GOLD [Archive] - Page 2 - Sharetrader Forum

Aussie

08-02-2009, 01:11 PM

Let's hope and pray the Mr. Key and Mr. English don't follow Australia's lead and send New Zealand down the road of massive deficit spending that will put us back into the debt trap of the 1980's . . .

The Revolt Of The Masses?

Just over a week ago, the Australian government under Mr Kevin Rudd came out with a plan to literally "inject" nearly $A 1000 into the bank accounts of almost every adult Aussie. He also revealed plans to borrow and spend the tidy sum of $A 118 Billion over the next four years. Why? To "rescue" Australia from recession.

This is not a joke, it is being shouted fervently by politicians, central bankers, Treasurers and eminent financial and economic "experts" all over the world. Some if not many of them in all likelihood actually believe it. After all, they have spent their entire lives with the absolute conviction that the solution to all problems, political and/or economic, is to do one of two things. They either regulate it or throw money at it.

Credit, they say, is the "life blood" of the economy. Consider, for a moment, the thoughts on the subject of Henry Hazlitt, an eminent economist and journalist from the past:

"There is a strange idea abroad, held by all monetary cranks, that credit is something that a banker gives to a man. Credit, on the contrary, is something a man already has. He has it, perhaps, because he already has marketable assets of a greater cash value than the loan for which he is asking. Or he has it because his character and past record have earned it. He brings it into the bank with him. That is why the banker makes the loan."
Henry Hazlitt - Economics In One Lesson - 1946

Compare this "old fashioned" insight with the modern practice of almost literally throwing "money" at people with total abandon and with a complete lack of discrimination. For decades, very few thought to wonder about where all this "money" was coming from. It had been almost universally accepted that economic health was measured by the volume of borrowing and then spending the borrowed money. Economics was cut in half with production discarded and consumption embraced as the only economic "problem" left to solve.

The lifeblood of an economy is wealth and the ONLY means of bringing wealth into existence is to PRODUCE it. Money is NOT wealth, it is merely an indispensible medium by which the wealth which exists can be exchanged between those who have brought it into existence. Wealth cannot be created out of thin air. And all the "deficit spending" and/or easy credit schemes in the world cannot PRODUCE it either.

What Mr Rudd in Australia and all his counterparts in all the capital cities of the world are staring at in horror is the inevitable end result of their own meddling. They have created a monster, an economy which is imploding because the artificial demand created by borrowing can no longer be sustained. To prattle about "preventing" a recession or "rescuing" a nation from recession is laughable. The world is IN recession. Productive capacity has for decades geared itself up to meet an artificially induced "demand" which is no longer sustainable. The economies of the world are littered with malinvestments, productive capacity for which the demand which only ever existed on paper or on computer screens has now literally evaporated. The gargantuan deflations in world stock, real estate and commodity markets have already taken place.

For almost two years now, people all over the world have been watching their governments haul interest rates down by main force, pump huge amounts of "liquidity" into banks and pile "stimulus" package after "stimulus" package into a system already choked with obviously unrepayable debt. People have lost paper fortunes on investments of almost all descriptions. And with every new nostrum and every new dollop of borrowed "money", they have watched the situation get still worse.

They are starting to stir.

A poll taken by an Australian paper shortly after it was announced asked Australians if they "approved" of the "stimulus" package announced by their Prime Minister. Fifty-one percent of those responding said no. In the UK, the announcement by the Bank of England this week that they were cutting official rates another 0.50% - to 1.00% - was met by a STORM of protest! The Bank was accused of an assault on savers. Even President Obama's stimulus bill is being seen in a harsher light by Americans. US polls show that support amongst Americans for the bill is falling fast with only 37 percent of respondents "backing" the legislation.

Unlike their political leaders, most so-called "ordinary people" are well aware that their nation is IN recession and that the recession is worsening with frightening rapidity. They have watched all the bailouts and the handouts. They have watched as interest rates have been obliterated. They are beginning to look with increasing suspicion at a situation in which the "seed corn" so vital to underpin any REAL recovery is being mercilessly attacked with the assault on interest rates.

There is a point where even the "full faith and credit" which underpins the entire monetary and financial structure of the world today can no longer command allegience. We are not at that point yet, but every new bailout plan and "stimulus" package brings it closer.

Gold is simply waiting in the wings.

AMR

08-02-2009, 08:50 PM

Beware Cash4Gold and other gold-buying ripoffs

Fri Feb 6, 2009 11:41AM EST
See Comments (http://tech.yahoo.com/blogs/null/118748;_ylt=AsCnXfPS0fi3SRcS9GaazDLxMJA5#see_comme nts) (753)
Buzz up!on Yahoo! (http://buzz.yahoo.com/article/y_tech/%2520http%253A%252F%252Ftech.yahoo.com%252Fblogs%2 52Fnull%252F118748)
http://a323.yahoofs.com/ymg/null__13/null-961659403-1233937810_thumb.jpg?ymSmfwADhAx_sCfy (http://a323.yahoofs.com/ymg/null__13/null-961659403-1233937810.jpg?ymSmfwAD5Ia92tjm)I don't watch much broadcast TV, and when I do I skip as many commercials as possible, but even I have seen the incessant televised advertisements for a company called Cash4Gold, and I'm sure most of you have, too (they even had a Super Bowl ad (http://www.youtube.com/watch?v=WRVzF9dBl7c)). The company is being heavily promoted online as well.
The sell sounds great on the surface: You pack up all your old jewelry that you'll never wear again into an envelope and send it, insured, to Cash4Gold. They melt it down and cut you a check for the value of the gold. End of process. It sounds better than going to a pawn shop -- the process is simple and requires no personal interaction with an appraiser -- so what could go wrong?
A little online sleuthing finds that I'm not the only one who figures that if Cash4Gold has this much money to spend on TV ads, someone's getting the short end of the stick, and it's probably the people sending in their family heirlooms to be melted into ingots. The folks at Cockeyed.com put Cash4Gold to the test (http://cockeyed.com/citizen/goldkit/cheat.shtml), rounding up a bunch of old rings, necklaces, and earrings, and taking them to a regular pawn shop to be appraised. The offer: $198 for the lot. They then sent the items to Cash4Gold and waited for a check in the mail. It arrived within a few days as promised... in the amount of 60 bucks. (You don't have to accept the check; the deal isn't done until you cash it.)
That price alone is practically criminal, but that's where the truly slimy part of the operation begins. First, if you call Cash4Gold and ask for your stuff back, you abruptly get a better offer: In the case of the above experiment, the offer was a whopping $178. That's a better deal, but still not market rate, though the caller was told that Cash4Gold could "manipulate the numbers on their end" to make it appear that more product was sent than was in reality. Bizarre, but it's really the only way Cash4Gold can cover its behind to convince you the original offer wasn't a wholesale ripoff.
As bad as that is, it's far worse if you opted for the company's "Fast Cash" option. Here, that original offer ($60) is wired into your bank account within 24 hours of them receiving the booty. It sure is fast, but it's not much cash -- and you don't have the option of declining the offer at all. You're stuck with a pittance for your valuable gold items. (It's also worth noting that Cash4Gold (http://cockeyed.com/citizen/goldkit/reputation.shtml) has offered Cockeyed cash 4 removing its expose from the web...)
As a side note, another website offers an in-depth expose on how the system works (http://www.complaintsboard.com/complaints/cash4gold-c117648.html), this time analyzed from the inside by a former employee. Here it's outlined how the company offers bonuses to phone operators who can convince you to accept a lower offer and how the company attempts to delay payments as long as possible. It's also worth a look if you're considering sending stuff to Cash4Gold anyway and haggling for a better deal.

---------------------------------

I wish they calculated how much that gold was worth on the spot market...

srowe

09-02-2009, 02:13 PM

[QUOTE=Aussie;242849]

Depending on who you are dealing with, during this time you can be financially exposed as your funds are "out there" in someone else's account until delivery. If it's with a solid, reputable dealer the chances of a problem are minimized but still there is an element of risk.

Its interesting to note that I was told by New Zealand mint that once the gold was bought and waiting for delivery[4-6wks?] that you could still sell your gold if it rose which I suppose takes a little of the uncertainty out of the situation[its still sell at 1% below spot though]
i guess threre is still a big advantage to having it physically right away but ofcourse there is no guarantie you are getting the real thing and i would be very nervious putting $2000 into someones bank acc and then waiting for the supposeably gold coin.

arco

09-02-2009, 02:37 PM

I picked this info up elsewhere - haven't had time to research the actual article yet.

Dr Petrov stated that that gold increased in value against a basket of commodities he called CRB, only twice in the 20th century 1906 & 1933. Interestingly at both times Gold had a fixed price and there was deflation. What is really interesting is that gold stayed exactly the same in comparative value to the CRB ( according to Dr Petrov) in the 1970's and early 80s.

arco

09-02-2009, 04:45 PM

Trade Me auction today - Gold premium about 15%

Half Sovereign 1865 Sold at: $230.00

Actual Gold Content (Troy Ounces)0.1177

Est value $200 NZD of gold content.

http://www.trademe.co.nz/Browse/Listing.aspx?id=200550643

Compare a Krug closing soon currently at $1930 may go higher.

Gold value currently about $1720

http://www.trademe.co.nz/Browse/Listing.aspx?id=200952038

Aussie

09-02-2009, 08:36 PM

Its interesting to note that I was told by New Zealand mint that once the gold was bought and waiting for delivery[4-6wks?] that you could still sell your gold if it rose which I suppose takes a little of the uncertainty out of the situation[its still sell at 1% below spot though]
i guess threre is still a big advantage to having it physically right away but ofcourse there is no guarantie you are getting the real thing and i would be very nervious putting $2000 into someones bank acc and then waiting for the supposeably gold coin.

Don't know for sure, but I'd be surprised if NZ Mint didn't pay at least spot for incoming gold Kiwis. Since there are precious few sellers and a wait of 4-6 weeks, I'm sure they would jump at the chance to acquire immediate inventory and would likely be calling a buyer . . . for another quick 6%!

But people sure seem to be happy enough to acquire them on TM and that's a better price than you'd ever get from the NZ Mint - they will have to meet the market to some degree IMO.

srowe

10-02-2009, 01:57 PM

arco

10-02-2009, 02:21 PM

they still claim they buy at spot-1% but like you say,they may be open to neg.
They also said they were uping the sell % from 7 to 8 but would still sell me at 7% since I bought once before at that rate.
It would be interesting to call and ask and see whether they were bulsh----g me

I just rang them and they confirmed Spot +8% and buy back -1%

They also said they now have an additional new supplier in Europe so lead in times should shorten. (currently 3-4 weeks)

Kiwi 1oz $1840 - currently Gold.NZD = $1691. Approx 9% premium

arco

srowe

10-02-2009, 02:33 PM

Its 9% because the spot we see is in N Z $ at the cross rate but unfortunately when we [and nz mint]buy, the bank takes thier exchange rate spread,making it 9%

I envy my mates in Montreal who can just drive over to Kitco and buy coins wih no fuss in thier own currency or better still,New York.

but look at all the other benefits here in GODZONE prob much better place to be if the probverbial sh-t hits the fan

arco

10-02-2009, 02:58 PM

Received these by e-mail from http://www.rathi.com/commodities.asp

Money flow continues in gold as total gold stocks with SPDR
gold funds crossed 850 tonnes this week. Looking at this weeks
economic indicators not much seem to be in store expect the
retail sales. Funds Also increased their net long in gold by 12%
Retail sales is expected to deteriorate further taking in view the
pathetic situation of American economy. Another factor that will
be the key is passing of $937 rescue package by American senate.
This bill assumes significance as it will test Barrack
Obama’s influence in the senate. Another key factor will be the
employment scenario in U.S. with unemployment rate touching a
high of 7.5% one can expect govt to come out with some stern
measures which can bring in certain amount of optimism in the
markets. However even taking all this into considerations we
expect dollar to strengthen against major currencies of the
world. The reason is that situation is expected to deteriorate
further in European countries which will lead to problems for
euro and other currencies. We see Euro Zone following other
developed nations and bringing their interest rates to 1% in
coming months. All these factors will lead to rise in gold prices
and we expect $950-$980 as a potential short term target..
however $930 remains a key resistance and above that a further
bullishness will be seen. All these factors will lead to rise in gold
prices and we expect $950-$980 as a
potential short term target.

arco

10-02-2009, 07:09 PM

1oz 1990 Australian Nugget just sold on Trademe for $1890
so about 17% over spot/NZD.

Not sure how much %wise you would lose if you have to trade
them in with a dealer (if unable to sell them on-line )

So maybe the 1oz Kiwi is better value - mint condition and $50 less.

Aussie

10-02-2009, 08:22 PM

I envy my mates in Montreal who can just drive over to Kitco and buy coins wih no fuss in thier own currency or better still, New York . . .

I have bought many times from the US and had gold and silver shipped in via Fed Ex. Paid 5% over spot + shipping and insurance on Maples, Buffaloes, GAE's and Philly's with Larry LaBorde at The Silver Trading Company in Shreveport Louisiana.

http://www.silvertrading.net

A perfect southern gentleman and AAARated in my opinion.

Also bought Kangas from Jaggards in Sydney and just picked 'em while over there sometime.

outspoken

10-02-2009, 11:04 PM

1oz 1990 Australian Nugget just sold on Trademe for $1890
so about 17% over spot/NZD.
Do we know what Trademe charges in commission for this trade?
I know for some things it's around 6% decreasing the higher $ amount

But for gold? I wonder what their clip is?

Dr_Who

11-02-2009, 07:36 AM

Anyone here know whats the best way to sell a 18 ct gold Rolex watch?

I bought this watch about 20 years ago for $45k and it has been sitting in the safe. It is in excellent condition and only worn it a few times. I dont use it, so may as well sell it. How do I go about selling something like this in NZ?

CAM

11-02-2009, 08:27 AM

Do we know what Trademe charges in commission for this trade?
I know for some things it's around 6% decreasing the higher $ amount

But for gold? I wonder what their clip is?

Trade me charges are here

http://www.trademe.co.nz/Help/Topic.aspx?help_id=18

Basically this........
Success fees
Up to $1506.9% of sale price (50c minimum) $150 - $1500 $10.35 + 4.5% of sale price over $150 Over $1500$71.10 + 1.9% of sale price over $1500
(max fee = $149)

CAM

11-02-2009, 08:37 AM

I have bought many times from the US and had gold and silver shipped in via Fed Ex. Paid 5% over spot + shipping and insurance on Maples, Buffaloes, GAE's and Philly's with Larry LaBorde at The Silver Trading Company in Shreveport Louisiana.

http://www.silvertrading.net

A perfect southern gentleman and AAARated in my opinion.

Also bought Kangas from Jaggards in Sydney and just picked 'em while over there sometime.

For peoples info...from the website...not quite for the little guy.

INTERNATIONAL ORDERS
The minimum international order is 500 ounces of silver, plus additional charges for shipping and handling.

Please add 2.0% commission to all international (export) orders. Our minimum commission is $25 U.S. dollars on any one order.
Please be advised that the U.S. does not charge an export tax on international shipments; therefore, you are responsible for determining and paying any and all local taxes, V.A.T., or import duty which may be applicable in your country

The minimum gold order for international orders is 15 ounces

srowe

11-02-2009, 09:19 AM

arco

11-02-2009, 09:31 AM

What is forum members opinion on the best gold coin to have in your inventory?

Basically they are all 1oz, so is there any advantage which gold coinage
you have - and why?

Krugerrand
Maple
Eagle
Kiwi
Buffalo

Aussie

11-02-2009, 09:49 AM

For peoples info...from the website...not quite for the little guy.

INTERNATIONAL ORDERS
The minimum international order is 500 ounces of silver, plus additional charges for shipping and handling.

Please add 2.0% commission to all international (export) orders. Our minimum commission is $25 U.S. dollars on any one order.
Please be advised that the U.S. does not charge an export tax on international shipments; therefore, you are responsible for determining and paying any and all local taxes, V.A.T., or import duty which may be applicable in your country

The minimum gold order for international orders is 15 ounces

The times I have bought from him, I spoke with Larry direct and was wiring funds directly from my US account so I got a better deal than that but still, I did order couple of monster boxes of ASE's and a box of CSE's . . . it's just hard to find cheap gold and silver ain't it!

I remember that the silver cost me about US$15.50 an once to my door back when the NZD was in the high .70's so I figured it was a good deal at the time compared to local prices of Silver Kiwis and Aussie Kookaburras which always seem so expensive.

srowe

11-02-2009, 04:59 PM

Yea I found the Oz stuff to be the dearest of the lot.
If we visit my wifes family in Montreal any time soon.I may just rock up to Kitco and buy some myself.
Does anyone know how much gold you can bring into the country without incurring duty [or jail time]
It seems you can get any amount sent.
sounds like you timed it just right Aussie, but I guess anyone who buys now may say the same thing if the melt down occurs[sorry for pun] Meanwhile hopefully the 1-2% we are talking about will become a non issue

The real issue now is whether to change the term dep into gold as they mature...decisions..decisions

arco

11-02-2009, 07:47 PM

Received today from Commoditymarkets2008.....................the pics were not attached for whatever reason

IN THE LONG TERM: WILL GOLD KEEP YOU SAFE ?

The global economic recession now has a literal "golden" lining: One Japanese jeweller's '09 collection of "Lucky Dolls" -- solid, 24-carat gold figurines that, according to tradition, are able to "ward off evil spirits and herald the coming of spring."
Small world. Mainstream financial wisdom makes a very similar claim; roughly: He who invests in GOLD shall avert the pain of economic uncertainty and unrest. In light of the current market maelstrom, this belief has never been stronger, as these recent news items make plain:

"Bullion Sales Hit Record In Stampede To Safety. Inflows into the world's largest gold-backed exchange traded fund surged to all-time high in January… amid renewed fears about the health of the global financial system." (Financial Times)
"…Known for its durability during a slowing economy, gold prices and sales have been steadily rising." (AP)
"Gold Rush: Investors are buying gold… rather than looking for a quick gain. This is a new round of safe haven buying." (Bloomberg)

Sure, the usual pundits tout gold as the ultimate safe-haven TODAY, when prices stand at a six-month high. Back in October 2008, however, with gold prices 30% in the red and hobbling at a one-and-a-half year low -- they shunned the metal as a certain casualty of the credit crisis.
To wit: "Gold prices plunge on recession fears. Confidence is at rock bottom. No one wants to be long any commodity." -- October 24, 2008, Bloomberg.
Really, these folks see gold as a surefire safe-haven when prices are rising; and NOT as one when prices fall. That's a recipe for disaster.
As for whether the precious metal TRULY does provide shelter from the economic storm, the March 14, 2008 Elliott Wave Theorist has the answer. In that publication, Elliott Wave International president Bob Prechter presented an indisputable case AGAINST the "safe-haven" status of Gold.
The first piece of evidence: The following table showing gold's performance during the 11 officially recognized recessions beginning in 1945.
Chart (http://www.elliottwave.com/images/futuresfocus/20081117a_nico.gif)
Bob also plotted the Dow Jones Industrial Average into the same period and made this startling discovery: The average total return for the Dow during recessions since 1945 is 6.89%. Taking into account modern transaction costs, the Dow actually beats gold with a 6.87% return.
The most powerful myth-debunking punch of all, though, came via the second chart of gold's performance -- this time during periods of financial growth.

