealth... and sleep like a baby. Hey some people like the action. To each his own. I'm sure you can appreciate that many here don't take Sprott's word as Gospel - many have their own opinions. I happen to like Eric Sprott and I don't hate Silver either. But I like piece of mind and Gold more.
Aaron, Brother John F told him it would. That's reason enough.
When the paper gold markets were started they were simply bets that tracked the price of gold. Physical trading (and the fundamentals that went with it) determined the price and the small paper market simply was a bet on that price going up or down. Now the paper markets are 100’s maybe even 1000’s of times the size of the physical market and completely dominate the pricing mechanism. This means that gold bull runs and bear runs are not based on gold fundamentals AT ALL. In fact, I would venture to say that the actual fundamentals of gold are put to use against unaware investors to take their money while they scratch their head. With complete control of the gold price in hand, it is not a major leap in logic to assume that mining shares can also be pillaged by the masters of paper.
There is only one play here that is not pure gambling. Buy the physical asset that is practically free while the music is still playing and DO NOT SELL while it is still being priced by the paper markets.
Aaron: Noyouarewrong, my belief is not based on glory days of bimetallic monetary system. Good try. I believe a 62:1 ratio will self correct because of the amount of physical available between the two, which ultimately will affect the price when the market self corrects and/or has true price discovery.
- Each year there are around 130 million ounces of gold available (80 million from mining and 50 million from recycled). For silver that number goes to 1 billion ounces (750/250). Just from those numbers you are looking at a ratio of 7.7:1. But remember, not all of that gold and silver above is available for investment purposes as it has industrial applications. So for investment purposes, it is estimated there is 120 million ounces of gold available and 350 million ounces of silver. That gets you to 2.9:1.
- Jefferson Lab estimates silver is 19x more abundant than gold, 19:1 (Ag= 0.075 ppm vs Au= 0.004 ppm).
- From the US Geological Survey's Mineral Commodity Summaries (2012) they have the reserves and production for silver at 9-10:1 compared to gold.
- If you look at ETF holdings for gold and silver, investors have purchased ten times more silver than gold (10:1).
Historically the ratio between gold and silver has been closer to 12:1 to 16:1. I am no prophet nor pretend to be, however I see the 62:1 eventually correcting down to its historical average. Will it go higher before this? Maybe. Will it happen this year? Probably not. Will it eventually happen? I believe so. From this perspective silver is undervalued.
Here is a good graph. Looks like we are seeing what took place from the 1930s to 1960s.
http://i.imgur.com/0C9JHIQ.png
Gull, a major part of Freegold is the fact that gold is the central item that can be revalued to be the release valve of all of this debt. Lets say gold is revalued to 50k, who would be buying silver at 5k? Which of the world's giants would support this price and why? Industrial demand would go to nearly 0, so the entire supply would have to be mopped up by the "silver stackers" and do you really think this would happen at 5k?
@gull_mann
I believe a 62:1 ratio will self correct because of the amount of physical available
So why don't you buy Platinum then? its 30X as scarce as Gold and almost the same price now. Under your logic it should go up "when the market self corrects and/or has true price discovery." that should dwarf the gains in Silver. Platinum was a monetary metal for 300 years (guessing your next argument.)
I believe a 62:1 ratio will self correct because of the amount of physical available between the two
This assumes equal demand with similar supply constraints in a post Freegold monetary system. Post Freegold, gold is bought (and stored) as a "useless" product for wealth preservation. Silver is purchased and consumed for industrial use.
Why do you believe that these two metals are stuck together in terms of currency valuation? Why is it that you believe if one metal (gold) realizes a revaluation from an evolving monetary system -- that the other metal (silver) will follow in tandem? You asked, "Is there anything wrong with that thought process?" and I am simply offering you the answer -- Yes!!
Freegold changes the market place in one very significant aspect that renders "the amount of physical available between the two" as meaningless. Gold is the focal point for currency valuation in Freegold. Not gold and silver -- just gold.
Luke: Who is Brother John? I remember a movie by the name that had Sidney Poitier in it.
I have read what A/FOA have written about Freegold. If industrial demand for silver went to 0, we would be in for big big problems; computers, medical uses, cruise missiles, switches, circuit beakers, contacts, control panels, cell phones, RFID chips, batteries, automobiles, solar panels...etc. Technology and everyday uses are very dependent upon silver for its properties, so there is no way that I foresee industrial silver demand going to zero. Do you really think all of the above would stop being produced?
I'm not saying silver is more important than gold at all. I believe in much of the Freegold theory and own gold. However, I also own silver and see it as a good buy now (in addition to gold).
"This assumes equal demand with similar supply constraints in a post Freegold monetary system."
I'm not talking about post Freegold.
"Silver is purchased and consumed for industrial use."
Maybe, maybe not. Not sure what the future holds but people that missed the gold boat could very well continue buying silver for wealth preservation.
"Why do you believe that these two metals are stuck together in terms of currency valuation? Why is it that you believe if one metal (gold) realizes a revaluation from an evolving monetary system -- that the other metal (silver) will follow in tandem? You asked, "Is there anything wrong with that thought process?" and I am simply offering you the answer -- Yes!!"
Once again, I am talking about Pre-Freegold. Not post.
"Freegold changes the market place in one very significant aspect that renders "the amount of physical available between the two" as meaningless. Gold is the focal point for currency valuation in Freegold. Not gold and silver -- just gold."
See above.
"I have read what A/FOA have written about Freegold. If industrial demand for silver went to 0, we would be in for big big problems; computers, medical uses, cruise missiles, switches, circuit beakers, contacts, control panels, cell phones, RFID chips, batteries, automobiles, solar panels...etc. Technology and everyday uses are very dependent upon silver for its properties, so there is no way that I foresee industrial silver demand going to zero. Do you really think all of the above would stop being produced? "
Absolutely not, which is why silver won't move much higher. Gold's best use is as money/sow. Silver's best use is as a commodity.
@gull_mann
Once again, I am talking about Pre-Freegold. Not post
So you must know when that is - please share! Ohhh your betting it's not Monday, or a week Thursday or a Tuesday in July. How will you know? When to pull the trigger on the most fruitful investment of your entire life? (nay 'of all time') Do you think the SGR will shrink... soon? It rises in a recession - and rockets in HI - you may have a long wait.
I'm not talking about post Freegold.
Ah, ok. So gull_mann what you mean to say is that you believe the silver:gold ratio will go to 16:1 just prior to the silver:gold ratio exploding to 10,000:1 as we cross into Freegold.
Does that statement represent your viewpoint?
"Absolutely not, which is why silver won't move much higher. Gold's best use is as money/sow. Silver's best use is as a commodity."
If I only had a penny for every time I heard that back in the late 1970s.
This isn't the 70's any more gull_mann. We now have structural support for Gold only, on the ECB's balance sheet. When gold is proven to be the only reserve asset the store of value function currently priced into silver will be removed, leaving its price found only by its commodity purpose.
"Absolutely not, which is why silver won't move much higher. Gold's best use is as money/sow. Silver's best use is as a commodity."
Luke one more thing:
"No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility."
If it was good enough for the Founding Fathers of this great country (as well as other country's going back over 2600 years), then it must be good for another 2600 years+.
"If I only had a penny for every time I heard that back in the late 1970s."
This adds nothing.
Nearly everything is up multiples of what it was in the 1970s.
"This isn't the 70's any more gull_mann. We now have structural support for Gold only, on the ECB's balance sheet. When gold is proven to be the only reserve asset the store of value function currently priced into silver will be removed, leaving its price found only by its commodity purpose."
If we only have structural support for gold now, than who cares when gold is proven to be the only reserve asset of the store of value as that should have already taken place as silver's price should only by found by its commodity purpose since there is no structural support for it. I guess China is getting it all wrong then?
"This adds nothing.
Nearly everything is up multiples of what it was in the 1970s."
Sure it does. People back in the early/mid 1970s were telling me silver would NOT go any higher than $2-5. Guess what it went to?
http://i.imgur.com/b2NfmUz.png
Silver is actually cheaper today than it was back in 1980 during the high when you correct with the pre-Regan CPI (Shadowstats). The whole CPI game is a whole other discussion.
Milamber,
If Au were revalued at 7K then HUI in a range from 2800 to 4200 if markets are rational. But I've learned markets aren't rational. We could see some crazy valuations. Time? I can't see how the system as configured can hold together by the end of the decade. Somebody is going to hit the reset button when the pain becomes intolerable.
Why savers won't be overweight gold in the hereafter?
When real rates are positive then there is little incentive to hold savings in a non-yielding asset. Think of it as a corollary to Gibson's Law that gold goes up by 8% for every percent real rates are below 2%.
What would you do if you have 10 ounces with a PP of 500K, but now with a delevered financial system a positive rate of 5% can be had? Do you catabolize the stack over time as the POG is stable or do you dishoard 8 oz to make 20K/year? Maybe that's enough to slow the burn rate of your nest egg or perhaps grow it.
Can you have long term deposits denominated in a currency if the currency doesn't have attributes of a SoV? The positive real rate is the market voting that it does. So is the SoV fn that is only gold's during the crisis remain with gold or is it intermediated back up the pyramid after the crisis? The POG would be stable, but would the value change? If we see a DOW of 5000 and gold 10,000 at the reset, what are we going to see 10 years later in a Kondratieff Spring? DOW 50K/AU 15K?
