$1 million Gold Bet

Quote from Daal:

yeah, the same analysis that made you say oil would never see $79 again
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im not a seer or a guru. however, i have access to erudite research, unconventional information, and a good intutive grasp of the markets. does this mean 100% accuracy? no way!!

yes, i have been wrong in the past, i readily admit it, i'm not ashamed of my errors in market forecasting.

surf
 
Quote from PaulRon:

Production and innovation is the backbone of any healthy economy, not consumerism. The reason we are able to maintain a 70% consumer economy is because the rest of the world is still accepting US dollars in return for their goods. Great things are in our future only if our currency holds up, and as it sits now it's at an all time low. Who's going to want to hold depreciating dollars?



Believing that our banking system is so robust and high tech that we're able to create wealth is a complete fallacy. Wealth is created through production and hard work. How long do you think the American will be able to sit on top of the food chain? When will the rest of the world stop funding our consumption?
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noted economist david riccardo way back in 1817 clearly showed that if something can be imported cheaper than it can be produced, then it should be imported. the level of economic misunderstanding on this board is phenomenal for a finance site.

gold is a dinosaur driven by hype, greed and misunderstood economic facts. it will retract just like any other traded instrument.

read "principles of political economy and taxation" by riccardo for a better understanding of the principle.

surf
 
Quote from marketsurfer:

noted economist david riccardo way back in 1817 clearly showed that if something can be imported cheaper than it can be produced, then it should be imported. the level of economic misunderstanding on this board is phenomenal for a finance site.

gold is a dinosaur driven by hype, greed and misunderstood economic facts. it will retract just like any other traded instrument.

read "principles of political economy and taxation" by riccardo for a better understanding of the principle.

surf
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Surf, why the urgency? I read Riccardo's theories years ago and the correlation to gold escapes me. - Then again we all operate within the constructs of our own designs and I am no exception.
I make no claims to be well versed in world economies, past, present or future.
Gold pushes the extremes of human emotions and therein lies it's appeal for me. It could be 10l6 steel for all I care.
...but it's not.
 
Quote from infolode:

Surf, why the urgency? I read Riccardo's theories years ago and the correlation to gold escapes me. - Then again we all operate within the constructs of our own designs and I am no exception.
I make no claims to be well versed in world economies, past, present or future.
Gold pushes the extremes of human emotions and therein lies it's appeal for me. It could be 10l6 steel for all I care.
...but it's not.
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no urgency, im sorry for the misunderstanding--the riccardo comment was not directed at gold but rather paulron's other ideas.

surf
 
Quote from marketsurfer:

no urgency, im sorry for the misunderstanding--the riccardo comment was not directed at gold but rather paulron's other ideas.

surf
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Ok, actually I'm sorry I took your comments out of context.

Good luck with your trades, you should make some nice coin on the downside over the next few months. I wouldn't get to comfortable though.

infolode:D
 
Quote from marketsurfer:

noted economist david riccardo way back in 1817 clearly showed that if something can be imported cheaper than it can be produced, then it should be imported. the level of economic misunderstanding on this board is phenomenal for a finance site.

gold is a dinosaur driven by hype, greed and misunderstood economic facts. it will retract just like any other traded instrument.

read "principles of political economy and taxation" by riccardo for a better understanding of the principle.

surf
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Of course if something is cheaper to import than produce it should be imported, which is what we currently do.

However, what happens when the USA's main export (US dollars) continues to depreciate and hit all time lows against a basked of curriences and commodities? All superpower nations end when their economic system is stretched too thin. We must be able to maintain our current import/export ratio to maintain our economic status. Without a strong dollar, it is an impossibility to remain a strong 70% consumer based economy in the long run due to the insurmountable trade deficit.

Hey, if we could keep to convincing the rest of the world to conitue to accept depreciating US dollars, by all means... I hope it works.

I have a feeling the rest of the world isn't that dumb.
 
Quote from PaulRon:

Of course if something is cheaper to import than produce it should be imported, which is what we currently do.

However, what happens when the USA's main export (US dollars) continues to depreciate and hit all time lows against a basked of curriences and commodities? All superpower nations end when their economic system is stretched too thin. We must be able to maintain our current import/export ratio to maintain our economic status. Without a strong dollar, it is an impossibility to remain a strong 70% consumer based economy in the long run due to the insurmountable trade deficit.

Hey, if we could keep to convincing the rest of the world to conitue to accept depreciating US dollars, by all means... I hope it works.

I have a feeling the rest of the world isn't that dumb.
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The reason we "export dollars" is because the rest of the world sells us stuff. Where else they gonna sell it??? Then in some cases, they throw barriers up to our stuff.

So a simple remedy for the rest of the world is that they just stop selling us stuff. Less dollars abroad. Maybe they could drop the trade barriers as well. LOL! I won't hold my breath.

OldTrader
 
Quote from OldTrader:

The reason we "export dollars" is because the rest of the world sells us stuff. Where else they gonna sell it??? Then in some cases, they throw barriers up to our stuff.

So a simple remedy for the rest of the world is that they just stop selling us stuff. Less dollars abroad. Maybe they could drop the trade barriers as well. LOL! I won't hold my breath.

OldTrader
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Where else they gonna sell it?... How about the rest of the world. While the US dollar continues to depreciate other consumers in the rest of the world have been and are staring to pick up our slack. Asian countries are becoming wealthier and might actually start consuming their own goods in the future... wow... imagine that.
 
Am I missing something or should the gold bulls be jumping on this bet?

If someone were to take Sinclair's bet and then immediately buy 15 ZGZ11 contracts (currently trading at 980). Tying up about 45k.

If gold goes up but does not reach 1650, you get 1 Million from Sinclair plus the profits off the contracts.

If the price goes down, to say $400. You loose $870,000, but get the 1 million from Sinclair.

If price does go to 1650, you must pay Sinclair 1 million but your profits on the 15 contracts are 1 Million.

It seems that the only way to lose is if gold drops below $400. I know I am not including the lost opportunity costs,
but it still seems like a good bet for a gold bull.

The irony is the bet could be taken by someone who agrees with his analysis.
 
Quote from PaulRon:

Where else they gonna sell it?... How about the rest of the world. While the US dollar continues to depreciate other consumers in the rest of the world have been and are staring to pick up our slack. Asian countries are becoming wealthier and might actually start consuming their own goods in the future... wow... imagine that.
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What part of the "rest of the world" is going to replace the US consumer anytime soon? Take your time with the answer.

And when they stop selling to the US, what happens to their own economy?

OldTrader
 
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