Chart (http://www.elliottwave.com/images/futuresfocus/20081117b_nico.gif)
In Bob's own words: "All huge gains in gold have come while the economy was expanding… The idea that gold reliably rises during recessions and depressions is wrong. In fact, like most such passionately accepted lore, it's backwards."

arco

11-02-2009, 10:18 PM

The IMF does well in difficult times for the global economy as its income to meet its internal budgets arises from loans to nations in economic difficulties. In such times IMF loans increase, as does its income, which could mean there is not such a pressing need for the Fund to sell its gold says London's VM Group.

Author: Lawrence Williams
Posted: Wednesday , 11 Feb 2009
LONDON -
Some two years ago the gold price was hit, albeit temporarily, by the announcement that the International Monetary Fund would sell 403 tonnes of gold as the basis of an endowment, the interest on which would be used to help defray the shortfall in the IMF budget. Indeed, at the time the Fund was suffering as its loan book was shrinking, eventually falling to SDR5.8bn at the end of the first quarter of 2008. The IMF does well when the world economy does badly, but conversely does badly when the world economy does well and at that time the global economy seemed to be riding high.

Full article (http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=78268&sn=Detail)

Aussie

11-02-2009, 10:57 PM

Does anyone know how much gold you can bring into the country without incurring duty [or jail time]
It seems you can get any amount sent . . .

Traveling with gold is NOT illegal, I don't know why people seem to think it is. I have travelled back from Australia many times sometimes with as much as 70 oz, which only one time was my bag inspected by outgoing security in Sydney (in a private room) and there were no hassles, the security guys were extremely professional.

Even if you are carrying more than the face value of the coins (Kangas are A$100) then it's no big deal to fill out a declaration. There are no taxes, duties or dirty looks . . .

peat

11-02-2009, 11:39 PM

Received today from Commoditymarkets2008.....................the pics were not attached for whatever reason

IN THE LONG TERM: WILL GOLD KEEP YOU SAFE ?
… The idea that gold reliably rises during recessions and depressions is wrong. In fact, like most such passionately accepted lore, it's backwards."

yes , both elliot wave and gann global have been bearish on the metals and commodities in general.
Prechter of EWI seem to have a very dismal view pretty much all the time - it does wear you down a bit. THey're offering some free book on deflation but I was too exhausted to d/l and read coz my anti-depressants hadnt arrived

the face value of the coins
so you're saying that due to the $10k currency import threshold you only have to declare bringing in over 100 oz's (where they are face value $100) even tho 99 oz is worth $175k ?
Awesome

Aussie

12-02-2009, 10:54 PM

. . . so you're saying that due to the $10k currency import threshold you only have to declare bringing in over 100 oz's (where they are face value $100) even tho 99 oz is worth $175k ?
Awesome

Pretty much peat. The coins were looked at and the question was asked "how many are there?" 72 I replied - which had a face value of A$7,200 or less than NZ$10k. . There were two customs/security officers and my wife and I in a small room with rolls of gold coins all over table . . . if they had a problem they would have said so. One of the guys actually smiled and said he was a silver collector and wished us luck. Like I said, very discreet, courteous and professional. I wold not expect the same of the TSA staff in the USA . . .

Going through Auckland was a breeze also.

srowe

13-02-2009, 10:29 AM

anyone know if krugs have a face value?

JBmurc

13-02-2009, 10:57 AM

Nervous Chinese To Diversify Into Gold
With Massive $1.95 Trillion Foreign Reserves
Mark O'Byrne
11 February 2009

Of even more significance are the drumbeat of Chinese concerns, the U.S.' largest creditor regarding their massive U.S. Treasury and other debt holdings. Bloomberg reports that influential Yu Yongding, a former adviser to the People's Bank of China, said that China should seek guarantees that its $682 billion holdings of U.S. government debt won't be eroded by "reckless policies". Premier Wen Jiabao said last month his government's strategy for investing would focus on safeguarding the value of China's massive $1.95 trillion foreign reserves.

Yongding said that "China should diversify its reserves away from U.S. Treasuries if the value of China's foreign-exchange reserves is in danger of being inflated away by the U.S. government's pump-priming," he said. He has previously said that China should diversify into the euro, yen, oil and gold. Yongdinghas has warned of possible panic selling of dollar assets leading to a global financial collapse and has said that the potential increases in the value of gold meant China should be hedging its bets by diversifying into gold.

Dow Jones reported in November that China's central bank is considering raising its gold reserve by 4,000 metric tons from 600 tons to diversify risks brought by the country's huge foreign exchange reserves, according to a Chinese newspaper.

China has almost certainly been nibbling in the gold market as they attempt to gradually diversify out of dollars and into gold. Especially in light of the fact that they have less than 1% of their currency reserves in gold unlike most western nations whose gold reserves are very significant percentages of their overall reserves. Despite having the largest foreign currency reserves in the world, they are only 9th in terms of central bank gold reserves and this will change in the coming years as they rebalance and diversify their foreign exchange reserves.

Mark O'Byrne, Executive Director

Gold and Silver Investments Limited

Mark O'Byrne is Executive Director of Gold and Silver Investments Limited (www.goldassets.co.uk). He is regularly quoted and writes in the international financial media and was awarded Ireland's prestigious Money Mate and Investor Magazine Financial Analyst of 2006.

Aussie

13-02-2009, 10:13 PM

anyone know if krugs have a face value?

No, they have a date. Gold coins are a bit of a mixed bag. Here's a list of the coins that I have and their info . . .

24k Gold Kiwi's - No FV - No date
24k Austrian Philharmonic - 2,000 Schillings + Dated
22k SA Krugerrand - Date Only
24k Chinese Panda - 100 Yuan - Dated
24k USA Buffalo - US$50 - Dated
22k USA Gold Eagle - US$50 - Dated
24k Australian Kangaroo - A$100 - Dated
24k Canadian Gold Maple - C$50 - Dated

Hope this helps.

Cheers

Aussie

13-02-2009, 10:18 PM

Capitalism needs a sound-money foundation.

By Judy Shelton
The Wall Street Journal
Thursday, February 12, 2009

http://online.wsj.com/article/SB123440593696275773.html

Let's go back to the gold standard.

If the very idea seems at odds with what is currently happening in our country -- with Congress preparing to pass a massive economic stimulus bill that will push the fiscal deficit to triple the size of last year's record budget gap -- it's because a gold standard stands in the way of runaway government spending.

Under a gold standard, if people think the paper money printed by government is losing value, they have the right to switch to gold. Fiat money -- i.e., currency with no intrinsic worth that government has decreed legal tender -- loses its value when government creates more than can be absorbed by the productive real economy. Too much fiat money results in inflation -- which pools in certain sectors at first, such as housing or financial assets, but ultimately raises prices in general.

Inflation is the enemy of capitalism, chiseling away at the foundation of free markets and the laws of supply and demand. It distorts price signals, making retailers look like profiteers and deceiving workers into thinking their wages have gone up. It pushes families into higher income tax brackets without increasing their real consumption opportunities.

In short, inflation undermines capitalism by destroying the rationale for dedicating a portion of today's earnings to savings. Accumulated savings provide the capital that finances projects that generate higher future returns; it's how an economy grows, how a society reaches higher levels of prosperity. But inflation makes suckers out of savers.

If capitalism is to be preserved, it can't be through the con game of diluting the value of money. People see through such tactics; they recognize the signs of impending inflation. When we see Congress getting ready to pay for 40% of 2009 federal budget expenditures with money created from thin air, there's no getting around it. Our money will lose its capacity to serve as an honest measure, a meaningful unit of account. Our paper currency cannot provide a reliable store of value.

So we must first establish a sound foundation for capitalism by permitting people to use a form of money they trust. Gold and silver have traditionally served as currencies -- and for good reason. A study by two economists at the Federal Reserve Bank of Minneapolis, Arthur Rolnick and Warren Weber, concluded that gold and silver standards consistently outperform fiat standards. Analyzing data over many decades for a large sample of countries, they found that "every country in our sample experienced a higher rate of inflation in the period during which it was operating under a fiat standard than in the period during which it was operating under a commodity standard."

Given that the driving force of free-market capitalism is competition, it stands to reason that the best way to improve money is through currency competition. Individuals should be able to choose whether they wish to carry out their personal economic transactions using the paper currency offered by the government, or to conduct their affairs using voluntary private contracts linked to payment in gold or silver.

Legal tender laws currently favor government-issued money, putting private contracts in gold or silver at a distinct disadvantage. Contracts denominated in Federal Reserve notes are enforced by the courts, whereas contracts denominated in gold are not. Gold purchases are subject to taxes, both sales and capital gains. And while the Constitution specifies that only commodity standards are lawful -- "No state shall coin money, emit bills of credit, or make anything but gold and silver coin a tender in payment of debts" (Article I, Section 10) -- it is fiat money that enjoys legal tender status and its protections.

Now is the time to challenge the exclusive monopoly of Federal Reserve notes as currency. Buyers and sellers, by mutual consent, should have access to an alternate means for settling accounts; they should be able to do business using a monetary unit of account defined in terms of gold. The existence of parallel currencies operating side-by-side on an equal legal footing would make it clear whether people had more confidence in fiat money or money redeemable in gold. If the gold-based system is preferred, it means that people fully understand that the purpose of money is to facilitate commerce, not to camouflage fiscal mismanagement.

Private gold currencies have served as the medium of exchange throughout history -- long before kings and governments took over the franchise. The initial justification for government involvement in money was to certify the weight and fineness of private gold coins. That rulers found it all too tempting to debase the money and defraud its users testifies more to the corruptive aspects of sovereign authority than to the viability of gold-based money.

Which is why government officials should not now have the last word in determining the monetary measure, especially when they have abused the privilege.

The same values that will help America regain its economic footing and get back on the path to productive growth -- honesty, reliability, accountability -- should be reflected in our money. Economists who promote the government-knows-best approach of Keynesian economics fail to comprehend the damaging consequences of spurring economic activity through a money illusion. Fiscal "stimulus" at the expense of monetary stability may accommodate the principles of the childless British economist who famously quipped, "In the long run, we're all dead." But it shortchanges future generations by saddling them with undeserved debt obligations.

There is also the argument that gold-linked money deprives the government of needed "flexibility" and could lead to falling prices. But contrary to fears of harmful deflation, the big problem is not that nominal prices might go down as production declines but rather that dollar prices artificially pumped up by government deficit spending merely paper over the real economic situation. When the output of goods grows faster than the stock of money, benign deflation can occur -- it happened from 1880 to 1900 while the U.S. was on a gold standard. But the total price-level decline was 10% stretched over 20 years. Meanwhile, the gross domestic product more than doubled.

At a moment when the world is questioning the virtues of democratic capitalism, our nation should provide global leadership by focusing on the need for monetary integrity. One of the most serious threats to global economic recovery -- aside from inadequate savings -- is protectionism. An important benefit of developing a parallel currency linked to gold is that other countries could likewise permit their own citizens to utilize it. To the extent they did so, a common currency area would be created not subject to the insidious protectionism of sliding exchange rates.

The fiasco of the G-20 meeting in Washington last November -- it was supposed to usher in "the next Bretton Woods" -- suggests that any move toward a new international monetary system based on gold will more likely take place through the grass-roots efforts of Americans. It may already be happening at the state level. Last month Indiana state Sen. Greg Walker introduced a bill -- "The Indiana Honest Money Act" -- which would allow citizens the option of paying in or receiving back gold, silver or the equivalent electronic receipt as an alternative to Federal Reserve notes for all transactions conducted with the state of Indiana.

It may turn out to be a bellwether. Certainly, it's a sign of a growing feeling in the heartland that we need to go back to sound money. We need money that works for the legitimate producers and consumers of the world -- the savers and borrowers, the entrepreneurs. Not money that works for the chiselers.

----

Ms. Shelton, an economist, is author of "Money Meltdown: Restoring Order to the Global Currency System" (Free Press, 1994).

Aussie

14-02-2009, 02:36 AM

Fear and Greed

Richard Russell (snippet)
Dow Theory Letters
Feb 12, 2009

February 11, 2009 Gold -- There's only one item that is bought through both fear and greed. That item is gold. Are you worried about the viability of the dollar? Then buy gold -- (fear). Are you afraid that the gold market is getting away from you? Then don't wait -- buy gold (greed).

Those subscribers who have heeded my advice -- "buy gold." They are doing OK today. Of course, for years I advocated buying gold coins and hiding them away and never looking at them or thinking of selling those little beauties. Now if you want gold, you have to buy "paper gold" in the form of GLD. Which is probably OK. Below we see an up-dated chart of GLD. And we see the breakout today at 92.29. This completes a huge base, which started at the 69 box and since has been building and building.

Note the numerous down-columns, these are the "wipe-outs" which periodically scare people OUT of their gold. Today, with the upside breakout at the 93 box on the P&F chart, we're forced to buy gold in the 944 (April futures) area. For those who missed out on gold when it was in the 700s and 800s, this is a scary proposition. So question -- is it too late to buy GLD or high-premium coins if you can find them?

As I see it, the frenzy, the speculative phase of gold, the rush of a frightened public -- lies ahead. Big bull markets always find a way to keep you frightened and OUT. Big bull markets are devils with no conscience -- to get in you have to "close your eyes, and just do it." Not easy, but in this business nothing is easy except losing money. Which is why I've always loved the gold coins. You buy 'em, you're not tempted to trade 'em, they look great and they feel great. And they're not made of paper, nor can they be created with a computer. Ultimately, "There's no fever like gold fever." And I'm beginning, just beginning, to feel the fever now. When I look at the chart, I can sense the fever rising.

Fiat paper fans and the Fed denigrate gold. They fear gold and despise it. They prefer the Federal Reserve Notes that they can manufacture at will. But as gold rises, they must face the fact that the Notes they manufacture are being devalued. You see, for thousands of years gold has been the standard against which all assets and currencies are measured. When the big bear arrives and everything faces the fire, "gold will be the last man standing, not dollars, not political talk or Presidential promises -- the only survivor will be the eternal and ultimate safe asset -- gold.

Notice the difference in gold trading during the day? Very little profit-taking. Buyers are buying gold to hold rather than to grab intra-day profits.

Richard Russell
website: Dow Theory Letters
email: Dow Theory Letters
Russell Archives
© Copyright 1958-2009 Dow Theory Letters, Inc.

Richard Russell began publishing Dow Theory Letters in 1958, and he has been writing the Letters ever since (never once having skipped a Letter). Dow Theory Letters is the oldest service continuously written by one person in the business.

srowe

14-02-2009, 08:40 AM

thanx for the input on face value Aussie Looks like G maples would be the best bet for carrying from Canada

AMR

14-02-2009, 09:43 AM

Aussie

14-02-2009, 11:42 AM

I met up yesterday with a gold trader who believes that the bull run in gold is nearly over.

Reason being, the hedge funds are sitting on massive unrealised losses and going to be forced to sell gold and stock to fund their withdrawals.

That's surprising. It seems to me that to a large extent this has already happened. There was a massive amount of forced de-leveraging from hedge funds last October and gold sold down to it's $680 low on the back of a stronger USD.

From both a fundamental and technical point of view gold is currently exhibiting enormous strength. In mid December when the USDX dropped below 80, gold was in the $780 area. Since then, the trading pattern has changed significantly rallying about $160 despite a strong uptrend in the USD - this is not an insignificant development . . .

1255

Could it go down from here - possibly. But I would say that there are now many strong support lines below the current level and that any selling will be met with aggressive buying.

The US Senate this morning past a US$787B spending package. In addition to the US$700B TARP. States and municipalities are in need of a US$1Trillion bailout in order to keep their lights on . . . where is the money going to come from to fund this?

The fundamentals tell me that we are rapidly approaching the time when gold is the only place left to go. US Treasury market is a bubble waiting to pop. The dollar is on precipice of a history making decline. There is no where near enough savings in the entire world to fund the US Treasury over the next 12 months let alone the rest of Obama's term in office and the USD will begin to reflect this once "quantitative easing" begins in earnest.

So where does one go to seek safety if it cannot be found in cash or government bonds? In my opinion the bull market hasn't even begun yet . . .

Gold is now rising in USD and is making record highs in all currencies. In my opinion it will continue to do so regardless of what the world's hedge funds do. I would view any dip in the gold price from here out as a buying opportunity.

Aussie

14-02-2009, 04:18 PM

Global systemic crisis – New tipping-point in March 2009:

'When the world becomes aware that this crisis is worse than the 1930s crisis'
LEAP/E2020 anticipates than the unfolding global systemic crisis will experience in March 2009 a new tipping point of similar magnitude to the September 2008 one. According to our team, at that period of the year, the general public will become aware of three major destabilizing processes at work in the global economy, i.e.:

• the length of the crisis
• the explosion of unemployment worldwide
• the risk of sudden collapse of all capital-based pension systems

A whole range of psychological factors will contribute to this tipping point: general awareness in Europe, America and Asia that the crisis has escaped from the control of every public authority, whether national or international; that it is severely affecting all regions of the world, even if some are more affected than others (see GEAB N°28); that it is directly hitting hundreds of millions of people in the “developed” world; and that it is only worsening as its consequences reveal throughout the real economy. National governments and international institutions only have three months left to prepare themselves to the next blow, one that could go along severe risks of social chaos. The countries which are not properly equipped to cope with a surge in unemployment and major risks on pensions will be seriously destabilized by this new public awareness.