Gary,
Miner picks: FSAGX
TGLDX
UNWPX
AEM
GG
Sam,
The paper masters will be the ones to make the most in the least time in the shares.
@gull_mann
If it was good enough for the Founding Fathers...
Unfortunately they had no conception of 17 trillion dollars of debt or 1 Quadrillion dollars of global derivatives. If you think this is going to be a simple 'let's-get-back-to-our-roots' solution, you're in for some BIG shocks. When you examine the extent of the mind-blowing debt problem - I mean you become fully cognoscente of the civilization-ending condition we are in - you will realize there is but one answer....and it doesn't have anything to do with Silver.
You've missed many of the Freegold lectures.
Firstly, Silver nor Gold will ever be used a money by JoePublic. It can never supplant paper/digital. Not in our age of zenith convenience. So get the idea out of your head that people will buy groceries and gas with silver and houses with gold. When paper currency fails - it will be replaced with a new paper currency - just like every HI in history, and the masses will accept that - they won't go running in the streets with torches seeking Silver. What does Freegold base its value on? International trade (think Oil) not person-to-person usage. What do CBs hold? Right.
Silver's Industrial usage will be what keeps it range-bound. It can't rise too much (in relation) or it will be 'replaced' (substituted) with a more cost-effective commodity (varies due to usage) Silver is the best reflector of the metals and best conductor (heat and electricity) but it is not the only one. Silver can't go to $200/ounce because its Industrial usage will drop off a table (unless this is during HI aka 'in relation').
Why doesn't Gold have this problem? That's right - it's, essentially, useless. The ultimate wealth asset.
So people won't use Silver (when paper fails) and Industrial won't (if it's priced too high). So why the heck will it go up? Because a bunch of coin buyers want it to? In case you haven't noticed supply/demand is not part of the PM equation anyway. Stock/Flow is. Silver will always flow. Period.
"Sure it does. People back in the early/mid 1970s were telling me silver would NOT go any higher than $2-5. Guess what it went to?"
These people did not see inflation? Check lead, gold, oil, zinc, stocks. Everything went higher.
There was a rumor going around that Eric Sprott was going to default the COMEX in 2010. As it went, he chickened out.
I wonder if he has lost enough money now that he will be mad enough to just do a Soros and see if can default the COMEX again. Him, John Paulson and maybe another guy should plan something out.
Sprott owns a significant % of Lakeshore gold.
John Paulson has lost millions on anything gold.
*Vladimir Putin has an interest in Kinross.
I'm not sure what the incentives are for giants to behave these days. If I was a giant, I would pull the pin on the system if it was possible. Why not ? The longer this goes on, the worse it gets for everyone.
*Prime Minister Vladimir Putin, has singled out Kinross for praise. More to the point, the Kremlin has invited CEO Tye Burt to join its Foreign Investment Advisory Committee, giving him access to Russia’s inner sanctum of power.
Grumps,
You put the word "If" at the beginning of your answer, so it is not really a answer.
You appear to advocate a gold standard, yes? In that light, my questions are simple:
What are your calls for the HUI, etc?
What is the correct price of gold as you see it?
And please explain freegold
And then what aspects you disagree with.
Milamber
gull_mann.
Can we differentiate between Chinese government and Chinese population? Some chinese are buying silver and some are buying gold. Recently the price drop in gold has led to higher demand in gold and we've seen the lines of people waiting to buy.
But it is all local production of Gold that is hoarded by the Chinese government plus we know the tonnage that enters through Hong Kong. The Chinese officials play their gold hand close to their chest.
Sam,
The TIME and CIRCUMSTANCE could be now, or any day now ... but we have thought this for quite a while yes? And yet ... the dollar still has support from a MoE standpoint (in the USA beyond any doubt) and even still by the rest of the world ...
Yes, the general consensus has been that when the dollar loses its SoV function the game ends, but I say that is old news, since before negative real rates of return, and before Cyprus.
The dollar lost is SoV function long ago, today it is "saved" only for its means of exchange value tommorrow. No one is truly long anything today.
ROW support ended in 2010? Think again. As long as the game of dollar denominated debt keeps Giants in wealth, the FED will issue more betting chips (swap liquidity) for their use value in this game.
It is the next dollar denominated derivative blow-out, probably interest rate related, that stresses the system by requiring the issuance of so much new zeri collateral debt that the BIS calls into question the nature of debt satisfaction in the context of its potential impact on means of exchange.
Until then, the FED simply complies with the needs of the ROW, who will BEG for more betting chips until the emporer of FIAT is found to be naked, and the great default is called.
After all, the BIS could decide that the current system is "a loser" at any time and refuse to "bail it out with itself" at discretion ... but why? It can continue forever as long as the betting chips have use value. They do not lose use value globally when the stop functioning as a store of value, that has already happened. They lose all use value when they cease to function as a means of exchange.
As when people like you or I look at our paychecks and say. "This is ridiculous ... meaningless. I am working all week for a loaf of bread, after taxes and bail-in fees. I renounce this paper. It is worthless to me. I am better off doing something else (holding X, trading for Y, converting to currency Z)."
When the common man has this thought collectively, systemically, these dollars will have no further means of exchange use. Not for shrimp, thus not for Giants. The common man does hold the ket, just as he unlocks the door with gold. Dollars will be abandoned, and ONLY GOLD will be used to satisfy this derivative debt blowout.
And yes we will have to reprice it, so shall say the BIS, to bail out this systemically important debt, in order that we clear the way for the new asset based system.
This is why, in communion with the flower, the trichomes of wisdom put forth the view that dollars MUST must fall to ZERO use value as an MoE, as in severe hyperinflation, which severely reduces the utility as a means of exchange.
People will abandon the dollar for a currency "strong in gold" as in "denominated in gold" but our way of understanding the hyperinflation already under way is to recognize the disparity between the wealth elite and the common man.
As that disparity grows ever wider, this is the definition of a new, centrally planned era of hyperinflation ... whereby the 1% live comfortably with trillions, while the average man simply does not command the millions required of the common class.
You may not like the new system, but gold may pull you through it.
Wil
Remember when consulting the FOU...no stems/no seeds. By ROW support I mean the sopping up of excess dollars. First Europe, then China, now no one. The US dollar is once again falling on its own sword. You suggest it is in the interest of Giants to keep things going for a while. I say the act of not buying their treasuries is to not catch them. It's a long fall but gravity speeds things up quiet a bit at the end.
"the common man..."
Yeah, I don't think I would be relying on that indicator. Because by then it is waaaayyyy past midnight.
@milamber
Since Grumps doesn't answer, what's your take?
Tell us your calls on HUI and GLD. You can spare us your take on FG.
http://www.youtube.com/watch?feature=player_embedded&v=c7E9SUwlooE#at=54
World Bank: Money Laundering Criminals | Interview with Whistleblower Karen Hudes
Published on Jun 21, 2013
"Abby Martin talks to Karen Hudes, former senior executive at the World Bank, about her experience blowing the whistle on the high level corruption within the international financial system and how her story was censored."
Future ages will laugh at their forefathers of the nineteenth and twentieth centuries, who gravely bought gold to imprison in dungeons in the belief that they were thereby obeying a high economic law and increasing the wealth and prosperity of the world.
A strange delusion, my masters, for a generation which prides itself on its knowledge of Economy and Finance and one which, let us hope, will not long survive. When once the precious metal has been freed from the shackles of laws which are unworthy of the age in which we live, who knows what uses may not be in store for it to benefit the whole world? http://moslereconomics.com/mandatory-readings/what-is-money/
Tom Hickey Reply:
October 9th, 2010 at 11:19 am
The point is that taxation makes state money a necessity in that society. No other theory of money accounts for necessity. Money is just a convenience. Necessity is useful in establishing causality.
http://moslereconomics.com/2009/12/10/7-deadly-innocent-frauds/
http://moslereconomics.com/wp-content/powerpoints/7DIF.pdf
Milamber,
Why is the conundrum of positive real rates ignored by the freegolders?
I do not see a gold standard coming. It looks like gold will comprise 15% of forex reserves. The POG would float like Sinclair's Gold Certificate Ratio.
Grumb Slap,
Have you considered... What if we are entering and era where there are no more risk free assets, including risk free positive real rates?
http://www.youtube.com/watch?v=CS9EvBZ_UOc
Makes sense to me...
Sprott will play the role of Bunker Hunt in the COMEX farce? He will take one on the chin for the common silverbug? Please. He's much too busy selling ETF shares to gullible everymen (at a nice premium). You don't get to be a billionaire by going down in flames with the bugs. But what if he did try to break the COMEX?
FOA: eventually (perhaps over only one day!) the outside the exchange demand for physical and it's escalating premium, will most likely see legal force from their physical buyers driving long players to demand delivery. Even if it cannot be delivered. Long,,,,,, longggggg,,,, before these delivery demands ever fully surface, comex will state position limits, cash settlement and trade for liquidation only. For you new people, this is exactly what they did during the Hunt silver fiasco. They have to do this because the articles these exchanges were created under manifest these trading places as price setting and price hedging establishments. Where the greatest majority of their trading is meant for cash contract settlement, not physical delivery settlement.
