Any good thoughts on gold?
- Thread starter TheStudent
- Start date
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10-27-03 03:28 PM
Re: Gold
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Quote from TheStudent:
I was hoping to ferret out some informed opinions on the whys and wherefores of the central banks in the gold game, but it seems like mentioning gold is like ringing the bell in a Pavlovian experiment.
Everyone starts going start raving mad and its a war between libertarian gold bugs and neo-"realist" rabid anti-conspiracy theorists!
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The simple fact is no one knows what this market or any other market is going to do. The experts track record's suck so why seek their opinions? You have to do your own thinking in this game.
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Alright Dude. Here it is. This should answer your original question.
......I hope.
This Chart should provide some of the answers you seek.
In responce to your post on page 2.Your attempt at exhibiting some intelligence was humorous.The Hunt brothers tried to corner the SILVER market.The forum subject is GOLD,and there is a world of difference between the two.Since you mentioned silver ,does that mean you think Warren Buffet is a paranoid clown who is hoarding silver.Your other posts are also void of intelligence on the subject of gold.The only thing you've accomplished here, is reveal you're intelligence level.
Just wanted to know whether you were planning on trading the future (COMEX or perhaps London, I would do COMEX!) or physicals. If you where thinking of trading futures on the COMEX then please PM me. I have some experience there, and my opinion is I don't care if the product has any true intrinsic value as long as it moves and I understand the market (which I believe I do when it comes to gold futures). I think I may be able to help you if you have any interest in trading future on the COMEX, getting a good deal and making sure you get a broker who will give you good executions.
Gold's going over $400 but the question is when? If your doing the futures you may run out of time. Just a thought.
Dont spend any time thinking about the extremeists,because the truth is some where in the middle.I dont know why people have such a difficult time grasping the concept that a weaker dollar means a higher gold price,or that a substatially weakened dollar means a substantially higher gold price.And why is it that people can believe that a $2 tech stock could somehow be worth $200 but cant understand why gold is moving up.We're not talking economic armaggeddon,hoarding metal,or rampant paranoia.What we are talking about is golds importance as a hedge in a weakening dollar enviornment.We are not marrying these investments, because you probably would sell off most gold positions should the dollars trend reverse itself and start appreciating.Unfortunately that doesn't seem like it will happen anytime soon.
Supply and Demand looks good for gold (but certainly nothing like the 1970's). From what I've read, gold exploded in the 1970's, simply due to supply and demand. Supply had been going down due to less mining, and less interest in gold (thanks to the US govts knucklehead decision to keep the price fixed at $35 an ounce). There wasn't much incentive to go out and open new mining operations. Demand slowly crept up. People found new uses for it since it was so cheap. Inflation and a dollar collapse in the 70's helped gold go up, but supply and demand were working well in its favor regardless.
Now you've had a 20 year bear market. You still have alot of supply. Demand could go up because of the dollar, because of india and china growth and because of inflation. I don't see it going back to $850 an ounce. But above $400 over the next few years.
Now you've had a 20 year bear market. You still have alot of supply. Demand could go up because of the dollar, because of india and china growth and because of inflation. I don't see it going back to $850 an ounce. But above $400 over the next few years.
How about an area of dynamic equilibrium between complete currency collapse and status quo ? For instance: fiat (paper) currencies still in effect, but all greatly reduced in value relative to the only 'real' currency - gold ? Fiat currencies may be devalued in a leap-frog fashion as countries try to gain trade advantages by undercutting competitors' paper. The U.S. is currently passively devaluing their currency ( down 25%+ in a year ) by keeping interest rates low. The U.S. economic recovery is being aided by this strategy, but the danger of collapse of the U.S. economy by way of the withdrawal of foreign investment is a dangerous possibility that Greenspan et al monitor closely.
Given that currency values are not absolute and that the downward spiral of competitive devaluations has no zero point, gold could conceivably rise indefinitely - ad infinitum! However, because (amongst numerous other reasons) there are hundreds of billions of dollars in DERIVATIVES associated with gold bullion commitments, the governments of the world must handle their devaluations in a gingerly fashion. The U.S. has built a global empire based on the reliability of its currency ; a sudden transition from a greenback-based global economy to a global economy based on some other currency (Euro, Yuan, Gold) would entail a period of chaos with unforseeable consequences. Every government in the world is watching the U.S. dollar devaluation with trepidation; they have a vested but weakening interest in the staus quo.
The U.S. still runs the show and has so far been able to manage the devaluation of its currency without triggering a round of competitve devaluations. If the greenback drifts much lower, however, many nations (Japan, Britain, Germany) may be left with no choice other than devaluation - and then the gold price will rise dramatically.
Incidentally, there is enough money in global pension funds to buy all the gold in the world hundreds of time over.
Let's hope the current currency adjustments (U.S. dollar retreat) are orderly. If gold goes crazy we're all in trouble, but it could increase in value substantially without Greenspan losing all control. The U.S. dollar could continues its downward drift to a new point of more-or-less stable equilibrium and gold would correspondingly rise; if other countries jump into the devaluation fray, gold will rise exponentially.
We're walking a path on the edge of a cliff - stay alert!
Given that currency values are not absolute and that the downward spiral of competitive devaluations has no zero point, gold could conceivably rise indefinitely - ad infinitum! However, because (amongst numerous other reasons) there are hundreds of billions of dollars in DERIVATIVES associated with gold bullion commitments, the governments of the world must handle their devaluations in a gingerly fashion. The U.S. has built a global empire based on the reliability of its currency ; a sudden transition from a greenback-based global economy to a global economy based on some other currency (Euro, Yuan, Gold) would entail a period of chaos with unforseeable consequences. Every government in the world is watching the U.S. dollar devaluation with trepidation; they have a vested but weakening interest in the staus quo.
The U.S. still runs the show and has so far been able to manage the devaluation of its currency without triggering a round of competitve devaluations. If the greenback drifts much lower, however, many nations (Japan, Britain, Germany) may be left with no choice other than devaluation - and then the gold price will rise dramatically.
Incidentally, there is enough money in global pension funds to buy all the gold in the world hundreds of time over.
Let's hope the current currency adjustments (U.S. dollar retreat) are orderly. If gold goes crazy we're all in trouble, but it could increase in value substantially without Greenspan losing all control. The U.S. dollar could continues its downward drift to a new point of more-or-less stable equilibrium and gold would correspondingly rise; if other countries jump into the devaluation fray, gold will rise exponentially.
We're walking a path on the edge of a cliff - stay alert!