In this 30th issue of the GEAB, the LEAP/E2020 team describes these three destabilizing processes (two of them are described in this public announcement) and gives recommendations to cope with the surge in risks. In addition, this issue also provides the opportunity to make an objective assessment of the reliability of LEAP/E2020's anticipations and specifies a number of methodological aspects of the analytical process used. In 2008, LEAP/E2020's success rate reaches 80%, and even 86% when it comes to strictly socio-econimic anticipations. In a year of major upheavals, our teal ise altogether quite proud of this result.

The crisis will last at least until the end of 2010

1256
Evolution of the US money base and indications of related major US crisis periods (1910 – 2008)
Source: Federal Reserve Bank of Saint Louis / Mish’s Global Economic Analysis

As we already explained in GEAB N°28, the crisis will affect in different ways the different regions of the world. However, and LEAP/E2020 wishes to be very clear on that aspect, contrary to the dominant stance today (coming from those experts who denied the fact that a crisis was coming up three years ago, who denied that it was global two years ago, and who denied the fact that it was systemic six months ago), we anticipate that the minimum duration of the decanting phase of the crisis is 3 years (1). It shall be finished neither in spring 2009, nor in summer 2009, nor at the beginning of 2010. It is only towards the end of 2010 that the situation will start stabilizing again and improving a little in some regions of the world, i.e. Asia and the Eurozone, as well as in countries producing energy, mineral and food commodities (2). Elsewhere, it will continue; in particular in the US and UK, and in all the countries depending on their economy, were the duration could approximate a decade. In fact these countries should not expect any real return to growth before 2018.

Moreover no one should imagine that the improvement at the end of 2010 will correspond to a return of high growth. The recovery will take long. For instance, stock markets will take a decade to return to levels comparable to 2007, if they ever return to that. Remember that it took twenty years before Wall Street resumed its 1920 levels. Well, according to LEAP/E2020, the present crisis is deeper and longer than in the 1930s. The general public will gradually become aware of the long-term aspect of this crisis in the coming three months and this situation will immediately trigger two tendencies carrying with them socio-economic instability: fear of the future and enhanced criticism towards leaders.

The risk of sudden collapse of all capital-based pension systems.
Finally, among the various consequences of the crisis for dozens of millions of people in the US, Canada, UK, Japan, Netherlands and Denmark in particular (3), there is the fact that, from the end of the year 2008 onward, news about major losses on the part of the organizations in charge of managing the financial assets supposed to finance pensions will multiply. The OECD anticipates that pension funds will lose 4,000 billion USD in 2008 only (4). In the Netherlands (5) as well as in the United Kingdom (6), monitoring organizations recently blew the whistle asking for an emergency contribution reappraisal and a State intervention. In the United States, growing numbers of announcements call for contribution increases and benefit reductions (7), knowing that it is only in a few weeks time that most of these funds will start calculating their total losses (8). Most of them are still deluding themselves about their capacity to build up again their capital after the markets turn around. In March 2009, when pension fund managers, pensioners and governments will become simultaneously aware of the fact that the crisis is there to last, that it coincides with the « baby-boomer » generation’s age of retirement and that the markets will not resume their 2007 levels until many long years (9), chaos will flood this sector and governments will reach the moment when they will be compelled to nationalize all these funds. And Argentina, who took this decision a few months ago already, will appear a pioneer.

All the trends described above are already at work. Their combination and the public becoming aware of the consequences they could entail, will result in the great collective psychological trauma of Spring 2009, when everyone will realize that we are all trapped into a crisis worse than in the 1930s and that there is no possible way out in the short-term. The impact on the world’s collective mentalities of people and policy-makers will be decisive and modify significantly the course of the crisis in its next stage. Based on greater disillusion and fewer beliefs, social and political instability will settle down worldwide.

http://www.leap2020.eu/GEAB-N-30-is-available!-Global-systemic-crisis-New-tipping-point-in-March-2009-When-the-world-becomes-aware-that-this_a2567.html

__________________________________________________ _

Don't know if many here have heard of Martin Armstrong. He is a fascinating man, an American economist who is currently serving his 7th year in prison WITHOUT EVER BEING TRIED for a fraud he claims he is innocent of. This occurred after refusing to work for the CIA and allow his proprietary models to become the property of the US Government.

http://www.topix.com/forum/business/TS8IHELKS6G8FDV65

His genius is his study, theories and writing based on the work of noted Russian economist Nickolai Dmyutriyevich Kondratieff (1892-1938). Once Stalin became aware of the importance of Kondratieff's work with the mathematics of economic cycles and the accurate predictive abilities his work produced - he was killed.

http://en.wikipedia.org/wiki/Kondratiev_wave

Armstrong released an essay dated October 10th, 2008 which is a fascinating read. At 72 pages it's definitely a download and print job. I read it all in less than a couple of hours.

http://www.contrahour.com/ItsJustTimeMartinArmstrong.pdf

In this document he outlines his theory of cycles and how they currently point to a market top on March 19, 2009 after which the world will enter a period of steep decline.

airedale

14-02-2009, 10:24 PM

I met up yesterday with a gold trader who believes that the bull run in gold is nearly over.

Reason being, the hedge funds are sitting on massive unrealised losses and going to be forced to sell gold and stock to fund their withdrawals.

Gold has been in a bull run since 2003. Of course it will end some day. But with the Fed and other banks printing bank notes as fast as they can, I think that gold will still rise from here.
Discl: holding gold stocks

ananda77

14-02-2009, 10:29 PM

That's surprising. It seems to me that to a large extent this has already happened. There was a massive amount of forced de-leveraging from hedge funds last October and gold sold down to it's $680 low on the back of a stronger USD.

Aussie:

...because worldwide US$-denominated debt in form of various debt instruments (CDS = one outstanding example) is incredibly MASSIVE, the accelerating default on such debt instruments will destroy massive amounts of US$ (remember: debt is money = like pay for a car with your credit card), the remaining stock of US$ will 'swell' in value (like: today the price of the car is $100, tomorrow, the price of the car will be $75);

...during the current ongoing period of 'quantitative easing' (fighting deflation), the race between the US$-destruction (deflation) and the Central Banks printing money is clearly miles out in favor of deflation;

...consequently, for the foreseeable future, most likely until at least 2010 or until such time until the last bit of debt is squeezed out of the hot bubble (>when Central Banks/Governments start to print money to pay off their own debt = inflation), the 'swelling' of the US$ will continue with possible detrimental effects for precious metals short to medium term

...so, take a deep breath and save some cash to buy Precious when Precious will be preciously around the US$600-mark for gold or anywhere nearby (am not worried too much about exact numbers here), because:

...The Rise of The GOLD PHOENIX cannot be prevented

Kind Regards

stevo1

15-02-2009, 11:05 AM

Sheeet Aussie that s heavy reading maaate
http://www.contrahour.com/ItsJustTimeMartinArmstrong.pdf
but well worth the time spent reading it thou parts degenerate into a crusade(rightly or otherwise)

Aussie

15-02-2009, 04:45 PM

...so, take a deep breath and save some cash to buy Precious when Precious will be preciously around the US$600-mark for gold or anywhere nearby (am not worried too much about exact numbers here), because:

...The Rise of The GOLD PHOENIX cannot be prevented

Kind Regards

I understand your logic but don't necessarily agree when it comes to the POG. Regardless, better to have it . . .

Cheers

arco

15-02-2009, 06:09 PM

lakedaemonian

16-02-2009, 01:18 PM

Coining it -

Eagle Matters

"Among collectors and investors at large, rising gold prices and publicity generated by record-breaking coin sales have piqued interest as well. In a 2002 auction, a 1933 double-eagle gold coin sold for $7.6 million -- a price widely acknowledged by people familiar with the market as the highest ever paid for a coin in a public auction. The 1933 double-eagle coins were never issued, and nearly all of them were melted down during the Great Depression, after President Roosevelt discontinued the gold standard".

Bulliontoday (http://www.stuppler.com/)

I have developed a little interest in nuministics after I began acquiring physical silver and gold about 6-7 years ago.

I enjoy having a look at some of the older, less common coins I have.....but I've always purchased ONLY on underlying melt value......I guess I just don't understand, or put much value in rare nuministics in toughening times.

I've acquired physical over the years for insurance and as a teaching aid for my kids...I reckon nuministic value will be the LEAST of my concerns IF I sold...........

arco

16-02-2009, 03:39 PM

Some interesting Gold statistics on this site....bakercoins.net

"A advertisement on the radio stated that gold has gone up 112% in the last twenty five years. They state that gold is a good hedge against inflation. Since everyone is talking about gold and crude oil prices, let’s compare gold and crude oil prices over the last 25 years.
1980 to 1985: Lets forget that on January 21, 1980, gold closed at $850.00 per ounce. The average for 1980 was still only $675.31 and the low was $559.50. The five year average for 1980 to 1985 was $495.46. Adjusted for 2005 dollars, the average price is $879.27. The average low for the same time was $477.35. Adjusted for 2005 dollars, the average low was $847.13.
Crude oil on the open market for the same time period was trading at an average price of $37.98. Adjusted for 2005 dollars, the price is $78.63.
In the radio commercial, the firm states that the value of one ounce of gold should be at least 15 times the value of a barrel of crude oil. The average price of crude for 1980 was $37.42 times 15 or a value for gold of $561.30. Gold average for 1980 was 675.31. 16.88% off, not bad, close enough to say, ok.
1986 to 1990: The average gold price for these years was $333.06. Adjusted for 2005 dollars, the average price of gold was $495.37.
Crude oil on the open market for the same time period was trading at $17.72. Adjusted for 2005 dollars, the price was $29.97 X 15 is $449.55.
1991 to 1995: The average price of gold between 1991 and 1995 was $369.15. Again, adjusted for 2005 dollars, gold had an average price of $448.08.
Crude oil on the open market for the same time was trading at $17.72. Adjusted for 2005 dollars, the price was $29.97 times 15 or $449.55. So here we can see that there was little change in the price of crude from 1986 to 1995. While gold value went down, but it is right at 15 times the value of a barrel of crude oil.
Lets look at gold for the 15 years from 1980 to 1996. In 2005 adjusted dollars, gold went from $879.27 to $448.08. This is a decrease in 2005 value of $431.10 or a decrease of 49.03%.
During this same time period, crude oil went from $78.63 to $29.97. This is a decrease in value of $48.66 or 61.88%.
1996 to 2000: The average price of gold between 1996 and 2000 was $300.83. Again, adjusted for 2005 dollars, gold had an average price of $334.08.
Crude oil on the open market for the same time was trading at $18.99. Adjusted for 2005 dollars, the price was $22.74 times 15 or $341.10.
2000 to 2005: The average price of gold between 2000 and 2005 was $393.48. Adjusted for 2005 dollars, the price was $413.40. While crude oil on the open market was $32.24 with a 2005 adjusted dollar of $33.94.
Now lets look at the facts. Between 1980 and 1985, the value of gold was $495.46 while the average value at the end 2005 was $393.48. It seams to me that is a decrease of $101.98 or a 20.58% decrease in value.
Crude oil went from a 1980 to 1985 average price of $37.98 while the average value at the end of 2005 was $32.24 or a decrease of 15.11%.
The 2005 prices do not take into consideration the value in 2005 dollars, but comparing just the gold value in 2005 dollars is a horse of a different color. The value in 2005 dollars in the average price of gold between 1980 and 1985 was $879.27. The 2005 dollar value would give you a decrease of $485.79 or a decrease of 55.25%.
Now, lets drop 1980 from the mix and compare January 5, 1981 to ending value on December 30, 2005. January 5, 1981, gold closed at $597.50 and closed on December 30, 2005 at $513.00. Well, lets try starting with January 4, 1982. Gold closed at $395.00 and closed on December 30, 2005 with a value of $513.00. Now here we have an increase in value of $118 or a 23% increase.
Let’s try the closing price of gold on January 5, 1983. Gold closed at $449.50 and closed on December 29, 2005 with a value of $513.00. This gives us an increase in value of $63.50 or a 12.38 % increase".

Read the article and see the % tables (http://www.bakercoins.net/learn/articles/gold/gold.html)

trader10

17-02-2009, 04:54 PM

On Daily MA 50 days has just crossed MA 200...very bullish......so consolidation yes....but it will go higher IMO....

<img src=http://img15.imageshack.us/img15/158/goldsc8.png>

peat

17-02-2009, 05:59 PM

http://img15.imageshack.us/img15/158/goldsc8.png

just showing that image for you trader10

trader10

17-02-2009, 06:49 PM

shasta

17-02-2009, 07:02 PM

Thanks peat...... why it did not show when I posted ? Can you share how you did it ?

cheers

Gold and silver are strong today...... Hillary Clinton had a speach in Japan this arvo..... looks like the first and second economies in the world will make another move soon.....

The bad Japanese GDP presented yesterday is reflect of the last 3 months of 2008....so we are already two months in the year and improvements can be already happening......

The only problema will be the printing and flooding of all different currencies IMHO....inflation could be knocking on the door pretty soon.....

cheers

Could someone please post a chart showing the next resistance level?

http://www.kitco.com/images/live/t24_au_en_usoz_home.gif?random=0.2974853515625 (http://javascript<b></b>:NewWindow('/charts/popup/au24hr3day.html','Au30Days','top=50,left=200,width =670,height=560');)

TIA

trader10

17-02-2009, 07:29 PM

Hi Shasta,

I would say 980's... but here an interesting chart and article on gold and silver..... Not sure if the chart will come up.....I'm having difficulties in post the charts here.

<img src=http://www.marketoracle.co.uk/images/2009/Feb/gold14month150209.gif>

http://www.marketoracle.co.uk/Article8908.html

and silver :

<img src=http://www.marketoracle.co.uk/images/2009/Feb/silver1year150209.gif>

http://www.marketoracle.co.uk/Article8913.html

cheers

shasta

17-02-2009, 07:37 PM

peat

17-02-2009, 08:59 PM

i just took the link (without the html code) of http://img15.imageshack.us/img15/158/goldsc8.png

and pasted it into the dialog box presented when you click on the insert image icon that is available when posting http://www.sharetrader.co.nz/images/editor/insertimage.gif

or you can just use the image links offered by imageshack as : Hotlink for forums (1)

Aussie

17-02-2009, 10:17 PM

Big move in Asia tonight. Gold rocketing in the face of a strengthening USD, now trading contrary to it's normal pattern. Just hit A$1,500 and heading to NZ$1,900. All Fiat currencies are sinking at the moment.

Jess9

18-02-2009, 06:58 AM

At this rate, USD $1K / oz will get taken out well sooner than originally forecast!

Dr_Who

18-02-2009, 08:01 AM

Gold $970! :eek:

Mysterybox

18-02-2009, 09:55 AM

Gold $970! :eek:

974.3 high.. it just doesn't stop.

Aussie

20-02-2009, 01:58 AM

"Gold has now entered the next and major leg of the long-term gold bull market after correcting down from $1,035. We see it targeting $1,000, initially. This will be achieved shortly after a small bout of consolidation. This Alert is to re-emphasize that you should be looking to see a long-term rise in the gold price, not simply another short visit to $1,000. We believe that $1,000 will be here to stay this time!

We believe, too, that gold shares will benefit to a greater extent than gold itself, in the next move up. In particular, we feel that soundly based gold “Junior” mining companies will benefit strongly . . ."

Man. I hope so . . . I have a few sorry looking Jr's with fantastic proven reserves . . . Let's roll!

ALSO . . .

"The subject of central bank sales keeps on raising its head in the gold market. Last week saw the question raised, “Will the I.M.F. sell its gold still as its cash flow seems to have improved enormously?” The answer from the I.M.F. is of course, “Yes!” It has to be, because the bureaucratic steps for that to happen have been set in place and only a meeting of the members of the I.M.F. can change that at a special meeting. This has not happened.

For the sale of 400 tonnes of gold from the I.M.F. to take place however, the key vote deciding this has not yet been cast. The U.S.A. controls over 16% of the votes [it needs an 85% majority for such a motion to be carried] of the I.M.F. and it cannot cast its vote until the U.S. Congress has cast its vote on whether they will permit the I.M.F. to sell. The vote on the subject has not even been proposed by Congress so until that is on the agenda the likelihood of such a sale is just not there. Meanwhile it sits as a seeming threat to the gold price, or does it?"

MORE . . .

"The internal strength of the market continues to improve which will support pullbacks and support future moves higher. General recognition of the massive monetary expansion and a destruction of trust in the system on various levels including in the world’s largest financial institutions has created a once in a lifetime opportunity for gold to stage a move that is likely to be historic in nature, powerful in force. Short term de-leveraging may continue to place some short-term pressures on gold and gold stocks, but overall the record prior quarter’s $32B in gold demand is going to soon overwhelm the market, above ground stocks are going to be depleted quickly. Once the supply nears or becomes depleted, the market will be in short-supply and a squeeze on the gold price will result in a very rapid move higher."

"In this author’s view, gold sub $1,000 remains a gift and accumulation should be heavy and aggressive at this time. Once the $1k level is broke then the market will accelerate momentum. This could occur in the coming 3 months."

"We are witnessing once in a century, or perhaps longer, financial event where gold and silver offer the only real protection. The U.S. treasury debt market may eventually succumb to this crisis as well at which time gold and silver would move to levels difficult to imagine today as it returns to its true historical attribute as currency."

Jess9

20-02-2009, 09:32 PM

Attempting 1K barrier?? Over 980 now.

Dr_Who

21-02-2009, 07:00 AM

Just hit $1000 as we speak!!! :eek:

arco

21-02-2009, 09:36 AM

Watch out for Butterflies blowing bubbles

Aussie

21-02-2009, 11:37 AM

Hourly Action In Gold From Trader Dan
Posted: Feb 20 2009 By: Dan Norcini Post Edited: February 20, 2009 at 3:53 pm

Gold hit the magical number of “$1,000” in today’s trading session in the front month April contract at the Comex and immediately registered newswire flashes across the various services. This is something guaranteed to garner the attention of that section of the public who are still somehow oblivious about the metal not realizing its role as a safe haven and the ease with which it may be bought or sold. Perhaps they have been too busy lining up waiting for the government handouts that are proliferating faster than the flu virus in winter. Either way, those who have been attempting to hold back the metal, got what they did not want - headlines and interest!

Keep in mind that this is only the second time in its history that gold has shot up above the $1,000 level. Generally short-term oriented traders like to book profits when such things occur so it will not be unexpected to see a bit of a pullback from here.