In this light, only Gold Advocates understand that default on Comex is really the forced non metal settlement of a contract at a contrived paper price. A price far below the physical traded price. Most likely a last day of trading price that settles out hundreds of percent below the world price for physical metal trading,,,,,, as it appears the very next day.
The big difference today (from the HUNT problem then) will be in the nature of this default. His was brought on by private investors buying a commodity. Today, gold market default and failure will be forced upon the dollar gold world by a sudden lack of "price setting" credibility. And that loss of credibility will stem from the stressed conversion of dollar contracts into Euro denominated units that demand "market based performance" (physical priced valuations) or an escalated (higher) Euro based cash settlement. This all will manifest in a lack of credibility in paper dollar gold trading that can no longer be marked to the market at the same value of physical gold.
This failure of price matching,,,,, this failure of contract conversion into metal,,,,,, this failure in the world gold market to any longer be able to correctly price real bullion,,,,,, will lead to a wholesale dumping of all dollar contracts that have US based performance,,,,,,and start a fall away of all dealings based on present protocols dollar market gold exchange.
As a side note: This will not apply to the paper silver markets as silver will not have the Euro vs. Dollar political struggle. A struggle where the ECB members are trying to loosen their main asset (gold) as a reserve wealth backing to replace the massive loss of dollar reserves. Remember, further back on the trail we covered how these reserve dollars will be simply cast down. In this light, silver trading will bear the brunt of selling in an effort to balance loses from a gold exchange that no longer works. Because silver has no hope of an official free market, it's paper pricing system may run amuck until it's price plunges to???
The risk free interest rate is an oxymoron.
In order for someone to give you interest rate above 0, someone (bank) must take a risk. Even if the interest rate is 0 or negative, there is still risk, custodian risk.
It boggles my mind that professional economist do not realize this.
Burningfiat,
Jean-Claude is referring to the present state of the system that being there are no more risk-free assets. You are transposing the present crisis conditions to the post crisis era. After a golden enema and readjustment then assets can be allowed to find a market clearing level. Balance sheets with gold would be able to absorb the writedowns. That's why we're seeing a rush to procure physical. It's to get ready for a market clearing event.
In the hereafter, the imbalances will have been corrected. A new credit cycle can start. The imminent risk of default will have passed.
Grumps,
Your failure to understand the end of the debt based paradigm means you are transposing the present crisis conditions to the post crisis era.
gull_mann, have a read:
http://apiigongold.blogspot.com/2012/11/the-gold-silver-ratio-and-reversion-to.html
Back in the 70's during the last bull run there was this same ideology floating around. Gold would continue to go up and up, people eschewing banks and debt instruments.
The very thing that will make you rich is also what will heal the system and present the opportunity of a lifetime.
Grumptard-
Thanks. What's your blog's link?
And who are these custodians you speak of? At my work, they get insulted if you call them that. They demand "mechanical engineer" as that's their union title and "custodian" is so 1970's.
Phat Expat,
I don't have any calls on the HUI or GLD, neither public or private.
But then again I am not continuously word vomiting on some miner forum about how they need to position themselves for Freegold, am I?
But with that said, I have seen no argument yet that sways me from FOFOA's call that the miners will be nationalized. So consequently, I don't really care nor do I pay attention to the trading price right now, because I no longer own them.
Milamber
@GrandFunkRailroad
Do we have to explain to you again the differences now from the 70s? Come on, you know better...
Perhaps you just don't see this debt-super-cycle coming at you like a frigg'in freight train. You don't see ALL the major players monetizing debt (was this happening in the 70's, GreatFreakBunion?) But you'll accept that if it means your miners will benefit, right?
This isn't the 70s, despite your tie dye "Keep on Truck'in" jeans (time for a wardrobe change, Jimmie... really). You seem to just see what you want to see to suit your investment ideas.
The very thing that will make you rich is also what will heal the system and present the opportunity of a lifetime.
Is this at all similar to your 'buy miners' thesis? The 'opportunity' of buying these juniors at pennies despite only 1 in 6500 go to production.
If you have a solution to 'heal the system' I'm all ears. Does it involve you making a lot of of USD?
Where do you see the $POT price of Gold going, GrailLakeBraintrust ? and why...
Grumps (aka Ciga Tom aka Member 238605),
OK I gave you several opportunities to answer some very specific questions. You have chosen not to.
Fair enough.
My turn.
I was going to spend some time and do a devastating take down and rebut your arguments using razor sharp wit and oodles and oodles of my time this fine hot Texas Sunday morning before I stopped being a heathen and went with all the other hypocrites to church.
But I don't have to. You are going to do it for me.
I present to the comment section......
Grumps/Ciga Tom/Member 238605 in his own words, edited for brevity (but most was left in for its pure comedic value). All emphasis and italics are mine. My additions are in all caps.
04-06-2013, 08:18 PM #380
Member 238065
Quote:
Originally Posted by BMBiology
Earning reports are being released this coming week. Is anybody betting the market will drop?
GRUMPS QUOTE:
"Not until after the 15th when IRA contributions stop. Then the general market may start to slide and the gold sector will begin an epic rise with bullion to 3500+ and the HUI to at least 1700. And that will be just an intermediate top."
----------------------------
HOW'D THAT CALL WORK OUT FOR YOU GRUMPY?
----------------------------
04-07-2013, 08:10 AM #385
Member 238065
Quote:
Originally Posted by BMBiology
Why would the main stream media want to hide things from the public? What incentive do they have?
GRUMPS QUOTE:
"So the retail investor can be the bagholder. The big secret is that the real money is made on the short side especially with HFT and no uptick rule anymore. Who sponsors the Financial MSM? Why do they always bash gold in spite a glacial 13 year advance? Why do they never mention that the stock market has declined in real terms even though nominally it's been a push at best since 2000? Why do they never talk of the Kondratieff Wave? Hell, whenever some technician talks about Fibonacci numbers the munny bunnies break out in a cold sweat and steer the conversation to dumber pastures.
The high priests know that the Dow is the major proganda tool to keep the slaves from panicking. They will debase the dollar enough to keep the nominal value of the stock market above 5000 at least, but I think 10,000 will be what's needed to keep pensions halfway solvent. That's probably where gold and the Dow will meet somewhere above 10k by the end of the decade, 2017 earliest."
---------------------------
SO IN A MARKET THAT HAS RISEN FROM AN S&P LEVEL OF 667 TO 1600, THE REAL MONEY WAS MADE SHORTING IT? I'M SORRY, CAN YOU EXPLAIN SHORTING TO ME AGAIN, PLEASE?
---------------------------
cont...
04-07-2013, 12:23 PM #392
Member 238065
@Skrumpy
I have a GoldMoney account and I store it at London in a Viamat vault. There are reporting requirements that turbotax will walk you thru. You can store it yourself in a nonbank vault. Google your local area. Usually a deposit box is $100/year. I wouldn't do a gold IRA or store it in a Delaware depository service. You want to stay hidden if the gold is onshore so use your imagination.
@BMB
The dollar may have 6 months or 6 years, it's amazing how they can kick the can down the road, but events of the last few months show that we're at the beginning of the endgame. The take-home point is don't try to time this b/c the big events will be discontinuities ala bank runs, overnite capital controls, false flag cyber attacks. Just ask the Cypriots, Portuguese, Argentines what can happen. As Americans we have been isolated from financial calamities since our Central Bank printed the currency oil is bought in and the currency the world saves in. There is 6 trillion in dollars that is external to the domestic US economy that will be coming home when the BRIC contigent no longer will settle trade imbalances with dollars. And as Gordon Long points out in the above podcast, this 6 trillion is unfractionated--very close to base money. So if just 2% ( 120 billion of treasuries) comes home to our banking system this will become 1.2 trillion under fractional reserve banking. Yikes!
---------------------
A LITTLE NWO'ISH FOR ME, BUT NOT BAD.
------------------------
cont...
CONTINUING GRUMPS QUOTE...
@Skrumpy
The Mcavalneys recommend 1/3 bullion, 1/3 equities, 1/3 cash. I pretty much follow that. Of the 1/3 bullion 90% is gold, 10% silver. Silver will have the bigger percentage gains but you will have to time it. The silver price will collapse afterwards, but I think $50/oz will hold as major support.
Gold is the true monetary metal that ascend to much higher equilibrium point, minimum 4500. It will stay there and not collapse b/c it is coming into the monetary system to settle trade.
The 1/3 equities I have gold miners mostly held between 3 funds. The FSAGX ( large caps), TGLDX ( midcaps), UNWPX ( quality small and microcap gold juniors). The miners are at truly historic lows relative to gold. I would be very jealous if you guys established positions here. I took advantage of the 2008 washout to drastically lower my costbasis so that even now I'm only about 15-20% in the red on my miners.
The fortunes will be made on the miners.
The rule of thumb is that miners outperform gold by 2-3 times. So if gold goes up by 100%, a miner should go up 200%-300%. The juniors will see even more spectacular gains.
And oh baby the dividends these puppies will be spitting out after the reset. I'm fully confident I'll get my original investment back just in dividends.