I know this does not sound like the words of an inspired market genius but one of two things will happen here. We will get the scenario that I just outlined or the market will shoot sharply higher. If it is the latter, it will be quite telling as it will reveal just how determined, eager or downright terrified people are becoming. Market action of that kind of nature speaks thusly: “get me in at any price – I simply don’t care – I want in”. Or in the case of trapped shorts: “Get me out at any price – I am terrified of getting wiped out”. In other words, the latter scenario will give us a measure of market intensity. The former will show that there is not yet any panic buying occurring in the gold market even though overall demand is very strong.
If the market does set back, I do not expect any subsequent price retracement to very deep this time around – things have changed since last March 2008 ( a year ago), the last time gold was over $1,000. The price rise this time has been measured, it has been steady, and most importantly, it has not been driven by a rush of hot fund money into the market. The open interest is 60% of what it was the last time the price of gold peaked – while there is a sizeable long position in the Comex gold market, it is well off the levels it reached at that last peak. Also, the reported holdings in the gold ETF, GLD, show that investment money is steadily flowing into this sector. The last time gold was over $1,000 back in March, the reported gold holdings were only 663 tons. As of yesterday, holdings were reported at 1029 tons. Obviously a much larger share of the public is moving into gold. I am hard-pressed to see a reason why all this money would suddenly decide to abandon gold unless of course an economic miracle recovery were to immediately commence. Perhaps the Obama administration will discover a new method of creating money that sees it miraculously fall out of the heavens so deep around us that we do not even have to bend over to pick it up. First time something like this occurred, it was quail. At least you could eat that. Paper does not sound particularly appetizing to me.

I should note here that gold priced in British Pound terms and in Euro terms has set brand new all-time highs the last four days in a row. BP gold is closing in on the 700 level and was fixed at 690.353 while Euro-gold is steadily heading towards the €800 level as it was fixed at €782.437 today. Both charts are absolutely stunning to behold. Europe has reached the point where you might say that confidence in paper money has been lost. Eastern Europe is still a major overhang and fears about a regional default are probably not out of line.

Also, we are not yet through the month of February, but gold is on track to put in its highest monthly CLOSE ever. Coincidentally, that occurred back in February 2008 when the front month closed at $975. Next Friday’s close is going to be interesting to say the least. One more thing – gold in inflation adjusted terms is still well off its all time high which on an inflation adjusted basis is over $2,000. The case could me made that even at current levels, gold is not particularly expensive.

Last night Japan’s TOPIX set the lowest close in that index in 25 years. The “buy Japan” when it comes to the Forex markets took a direct hit for while the Yen did indeed move higher in the usual knee-jerk risk aversion trades, the news out of the land of the rising Sun was so gloomy, that even yen buyers were put off and the currency faded well off of its session highs. The reason I mention the yen is because this flight into the Yen has made it one of the few major currencies in which gold when priced in those terms has not set a brand new all-time high, in contrast to what the yellow metal has been doing when priced in just about every other major out there. Japanese investors are probably still rushing into what they perceive to be the safety of their bonds but one has to wonder how much longer that will be the case. You have to look at the Japanese stock market to realize just how bad things could deteriorate over here. Their broad stock market has never recovered from the bursting of its bubble back nearly 2 decades ago. Imagine – almost 20 years later, the stock market there, the Nikkei, has not even managed to stay recapture half of its losses!

Around mid-morning, something quite remarkable occurred in those same Forex markets, something which could quite possibly portend a major sea change in sentiment towards the Dollar. I cannot explain why but the Euro and then the other major currencies suddenly reversed course and shot sharply higher of their lows after being down sharply overnight and early in today’s morning sessions. Could it be that the Dollar is beginning to finally anticipate what the spending orgy that this nation is embarking upon is going to do to it? Remember how long it took for the bonds to realize that you cannot create gazillions of the things and then expect supply not to overwhelm demand. We had to sit through a bubble in that market where knee-jerk safe haven buying originating out of stock market fears gave way to supply side fears. This tug of war can still be seen in the bonds as they once again shot up sharply today but look how far off their bubble peak they are now sitting. I think we will eventually see something similar with the dollar, although I do not know the timing. It is interesting however that today’s move in the Euro and in the Dollar came on no news that I can see whatsoever. Those kinds of moves are always, always, the most significant ones. Right now, it sure as heck looks to me that the Dollar might have finally topped out. A weekly close below the 86.60 level will give us the technical signal that a short term top is indeed in. It is still too early to say a longer term top is in however.

The only commodities that I could see that were up today were gold, silver and platinum, with platinum having gone back to trading as a precious metal. Some guys are looking at it being priced very close to the price of gold and are wanting to own it. Every other commodity was down, and down hard. Grains got whalloped with beans leading the way lower. Crude oil gave up its gains from yesterday failing at the $40 level and now heading back down to near that magical $33-$34 level once again. Natural gas is getting the snot beat out of it as the glut of the stuff in supply continues to weigh down the market. It now has a “3” handle in front of it. Talk about cheap…. I only wish I had lots of spare salt domes to store the stuff so I could resell later after the inflation tidal wave that is coming arrives.

The mining shares are proving to be go to investments in the equity world as those who bought them are finally seeing them respond to the higher gold price. They are still well off the highs they made the last time gold prices were above $1000 however. To give you some perspective – The HUI was over 500 in March 2008. Currently it is near 325. The 50% retracement level on the weekly chart comes in near 335 so the HUI is definitely within gunshot of that. Large institutional investors will be monitoring that level with interest. If the HUI can mount a convincing climb above that level, they will move in. I should also note that the 50 week moving average also comes in near 341. To say that the HUI is at a critical level is an understatement to say the least. It is time for the bulls to perform if they want to break the back of the mining equity perma shorts. To a certain extent, some of the miners might be seeing selling pressure from guys just blowing completely out of stocks and selling everything. Other than that, I cannot see much other reason to sell them. When you get violations of major lows in the broad stock markets, that sets off a sort of random computer generated selling process and a lot of good stuff gets tossed out until the dust settles and guys who actually think before they pull a “buy” or “sell” level move in.

You will notice on the daily chart below that I have now made the switch back to the daily or in today’s case, the weekly chart. Gold is now at levels that we cannot see resistance levels on the short term charts until we get some more consolidation type price action. Until we do, I will not be using the 12 hour charts.

One last thing – on the delivery front – JP Morgan has gone to becoming a seller the last three days after taking 1,498 contracts out of the total 4,611. Goldman however took the lion’s share of deliveries once again stopping 611 out of 680 contracts. They have taken 2,162 February’s out of 4,611 or nearly 47% of all the gold. That has definitely caught my attention. Obviously someone for whom Goldman is acting was well informed about the gold market.

Click link to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini.

http://www.jsmineset.com/wp-content/uploads/2009/02/february2009gold1230pmcdt.pdf

ananda77

21-02-2009, 04:17 PM

Watch out for Butterflies blowing bubbles

...mania always the best reason to get the heck out of here...will see you at ~USD 600 (or nearby) -happily-

Kind Regards

Jess9

21-02-2009, 05:22 PM

BOE seems set to "print money" after March 5th. Seems authority for this is being sought now.

Unbelievable! Gold/silver to go ballistic if this occurs.

JBmurc

21-02-2009, 05:37 PM

BOE seems set to "print money" after March 5th. Seems authority for this is being sought now.

Unbelievable! Gold/silver to go ballistic if this occurs.

They want inflation NOW even if the savers of this world suffer.
paper money is only worth what another is willing to accept for it(just checkout the NZD THIS NOTE IS LEGAL TENDER FOR?? 20 peanuts..... going forward the USA,POMs etc only have Inflation as their last chance that or World War 3 ..compared to Gold & silver bullion papers only going to become more an more weaker in buying power of real assets IMHO exchanging paper for Gold & silver bullion will only become harder.
Great time to buy that house or company on tick as interest rates will be below true inflation soon

Jess9

21-02-2009, 09:13 PM

yip, cheap cash for real assets equals wealth transfer in such an environment.

Aussie

22-02-2009, 09:42 AM

...mania always the best reason to get the heck out of here...will see you at ~USD 600 (or nearby) -happily-

Kind Regards

ananda77, gold is no where near any kind of mania yet - not even close. It hardly gets a mention in the mainstream media. It mostly gets ignored and the general public doesn't even know or understand it. In Europe and Asia there is a cultural and historical understanding of gold so they are far more predisposed to buy it.

But here in NZ, gold was was by far one of the best investments of 2008 with a +40% return in NZD yet was completely ignored. The financial press ignore it because they consider it a strange, speculative investment. To me, speculative wold have been keeping all my assets in NZD.

The fact is . . . once you buy physical gold, you EXIT THE BANKING SYSTEM. The establishment has a vested interest in keeping people out of gold and remaining in stocks, bonds, currencies and all things paper.

We may see a healthy correction back to the $920 - $930 are but the stage is set. With gold now trading higher IN STEP with the USD, any kind of re-evaluation of the USD by foreigners will see gold vault many hundreds of dollars from where it is right now. I seriously doubt we will never see $600 again.

George

22-02-2009, 10:13 AM

Correct me if wrong, but is this thread not similar to the oil one when
they were talking about $200 a barrel???

JBmurc

22-02-2009, 11:53 AM

Correct me if wrong, but is this thread not similar to the oil one when
they were talking about $200 a barrel???

Yeah for sure both Oil an gold silver copper property etc etc are real hard assets $$$$ in turn are only worth the paper they are printed on But as long as the world believes the paper is real money it will hold an ever decreasing value as more an more is printed
Now add in the fact things like Gold silver Oil aren't infinite like paper and when you look into any true reserves of the above your see both 200bbl oil and 2000USD gold is just going to have to happen only thing we don't know is excatly when 2yrs or 20yrs time i guess it's more like how long will the population be fooled for before waking up.

Aussie

22-02-2009, 01:36 PM

Correct me if wrong, but is this thread not similar to the oil one when
they were talking about $200 a barrel???

Good point George, in some ways I suppose it is. The truth is, no-one knows anything with 100% certainty. I am amazed at the price of oil, could the gold price drop by 70% in the very near future? I suppose anything is possible but one has to look at the facts and figure out the probability, which I think looking at the economic fundamentals is remote.

Regarding oil, I personally believe that we are experiencing a temporary price collapse that has been artificially "generated" on the US controlled NYMEX paper markets.

There is a huge contango at the moment between the paper price and the future physical price as witnessed by the massive number of tankers and holding facilities full of oil, that have been leased by none other than the Wall St. investment banks. US 60 Minutes recently did a great story on oil and how Morgan Stanley is now the biggest player in the oil business and is holding massive quantities in anticipation of higher prices later this year.

Oil consumption has declined with the global recession, but no-where near 70% as the current oil price would indicate. Whatever oil the west does not use, the developing world including OPEC nations themselves consume.

The fact that cap ex, oil rigs, exploration and development projects have been shutdown all over the world should be ringing alarm bells with regard to the world's ability to bring new supplies on-line in the coming months and years. This "mal-investment" will probably cause the price to go far higher later than it otherwise should.

And who has been the chief beneficiary of the collapse in oil? Looking around I see no one has benefitted more than the good 'ol US of A. Cheaper gas, stronger dollar . . . and at the same time they are achieving the poitical goals of breaking the economies of their "enemies" Mr. Putin and Chavez while keeping the OPEC nations from becoming too troublesome . . . nice job on a lot of fronts if you are an American policy maker.

ananda77

22-02-2009, 02:01 PM

But here in NZ, gold was was by far one of the best investments of 2008 with a +40% return in NZD yet was completely ignored. The financial press ignore it because they consider it a strange, speculative investment. To me, speculative wold have been keeping all my assets in NZD.

...you could have had the same return simply being long in USD over the period...

...do not get me wrong, gold is an asset and should therefore be part of a balanced portfolio but other than that I prefer to buy and sell as I see fit...

kind Regards

Dr_Who

22-02-2009, 05:16 PM

peat

22-02-2009, 05:58 PM

Heres a gold chart covering the '87 crash - which of course now only looks like a blip in the DJI

http://www.kitco.com/LFgif/au85-89.gif

Dr
the dow chart of the corresponding era bottomed around early 1988 so we can see that Gold did go against DJ trend acting as a safehaven but as we know the DJ didnt stay down like NZ market.

ananda77

22-02-2009, 08:41 PM

Can someone please post up the gold price and dow jones graph correlation from 1980-1990?
I want see if there how gold price reacted during the 1987 market crash and if there is a correlation.
Cheers

In Fortune magazine a while back, David Rynecki wrote:

Gold investors are notoriously bad forecasters. From 1985 to 1987, for example, a collapse in the dollar boosted gold 76% and had many metalheads predicting an extended rally. Instead, the price fell 15% the very next year. ... Even bullish gold pros caution the average investor to put no more than 5% of a total portfolio into gold-related holdings and say it's safest to invest through funds

The big picture

In his seminal book Stocks for the Long Run, University of Pennsylvania finance professor Jeremy Siegel revealed what a dollar invested in various things would have grown to, from 1802 to 2001 -- yes, just about 200 years! (Amounts have been adjusted for inflation.)

* Stocks: $599,605
* Bonds: $952
* Bills: $304
* Gold: $0.98

Did you catch that? You would have lost two cents of your dollar in gold -- over 200 years.

...(see attachment) and now we see the CREDIT-(not currency)INFLATION DEFLATING as a result of the death of the whole securitization market; this market provided the BULK OF CREDIT for the last ~25 years and is now DEAD; and for example: another 30 trillion of CDS still in need to be deflated or neutralized

...I think people still think in inflationary (scare) mode and underestimate deflationary forces building unstoppable momentum;

!!read:

Monetize This!: Resolving a Spiraling Public Debt Crisis
How Obama could take a Page from the Fed's Playbook
by Ellen Brown

...But Wouldn’t That Be Inflationary?

The usual objection to funding the government with credits drawn on its own central bank is that the result would be inflationary. However, the scenario most feared today is actually deflation – a lack of available dollars to fuel the economy. Asset values have collapsed, and savings have collapsed along with them. People with only half as much money in their brokerage accounts have less to spend; people whose houses have plummeted in value cannot take out consumer loans against equity as was done in the boom years. Funding a "stimulus" package with existing money that is merely recycled through the banking system as loans will not stimulate the economy but will only add to the problem, by adding to the collective burden to service debt. Money that should have gone into more productive endeavors will wind up going into interest payments. To bolster demand and stimulate production, recovery requires an infusion of new dollars – dollars that can be used to pay wages and salaries, which can then be used to buy goods and services.
http://www.globalresearch.ca/index.php?context=va&aid=12394

Kind Regards

Aussie

23-02-2009, 01:56 AM

ananda77, that analysis you posted is so full of holes I hardly know where to begin, so let's just start at the top . . .

In Fortune magazine a while back, David Rynecki wrote:

Gold investors are notoriously bad forecasters. From 1985 to 1987, for example, a collapse in the dollar boosted gold 76% and had many metalheads predicting an extended rally. Instead, the price fell 15% the very next year. ...

Fortune Magazine . . . a truly unbiased source of financial mainstream media. A two year snap shot - very scientific. That temporary gold rally was related to the market crash in October '87. He calls gold investors "metalheads" - does that sound like the author has an even bias . . ?

David Rynecki . . . the same hack who wrote "Deals On The Green: Lessons On Business and Golf From America's Top Executives".

Impressive source!

http://www.amazon.com/s?ie=UTF8&search-type=ss&index=books&field-author=David%20Rynecki&page=1

put no more than 5% of a total portfolio into gold-related holdings and say it's safest to invest through funds

In case you haven't noticed, people who have put their entire life savings in "funds" over the past few years are getting wiped out whereas people who have invested in gold are doing rather well.

In his seminal book Stocks for the Long Run, University of Pennsylvania finance professor Jeremy Siegel revealed what a dollar invested in various things would have grown to, from 1802 to 2001 -- yes, just about 200 years! (Amounts have been adjusted for inflation.)

* Stocks: $599,605
* Bonds: $952
* Bills: $304
* Gold: $0.98

Did you catch that? You would have lost two cents of your dollar in gold -- over 200 years.

OK. Jeremy Siegel. He's written only 2 books in his 42 year career. Taught at University of Chicago, Wharton School of Business and 15 years as head of economics training at JP Morgan . . . since 1988 as academic director of the U.S. Securities Institute, and is currently Senior Investment Strategy Advisor to Wisdom Tree Investments . . . so why would anyone believe research from someone who A) is a Keynsian Economist through and through and B) has a clear vested interest in selling stocks and ETF's (and books on stocks and ETF's). I guarantee you this "Phd" is staring at a bleeding portfolio, still scratching his head wondering how this crisis has come about . . .

Of course he hates gold he's a paper guy and his ridiculous study shows it . . . this is as disingenuous as studies get.

ananda77, are you honestly asking us to believe that ANY study over a 200 year period where 3 out of the 4 asset classes are valued to market and the 4th (gold) is FIXED at US$20.67oz for 131 years, then raised to US$35oz for the following 38 years before finally being allowed to "float" against the other assets for only 30 years is fair and honest? . . . and let's not even talk about Robert Rubin and the US "Strong Dollar Policy" of the 1990's, which was of course to sell and lease central bank gold allowing the US Fed & Treasury to "manage" the price of gold in order to artificially keep US interest rates low while propping up the USD. This is a policy that continues to this day and the evidence for it is overwhelming.

To further destroy the credibility of Siegel's woefully biased analysis, consider how extraordinarily convenient it is that his timeframe ends "just" before the start of gold's current secular bull market in 2002, so gold's 8 year, 4 fold gain is not included, nor is the Dow's 18 month 50% decline!!!

So let me get this straight, the net result of this study is that Stocks, Bonds and Bills are allowed to be worked by the market for 170 years while gold is artificially shackled in the $20-$35 range and you believe this is a credible comparison and a reason not to invest in gold in todays economic environment?

_____________________________________________

Now let's look at some REAL facts . . .

Starting with the value of the USD since 1792 . . . of which it has lost 96%! A picture does say a thousand words.

1275

Next a comparison between the DJIA and gold from 1971 till present.

1971 DJIA (937-7365) = 786% gain
1971 Gold (35-995)= 2,842%

I know which one I prefer.

The following chart shows the DJIA priced in gold ounces.

1274

Note that it is only charted through October '08 at 13 ounces. A current chart would show the Gold/Dow ratio at a stunning 7.365 ounces that's a whopping 40%+ drop in 6 months - and with a surging US dollar to boot! This chart will drop through the floor when the USD starts actually falling.

How are those stock values looking now when valued in real money?

...I think people still think in inflationary (scare) mode and underestimate deflationary forces building unstoppable momentum;

Deflationary forces are winning for now, but in the near future a change will come. Do not forget that the $Trillions that have been pumped into global banks have so far not been loaned ie: they have not been multiplied many times over by the magic of fractional reserve banking at the retail level.

Money is now slowly gaining more purchasing power over economic goods. That won’t last. The period of devaluing sales is likely to ebb by mid summer in the US. It will ebb with the arrival of a lesser stream of consumer goods because fewer factories are still producing them. With a falling increase in imports of consumer goods, the increased scarcity will then lead to higher prices. Do we think that $30 oil is here to stay with production decreasing, wells being capped, cap ex drying up and exploration shelved . . . I don't think so.

Do not be deceived, rabid inflation is coming.

patsy

23-02-2009, 11:41 AM

Siegel's study does not provide any information not already known. For starters, it confirms gold's property as a hedge against inflation. Siegel's study shows that a holder of gold would not have his/her wealth eroded. On the other hand, Siegel's study confirms that owning stocks is the best strategy for increasing wealth.

The problem with Siegel's study is that it shows end-to-end results. A more enlightening study would be to break down the performance of each asset category within inflationary and deflationary periods. For example, during the decade 1970 to 1978, in which Australia suffered one of the most severe and lengthy inflationary periods, the Australian sharemarket returned exactly 0%, whereas inflation grew at a rate of 12% compounded per annum.

The key question is, given that we all have a finite investment horizon (e.g., because of age or retirement approaching, etc.), what is the best asset allocation during an inflationary period?

During high inflationary periods, stocks do not perform well - full stop. In fact, stocks and inflation are not correlated at all, but gold and short-term bonds are, and these are the two best ways of protecting wealth during that period. If an investor has an investment horizon of 40+ years, then the investor can ride out inflationary and deflationary periods with a single investment strategy (i.e, owning stocks) and Siegel's study is a good reference. However, if we have a limited time horizon then the asset allocation should respond to the period we are going through.

Incidentally, someone at the office pointed me to the following study, which makes a lot of sense:

http://madmoneymachine.com/2009/02/19/investments-for-inflationary-times-to-come/

Aussie

23-02-2009, 11:57 AM

All really good points Patsy. I'm certainly not someone is against stocks, in fact I own quite a few and I'm not "in love" with gold as an asset class, I just appreciate it for what is does at certain times. And now is one of those times.

I just get annoyed with slanted research that is not relevant to the current climate and clearly is presented by an author with an agenda - to sell books and sell stocks. Brokers do not like gold as there is no "churn", no ongoing kickbacks or commissions . . .

I would agree that anyone who bought gold in 1980 and held through to 2001 would have been foolish. They would have missed one of histories greatest bull markets in stocks. I just try and be practical and invest within what I see as major trends.

I will be quite happy to sell my gold assets at what I consider to be the appropriate time. I don't want to be holding on to any long-term doorstops ;)

Aussie

23-02-2009, 12:06 PM

...you could have had the same return simply being long in USD over the period...

...do not get me wrong, gold is an asset and should therefore be part of a balanced portfolio but other than that I prefer to buy and sell as I see fit...

kind Regards

ananda77, what you say is essentially true. However, I chose to purchase gold assets at cheaper prices over the past few years whereas if I was still in USD cash at the moment, I'd be paying a lot more to acquire what I have.

So I see it currently as being a plus-plus as gold has risen in value as the USD has risen also.

Cheers

ananda77

23-02-2009, 12:30 PM

The key question is, given that we all have a finite investment horizon (e.g., because of age or retirement approaching, etc.), what is the best asset allocation during an inflationary period?

...during an inflationary period I would like to be increasingly long gold for sure but the whole argument is that we are not in an inflationary period but -IT IS DEFLATION- and therefore I understand, the current rise in gold is FEAR based and that, potentially, makes for extreme volatility

...and hopefully, if we are fortunate enough, we will all be spared the time when gold may go to new highs correlating to new highs in fear as a result of a worldwide complete collapse of any political, social, and economic structure

Aussie: read this again very carefully>

Monetize This!: Resolving a Spiraling Public Debt Crisis
How Obama could take a Page from the Fed's Playbook
by Ellen Brown
http://www.globalresearch.ca/index.p...t=va&aid=12394

Kind Regards

patsy

23-02-2009, 01:42 PM

...during an inflationary period I would like to be increasingly long gold for sure but the whole argument is that we are not in an inflationary period but -IT IS DEFLATION- and therefore I understand, the current rise in gold is FEAR based and that, potentially, makes for extreme volatility

Price increases are the RESULT of inflation, not the DRIVER of inflation. Inflation is driven by an increase in money supply. When you're referring to deflation, I suspect that you are referring to asset deflation, which is currently caused by de-leveraging.

The best way to assess whether inflation is/isn't a threat is by looking at the growth in M3 (currently 16% in Australia) or by looking at the US Fed's balance sheet, which also shows a massive increase.

I agree that gold prices reflect fear and inflation expectations. I gather that your argument is that "inflation expectations" are wrong... but, again, no matter where you look, money is being created out of thin air everywhere, whether USA, Australia, NZ, China.... and that's what drives inflation REGARDLESS of expectations. The comment below shows just a starting point:

---------------------------------
Thursday, February 19, 2009
Wholesale Inflation Takes Biggest Jump in 6 Months
Lauren Covello and Ken Sweet
FOXBusiness

Inflation Hand

After two straight months of declines, the index that measures inflation at the wholesale level surged by an unexpected 0.8% in January. The U.S. Labor Department said Thursday that producer prices jumped last month as increases in oil and energy prices led to higher costs for manufacturers. The rise -- which represents the biggest increase the index has seen in six months -- was slightly more than what economists were looking for, as they expected producer prices to rise 0.3% for the month.

The results follow two months of declines in the index. In December, the producer price index fell by 1.9% and in November, by 2.5%.The Labor Department’s “core” reading on wholesale inflation, which strips out volatile food and energy costs, showed that prices rose 0.4% during the month -- much more than the 0.1% that economists were looking for.

-------------------------------------

By the way, I'm no gold bug and I seriously fear a significant correction in the price of gold. I don't know if the price of gold is commensurate with the increase in money supply but I'd argue that inflationary times are just ahead of us.

peat

23-02-2009, 02:02 PM

Monetize This!: Resolving a Spiraling Public Debt Crisis
How Obama could take a Page from the Fed's Playbook
by Ellen Brown
http://www.globalresearch.ca/index.p...t=va&aid=12394

Kind Regards

I didnt find it there , but here :
http://www.globalresearch.ca/index.php?context=viewArticle&code=BRO20090221&articleId=12394

so this article says money can be created from nothing! .... ??

Dr_Who

23-02-2009, 02:58 PM

Does anyone have a graph between inflation and gold price?

I bought some SBM today. :)

Aussie

23-02-2009, 04:33 PM

Aussie: read this again very carefully . . .

ananda77, I just read it again and I still think I disagree but I would be happy to be challenged because it's a complex issue and I think some of the misunderstanding about it is due to a misconception of terms related to monetary inflation/deflation v's price inflation/deflation.

I don't think the debate has to be either or, inflation and deflation can happen simultaneously in different parts of the economy at the same time.

It seems to me that if this woman's theory of funding government via the printing press (or quantitative easing) was correct, then Zimbabwe would be one of the wealthiest nations on earth. I think patsy is on the right track. My understanding is that wealth destruction via asset deflation is entirely different to actual monetary deflation - which by definition is a CONTRACTION of the money supply - just as inflation is an EXPANSION of the money supply. Price reaction in either direction is a RESULT not a CAUSE. After PRICE INFLATION comes WAGE INFLATION as wages can never keep up once inflation takes root.

For example, I have some stock in my portfolio that has declined in value, so has the value of my home. However, no real money has been extinguished (deflated) during this period because it's not until an asset is sold that it's actual value becomes realized - until then any notion of real value is illusionary. And if I did decide to sell, since I did not borrow to fund these assets, nothing has to be re-paid so no loans (money) are extinguished and no deflation occurs . . . because I used my own SAVED CAPITAL as opposed to DEBT CREATED CAPITAL that MUST be re-paid to someone. This latter type is what governments are creating and using to shore up the financial system. There is a huge difference . . .

This may be a bit simplistic, but imagine that we are at patsy's house playing a game of monopoly that I brought over . . . after several rounds of the board, we have bought up all the properties. Suddenly, ananda77 looks over at a shelf and sees that patsy has a game of monopoly too. "Why not take all the money from patsy's game and add it to ours by divvying it up amongst us and see what happens." We still have the same number of properties, the same number of houses and hotels for sale, but since we are all cashed up, what do you think is going to happen to the prices of those houses and hotels as we all compete to buy them for our properties? And as the houses get scarcer and scarcer, the prices will go higher and higher.

So the actual amount of new money being created globally is increasing out all proportion and there is much, much more to come. As Mr. Bernanke has famously said "There is literally no limit to the amount of liquidity that the Federal Reserve is willing to create in order to reflate the financial system." eventually this money that is currently being held in insolvent banks and sloshing it's way back into the Fed as interest bearing deposits will become the capital that these banks use to start lending again on a 10:1 ratio and in a fractional reserve banking system, once it's out there the Fed HAS NO CONTROL of how many times it is multiplied and how many $Trillions more is created.

Once the world economy starts to revive as it hopefully will, the velocity of money will increase greatly as business and consumers compete for less goods and services since so many factories, industries and workers are no longer producing. The Fed claims it stands ready to drain the excess liquidity by raising interest rates etc but most commentators doubt that they have the skill or will know the timing to get it right and will leave the plug in too long . . . plus their track record in this area is horrible. This is probably the best case scenario.

Worst case is as you say, the entire global banking system crashes.

if the US had not injected $trillions in liquidity over the 12 months, US and UK banks would have closed twice. Our financial markets would be at fraction of their present value, and world bond markets collapsed. Effectively everyone . . . institutions, individuals, businesses would have tried to pull their money out of every possible account simultaneously. Needless to say, that is what forces bank closures – to stem it. When bank closures happen, a general financial emergency is declared, and governments freeze international money transfers to prevent a run on the currency.

In that case the entire world economy would stop, businesses could not ship, food would be unable to be shipped as no one can transact. Everything stops, probably even the petrol pumps. The world supply chain is roughly 3 days supply of everything.

I'm hoping for inflation and I think the politicians are too . . .

I would be interested in your thoughts.

Cheers

outspoken

23-02-2009, 06:46 PM

They can print money all they like but if the velocity of money doesn't change then you wont have inflation in any asset classes

ananda77

23-02-2009, 08:17 PM

...massive credit inflation to 2007 (asset to debt ratios: 1:30,40,50 = massive leverage); since 2007, credit disappearing big time >debt implosion = (USD disappearing); USD has lost substantial value in the past (gold up) but surviving stock of USD will buy more as long as debt implosion continues; may be the reason why investors, despite low treasury yields are still piling into treasuries;

...in terms of debt implosion >default on debts: what's next after the subprime US500 billion loss wave:

-CDS Market >notion value of contracts 30 trillion still in need to be 'neutralized'/deflated; increasing corporate defaults

-Alt-A Mortgages (notional 1trillion) currently downgraded from AAA (70cents/USD)? to CCC (7cents/USD)?

-CMBS >300Billion of securities = 50% of all outstanding CMBS most likely to be downgraded to junk -based on further decline of property values expected for next 12 to 24 months

-Option ARM's (750 Billion market) begin resetting as US economy sheds 600 000 – 700 000 jobs/month >extreme danger of exploding delinquencies/foreclosure/repossessions to 50% from now 28%

-Possibility of a large country defaulting on it's bond >maybe the gold driver at present; however if the US defaults on it's bonds >what world do we live in then???

-Insurance companies >lots of toxic garbage in their portfolios

-Money Market Funds

-Municipal Funds >high exposure to derivatives and pension fund obligations >again danger of default of counties (New York 1970's >bankruptcy loomed)

-Junk Bonds >15 to 17 % default rate most likely rising

-Credit card debt >delinquencies on the rise and asset backed securities tied to receivables at risk

-Heloc's (Home equity LOC) >problems ahead

-Doha Trade Talks collapse >high risk, door on open markets closes >protectionism

source: http://www.atlanticadvisors.com/uploads/market-commentaries-2009-02-17-free-fallin.pdf

...when will it all turn???

eventually, the value of credit will contract to the point where it can be sustained by new production. At that point, the USD may indeed collapse as gold soars under the weight of the Fed's bailout machinations. BUT DEFLATION MUST RUN ITS COURSE FIRST. In our opinion, it has a long way to go as stocks are not even through Primary Wave 1...

source: The Elliot Wave Financial Forecast 30 January 2009

Kind Regards

Dr_Who

24-02-2009, 07:59 AM

If this market continues to deteriorate, we can see gold go over $1000 and onwards. Investors out there have lost confidences in the market and the govt, so gold is seen as a safe heaven.

I use gold and shorts as a hedge. Kind of like an insurance for my portfolio of investments.

arco

24-02-2009, 09:41 AM

This site measures the current pure metal value or melt values of circulating coinage - gold and silver. Updated daily.

Plus other interesting articles

http://www.coinflation.com/

arco

24-02-2009, 09:44 AM

(http://www.bloomberg.com/apps/news?pid=20601116&sid=auCD.nWUOOnw&refer=africa#)

By Carli Lourens
Feb. 23 (Bloomberg) -- Rand Refinery Ltd. (http://www.randrefinery.co.za/), the world’s largest gold refinery, increased coin output to the highest in about 23 years as demand for South African Krugerrands rose.

Article (http://www.bloomberg.com/apps/news?pid=20601116&sid=auCD.nWUOOnw&refer=africa)

arco

24-02-2009, 02:58 PM

Proof of the penny is in price market will bear

John Elder
February 21, 2009

http://images.watoday.com.au/2009/02/21/391562/N_BELINDA_PENNY-200x0.jpg

Rare coin dealer Belinda Downie is offering this Proof 1930 Penny for at least $2 million. Photo: Craig Sillitoe

IN 1930, a loaf of bread cost seven pennies. Today, a single 1930 penny could buy a house in Brighton, or 10 cheap flats in Frankston.
That's the hope of an anonymous rare coin collector who this week put on the market his Proof 1930 Penny — one of only three in private hands. Caulfield-based dealer Belinda Downie says the man is asking $2 million-plus, a record price if he gets it.

Full article from Fairfax Digital
(http://www.watoday.com.au/national/proof-of-the-penny-is-in-price-market-will-bear-20090221-8e9u.html)

peat

24-02-2009, 03:34 PM

This site measures the current pure metal value or melt values of circulating coinage - gold and silver. Updated daily.

Plus other interesting articles

http://www.coinflation.com/

I've got a spreadsheet for NZ and Aus silver coins....
tho theres only a few worth buying for melt value

NZ 1949 Crown 0.4546 $12.99
Florin (1933-1946) 0.1818 $5.20
1/2 Crown (1933-1946) 0.2273 $6.50

and I have now finished cataloging the collection was surprised to find its 27.5 oz's so far. not that much but only been buying them when I can get a bargain.

arco

25-02-2009, 09:28 AM

Watch out for Butterflies blowing bubbles

Butterfly leg 'd' reversed right on the 127 Fib and daily hart presently printing an Evening Star

Dr_Who

25-02-2009, 11:07 AM

Butterfly leg 'd' reversed right on the 127 Fib and daily hart presently printing an Evening Star

Please translate into English. ;)

Aussie

25-02-2009, 12:25 PM

Interesting that this carpet bombing of gold materializes immediately before options expiry, Mr. Bernanke's testimony on Capitol Hill and President Obama's first State Of The Union speech . . . NOT a normal looking trading pattern.

1281

arco

25-02-2009, 12:51 PM

Please translate into English. ;)

Heres what a yellow Butterfly looks like. (They are based on Fib numbers)

If you read the Butterfly thread you will get the bigger picture. (Perhaps :))

.
http://www.khalsaspad.com/files/110905chf5m_143.gif

Aussie

25-02-2009, 02:27 PM

Butterflies, cup and saucer, inverted head and shoulders, hanging crosses and flag formations . . . who knew that TA could be so creative . . . ;)

peat

26-02-2009, 12:08 PM

3) As far as The SPDR Gold Trust is concerned, HSBC is it's custodian and investors of GLD have plenty to be worried about . . .

Email from the Van Tharp institute also raising this issue today Aussie...

The way GLD is set up, there is a series of legal barriers that prevent anyone from verifying if the gold is in the vault or leased out. Thus, GLD could have nothing to actually back up the 850 tons of gold it claims to have. Is GLD another financial Ponzi scheme, but with good intentions?

Aussie

26-02-2009, 12:14 PM

The GLD ETF turned in a fourth business day in a row with alleged gold holdings unchanged at 1,028.98 tonnes. This means this idiosyncratic instrument has managed to weather today’s down $25.50 Comex day and Friday’s up $25.70 move without feeling the need to change its holdings even 0.01 tonnes (321.5 ounces).

Given the recent attention to the GLD holdings this will probably be interpreted as bearish. My own view is that the directness of the relationship between GLD’s alleged holdings of bullion and short term gold price action is dubious.

trader10

01-03-2009, 07:34 PM

Memo to gold juniors: the times are on your side
--------------------------------------------------------------------------------
Thursday, 12 February 2009

JUST so long as you can get off your backsides and start mining. The Outcrop by Robin Bromby

Are you already tiring of all the talk about the 1930s happening again?

Fair enough. You’ll have plenty of time to relive it when this economic crisis gets into full gear.

The next sound you’ll hear is the bond market collapsing and that of Chinese and other doors being slammed in the faces of the supplicants from the US Treasury.

But there is one sector that can, actually, look forward to doing very nicely – provided companies can stay in business long enough to start mining, that is.

And directors can get off their backsides to get the metal out of the ground.

Of course, this is all about gold, the “barbarous relic” that seems like that when times are good, but suddenly comes back into favour when the world economy turns sour.

Sure, you know all about how gold is the only metal that is actually seeing good price increases.

That’s fine, but probably you should catch up on just how much of a safe haven the gold sector was during the depression that lasted, in effect, from 1932 until World War II.

You also probably know the Homestake Mining story.

If you bought Homestake Mining shares from your Wall Street broker in October 1929 they cost $US80, but by 1935 Homestake stock was worth $US495 per share.

Moreover, in those years, the miner paid out $US128 in dividends per share.

That year – 1935 – was also the year Emperor Gold Mines went into business in Fiji and did well for more than 60 years.

But there was also another big story of the time that should resonate and bring comfort to the gold sector – the formation in March, 1933, of Western Mining Corporation.