----------------------
AND THIS IS WHERE YOU PROVE, YOU HAVE NO FRIGGIN CONCEPT WHAT FREEGOLD IS REALLY ABOUT. BUT BY ALL MEANS HANG ON TO THAT SILVER! OR BETTER YET, WHEN THE GSR HITS 12, SELL ALL YOUR SILVER FOR SOME MORE MINERS. YEAH, THAT'S THE TICKET!
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I also have individual positions in AEM and GG. Agnico is the safest geopolitically and their CEO understands he is not mining a commodity, but the future cornerstone asset of the new monetary system. Agnico is smart about they grow reserves and they are in that midcap sweet spot where they will go from one million ounces/year to 1.5 million/year as gold will be ascending in the 2015-2017 time frame. So extra leverage to the gold price , but safe as can be.
My positions in PAAS and SSRI I will unload up to 80% when silver gets to $150 or when the miners can make $100 per ounce of silver. When I grind the numbers in this scenario I see twenty-baggers for the positions I built. I'm using a very conservative P/E when I crunch these numbers. Imagine if there is a panic/mania. That's why I'll hang onto 20% just in case things get crazy.
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SO YOU ACKNOWLEDGE THAT GOLD WILL THE "FUTURE CORNESTONE ASSET OF THE NEW MONETARY SYSTEM", BUT YOU THINK THAT GOV'TS WILL LET PRIVATE ENTITIES MINE IT WITH ABANDON AND POCKET THE DIFFERENCE BETWEEN MINING COSTS VERSUS RESET VALUE. AMIRIGHT??????
cont...
Luke: These people did not see inflation? Check lead, gold, oil, zinc, stocks. Everything went higher.
Luke you are missing the point. Please look at this graph: http://i.imgur.com/b2NfmUz.png
Name me one thing that is cheaper today (2013) than it was in the 1980s. Other than silver, the list is going to be fairly short. I guess you could probably throw computers/CPUs on the list as being cheaper now than back then.
Jeb: Can we differentiate between Chinese government and Chinese population? Some chinese are buying silver and some are buying gold. Recently the price drop in gold has led to higher demand in gold and we've seen the lines of people waiting to buy.
But it is all local production of Gold that is hoarded by the Chinese government plus we know the tonnage that enters through Hong Kong. The Chinese officials play their gold hand close to their chest.
This isn't about Chinese people vs. government. The PRC (government/banks) are buying silver at an alarming rate. The country is mining silver at an alarming rate and keeping it all within their borders as well as importing more silver on top of that. Any guesses why?
Member 238065
Quote:
Originally Posted by Skrumpy
Thanks for the info grumps. Are there a couple of online (or otherwise) resources you suggest for one to get in and do some of the research to build up some knowledge in these areas? I'd like to have a stronger grasp on everything prior to jumping in.
GRUMPS QUOTE:
The sites I frequent
everyday:
http://www.jsmineset.com/
The following has alot of junk on it but I look for bylines of Jim Willie ( late in month) and Captain Hook( usually tuesdays).
http://www.goldseek.com/
I have zerohedge on IV drip.
What's amazing is seeing the evolution the last few years of what were mainstream economists waking up to the hopelessness of the debt and seeing gold as the way out.
An anti-gold podcast is Tim Wood's Cyclesman. He used to do a weekly show with two knucklehead technicians, John Grant and Chris Wilson.
When the crisis started in 2008 all three were on the same page that deflation was inevitable and that gold would crash. As time went on, John and Chris did their homework and would contradict Tim's view of gold. They realized that gold is the antithesis of debt and it doesn't matter if you have hyperdeflation or hyperinflation gold would outperform. They don't do as many shows anymore.
http://www.cyclesman.net/audio-commentary
Here's a link to QBAMCO's Locked and Loaded:
http://www.ritholtz.com/blog/2013/02/locked-and-loaded/
Always keep an eye out for a Thunder Road report. Usually zerohedge is on top of these. The Dec 2012 was excellent. It looked at things thru the Kondratieff lens.
http://www.scribd.com/doc/116318760/...ieff-long-wave
Here's a graph I use to keep in mind what tectonic shifts are ahead. This is a log chart and dividends are NOT included.
http://edegrootinsights.blogspot.com...dividends.html
I keep an eye out for a Charles Nenner/David Gurwitz podcast on kerry Lutz's site:
http://kerrylutz.libsyn.com/rss
Then there's Turd. He's hopeless. I don't read his stuff because it's permabullish but he will have good guests on his podcasts like the Jackass, Jim Willie who has an excellent contact in Europe.
http://www.tfmetalsreport.com/rss.xml
Then there is an alternative site the FOFOA blog. I don't recommend it anymore. The thesis there is that gold will stay external to the system at a price of 55,000/oz. There will be no mining of gold, no gold lending, easy credit creation in a currency will be punished by a higher gold price in that currency. It is bizarre. I post there under GrumpsLabastard telling the cultists there they're full of crap. My name is mud over there.
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AS WE WILL SEE LATER, BEING CALLED BIZARRE BY YOU, GRUMPY, IS AN HONOR
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cont...
04-12-2013, 08:02 PM #416
Member 238065
Quote:
Originally Posted by BMBiology
Bad day for gold and silver. Hope not all your asset is in gold. That's pretty risky.
GRUMPS QUOTE:
"It is. I'm not worried about me. I'm worried about you guys that don't have any exposure. The fact that they wacked gold today to this extent show's they are desperate and something has them scared. They screwed up by pushing it too low b/c now the BRIC central banks will stand for delivery at these low prices, draining the West of more gold. I always kept plenty of dry powder b/c I always suspected they would try a stupid takedown like today when the situation started to become terminal. I lowered my cost basis on my miners and am looking to get more bullion.
Here's an interesting explanation of what happened:
http://goldtrends.net/FreeDailyBlog?...ew&bmi=1267250
The risk is not in gold, it is in certificates of deposit, bonds, and to some extent the general stock market with some exceptions. By the end of the decade today's move will be an indiscernable squiggle on the chart."
04-13-2013, 05:33 AM #418
Member 238065
But KO will go down when priced in gold. I'll be able to buy 9-10 times more KO stock later.
Even after adding $8.09 of accrued dividends since 2000 to the current of KO price of 41.08 for $50/share, the gold/ko ratio has gone from 288/33.43 (8.6) to the current 1477/49.17 (30.0). You see that's the K-wave winter in action. A dead inert asset outperformed a cash-flowing business by more than 200%.
Will that trend continue forever? No, but it will until the debt as been purged. After winter is over then RE and stocks will be the assets to hold.
Remember that Halloween Simpsons with the evil Krusty clown. It wasn't until that Brooklyn character shows up to repair it, flips the doll over and points out, " Here's ya problem right here. This switch is set for evil."
Now imagine the Western economy as that doll and it just won't behave properly in spite of deficit spending by governments. Keynes is resurrected and asked to repair it. Upon examination he flips the doll over, " Here's ya problemo right here pallies. See this flow switch. It's been tripped b/c you have too much debt. This doll is constipated with too much debt. But there is a reset button. Press this button to revalue gold and that will purge the debt. A golden enema if you will."
The priests protest," But your teachings say to have govt replace private sector demand during a recession." Keynes responds," Yes, until a point. After enough time we all are all dead. Well, your monetary system is now dead."
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PLUS 1000 FOR WORKING IN A SIMPSONS REFERENCE. I LOVE THE EARLY SIMPSONS!
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cont...
04-13-2013, 09:14 AM #421
Member 238065
The hyperinflation is in the bond market and OTC derivative market ( over 1.44 quadrillion in notional value).
The price of gold is like a thermostat reading. If it gets too high it's like a car idiot light telling the bond markets that the financial space-time continuum is unravelling and that a reset of the monetary system is on the horizon.
That's why the powers that be will stand on their head to keep a lid on this price signal and propagandize that gold is a unstable asset, no competition for a USTreasury bond.
The ultimate equilibrium price will not be determined by shrimp investors, but by creditor Central Banks. This price will not be the result of speculation, but of hard-core math. Imagine the financial universe as a repeating Big Bang/Big Collapse cosmos. At the start of an International Monetary System, gold is stable and credit/debt expands thru spring, summer, and fall. In winter the debt levels stall and start to decline. Defaults ensue, gold begins flashing a warning, the financial cosmos starts to collapse in on itself until a new singularity is formed, that is a new monetary system in which the constants, aka gold value, are reconfigured. The current action in gold is telling you the Financial Cosmos is sick.
Are real rates positive? No, they've been negative for 5 years. ( Actually longer.) The fact that rates around the globe have been zero since 2009 is like a blaring red light klaxon telling the market that the submarine has reached the crush depths of debt levels. The MSM has been succesful in lulling the public into ignoring these danger signals.
The good news? It's manufactured propagnada for the purposes of Management Of Perception Economics. MOPE.
If you wait for the hyperinflation in the bonds and derivatives to phase transition to the real world, then it will be too late. Physical gold will go into hiding. Gold will not bid for dollars. Credit cards won't be accepted. Notice how some gas stations charge different price for cash vs. credit. Watch that spread, it'll get bigger. Mining stocks will have already priced-in a big move.
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YOU ARE CLOSE, BUT YOUR MINING STOCK PHYSCHOSIS IS REALLY HOLDING YOU BACK
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04-15-2013, 01:06 PM #441
Member 238065
Is this a bottom for gold? I think not. 1) It looks like the general market wants to drop and margin clerks are indiscriminate as to what to sell. 2) April 20 is coming up. What better time for a false flag to distract from financial crimes.