Remember this was possibly the worst year of the slump, the Dow Jones by the end of 1932 having lost 82% of its worth since the 1929 crash.

The month before Western Mining was formed, newspapers were reporting frenzied excitement on the London Stock Exchange focused on buying shares in South African gold miners.

By 1934, when Homestake stockholders were raking in the dividends, Western Mining had established its Gold Mines of Kalgoorlie operation. A year later, there would be its Central Norseman Gold.

The depression, and the increased value of gold, had an extraordinary effect on the industry here.

According to the 1935 Australian Year Book, the value of the gold yield in this country in 1929 was the lowest recorded since the discovery of the metal in 1851.

Well, that might be due to the boom times of the late 1920s.

There was a slight increase in production in 1930 as gold prospecting started to pick up and operators looked to start working over all mining areas.

But then the price of gold paid to miners started to get a move on.

Anyone born before 1960 will be able to follow the pounds/shillings/pence amounts (the quarter fractions refer to farthings) and, of course, know that a pound then was real money – you didn‘t break a pound note lightly.

For those born later, there are conversions in parentheses – the amounts bear no relation to today’s values, but you’ll get the picture.

Australian miners earned £5/19/9d ($11.98) an ounce in 1931.

In 1932 the gold was worth £7/5/11¾ (around $15.60).

In 1933 it rose slightly to £7/14/3¾.

Then in 1934, the price was £8/10./0¼ (around $17).

What you have to remember is that, in parallel, with this substantial increase in the gold price, was that the prices of almost everything – labour, fuel, food, etc – were actually falling (that is, deflation), which must have blown out the margins significantly for the mining companies.

It was part of a worldwide pattern.

In 1933 the American Bureau of Metal Statistics estimated that 1932 worldwide production of gold totalled at least 23.5 million ounces worth $US485.7 million, compared with 21.33Moz in 1931, 20.3Moz in 1930 and 19.86Moz in 1929.

The 1932 figure was probably higher as the Americans were working with old figures on Russian output but anecdotal evidence suggested those figures had been surpassed.

But what is significant is that the price kept rising during the slump in the face of not only increasing mine production but the sudden surge in scrap supplies.

Gold released from jewellery and other items soared as owners needed money.

In the year to September 1932, British India exported the equivalent of 11.5Moz salvaged from fabricated items. Germany was another big source of gold from scrap.

In other words, the world in the 1930s just couldn’t get enough gold.

As it won’t in 2010.

http://www.miningnewspremium.net

Dr_Who

04-03-2009, 10:38 AM

Gold is falling.

Whats the news?

Aussie

04-03-2009, 11:10 AM

Gold is falling.

Whats the news?

Three US banks 'own' gold futures at Comex!
009-02-11 16:30:00

The collapse of US banking gaint Lehman Brothers few months ago was the beginning of this decade's severest global eoncomic meltdown. Falling stocks markets, rising commodities prices and volatile currencies have made several nations to cut interest rates and people are these days running after gold saying that the yellow metal is the safest investment during recession times.

But do you know that some large American banks are dominating the gold market in the world? Or some of the same banks that helped spawn the current global financial crisis, have the largest positioning in gold and silver futures at Comex, a division of Nymex?

In an interesting report, noted gold market analyst Gene Arensberg, has reviewed the latest gold and silver market data from the U.S. Commodity Futures Trading Commission from a trading standpoint and observes that the largest traders are positioning themselves for a fall in gold but not so much for a fall in silver.

Here is an excerpt from Gene Arensberg's article:

"The very largest traders for gold and silver are, wouldn’t you know it, big U.S. banks. It looks like a few big banks, some of the same ones whose brilliant management helped spawn a global financial crisis, have the largest positioning in gold and silver futures. As of February 3, their positioning in gold and silver futures was big all right – big and short the market for gold, somewhat less short silver comparatively speaking.

A short position means the trader profits if prices fall.

According to the monthly CFTC Bank Participation in Futures and Options Market report released Friday, February 6, two large reporting U.S. banks held zero long and 27,189 short futures positions in COMEX silver futures as of February 3. All commercial traders as a group held a net short silver position of 33,173 contracts that same day; so just two banks held 81.96% of all the COMEX commercial net short positioning for silver.It should be obvious that these two very large banks could exert a disproportionate share of influence on the small silver futures market if they were so inclined. When just two traders are allowed by the Commodities Futures Trading Commission (CFTC) and the Securities and ExchangeCommission (SEC) to accumulate so massive a position that it constitutes an overwhelmingly large percentage of the action; when the authorities allow just two banks to literally dominate a market with the weight of their own trading, traders are left to speculate on what the largest traders are going to do instead of concentrating on the supply/demand fundamentals and legitimate price discovery.

Isn’t that the equivalent of subjects wondering what price the King will decree rather than citizens all haggling in their own self interest to determine a market price? Or, as one trader put it recently, is the COMEX silver market waiting on JP Morgan Chase to show its hand or make a move?

In fairness, it is quite possible that the positions taken by the banks are for the most part legitimate hedges, offsetting corresponding positions in markets outside the COMEX. However, the sheer size of the positions taken by just two banks raise questions as to the legitimacy of the price discovery process on the COMEX, division of NYMEX.

Intuitively, it should be plain to anyone that positions of overly large size could compel defensive, rather than passive, action on the part of the position holders regardless of whether or not they are hedges.

For gold, the bank positioning is similar. Although not quite as dominant as in silver, just three U.S. banks held a collective net short position of 111,190 contracts while all commercial traders as a group reported a net short positioning of 177,589 contracts. So, three U.S. banks represent a shockingly large 60.57% of all the commercial net short positioning on the COMEX for gold.
From January 6 to February 3, the three banks added 27,367 contracts or 34% to their net short positioning as gold rose $37.09 or 4.3% from $864.16 to $901.25. That is about an 8:1 ratio, meaning the banks strongly expect lower gold prices.

Again, the very large commercial net short positioning doesn’t necessarily mean that the commercials are “right.” It just signals clearly what they are positioning for.

Some analysts assume that the banks can actually drive prices lower temporarily if they don’t get what they expect. If true we have to wonder then why they haven’t done so before now? Or if, perhaps, “they” have been doing that all along. We’ll see, but back in October 2005, gold reached an obvious technical resistance zone in the $470s and the big commercial traders took a then staggeringly large net short position of 212,714 contracts, or a huge 57.36% of all open contracts.

arco

04-03-2009, 02:32 PM

Gold is falling.

Whats the news?

Its old news - from my post on the 21/2 - attack of the Butterflies.

arco

04-03-2009, 10:31 PM

http://news.bbc.co.uk/2/hi/americas/7920895.stm

Hostess Stephanie Hunt made $477 and salon-worker Amie Larson $416, while another guest, Bebe Bach, came out tops with $541. Others walked off with about $100 or $200.

Dr_Who

05-03-2009, 10:12 AM

Do you think gold will hold at $900?

dayz

05-03-2009, 11:57 AM

Gold seems to be tracking the Euro/USD to some extent, can't see that going to 1.20 so it seems that gold will get some support soon. Gold is pushed around by banks/speculators/govt interestes etc however and no-one is likely to be able to predict gold/USD values in the short term that precisely.

imho

airedale

05-03-2009, 01:08 PM

Do you think gold will hold at $900?

Hi Doc, I will stick my neck out and say yes.;)

patsy

05-03-2009, 04:24 PM

Email from the Van Tharp institute also raising this issue today Aussie...

There is no reason to run the risk of investing in GLD... there are too many recent examples of Ponzi schemes to afford buying what may turn to be "paper gold". There are some other alternatives that yet avoid the hassles of bullion storage, transportation, etc. such as CEF (Central Fund of Canada), another ETF, which is a mix of gold and silver, but has much tougher audit restrictions. Anyone can check the gold/silver holdings, and also sits outside the USA and this has the added advantage of not being subject to the same risk of expropriation as happened during 1930s in the USA.

Another option in the ASX is ZAUWBA, warrants issued by the Perth Mint and guaranteed by the Government of Western Australia.

Of course, everyone will see the risks of these products differently - nevertheless, such risks are much lower than holding GLD, which may turn to be a black hole.

patsy

05-03-2009, 04:28 PM

Do you think gold will hold at $900?

The price of gold has a standard deviation of 55% so whether a certain level is held or not is possibly irrelevant - big swings are part and parcel of gold prices. Long-term, gold prices are inflation proof but to achieve such protection against inflation one has to have a strong stomach.

Jess9

06-03-2009, 12:53 PM

http://www.stuff.co.nz/business/world/rest-of-world/2008697/BoE-printing-money

Up gold goes!

arco

06-03-2009, 01:08 PM

http://www.stuff.co.nz/business/world/rest-of-world/2008697/BoE-printing-money

Up gold goes!

Theres an old support level circa 934.40 which its just tested and its currently holding as resistance.
We now need to see it break back over that line and re-test it to confirm support. Also potentially it could come down a bit to test the down-trend line its just cleared. (922 ish if that happens).

Basically still down-trending on short term charts.

peat

06-03-2009, 06:17 PM

Colin Twiggs from Incredible charts presents a very matter of fact trading diary which is pretty often spot on the money actually

http://www.incrediblecharts.com/tradingdiary/2009-03-06_gold_crude.php

and he reckons

Spot gold respected support at $900, rallying above short-term resistance at $920 and breaking out of its trend channel to signal reversal of the recent down-trend. The short-term target is $940; calculated as 920 + ( 920 - 900 ). Retracement that respects the new support level at $920 would confirm the up-trend, offering a medium-term target of $1000. Failure of support at $900 is now unlikely, but would warn of a test of $700. In the long term, breakout above $1000 would offer a target of $1200; calculated as 900 + ( 1000 - 700 ) from the large descending broadening wedge over the last 12 months.

Jess9

06-03-2009, 10:58 PM

Colin Twiggs from Incredible charts presents a very matter of fact trading diary which is pretty often spot on the money actually

http://www.incrediblecharts.com/tradingdiary/2009-03-06_gold_crude.php

and he reckons

The short-term target is $940; calculated as 920 + ( 920 - 900 ).

...short term, like right now. Just nudged above. Lets see where it closes.

ananda77

08-03-2009, 02:01 PM

...short term, like right now. Just nudged above. Lets see where it closes.

...only a decisive push above 1007 will prevent gold to abandon the 680 target

Kind Regards

airedale

08-03-2009, 10:45 PM

If you look at the 5 year chart 0n Kitco, there have been 3 attempts to get above $US 1,000 since 03/08. My feeling.....based on the amount of paper being printed by banks.....is that $1000 will be breached and become support.

patsy

09-03-2009, 06:49 AM

Gold bullion sales in eBay reached almost $4M last month. However, the interesting figure is that some non-collectible gold coins are carrying a 100% premium over gold content.

arco

09-03-2009, 09:53 AM

Gold bullion sales in eBay reached almost $4M last month. However, the interesting figure is that some non-collectible gold coins are carrying a 100% premium over gold content.

There are also some ridiculous prices for silver and gold coins on sella.co.nz and TradeMe.
If anyone buys these overpriced coins they are going to be sitting with them for a very long time before they can turn a profit IMO

JBmurc

09-03-2009, 10:27 AM

There are also some ridiculous prices for silver and gold coins on sella.co.nz and TradeMe.
If anyone buys these overpriced coins they are going to be sitting with them for a very long time before they can turn a profit IMO

well current silver reserves will last 15yrs total est. probable silver left in the world 25-30yr at current usage, that's if silver demand doesn't increase which IMHO it will- as silver is only second to crude oil for world wide different uses it's a true precious thing unlike the paper money you pay for it which is incresing by trillions while the world silver is depleting

Also I remember talking with a NZ silver trader 2-3yrs ago when silver was $7usd(If you look back on my sharetrder post I asked the forum where I could buy 100kilos of silver as I believed it was very good buying)
The trader I talked with like youself arco thought I was crazy trying buy silver for a investment why he asked would you want so much silver theirs pently enough around,the price hasn't increased much over the last coulpe yrs,go buy gold etc etc etc

Silver hit a high of $21oz USD like a 1-2yrs later
as of more recent times when I finally decided to start buying bullion right upto couple months ago I paid an average of $26oz for my 30kilos of bullion savings currently I could sell on trademe for 35oz-40oz personal I'll happy to wait for a couple more yrs as 000's will be alot better

JBmurc

09-03-2009, 10:46 AM

The precious metals industry is experiencing a substantial surge in activity which may cause delays. We apologize for this inconvenience and are working hard to get you your package as soon as possible. From the date your funds have cleared to the time you receive your order can currently take 3 to 4 weeks.

lakedaemonian

09-03-2009, 12:37 PM

lakedaemonian

09-03-2009, 12:42 PM

well current silver reserves will last 15yrs total est. probable silver left in the world 25-30yr at current usage, that's if silver demand doesn't increase which IMHO it will- as silver is only second to crude oil for world wide different uses it's a true precious thing unlike the paper money you pay for it which is incresing by trillions while the world silver is depleting

Also I remember talking with a NZ silver trader 2-3yrs ago when silver was $7usd(If you look back on my sharetrder post I asked the forum where I could buy 100kilos of silver as I believed it was very good buying)
The trader I talked with like youself arco thought I was crazy trying buy silver for a investment why he asked would you want so much silver theirs pently enough around,the price hasn't increased much over the last coulpe yrs,go buy gold etc etc etc

Silver hit a high of $21oz USD like a 1-2yrs later
as of more recent times when I finally decided to start buying bullion right upto couple months ago I paid an average of $26oz for my 30kilos of bullion savings currently I could sell on trademe for 35oz-40oz personal I'll happy to wait for a couple more yrs as 000's will be alot better

Yup...I've been acquiring silver since approx. 2002.

I got nervous when silver climbed like a rocket then dived 2-3 years ago....I simply bought more and kept my dollar cost average low.

At these prices I still think it's a great long-term buy......but I'm really cheap.......NZD cost basis is far, far higher than it was even a year ago...using old .80 NZD/USD cross cash offers a better opportunity......current .50NZD/USD, not nearly as much

Aussie

09-03-2009, 04:23 PM

There are also some ridiculous prices for silver and gold coins on sella.co.nz and TradeMe.
If anyone buys these overpriced coins they are going to be sitting with them for a very long time before they can turn a profit IMO

I disagree, the market is what the market pays . . . if anyone here thinks they can just go out and buy physical gold for the spot price, then good luck . . . you'll be looking for a long time.

JBmurc

09-03-2009, 05:56 PM

I disagree, the market is what the market pays . . . if anyone here thinks they can just go out and buy physical gold for the spot price, then good luck . . . you'll be looking for a long time.

I think it's going to take time an alot more knowledge of silver for many investors to see it more than spoons an cups and more as the most precious of the PGM's it's just been so undervalued for so long now.

The facts are 1oz Gold coin $1800 no one blinks at the price- Silver 1oz coin $40 WTF!! I'm going to say this for the 10th time there is no more than 6-7 times more silver in the ground left in the world.
And as 90% of silver is used in Micro-usuage depletion( chips on CCards, electronic goods etc )
there is currently less silver above ground than gold, $40 is cheap..If just 1% of the gold bullion holders sold their gold to convert to real silver bullion the price would explode like never before...

arco

09-03-2009, 09:39 PM

................I remember Peak Oil :D

I'm not saying silver is not good.........most of my silver and gold was bought in 2002/2003 when everyone else thought I was mad. I sold some not long after Buffett .

If the action breaks the daily DT line, I might buy some more...we'll see if that happens.

You can still get some just above spot if you know where to go, and what to look for.

arco

Craig3215

10-03-2009, 02:29 AM

There is a ton of 1 oz gold coins selling on e-bay for ~$1000, some with free shipping which seems reasonable

Aussie

12-03-2009, 01:39 PM

Craig3215, what do you think of GATA and Bill Murphy's hypothisis . . .

___________________________________

The suppression of the price of gold was the essence of Robert Rubin's famed Strong Dollar Policy. What else did the US do to effect that policy? Talk? Jawbone?

It seems to have all started with the suddenly not so highly regarded, Robert Rubin…

Before he was CEO of Goldman Sachs and then US Treasury Secretary, Robert Rubin worked in London for Goldman Sachs. One of his duties was to oversee their gold trading operations. We know this because the CEO of GATA supporter Kirkland Lake Gold, Brian Hinchcliffe, worked in London back then for Goldman Sachs and reported directly to Robert Rubin.

This was many years ago and interest rates in the US were very high, say from 8 to 12%. Rubin had Goldman Sachs borrow gold from the central banks, sell it in the physical market and use proceeds to fund their basic operations They could do so at about a 1 % interest rate. This was like FREE money, as long as the price of gold did not rise to any sustained degree for any length of time.

Soon other major financial institutions realized what GS was doing and copied them. Rubin continued these operations as the Goldman Sachs CEO and then took it to a new level as US Secretary Treasurer. As mentioned, the gold price suppression became the lynchpin of his widely acclaimed "Strong Dollar Policy." GATA's Reg Howe caught on to this notion in a paper titled, "Gibson's Paradox and The Gold Standard," co-authored by Lawrence Summers in 1988. Summers, a professor at Harvard at the time, succeeded Rubin as US Treasury Secretary. The bottom line of Summer's analysis is that "gold prices in a free market should move inversely to real interest rates." Control gold and it will help to control interest rates. How disturbing to have Summers, a man very responsible for America's current market nightmares, back on the scene as Obama's most significant economic advisor.

Bullion banks such as Goldman and Morgan became The Gold Cartel's hit men, trading the gold market from the short side and bombing the market in coordinated anti-trust fashion at the beck and call of our government, making a great deal of money in the process.

airedale

12-03-2009, 11:37 PM

Aussie, if the POG " should move inversely to real interest rates" then POG should be going up as interest rates worldwide move down.
I still see the support at $900 as part of a continuing uptrend.

As for Rubin et al.....foxes looking after the henhouse:(

airedale

13-03-2009, 01:15 PM

Interesting to see that POG jumped $20 when the Nymex opened last night. It usually goes down when the strings get pulled in NY.

Aussie

13-03-2009, 07:46 PM

Interesting to see that POG jumped $20 when the Nymex opened last night. It usually goes down when the strings get pulled in NY.

The cartel was caught off guard by the Swiss and it took them an hour to control the price back down again . . .

From Trader Dan . . .

The big stunner of today was massive intervention by the Swiss National Bank into the Forex markets which absolutely obliterated the Franc. They caught everyone flatfooted and achieved maximum shock value. I had to double check my price quotes and the charts to make sure that they were correct as the currency simply evaporated… The last time the SNB had intervened in these markets was all the way back to 1995 or 14 years ago.

The Swiss cut their 3 month Libor target by 25 basis points but they also stepped into the bond market and purchased substantial amounts of Swiss franc bonds. That in combination with them buying large amounts of foreign currency is in my view what shoved gold up so sharply today. The strategy of the Swiss is pretty clear – undercut their own currency to remain export competitive especially against the Euro and the US Dollar and provide substantial amounts of liquidity in the process. While I have not yet had a chance to calculate the gold price in terms of the Swiss Franc, there is no doubt whatsoever that it shot sharply higher today. After all, it is evident that the Swiss have decided to play the “beggar thy neighbor” policy in terms of the foreign exchange arena. All of this serves to remind investors why it is an imperative in today’s environment to own gold – after all, if your Central Bank is determined to debauch your native currency, you have to protect yourself. It is that simple!

I can well remember when the Swissie was once the “go-to” currency when it came to a safe haven during times of economic or geo-political crisis. Obviously that is no longer the case. My how times have changed! It is going to be interesting now to watch the contest between the SNB and the speculators to see how the game is played out. Will the specs leave them alone or will they play the cat and mouse game and bid it back up to see what kind of reaction they get from the Swiss monetary authorities.

http://jsmineset.com/index.php/2009/03/12/hourly-action-in-gold-from-trader-dan-84/

Aussie

17-03-2009, 09:37 PM

To all; AIG finally 'fessed up as to where the $150+ billion of bailout money went. Foreign and domestic banks got huge shots in the arm with this and TARP, TALF, etc., and where do we stand now? The system is more gridlocked, more precarious and more leveraged (due to additional derivatives and sovereign borrowings) than we were last fall. The banking and financial system as we knew it, is now broke and on life support. This includes governments and thus their currencies.

If you knew for a fact that tomorrow morning the global banking system would not open, what would you do? If you knew that government responses would be to go to market and borrow more, then print to infinity, what would you do? All roads lead to Gold because it is the only "money" that has not and cannot be infected by a credit crunch, sovereign bankruptcy, financial panic, or mass monetization.

Tomorrow morning will be here one of these days soon. It is wise to have only enough "cash" for 3-6 months worth of expenditures, the rest MUST be Gold and Silver related. Whether the G-20 meeting accomplishes anything or nothing makes no difference. The market place and human psychology will do Mother Nature's bidding for her. We are in the "fantasy" stage where all sorts of "innovative ideas" are being thrown around to instill confidence and turn the clock back to the good ole days. None of this can work because it is all slight of hand and "unsound" business practice. It is simply BAD MATH!

Everything has become unsound, the banks and financial sector, industrial sector, pension plans, governments and their currencies, etc.. The light bulb is going on as evidenced by the demand for physical bullion, this thought process will spill over to the mining sector and the shares as the world wakes up to valueless financial sector. Imagine your thought process after a string of banks and financials actually fail, and the Treasury wants to borrow more "money" than is available or offered. Imagine the Fed printing $1 trillion, or even 10, to buy Treasury bonds to keep the government running. Imagine not having access to your liquid funds, or being overseas and hearing "we don't accept Dollars". Then, after a couple weeks, you hear the same thing in the States. In my opinion this is where we are heading one morning in the near future. We will wake up to this, you will be prepared or you won't.

We are being told that the banks have been profitable for the last 2 months, GM doesn't need the $2 billion this month, blah blah blah. The stock market is now getting its long awaited bounce. Now we watch for the flame out, once this rally fails, I believe the big bust or TOMORROW MORNING will arrive. Confidence has been shattered and "hope" (the refuge of fools) is that the bottom is in and the worst is over. In this next phase, the only thing that will "be over" is the fiat monetary system. The Swiss fired the "Ft. Sumter" shot of devaluation last week, the race to the bottom is now on. When the stock market starts to flame out and begins to roll over, I believe information and events will go into hyperdrive. They cannot stretch the system nor the truth any further. It is time to "pay the piper", if I were him I would only accept hard currency.

Regards, Bill H

airedale

18-03-2009, 01:18 AM

Hi Aussie, gold is going sideways at the moment,and will possibly slip down a little from here. I think that is merely an orderly minor retreat in the ongoing bull market.

Craig3215

18-03-2009, 11:33 AM

Aussie

18-03-2009, 08:01 PM

Thats interesting, that is the first time ive heard that. It seems to me that gold prices could be effected by real interest rates but i'm not sure how real interest rates would be effected by the price of gold... i'll forward this on to martin armstrong he's not exactly a fan of goldman and he might have some input on this

Thanks Craig, that would be awesome. He should look into "Gibson's Paradox" I'm in the middle of reading his latest report "Is It Time To Turn The Lights Out". It's a great read so far . . .

http://www.contrahour.com/turnoutlights209.pdf

JBmurc

19-03-2009, 08:24 AM

WOW talk about sharp rise GOLD up to $60 at it's peak from it's 2hr ago low someones buying up big

Aussie

19-03-2009, 08:39 AM

WOW talk about sharp rise GOLD up to $60 at it's peak from it's 2hr ago low someones buying up big

Fed just announced they are buy US$Trillion in Treasuries. Quantitative Easing has officially begun in the US. The printing presses just got switched to high.

Dr_Who

19-03-2009, 11:37 AM

Wow amazing!

Lego_Man

20-03-2009, 10:41 AM

POG in NZD terms is still down...

Aussie

20-03-2009, 12:55 PM

Trader Dan over at JSMineset is a must read each day . . . great analysis.

http://jsmineset.com/index.php/2009/03/19/hourly-action-in-gold-from-trader-dan-86/

arco

20-03-2009, 01:41 PM

POG in NZD terms is still down...

Currently about 15% down since 3rd March if my calcs are correct

Aussie

22-03-2009, 09:08 PM

End Game - Printing The Reserve Currency

For months now, both Fed Chief Bernanke and Treasurers Paulson and Geithner have been spouting the same mantra. The Fed and/or the Treasury, they keep repeating, will do "whatever is necessary" to rescue the global financial system from its present implosion. This week, the Fed went as far out on the monetary limb as a central bank can go. It announced plans to MONETISE $US 300 Billion of the debt of the US government as issued by the US Treasury. This is the ultimate form of money printing, made possible only because what the US (and the world) uses as "money" is fiat paper backed by nothing and redeeemable in nothing except more of the same.

Yes, other central banks have announced plans to monetise the debt paper of their governments. The Japanese central bank has been doing it for quite a while now. And in the week before the Fed announcement, the Bank of England announced their own plans to start buying (with "money" created out of thin air) UK government bonds.

It is one thing for the central bank of Japan, the UK or anywhere else to embark on what is now quaintly referred to as "quantitative easing". It is another thing entirely for the central bank of the nation which provides the world with its RESERVE CURRENCY to do so. In the past, nations which provided the world with "key currencies" have seen themselves as being forced up into a corner from which there is no escape except to either repudiate their debt or literally print it out of existence. These nations, including the UK in the early 1930s, did monetise their debt and, in the process, sounded the death knell of their currency's role as a key or reserve currency.

When the UK did this, there was another currency waiting in the wings to take over as the world's "reserve currency". That currency was, of course, the US Dollar. Having gained the sole global reserve currency role after the 1944 Bretton Woods agreement, the US abused the privilege to the point where, in 1971, it could no longer maintain its Bretton Woods mandate to REDEEM the US Dollar on demand (by foreign governments and/or central banks only) at a rate of $US 35.00 for one troy ounce of Gold.

The HUGE historical change that took place in 1971 was that the US Dollar was NOT dethroned as the global reserve currency. There was no viable replacement, as there had been in 1944. Instead, the US declared its paper money to be purely fiat - redeemable in NOTHING. The rest of the world followed suit and by early 1973, the world was on a global PAPER money standard for the first time since the standardisation of Gold in coin form as money nearly three millenia ago in 700 BC.

It has taken almost exactly 36 years, but the global fiat system which was set up in March 1973 has now imploded. With the Fed's decision at their FOMC meeting on March 17-18 to buy Treasury debt with its own "Federal Reserve NOTES" (aka US Dollars), there is nothing left in its manipulative arsenal. The ultimate absurdity of a global financial system based on IOUs payable in more IOUs has finally been reached. The present fiat money system based on debt and "supported" by the paper of history's biggest net debtor is doomed. It was always just a question of "when". That question was answered on March 18.

The evidence of that is all over the markets. Treasury yields dived precipitously (and prices rose) immediately after the Fed announcement in a knee jerk reaction that the Fed would succeed in lowering longer-term rates by buying the longer-term debt paper. The US Dollar fell even more precipitously, wiping almost three full points off the USDX in 48 hours. And Gold went into paroxyms. In the immediate aftermath of the Fed announcement, the spot future price plummeted below $US 900. Then, in after hours trading on March 18, it soared well over $US 50. On March 19, spot future Gold had one of its biggest one day rises ever, up $US 69.70 on the day.

The idea that a currency can retain its global reserve status in a situation in which its central bank is forced to buy government debt paper to postpone a terminal meltdown in the system itself is absurd on the face of it. The Fed has already gone most of the way to destroying the current credit based banking and financial system. If it makes good on its promise of March 18 and DOES start to monetise the debt of the US government, it is going to destroy the US Dollar as well.

In the lead up to the April 2 G20 Heads of State summit in London, there is already much talk about "replacing" the US Dollar as the world's reserve currency. So far, the only alternative NOT being mentioned is the only one which will ultimately work. That, of course, is Gold. Meanwhile, the tragedy continues as the global powers that be continue to dig a grave for the present credit based fiat money system in their doomed attempts to "save" it. Not only can it not be "saved", the sooner it is replaced with a system based on SOUND money, the better - for ALL of us.

patsy

23-03-2009, 08:48 AM

[B][SIZE="4"]

In the lead up to the April 2 G20 Heads of State summit in London, there is already much talk about "replacing" the US Dollar as the world's reserve currency. So far, the only alternative NOT being mentioned is the only one which will ultimately work. That, of course, is Gold. Meanwhile, the tragedy continues as the global powers that be continue to dig a grave for the present credit based fiat money system in their doomed attempts to "save" it. Not only can it not be "saved", the sooner it is replaced with a system based on SOUND money, the better - for ALL of us.

If there were one positive outcome from the current economic meltdown would be the disappearance of fiat currencies. However, given the overall populist paradigm of most governments around the world (from Rudd to Obama) and the thinking of most central bankers (from Bollard to Bernanke), a change towards hard currency would have a very low chances of ever happening. There is no way that hell-bent welfare states like we are experiencing throughout the West will bow to a currency they cannot manipulate. And third world would hate to lose the a mortal weapon they have: competitive devaluation.

It would be a dream if it happened..... it would ensure prosperity for the next generations but politicians, as we know them, prefer fictitious growth at the expense of serfdom for the next generation.

Aussie

23-03-2009, 12:21 PM

If there were one positive outcome from the current economic meltdown would be the disappearance of fiat currencies. However, given the overall populist paradigm of most governments around the world (from Rudd to Obama) and the thinking of most central bankers (from Bollard to Bernanke), a change towards hard currency would have a very low chances of ever happening. There is no way that hell-bent welfare states like we are experiencing throughout the West will bow to a currency they cannot manipulate. And third world would hate to lose the a mortal weapon they have: competitive devaluation.

It would be a dream if it happened..... it would ensure prosperity for the next generations but politicians, as we know them, prefer fictitious growth at the expense of serfdom for the next generation.

Agreed - unfortunately. But a glimmer of hope exists since there's a good chance when the USD collapses, the system may get smashed back to the stone age - so to speak.

I can't see the Chinese, Russian's and Saudi's allowing the US to dominate the financial landscape any longer. The damage at this point is too great. In the future, they are going to want more than pieces of paper in exchange for their hard assets.

lakedaemonian

23-03-2009, 02:16 PM

Aussie

23-03-2009, 04:12 PM

I would follow a thought posted on the iTulip forum stating that we could likely see USD-ish, Euro-ish, and YEN/Yuan-ish regional currency blocks eventually.

BUt Gold will play A role in the transition to something like that.

I know TPTB don't want to do it, but in my mind a revaluation of gold has to occur at some point . . . it's logical, how else can any real value be restored to the financial system. If gold is not important, why do central banks still hold it?

We are still in the early days of this crisis, after government's around the world have finished trashing their currencies in the next few months and years, how are they going to restore value. Talk is cheap . . . people will insist it be backed or be convertible into something tangible. Government distrust will be at an all-time high.

Lego_Man

24-03-2009, 04:24 PM

Currently about 15% down since 3rd March if my calcs are correct

And more now...

Aussie

25-03-2009, 02:03 PM

And more now...

Discounts are good news, buy more!

Lego_Man

27-03-2009, 03:12 PM

Discounts are good news, buy more!

I buy physical off trademe, some people are still willing to pay ~2000 an ounce?

A pseudo futures market perhaps?

outspoken

27-03-2009, 03:24 PM

Has anyone used this guy?

http://www.thegoldman.co.nz/

shasta

28-03-2009, 01:06 AM

I buy physical off trademe, some people are still willing to pay ~2000 an ounce?

A pseudo futures market perhaps?

No just uninformed "sheep" buying overinflated prices, well over spot.

If you're prepared to wait you can still get the physical stuff, just hard to get in large quantities.

ananda77

28-03-2009, 07:10 PM

...3 market attempts to break the *900 psyche barrier so far unsuccessful but still, instead of surging above the *1000+ barrier, another 4th attempt to break *900 most likely in progress...and if it breaks, selling pressure will take gold quickly into the *680 area and most likely below

...in the meantime, the USD surged 3 cents in one trading session and seems determined to challenge the *92.36 level

...Deflationary Forces...

...unless the market takes out US967 on a closing basis, no further committment of holding gold

Trading Strategy: have cash will buy; say 'WHEN' -Inflation-

Kind Regards

peat

29-03-2009, 09:45 PM

EWI agrees a77

Dr_Who

31-03-2009, 11:02 AM

I never understand how the gold price move. On a day like this gold price should be up, yet it is down. Something I dont understand I stay well clear.

Aussie

31-03-2009, 07:20 PM

I never understand how the gold price move. On a day like this gold price should be up, yet it is down. Something I dont understand I stay well clear.

Dr. Who, in short . . . gold is a political metal. The G20 is about to start!

Have a good poke around the GATA site and carefully read their WSJ ad that ran last year, it will make everything a lot clearer.

http://www.gata.org/node/wallstreetjournal

BTW, Does anyone here think this looks like a normal trading chart . . .

1410

I looks more like a chart depicting forces that were aiming to get the price back below $900 - found some strong resistance and were temporarily overwhelmed before returning to their mission. That's a huge price increase then decrease in the space of 2 hours.

How does that happen I wonder?

peat

06-04-2009, 09:47 PM

lakedaemonian

06-04-2009, 10:31 PM

but just to put things in perspective in relation to my comments in other thread about Martin Armstrong and gold price...

Colin Twiggs put out a warning on gold today.

"Spot gold broke through the band of support at $900 after earlier penetrating the rising trendline — signaling reversal to a down-trend. Expect support at the January low of $800, but the target is primary support at $700. "

kind of like the break that arco talked about in Silver.

I'm swapping my NZD for USD at these levels and will be buying lots more Gold on weakness.....enough to bring my dollar cost average up substantially....least bad option going forward in my opinion

arco

09-04-2009, 08:32 PM

As a consequence of the US Mint's new pricing policy (http://www.google.com/url?sa=t&source=web&ct=res&cd=1&url=http%3A%2F%2Fmintnewsblog.blogspot.com%2F2009% 2F01%2Fus-mint-publishes-new-pricing-policy.html&ei=psnbSZihEKrrlQfOq4H6Bw&rct=j&q=us%2Bmint%2Bpricing%2Bpolicy&usg=AFQjCNHGvHCUBfLY8p8OWRXZrDMjsqRCDA), the prices for gold coins will likely decrease this week.

Will collectors use this as an opportunity to buy US Mint gold coins?

http://mintnewsblog.blogspot.com/2009/04/us-mint-gold-coin-price-decrease-likely.html

airedale

21-04-2009, 09:01 PM

Aussie

22-04-2009, 12:06 AM

Someone posted a link to Martin Armstrong recently. He suggested....a couple of weeks ago....? that the current drop in POG would fizzle out on Sunday 19th April.
The action since Sunday suggests that he may have been right.

I'm following all this too airedale. It's going to be very interesting to see how things pan out . . . very interesting indeed!

Aussie

22-04-2009, 01:37 PM

The Return Of "Risk Appetite"

Last week, we talked about the huge rally in global stock markets over the past month. This week, coupled with increasing talk - especially in the US - about the "end" of the recession, we have seen a surge of reports that investors are now reassured by the stock market and that their "risk appetite" is returning. One major piece of evidence for this is, of course, the falling $US Gold price. As you know, spot future Gold could not break back above the $US 900 level early in the week and then fell away to close on April 17 at $US 867.90. That is its lowest spot future close since January 22. For the record, the lowest spot future close so far in 2009 was $US 805.20 - reached on January 15. That's right, Gold has moved in an almost $US 200 range so far this year.

In reality, of course, there was very little in the way of "risk appetite" over the 25 years (1982-2007) when paper assets - stock market assets in particular and real estate in the later stages - were in their great boom. Most of the participants in these markets didn't see themselves as taking risks at all. When a market keeps setting new (nominal) highs for a quarter of a century, an attitude becomes entrenched. And once entrenched, it takes a HUGE amount of contrary evidence to destroy it.

A recent article in Bloomberg illustrates this point very well. The Boston College "Center for Retirement Research" has recently shown that a median-income worker who put money into an all stock retirement plan over the decade ending on March 31, 2009 would end up with 26 percent less than he or she had contributed. This has changed the investing habits of most people hardly at all. In the fourth quarter of 2008, 6.1 percent of retirement fund participants changed their asset allocation. This was up a mere 0.3 percent from the fourth quarter of 2007.

The Dow hit its all time high in the fourth quarter of 2007.
Nor has it changed the asset allocation of most of the big US retirement or mutual funds. To give one example, the Vanguard Group still maintains a 90 percent weighting in stocks for all investors under the age of 42. And that is after the already mentioned 26 percent haircut suffered over the past decade. The old mantra - "in the long run, stocks ALWAYS go up" - is not going to go away without a fight.