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OK SO NOW WE REALLY START TO SEE THE REAL GRUMPS. YOU CAN'T BE WRONG ON YOUR MINER & GOLD PRICE ACTION CALLS, SO IT HAS TO BE A FALSE FLAG OPERATION JUST TO SHOW GRUMPS UP!!!!
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04-15-2013, 03:58 PM #443
Member 238065
It appears big crap has just hit the fan. The London Bullion Metals Exchange was experiencing a spike in demand for physical delivery of product it didn't have. Hence the reason for the frozen platform. It was a default. The smashdown was a rescue for the bullion banks. Prime suspect, the Exchange Stabilization Fund out of the US Treasury. I'm sure plans have been put in motion for sequelae of this default.
The Boston bombing appears to be a rush job, anything to distract the public.
So far no patsy, no legend.
Probably had no time or maybe the velvet glove is coming off and the true culprit will be revealed.
What I would do now is prepare for a cyber attack. Get all the DNS addresses for the websites that are vital. If they just take out the DNS servers then you should be allright with these addresses.
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OK YOU ARE OFFICIALLY A NUT. BUT MY FAV RESPONSE TO YOU WAS THIS ONE:
Member 150642
If I were you guys, I would be investing in Reynold Wrap. There will be spike as somebody here is cornering the market for tin foil hats.
By the way, DNS (Dude Needs Stelazine)
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cont
04-16-2013, 04:48 PM #447
Member 238065
And now the ole bioweapon in a letter crap. Any doubt now if this is false flag?
Expect more incidents.
Anything to distract the public. They won't even bother to nab a patsy.
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I AM STARTING LOSE INTEREST IN THIS PROJECT
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04-17-2013, 04:07 AM #450
Member 238065
Absolutely, no margin. Margin is a death wish. The strategy is to take unleveraged positions with money you won't need for 10 plus years. I would expect the paper price to collapse before a default so that the bullion banks can settle their paper obligations at a much lower price.
Stocks will be volatile, but will preserve your wealth better than bonds. I'm just waiting for stocks to drop to a dow/gold ratio of one to one with dividend yields of 6-7%.
The usual suspects are FBI division 5 or military/intelligence special teams. The Corporation of the District of Columbia will kill its own livestock to keep the privilege to print the world's reserve currency. A high gold price is the bond market's thermostat.
-------------------------------
YUP, YOU ARE A LOON
--------------------------------
04-17-2013, 02:33 PM #453
Member 238065
Full List of Bankers at White House Meeting Thursday.
• Lloyd Blankfein, Chairman and CEO Goldman Sachs
• Jacques Brand, CEO Deutsche Bank Americas
• Michael Corbat, Chief Executive Officer Citigroup
• Jamie Dimon, Chairman, CEO and President J.P. Morgan Chase
• Sergio Ermotti, CEO UBS
• James Gorman, Chairman and CEO Morgan Stanley
• Gerald Hassell, Chairman and CEO Bank of New York Mellon Corpo ration
• Jay Hooley, Chairman, President and CEO State Street Corpo ration
• Abby Johnson, President, Fidelity Financial Services, Fidelity Investments
• Steve Kandarian, Chairman of the Board, President and CEO Metlife
• Brian Moynihan, President and CEO Bank of America Merrill Lynch
• John Strangfeld, CEO, Prudential
• John Stumpf, Chairman, President and CEO Wells Fargo
• Jim Weddle, Managing Partner, Edward Jones
• Bob Benmosche, President and CEO American International Group
http://blogs.wsj.com/washwire/2013/0...ting-thursday/
Methinks somebody was in trouble in bullion market, hence the pow-wow of the International Working Group of Financial Markets, aka the goon squad for the Exchange Stabilization Fund.
And oh my, our Obamayomama has received a letter. This is getting rich. What's next? Letters to a network head, a SCOTUS judge, an American Idol contestant?
Let's see we've had a small-scale bombing and ricin letters. What could our thug govt have in store for us next? Cyber attack? Reports of mysterious mass animal deaths? Avian Flu outbreak? Nuclear reactor leak? MK-ultra suicide bombers on planes? Truck bombs? Or do we go bigtime and drop a nuke on a city and pin it on Lil' Kim or Imadinnerjacket? April 19/20 are coming. Go ahead and wiki those dates.
If they apprehend a suspect for Boston, it will be an idiot dupe the division-5 suckered into an operation like McVeigh. Perhaps they had the dupe in custody but he wasn't willing to play ball like Timothy who is now living large with Kenny Lay in Uraguay.
I'll be posting more later with links to very interesting stuff.
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WOW. I'M SPEECHLESSS.
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cont...
The future won't look like the past (metal standard) or the present (debt standard). It's not hard to understand.
04-17-2013, 07:24 PM #459
Member 238065
Wow! Did we just get our truck bomb in Texas?
-------------------
OK I'M out.
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-----End journey into Grumps delusional world-----
So Grumps, when people don't respond to you anymore, now you know why. You are a certifiable nutjob with a martyr complex. You have a passing acquaintance with reality and a miniscule understanding of what is being discussed here.
So please for love of all that is holy, go crawl back to your truther forums and STFU.
With all due respect,
Milamber
http://www.youtube.com/watch?v=Af-Id_fuXFA
Sources
http://forums.studentdoctor.net/showthread.php?t=761604&page=8
http://www.jsmineset.com/2013/02/13/currency-wars-are-realyra-harris/
Gold will come into the system as a marker for trade settlement, a reference point. That doesn't mean it will hold value like other asset classes. It would track the growth in a monetary aggregate but this would be exceeded by the growth in value of other assets.
As for silver, tyrannyofthe present has an excellent rebuttal in his 95 theses. Industry can handle $200 silver. For most products that use silver the input cost is negligible since so little is used per unit.
And I wouldn't be so quick to dismiss that Ag wouldn't have a role as a reserve asset. The East has a long memory of what the Venetians did.
Tyrrany has 99 problems (bein' right ain't one.)
Jojo,
The Custodians are the Venetian Black Nobility, the Papal Black Nobility, and their counterparts in Asia. These are the families that own the BIS.
http://twoshortplanksunplugged.blogspot.com/2013/05/gold-nwo-elitesthe-gamethe-ambush.html
Quote from Fat Bastard:
Then there is an alternative site the FOFOA blog. I don't recommend it anymore. The thesis there is that gold will stay external to the system at a price of 55,000/oz. There will be no mining of gold, no gold lending, easy credit creation in a currency will be punished by a higher gold price in that currency. It is bizarre. I post there under GrumpsLabastard telling the cultists there they're full of crap. My name is mud over there.
So right you are Fat Bastard. So right.
Does anybody have an idea how to resolve the conundrum?
Which conundrum is that? This one?
Quote from Fat Bastard:
Then there is an alternative site the FOFOA blog. I don't recommend it anymore. I post there under GrumpsLabastard telling the cultists there they're full of crap. My name is mud over there.
Nice work, Milamber. If a certain someone isn't butt hurt like there's no tomorrow, I can only determine that it's only because his tush is already hopelessly numb.
These past two days have been great guys!
gary, I have thoroughly enjoyed your voice
millamber, what more can be said to describe someones position than to use there own words
Let It Ride
Mud,
I think the conundrum would be solved if it would just leave. Especially before the next false flag op hits.
In other words you are going to be in a permanent Kondratieff winter on this blog while you persist in your psychosis.
Milamber
Supporters of gold's revalued price will be the central banks.
Supporters of silver's revalued price(plus move to the "historical ratio") will be the youtube silver stackers.
Yes, I can see this playing out perfectly.
What does a pension manager do in the hereafter? Stay in a nonyielding asset or go where there is a real yield?
You could always tell the pension manager something like this:
Quote from Fat Bastard:
Then there is an alternative site the FOFOA blog. I don't recommend it anymore. I post there under GrumpsLabastard telling the cultists there they're full of crap. My name is mud over there.
GrmmpsLimpFishsticks or GrubsLameStocktard or Mud,
Take a vacation and RTFB! You might learn something. When you come back humble yourself a bit. This is always a good excuse for behavior that results in one being called MUD.
Pensions will perform as promised. Nominally. And savers won't have to try to be their own market timing investment manager.
FOFOA: One natural probability not mentioned here is the global marketplace devaluing the very denominator of these ridiculously-oversized promises. Then the states can easily meet their obligation. Each pensioner will get one guaranteed square of toilet paper per month... for life!
(...)
...the point is that today, all over the world, people's savings are "captive money" inside the $IMFS. One cannot simply walk out of the $IMFS today and hope to retain one's purchasing power over the long run. Therefore the people's savings, their 401Ks, IRAs, pensions and trusts are all captive to the managers of the system. Under Freegold this will be different.
First of all, there is no incentive for people to gamble on price changes in something that is stable in price. And second, the gamblers' casino chips, ambiguous claims on some illusory pile of gold somewhere back in the cage, will no longer exist.
With people's savings no longer captive in a financial system that lends them out at will, interest rates will once again be a direct function of the supply of (as well as demand for) capital inside the system. Yes, banks will still be able to conjure "thin air money" on their balance sheets to make loans, but the aggregate of loans within the banking system will once again be constrained by the capital ratios in the banking system as no secondary market for this debt will exist. And as a result, we will witness the return of prudent lending standards.
All of these subtle changes/differences will flow from the inevitable loss of the paper gold market that presently denies us the stable benchmark that is gold's ONLY job. As will the end of the seemingly infinite well of power that currently springs from the U.S. dollar printing press.
But, Jeff, promises become too big at the end of the cycle, not throughout.
" ...interest rates will once again be a direct function of the supply of (as well as demand for) capital inside the system"
That's the fallacy. Interest rates will be a pull on savings held in gold. The capital held in gold will be influenced.
Here's a good youtube channel:
https://www.youtube.com/watch?feature=player_detailpage&v=oLnKhoyo23Q
I haven't watched it yet, but Grove understands who the Custodians are.
Gee, you sure seem to have a certain immunity, a sort of elephant skin (rhino skin?) to keep coming and coming and coming again after having been exposed so thoroughly. A personality trait, a characteristic beyond the common.
No time for an ego? Then, who are you anyway? Sunday today! Please, do reclaim your ego and save your immortal soul.
I haven't watched it yet, but Grove understands who the Custodians are.
I just finished watching your video Bastard and there's one implied sentiment contained within you seemed to have missed although luckily you've captured it in a previous comment:
Quote from Fat Bastard:
Then there is an alternative site the FOFOA blog. I don't recommend it anymore. The thesis there is that gold will stay external to the system at a price of 55,000/oz. There will be no mining of gold, no gold lending, easy credit creation in a currency will be punished by a higher gold price in that currency. It is bizarre. I post there under GrumpsLabastard telling the cultists there they're full of crap. My name is mud over there.
gull_man
Some comments re GSR for your consideration....
http://www.tfmetalsreport.com/comment/244784#comment-244784
http://www.tfmetalsreport.com/comment/244798#comment-244798
http://www.tfmetalsreport.com/comment/244804#comment-244804
TF
Dr. Boer ask:
Gee, you sure seem to have a certain immunity, a sort of elephant skin (rhino skin?)
Confuse us say,
Never confuse thick rhino hide for thick human skull.
Jeb asked himself:
Why would the ECB hold its number 1 reserve asset at a free market price and then allow that price to be taken down. I can only conclude that the price was managed up and is no now being managed back down with the ECB's blessing.
Freegold theory says: no. Price is not "managed" down. Price is falling by itself: because nobody is buying papergold anymore. The "blessing" of the ECB is: They let it go. Why? Because they are now interested in the paper gold and therefore dollar collapse. Euro is ripe enough to take over.
Do they completely lose control of the paper market?
No. Full control. They could buy papergold again to rescue it. But they don’t want anymore. So papergold is dying it’s own death. By itself.
That’s my gross understanding. Right? Wrong?
I think we might see 2 $ before we see 200 $ silver. And that 200 $ silver will probably be less worth, in real terms, than 2 $ silver.
MF,
You are something of Internet kamikaze. I salute you.
"My advice to you is: go find a girlfriend and while doing so please refrain from telling her how smart you are."
:D
I'm a long time reader that never posts, but saw this article and found it interesting as comments from the World Bank have always had a freegold ring to them, so to speak.
Karen Hudes was an economist and attorney at the World Bank for 20 years and talks about the corruption in the global banking system. In recent interview she says:
“All of the countries of the world are going to allow precious metals to serve as currency, and this will be an underpinning for paper currency, [as] we’ll have both systems at the same time. This is my guess, as I mentioned—I am an economist.”
World Bank Whistle Blower
@ Rob Shawk
Good find.
Did everyone catch this among the ForestGumpthebastard talk ?
"We’ll have both systems at the same time."
@Rob Shawk
I saw the interview on RT Friday night. Ms. Hudes is aware of this blog. I think she has the right perspective to understand freegold and wish her well on her walk down the trail. :D
Here is the interview I was referring to.
Grumps
like sooo many before you, you have come to save us from ourselves, to show us a different way.
I'd say your services are not wanted or needed. I would politely suggest it is ti,e for you to go. You fill these pages with irrelevant nonsense and in fact do not even understand that which you wish to save us from.
I would argue for banishment. You do NOT provide any use as a counterpoint because you never pick a topic and deal with it logically. You just blurt.
This is the Website of Karen Hudes.
And this is an article on her ongoing case.
Knotty pine
"Ms. Hudes is aware of this blog."
How were you made aware of this ? Are you Ms Hudes ?
To the paper playas; do you also trade NUGT and DUST? Hope the paper game continues even after FG since the casino is still 'fun'; manipulation and all. Of course charts help to identify the manip and a mechanical system doesn't hurt either. ;-)
When it comes to gold and silver (and platinum and palladium as well, though as we get to other metals things get more complicated), I think like this:
If freegold happens, it's only going to be gold. I think we can all agree on that. People will use fiat and save in gold once they have enough fiat. Simple and sustainable. The "checking and savings" accounts reworked.
Still, this will raise awareness of precious metals in general, so many people will turn to them and there will be alot of debate and talk and it will become sort of universal. People will talk about metals and miners the same way they talk about the dow and housing now. Everybody will want a "piece of the action."
As this happens, it will be generally bullish for the entire sector. However, as we've all seen, nothing goes up forever and ultimately silver and the miners will correct, just like stocks and housing. But at a higher level, and hopefully with less volatility. Silver will become a stable commodity with a narrow trading range and the miners will either be nationalized or will resemble utilities.
If this is the case, and I think it is, it still makes sense to buy other metals and keep them secret and safe as we await the collapse of the current system. At the very least, it helps to hedge against the very real possibility that freegold fails to materialize in a timeframe that is meaningful for us.
Personally I hold about 90% gold, 5% silver, and 5% platinum (in fiat terms). I don't speculate in miners but I don't necessarily begrudge the people who do, we need all the help we can get.
And now the BIS speaks to the utility of the system continuing to bail itself out.
This will be the first of several reality checks. There is still time ...
http://www.bis.org/speeches/sp130623.pdf
But are you TRULY prepared for FREEGOLD??
Michael,
So I should hold gold even though I could get a positive real rate of return on the currency? To forever stay in the bunker with my precious miserly dishoarding not to exceed an actuarial burn rate?
If I were banned who would Gary have to play with?
Fat Bastard said...
So I should hold gold even though I could get a positive real rate of return on the currency?
That's a great question Bastard, but I think you've already answered that question in one of your previous comments. Allow me direct you to the relevant comment:
Quote from Fat Bastard:
Then there is an alternative site the FOFOA blog. I don't recommend it anymore. The thesis there is that gold will stay external to the system at a price of 55,000/oz. There will be no mining of gold, no gold lending, easy credit creation in a currency will be punished by a higher gold price in that currency. It is bizarre. I post there under GrumpsLabastard telling the cultists there they're full of crap. My name is mud over there.
Grumps
you should do whatever your heart tells you to do. Ride in the hidden forest and the secret garden with your unicorn spurring him up through the feather clouds to the sacred dragon lair. And say hi to Gary. It is not that anyone wishes you ill it is that you just blurt.
for instance: fofoa has written gobs ( huge gobs!) about why SAVERS will choose gold (because there will be no RISK!).
A knight like your self will choose risk and slay the beast to much acclaim but the widows and orphans will seek the security of knowing that there will eat and be sheltered to the ends of their days without having to rely on a fickle and dangerous market.
I suspect you understand that.
If you do not it is for lack of reading. This is disrespectful of the forum. If you do the WTF are you saying?
NEW refreshing ideas are welcome here. Horseshit from a guy who speaks behind our backs is not.
I vote you go away. If you choose to stay it must be due to a mental problem cuz you have not given a rational reason for being here.
Grumps,
I've located your theme song!!
My Name is Mud
SP
gold...buy ...'as much as you understand'
Phat Ex
I hedged my Plan with DGLD. I recently became aware of the benefits of DSLV and DUST. I am now in all 3.
I have my position in phyz already.
@SP
As I see it the problem is one of basic respect. I spent over two years reading this blog before I even considered commenting. Obviously the material here appealed to me enough to continue reading even though I could not fully comprehend it. At some point I decided that these folks are on to something here. Any questions I had were always answered respectfully probably because they were asked respectfully. If after a few months I had decided the stuff I was reading here was bullshit I would have moved on. One thing I was sure of: agree or not the people who were responsible for this blog (A/FOA/FOFOA/and all the contributors) absolutely deserved my respect. The time, effort and thought that went in to each post was obvious. Even the comments (for the most part) appeared to be product of a lot of thought and effort.
There are plenty of websites for traders out there but not many for savers. This one is about freegold, not trading silver stocks. Most of us here believe an epic paradigm shift in the way the superorganism views the functions of money is coming. It seems that those who are at odds here (GripsLameStocktard, Tranny etc.) see the transition through the lens of a trader. I think they are wrong but I wish them well. I just don't understand why they hang around here.
@M
No. I emailed Karen and asked if she was aware of this blog because there seemed to be some correlation between her statements and the material here. She has joined the blog and hopefully will find the material interesting.
@forestGump
Qoute"So I should hold gold even though I could get a positive real rate of return on the currency? "
For fuck sakes man.
So I should hold gold even though I could get a positive real rate of return on the tulips ? That is what you will sound like post freegold. We are talking about the biggest ponzi scheme of all time.
People will know in the end, that the bond markets were ponzi's. Time deposits were all just ponzi's. Banks are ponzi houses.
Savings will be real.
Positive rate of return......Hahahah
@ Knotty pine
She seems very well connected.
Nevada is one of the top 5 gold mining districts on the planet. The local Las Vegas paper reports today that the recent drop in the POG has caused Barrick and another large miner to announce layoffs. I suspect even the established large miners see that they will be unable to survive in the current environment.
If ABX is in trouble imagine the situation with smaller guys or growing companies who need to do expansions of CAPEX.
I suspect we will see continued decreases in miners stock price but perhaps some stabilization of POG as supply shrinks. This might not occur however as supply and physical overall seems a trivial part of the POG which is down $8.80 as I type.
Michael, those leveraged funds decay overtime. The more volatility the faster they decay. I would recommend buying puts on NUGT rather than buying DUST outright. The miners could go to 0 and at the same time so could DUST.
@Michael dV
DGLD 3x. Like the volatility and liquidity but doesn't look like options available; bummer.
Has anyone read David Stockman's book ?
If I hear him right, he doesn't think anything will change until there is no profit in front running the Fed into the bond market. He also says that this makes inflation a red herring because the front running just sloshes around in financial markets.
His short takes don't say much about the gold standard but its in his book. He does know that the current gold price is just a fantasy within the the system. He says gold will win out in the end but he doesn't even trust that. Im guessing he means paper. And he said this on TV. I think he knows which way the fantasy is incorrectly pricing physical gold.
His comments about bond front running is why I think paper gold could unfortunately live another day. We have no markets. There is no price discovery mechanism. Interest rates are simply trading the flow of liquidity and word clouds out of the Fed. If inflation is a red herring then when does this stop ?
Some of this endless liquidity could easily flow back into the paper gold market.
David Stockman clip
http://www.youtube.com/watch?v=uF9UJh8bU70&feature=youtu.be&t=1m30s
Fucktard
Is there something special about American money ?
You are just as bad as the keynesians.
Does paper/digital money have intrinsic value or not ?
You are mad about money printing because you think it can over power gold !!
Think about it
There you go.
You said it yourself.
Somehow this magical American money can over power gold. No other countries magical money can except Americas.
Luke ..thanks for the ideas. I hate options because they expire.
I'm aware the triple Xs do not always perform as promised. During the Thursday (which it looks like we could be repeating tonight) the underlying decreased 1x but the ETF merely went up 2.2X.
I'm open to suggestions as I need to hedge my Plan.
I am fuzzy on the way volatility effects the ETFs btw..
Who are the happiest people on earth when the price of gold goes down?
Why,
FREEGOLDERS of course!
Because Freegolders are happy that the price of real money is UP in terms of gold.
Who is happiest when FOFOA mocks them (Ohh nooo!!! Gold so low!)
Why, FREEGOLDERS of course!
Because who could ask for more than waiting another 100 years before the price of gold goes up in terms of REAL money?
God bless Freegolders and their messiah FOFOA.
We really need them.
The BIS are indicating that the time is coming to change from printing to a 'different policy mix'.
Indicating the revaluation in diplomatic speak perhaps?
"In its latest annual report, the Bank for International Settlements says the world's central bankers have bought time for governments by printing money and slashing interest rates.
. . . . the bank's general manager Jaime Caruana says there is little left for central banks to do.
"Monetary policy has done its part. Recovery now calls for a different policy mix - with more emphasis on strengthening economic flexibility and dynamism and stabilising public finances," he said in a speech at the launch of the report in Basel, Switzerland."
http://www.abc.net.au/news/2013-06-24/bis-warns-central-banks-have-done-all-they-can/4776608?section=business
Michael,
The markets won't always be in crisis. I refer to conditions after the resolution. Widows and orphans will need yield. For people to see gold as the top of the savings food chain would imply negative real rates exist.
Gold will only function as a wealth reserve for those that have more money than God and can afford that portion of their portfolio to lie fallow for decades. Shrimps don't have that excess capital. They need to be earning a yield in at least a CD throughout a lifetime in the attempt to get to a critical mass that can yield enough to support retirement and not deplete principle.
What would be your psychology if upon retirement you only had a lump sum of gold or money that spun off no income? Even if real rates were negative so that gold could appreciate, it would still be tough to watch the pile wither down. And if real rates were negative what would that mean for the investment world? Do you want to live in that world?
"What would be your psychology if upon retirement you only had a lump sum of gold or money that spun off no income?"
You mean like now? We are already there; next up, hyperinflation. Prechter, Mish, and a handful of others are getting their 15 minutes. And, their gone...
Yes, Phat. And what are people doing...reaching for yield. Most will only go to gold if the price action confirms its lifeboat status.
This PGA dog just bought 10 gram bar. Not much but still. Couldn't resist.
I would also like to propose new acronym:
PGA - Physical Golds Anonymous
@Grumps
"And what are people doing...reaching for yield."
Well, sometimes you just have to say 'no'. Why take on that risk? Just another reason that FG is a foregone conclusion, at least for me. In the mean time, as advocated by many of the senior members of this forum; live, stack as comfortable, seek yield with what you can afford to risk, carry on...
Yes, some do view the world throough the lens of a trader, dropping their "K-cycles" and E-pyramids" dogma at every opportunity to prove that dying religion.
"Throw your charts and TA away" said Another .... but some will cling to them even through the fire of change.
So ... in a (very) brief respite from the Grumps show ... Yes, JC, as I noted above, the BIS has indeed changed it's outward facing position to the world.
What we must then ask ourselves, "Is the BIS willing to deliver a painful death blow to the global economy through a coordinated withdrawal of easing?"
I think the answer is, "Yes, as long as we have a solid PLAN B."
The governments have bailed out the fraudulent debt which arises as a systemic cancer upon any and every debt-based monetary system in the final throes of its expansionary self-destruction.
And of course said bailouts served the interests of all systemic stakeholders in these final episodes of Dollarism.
The classe politique was given ample time to manage the expectations of the sheople. But no one with the power to allow that time truly thought they would behave in a fashion that imperils their own capacity for self-preservation.
This is why we have Fatherland (oops, I mean "Homeland") security.
Take away the "easing" and the true terror unfolds at your local Walmart.
But this is the Faustian bargain of Fascism. The politique enters into it knowing all too well the final outcome of borrowed time.
Can the Euro truly replace the Dollar in all ways virtuous and exhorbitant? Of course not.
Can it function as an interim replacement as a new asset-based system which recognizes the truth wealth of the truly wealthy comes into being? Perhaps.
Remember from the video, "FREEGOLD is the end of QE without Armageddon."
So in what lies ahead, painful though it may be, take comfort in the understanding that without FREEGOLD it will be (and could have been) MUCH WORSE.
There is still time to get you some, but in other ways and changes to come, are you truly ready?
This is the question again posed by the flower of understanding ...
@Wil
"Throw your charts and TA away" said Another
And the reference was strictly to FG/gold. From your tone, it sounds like you are painting with a broader brush.
I can't imagine too many here believing the FIN is going away; just that roles are changing. And thus, for the paper playas, TA remains a valuable tool.
The Western public will not hold an asset that going nowhere, at least in currency terms. ( if one can only see value in paper currency terms then one cannot see value at all ) - Another
We all choose our own path. For me it's the gold trail :-)
Edit: above is directed at Grumps.
Will charts and TA give you comfort if your paper dollars are stored in a "checking account"?
Will charts and TA help you if your gold is not in YOUR physical possession?
Will they help you if you do not have food enough, or the ability to be self-sufficient, through the brief chaos of reset?
Will they help you if you do not have a means to protect yourself from others who are hopelessly ill-prepared?
We are going back to "a much simpler time than many will accept".
Gold will represent wealth, and paper will represent the sorrow of broken promises.
There is your chart. There is your technical.
There will be ample time, after the reset, for the complexities of an asset based system to be analyzed and predicted.
But no analysis of the present system can prepare you for the next. There are too many unknowns ahead. The game changes, therefore the rulebook is thrown away.
@Wil
There is no argument on the physical in your possession, never has been, from me.
In reference to the transition, yes, it will be tumultuous. However, the FIN (stocks/futures/forex/...) will likely still exist, in some form to allow for hedging and speculation and financing and... Maybe the level of sophistication of the playas might change with the entry bar raised; but there will always be some kind of market. And it won't be long after the reset. The futures market alone is far too important (we wouldn't be as well off today without it).
And things continue to get more and more interesting.
A key passage from BK's latest.
If the DOJ indicts a Swiss bank, it can prevent it from making dollar based wire transfers. The DOJ will order all US banks to not make transfers on behalf of the targeted institution. At that point, the bank is functionally shut out of all dollar based business. No global bank can operate for long without the ability to make transfers in dollars.
Indeed, and it is just sort of domination- What do you call "a friend" who bullies you? An enemy- and all the vile sewage that comes from it that the ROW has become heartily sick of and is taking steps to terminate.
OK Grumps, I'll give it a go...what would I do if at retirement I had just a lump...
In today's world I retire with a lump of cash. I take 4% a year out and hope I have enough for my coffin. If markets crash I could just be thrown into a hole naked.
I FG I divide my lump by my life expectancy and spend that each year knowing that my purchasing power is secure.
Is that too simple?
Golden Minerals Announces Suspension Of Production
http://goldenminerals.com/press.php
Just a general question about FG. I understand how the Euro is a central part of the theory. What happens to the FG theory if/when the Eurozone collapses as well as the Euro collapses? We have already been very close to that collapse in the past and I don't think it will take much to see something happen in the next 12-24 months to have a split. Whether a complete collapse or a split into north + south.
Even the Swiss Army is preparing for a scenario when the Euro collapses: http://www.businessweek.com/articles/2013-01-31/if-the-euro-collapses-the-swiss-army-is-ready
Don't think this event is so much if, just a matter of when.
Michael dV :
Be carefull of using this inverse ETF's.
In 2007, looking at Housing market and it's corresponding effect on Banks, I bought SRS(2xshort Real Estate) and SKF(2 x short Finance) in October 2007. I bought both around $80 I think. All during the breakdown in the banks and Housing market, they were tracking OK, but then at the depths of the crisis
- they stopped tracking fully.
- they oscillated so much during panic time.
- one day Govt banned shorting banks. thes vehicles collapsed, then recovered.
- after all these experience and Govt tricks, I
sold them for around $130.
If I had bought PUT options for citibanks instad of buying these inverse, I would have been a mega millionaire. My timing and knowledge was correct, but I used the wrong vehicle because I did not know how to buy PUT options at that time.
When I bought these inverse ETF's Citibank was trading at $45, I think and when I sold it was around $18(before going all the way down to $3).
So my suggestion is to buy PUT options than buying these fleecing ETF's, which will drain you in drips. If you believe this is it and FG is upon us, just buying PUT option in GLD would be better than using these inverse ETF's.
of course OPTIONS are more riskier than ETF's, but buying long dated one's can mitigate risk with less profitability.
Alex-
FG does not require the Euro. FG comes regardless.
Read these 2 posts of top of my head:
http://fofoa.blogspot.com/2011/07/euro-gold.html
http://fofoa.blogspot.com/2010/02/greece-is-word.html
Jojo:
Thanks jojo. I will read those posts. From my brief overview of FG theory, I understood the theory as believing that USD would hyperinflate and the Euro would rise due to its relationship with gold.
www.youtube.com/watch?v=iiI48F-U4eY
I will keep reading.
The Euro was created with this event in mind- to take advantage of the dollars receding role, ready to step in when the time is right.
@ Alex
The Eurozone already collapsed and the Euro currency fine. Look at the stock market and bonds of the troubled countries. Look at the employment numbers.
What do you consider collapse ?
Morons,
Deutsche Bank is short gold and you say that the Euro is 'gold friendly' and will rise along with it?
I say,
Morons.
With reason.
The "Freegold" psy op is finished.
Just too many contradictions.
The most basic of them all was your stupid argument for fiat money using gold.
FREEGOLD is what we have now.
FREEGOLD is nothing other than the cooperation between the US, China, Europe and the rest of the world to suppress the price of gold and impose fiat currencies as money.
Such cooperation is only possible when the interests of the international ruling classes coincide.
That is no longer the case today.
So today, FREEGOLD dies.
Does anyone have Art's email address ?
fuckedup@Imalooney.com
»What central bank accommodation has done during the recovery is to borrow time – time for balance sheet repair, time for fiscal consolidation, and time for reforms to restore productivity growth. But the time has not been well used, as continued low interest rates and unconventional policies have made it easy for the private sector to postpone deleveraging, easy for the government to finance deficits, and easy for the authorities to delay needed reforms in the real economy and in the financial system. After all, cheap money makes it easier to borrow than to save, easier to spend than to tax, easier to remain the same than to change.«
Bank for International Settlement (BIS)
83rd BIS Annual Report 2012/2013
23 June 2013
“[W]e look at the increasing number of flashing indicators warning that a 2008-style – but worse – sell-off is arriving. We say ‘worse’ because this time it looks like it will be accompanied by a vicious cycle of rising interest rates. Plus, governments and central banks have used up all of their major options already. There are no more white knights to hope for.”
Chris Martenson (Peak Prosperity), quoted by
Michael J. Kosares, who knew Another in the old Kitco times …
Mr. FOFOA first deletes my posts than re-publishes them again.
Ask him what his problem is.
He leaves my posts intact in the interest of free speech, and we won't have such stupid problems.
Ask yourselves?
Why is this guy so hell-bent on deleting the things that I say?
Michael,
You have it backwards. In today's world you move to gold since you are being financially repressed with negative real rates. If you absolutely need yield then you have to move up the risk ladder.
In a world after the debt purge, you take the lump sum and put it in safe assets yielding a positive real return. The positive real rate is keeping your PP secure. Gold doesn't do well in positive rate environments. It would probably at best track global M3 on a long term average trend line oscillating above and below this line as trade balances are settled. This modest rise in the nominal POG would be less than the end user cost of living. If you stayed in gold after the revaluation, you may not notice the loss in PP until after 5 to 10 years. The POG wouldn't catch up until real rates turn negative as inflation rages in the summer phase. That would be the phase to go back into gold. If you or your heirs hold gold throughout this period it probably would have been spent before the next upleg.
http://2.bp.blogspot.com/_zq0BtYfc9qY/TPLC4IthlEI/AAAAAAAAABs/vwOoZwd-GLo/s1600/The+KONDRATIEFF.JPG
http://www.scribd.com/doc/116318760/7/Detailed-analysis-of-the-Kondratieff-long-wave
FG ignores this relationship with interest rates. It pretends that savings in gold will be isolated from the financial world ambivalent to the opportunity cost of eschewing a safe positive real yield, not to mention incurring the added costs of storage and insurance. In a debt-purged low default risk environment it makes no sense to be overweight gold. You would only allocate maybe 5 to 10 % of a portfolio as insurance against monetary black swans.
jojo: "The Euro was created with this event in mind- to take advantage of the dollars receding role, ready to step in when the time is right."
I understand that. But I was questioning more what happens if/when the Euro is no longer with us.
M: "The Eurozone already collapsed and the Euro currency fine. Look at the stock market and bonds of the troubled countries. Look at the employment numbers.
What do you consider collapse ?"
I agree. In theory the Eurozone has already collapsed, and yet it is still with us. Same argument for the USD/economy being collapsed, and yet the bankers still find ways to puff them up again with more duct tape. I was speaking more in terms of when the house of cards actually falls down. To the point that the MSM and sheep can't hide from it any longer.
I need Arts email
I will make life very fucking difficult for him if he keeps this up. That is a promise. He is really starting to piss me off and the the rest of the board off.
Art
How about you just make one post and get in a legit argument rather then posting something 10 times ?
@Grumps
Freegold doesn't ignore interest rates. You think it will be business as usual post transition while we expect a major change in perception. Try readingthis.
Alex: "I understand that. But I was questioning more what happens if/when the Euro is no longer with us."
Are you asking about the Euro Currency?
@ Alex Hillock
"I was speaking more in terms of when the house of cards actually falls down. To the point that the MSM and sheep can't hide from it any longer."
If you read up on the great deprsssion, you will see that even then, the mainstream still basically sugar coated it.
I agree though. The currency crisis in the US will be the only thing that kills the mainstream BS. When the USD starts losing serious value, its game over.
@M
The troll's comments will be deleted so you be talking to a phantom. I think the troll just craves attention. It is probably best to ignore him.
For our resident Silverites: the SLV fund just ADDED 90.05 tonnes today! 6/21 they held 9983.93 and today 10,073.98!!
M
"If I hear him right, he doesn't think anything will change until there is no profit in front running the Fed into the bond market. He also says that this makes inflation a red herring because the front running just sloshes around in financial markets."
It was my understanding that money flows through the market. It doesn't slush around in the market. How would this not create inflation?
Worst day ever for gold miners. Lakeshore was up 56% though...
Medusa is a quality small tier in Australia
MML 1.35 -0.24 (-15.14%)
Itl.Tower hill was Jim Cramers favorite jr back a few years ago
ITH 0.520 -0.150 (-22.39%)
These are unprecedented losses. They are considered quality stocks in the industry.
@ Chales bravo
" How would this not create inflation? "
It does obviously but not anywhere near enough to scare the Fed at all.
Who are the happiest people on earth when the price of gold goes down?
is not the correct question.
Who are the happiest people on earth when the paper price of gold goes down?
Freegolders, or PGA (Physical Gold Advocates) or people who save in Gold (and can increase their nest egg more substantially).
Who are the saddest people on earth when the paper price of gold goes down?
People who have invested in gold to sell and make dollars, people who own miners, people who own paper gold.
Which group are you in, Art?
GARY says
The price of physical gold
Stays the same
When the price of gold futures
Goes down.
GARY is a Freegolder.
GARY is full of shit.
@biju, Michael dv: Leveraged ETFs are designed to provide +/-nX performance over a single trading day. They are not intended for holding over long periods of time because they are composed of short-term options, which, of course, suffer time decay. This is part of their design, but is rarely mentioned (and perhaps not understood) by the newsletter writers who recommend them.
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