Even more to the point, it is an all but universal attitude in the US and in many other "developed" nations that stock market investments are actually "savings". When asked about the implications of the Boston College findings, the director of the college center which compiled the data said she was not surprised that most investors were still feeding their 401K plans as before. "What is the alternative", she said."Are you not going to save at all?"

Compare, for just a moment, the alternatives to putting one's "savings" in two other types of asset rather than stocks. Someone who had merely held cash in hand - earning no interest at all - would be 26 percent better off. Someone who had bought Gold ten years before March 31, 2009 would have seen their holdings appreciate from $US 287.80 to $US 922.60. That's an increase of 220.6 percent. Here's the scorecard, using $10000 as a constant.

In stocks: $10,000 on March 30, 1999 becomes $7,400 on March 31, 2009

In cash: $10,000 on March 30, 1999 remains $10,000 on March 31, 2009

In Gold: $10,000 on March 30, 1999 becomes $32,060 on March 31, 2009

Show this simple list to almost anyone who is dutifully keeping up his or her monthly contributions to a mutual fund or 401K fund which still allocates 80-90 percent to the stock market and they would not believe it. Don't forget, we are talking about a DECADE of comparative returns here, this is not a short term situation. Yet the attitudes of most people have not changed at all from what it was when stocks were peaking in early 2000 or peaking again in late 2007. They still see paper assets as the only viable means of either getting ahead or saving. The halving of stock indices and the much worse performances of many individual stocks since late 2007 has not dissuaded them. They did not sell out when stocks fell nearly 50 percent in the US last year. They did not sell when they plummeted even further in the period up to March 9 this year. And now, six weeks later, their "risk appetite" is returning??

They never had a risk appetite. They were sure they were onto a sure thing. Most of them still are. If anything, they are even more sure of it since now they believe that the government will always be on hand to bail out anyone or anything that gets into any kind of financial grief. It is a sad and tragic phenomenon to watch unfold.

US Treasury funded debt is now on the verge of being 100 percent of (real) US annual GDP. No nation has ever recovered from such a position without a gut wrenching valuation collapse. Even though the Fed cut official US rates to effectively ZERO last December and announced plans to directly buy (with US Dollars created out of thin air) Treasury debt a month ago, longer-term Treasury bond yields are inexorably rising. On April 17, the yield on the 30-year bond hit 3.8o percent. When the Fed cut rates to ZERO it was just over 2.5 percent. The yield on the ten-year bond has gone from 2.10 percent to 2.95 percent over the same period. Somebody out there is certainly not regaining their "risk appetite".

It is impossible to know how long US and world stock markets will continue their rally. It is crystal clear, however, that most holders of paper assets have sold little if any of them and that this rally has seen many of them buy more. No bear market ever ends before the majority of investors give up and sell in a panic. There has been no vestige of that yet in this paper bear market. That means that it has a LOT more to fall. And somewhere in that fall, the "no risk" attitude of those who have spent their lives watching paper assets go higher is going to crack right down the middle. Until then, Gold is going cheap.

dumbass

22-04-2009, 07:28 PM

hey aussie no offence intended but your gold articles are the most one eyed , paranoid rantings ive read in a while.

heres a random date ive plucked out of the air and compared returns of gold , stocks and cash
by the way most people who hold cash get a return and compound it.

Here's the scorecard, using $10000 as a constant.

In stocks: $10,000 on March 31, 1980 becomes $86,948 on March 31, 2009

In cash: $10,000 on March 31, 1980 becomes $31,186 on March 31, 2009

In Gold: $10,000 on March 31, 1980 becomes $14,027 on March 31, 2009

it cant be true the shiny metal has returned sweet **** all, and thats being generous as i have factored in zero dividends in stocks and only a 4% compounded return for cash.
must have been gold cartel manipulation.

i just think you need to read some of these articles from a more balanced perspective.

Aussie

22-04-2009, 08:08 PM

hey aussie no offence intended but your gold articles are the most one eyed , paranoid rantings ive read in a while.

Why would I take offense dumbass? I don't write 'em and don't vouch for the info, I just find the broad thrust of them interesting that's all.

So you don't believe there is a banking Cabal out there . . ?

Aussie

23-04-2009, 02:13 PM

. . . i just think you need to read some of these articles from a more balanced perspective.

dumbass , I read and watch the mainstream media as well as the non MSM. I have generally found that what passes for news today (and particularly financial news) is often propaganda and this is usually confirmed to be so in the course of time. A great example is the so called Russian invasion of South Osetia last year. The Western press reported exactly the opposite of what really happened ignoring the real reasons behind the entire episode. It was nothing but a US propaganda exercise. And of course the people who saw the current financial crisis looming several years ago were laughed at - yet they were proven right. I tend to listen more to the folks who got it right and what they think is coming next, rather than those in control who "didn't see it coming" . . . yet were the very cause of it. They are hopelessly compromised.

The vast majority of people know nothing of what is really going on behind the scenes. They are simply financial taxpaying sheep that are herded, sheared in a continuous cycle. I am one them, it's hard not to be. But at least I am trying to look out of the stall and see what the farmers are doing. If you take the time to study and look hard enough you can catch glimpses, see patterns and make observations over time that paint a picture that looks far different to the one that our politicians / banker farmers would have us see.

In this current economic environment where there is no transparency, white is black and black is white. We are witnessing a huge economic paradigm shift. Permanent damage has been inflicted and things are never going to go back the way they were before. People have to come to terms with that. The global economic system has been gamed for decades by the collusion of Western banks and governments and their debt laden end is coming soon, no-one knows exactly when but eventually the laws of economics will ensure it does. A new financial system will have to emerge, and that may well be a part of the plan. Create chaos and then bring a new order out of that chaos. But who will be the new top dog? The current bankrupt Anglo American banking cartel or a new power base that emerges from China, Russia and the Middle East?

This decision will likely coincide with enormous social and political upheavals with once free countries becoming more and more centrally controlled as governments quell dissent from the masses while jockeying for position and grapple with the forces working against them. Human history and the cycles give clear warnings of the convergence of events that we are facing in the next few years.

There may be a bear market rally here and there but unstoppable forces are in play. The big dominoes are already slowly falling, most people haven't connected the dots yet but they are starting to. Look at the tax and spend rally's held in over 750 cities across America on April 15th. This is the start of a significant event and the MSM largely ignored it and the politicians (like Nancy Pelosi) demonized the participants. The coming years are likely to be very turbulent and I think the world will be truly shocked by heavy-handed government reactions.

If you continue to believe everything that gets trotted out by Obama, Geithner, Bernanke, Brown etc. then I think you will be very unprepared for what lies ahead. Look beyond the headlines, delve deeper into the issues and have an open mind.

Cheers

dumbass

23-04-2009, 08:41 PM

think we may well look at the markets from different perspectives, my background is technical analysis and have never really bought into the perceived manipulation that you feel dominates the markets.
I know from personal experience that there are big players exerting an influence on markets but they tend to be short term exploitive moves rather than some big multi year effect.
The idea that the price of gold is artificial engineered by mysterious forces over long time frames instead of being governed by normal market forces just doesnt add up.
If gold wants to move up then why swim against the stream just manipulate the market in the direction it wants to move, its way more profitable.

dumbass , I read and watch the mainstream media as well as the non MSM. I have generally found that what passes for news today (and particularly financial news) is often propaganda and this is usually confirmed to be so in the course of time."

Since when did a serious investor make any kind of investment decision based on whats in the media , other than to confirm a contrarian view.

generally im in agreement with your views, i believe there has been a monumental corrective shift in the credit markets which will never revert back to their indulgent past behaviour but why focus blindly on gold, there are many other asset classes that will be very profitable in the third leg of this bear market.
the quality of your last article does not in any way provide us with insight other than too the authors riduculous narrow minded investment outlook.

gold will be a buy and a sell but to so completely focus on it and ignore everything else is in my mind a very risky proposition.

If you continue to believe everything that gets trotted out by Obama, Geithner, Bernanke, Brown etc. then I think you will be very unprepared for what lies ahead. Look beyond the headlines, delve deeper into the issues and have an open mind.

i have the broadest of minds because i know anything is possible over any asset and its always in the charts.

Mick100

23-04-2009, 11:38 PM

aussie

Have you read the book - "the fourth turning"

It's got nothing to do with gold but nevertheless ties in with your thinking
,

Aussie

24-04-2009, 01:18 PM

aussie

Have you read the book - "the fourth turning"

It's got nothing to do with gold but nevertheless ties in with your thinking
,

It sounds familiar Mick. Can you elaborate? Who was the author?

Mick100

24-04-2009, 02:20 PM

It sounds familiar Mick. Can you elaborate? Who was the author?

Author: william strauss and Neil howe

A facinating book about generational cycles

If you believe that there will be some major changes in the world over the next 10 - 15 yrs, as i do, then this book provides the possible reasons for the turmoil and explains how turmoil and change is unavoidable

Aussie

24-04-2009, 02:55 PM

. . . generally im in agreement with your views, i believe there has been a monumental corrective shift in the credit markets which will never revert back to their indulgent past behaviour but why focus blindly on gold, there are many other asset classes that will be very profitable in the third leg of this bear market.
the quality of your last article does not in any way provide us with insight other than too the authors riduculous narrow minded investment outlook.

gold will be a buy and a sell but to so completely focus on it and ignore everything else is in my mind a very risky proposition.

i have the broadest of minds because i know anything is possible over any asset and its always in the charts.

dumbass, that article was written by Bill Buckler, an highly regarded and internationally respected commentator and author of The Privateer. Bill has been providing informed market commentary and authoring The Privateer since 1984 - he's seen a lot. That particular piece is from his weekly gold commentary called "Gold This Week". I quoted it into this particular section of NZ Sharetrader because it is for info about . . . gold! That's what this section of the board is for - gold. It's not the investment advice section so in that regard I consider it relevant.

The purpose of articles and anything anyone posts here is NOT to give investment advice - it's just stuff that I like and others may find interesting. People can make up their own minds. I do not focus exclusively on gold, I like it and believe it's time is coming but it's not the only investment I have. And yes, there most certainly will be a time to sell.

I can understand that as a TA guy, to you everything is in the charts. But I contend that while the charts are valuable and do indicate trends, they should be used as a guide only because they are quite often "painted" by market makers and those in control - especially the gold chart.

If you really look into the GATA perspective you will find a very compelling case for the manipulation of the gold market by US Treasury and Fed working in tandem with other central banks and certain Wall St. and City of London firms. Their motives FOR doing so are clear, they are in the position TO do it and have benefited greatly FROM doing it. Everything that has happened to date to a large extent is a result OF it.

In this area I categorically disagree with you. As far as I am concerned, the evidence for the long-term manipulation of the gold price is mounting almost daily and I challenge you to look into it for yourself.

As Bill himself so eloquently puts it . . .

"In any discussion of the future of Gold, or of the price of Gold, the first thing that must be realized is that Gold is a POLITICAL metal. In the true meaning of the word, its price is "governed".

This is so for the very simple reason that Gold in its historical role as a currency is fundamentally incompatible with the modern worldwide financial system.

Up until August 15, 1971, there has never in history been an era when no paper currency was linked to Gold. The history of money is replete with instances of coin clipping, printing, debt defaults, and the other attendant ills of currency debasement. In all other eras of history, people could always escape to other currencies, whose Gold backing remained intact. But since 1971, there is NO escape because NO paper currency has any link to Gold.

All of the economic, monetary, and financial upheaval since 1971 is a direct result of this fact.

The global paper currency system is very young. It depends for its continued functioning on the BELIEF that the debt upon which it is based will, someday, be repaid. The one thing, above all others, that could shake that faith, and therefore the foundations of the modern financial system itself, is a rise (especially a sharp rise) in the U.S. Dollar price of Gold."

Baa_Baa

25-04-2009, 02:17 PM

The chat here about gold (physical metal) would be better informed in the context of insurance than investment. Looking at it from an investment point of view misses the objective of owning gold. Invest and trade in Gold derivatives (options futures ETF's stocks etc) if you will, but discussing physical precious metals like they're an easily traded investment asset class isn't helpful.

BAA

Dr_Who

25-04-2009, 02:24 PM

The Chinese are have been buying gold for their reserve. China now holds over 1,000 tons of gold. WOW! :eek:

dumbass

25-04-2009, 03:15 PM

no surprise really they are the largest gold producer.

Aussie

25-04-2009, 10:45 PM

The Value Of Money

No we are not talking about the fact that one can buy item A for $100 or item B for $1000. We are talking about something far more fundamental. We can start by making a few basic observations. First, money can perform its function only in a situtation where property rights are recognised and scrupulously upheld. There are two types of economic transactions - direct exchange or barter or indirect exchange with the use of money as the MEDIUM of exchange. Please note the term common to both types of transaction - the term exchange. By definition, an exchange presupposes three states of affairs. First, that each potential party to the exchange OWNS the good, service or sum of money put into the market. Second, both parties to the exchange can without let or hindrance of any kind choose to exchange or refrain from exchanging. Third, that when the two parties DO choose to exchange, each party values the goods received MORE THAN the goods offered in exchange.

The value of money lies in the fact that it makes the process of exchange almost infinitely easier and more efficient than would be the case if there was no medium of exchange. By doing this, it enhances to the maximum the institution of private property, a principle without which no free or prosperous civilisation can come into existence, let alone grow. Before one can exchange, one must have something to exchange. Before one has something to exchange, one must employ the effort, energy, knowledge and most important time necessary to produce it. The triumverate - life, liberty and property are indissoluble. To understand the true importance of property, only one simple question is required: "Who owns my life?"

In reason if not always in reality - slavery has a long and sordid history - there is only one answer to that question. And there was a time not so many years ago when, at least in certain parts of the world, the right to life, liberty and property was acually upheld. The nations which upheld it had certain features in common. There was no (or extremely minimal by modern standards) income tax. There was no "welfare state". Government and its bureaucracies were small and, in the main, were instituted to defend the lives and freedom of their citizens. The extent to which these features held fast varied from nation to nation. But there was one feature which did NOT vary at all. All free nations before the outset of WWI were based on SOUND money.

Sound money - Gold (or Silver) has one vital attribute. Like other economic goods or the time, energy and effort needed to create them, money if it is sound cannot be "created" out of thin air. The value of - sound - money lies in the fact that no free nation can stand on anything else. Nor can any prosperity or any viable provision for the always uncertain future. And today, as prosperity is being destroyed and as the future becomes an ever more daunting prospect that few want to look at too closely, the value of money is being displayed as never before in our lifetimes. It is being displayed by the fate of what has taken its place.

To anyone who truly understands money, the antics of the world's governments and central bankers today would be comical were it not for the tragic legacy they hold for the future. Having destroyed any semblance of a rational price system, they are now pretending that the "valuations" of assets which are in reality valueless can be maintained by creating "money" out of thin air. Having debauched the money, they have now all but eliminated any reward for holding money while exhorting their citizenry to get off their behinds and start borrowing more of it. While watching unemployment skyrocket and tent cities spring up in their midst, they maintain that the path to prosperity is to consume what has not yet been produced.

And what is the ONE item of discussion and debate which they refuse to even contemplate, let alone address? It is of course the nature of the "money" which they are "borrowing into existence". Their contempt for the VALUE of money is shown by every new regulation they pass for its redistribution. And of course, it is shown by every new $TRILLION they conjure in an increasingly doomed attempt to prolong their power to control what people use as their medium of EXCHANGE! It is a sad fact today that most people see themselves as being dependent on government, when in reality the situation is in exact reverse. Government produces NOTHING.

Slowly but surely, more and more people all over the world are coming to realise that, having blocked off almost all the avenues which remain towards the production of WEALTH, about all governments are producing these days is "money". From that, it is but a short step to the realisation that the ONLY thing that gives this fiat money any facility at all is the government's power to force its acceptance and to ban anything else from being used as a medium of exchange. From that, it is a short step to the realisation that every new unit of "money" forced on us is impoverishing us still further.

There is only one cure for what currently ails the world's economies. That is the re-introduction of two things. The first is a proper respect for money. The second is a money worthy of respect. In all of history, only Gold has earned that respect. And, having earned it, it has never faltered in providing a sound money. The issue is as basic and as important as it has always been. You can't have a free country without a sound money.

Ultimately, there will never be a free and prosperous commonwealth until the principle of the separation of money and state has achieved the same status as has the separation of church and state. The government, in principle, has no business in meddling in either. And it is a moot point as to which form of meddling has resulted in greater human tragedies and disasters in history.

TTrader

01-05-2009, 12:59 AM

A little off topic but does anyone know where I can obtain information about traveling on an international flight from Australia to New Zealand carrying gold coins.

peat

01-05-2009, 08:58 AM

we've discussed it here on this forum a while back, I presume in this thread but I couldnt find it on a quick search. but a poster said he had travelled through customs with quite a number of gold coins no problem. The $10,000 currency limit does apply but the coins are valued at their nominal value not their gold value. most gold coins have a nominal value tho not all do. eg if it was a $50 gold oz you could carry in 200 of them

TTrader

01-05-2009, 02:54 PM

Alright as it is only a few coins I am not to worried am still waiting a call from someone at AirNZ to confirm.

Aussie

02-05-2009, 01:19 PM

Alright as it is only a few coins I am not to worried am still waiting a call from someone at AirNZ to confirm.

TT, the poster Peat is referring to may have been me . . .

Firstly, I would NOT contact anyone at Air NZ and disclose any information about what you are carrying or what flight you are on. The best security you have in carry PM's is complete anonymity. Nobody can steal what they do not know about. While Air NZ is a great company full of mostly honest people, you don't know who is on the other end of the phone and who they may later talk to . . .

You need to understand and be confident in the fact that there is absolutely NOTHING illegal about traveling with gold. People seem to think they are sneaking something or getting away with something illegal. Have no such fear.

About 2 years or so ago, I bought 72 Kangaroos from Jaggards in Sydney and flew back to NZ with them. I have made this kind of trip several times before without incident but on this particular trip I was stopped at the security area in SYD and asked for my bag to be opened. I indicated that I was carrying valuables, and asked if we could move to a private room for the search. The security officers could not have been nicer or more obliging. They made sure they had two officers present and that my wife was also present so there could be no issues of impropriety. After opening the bag and seeing the sealed rolls of coins at the bottom, they smiled and said "no problem". One of the guys even mentioned that he was a silver collector and wished us well. They were looking for drugs, they could care less about gold.

On arrival in AKL there were no issues. There is no GST on .999 gold or silver so there is nothing to worry about. Just be careful to keep the gold in your personal possession (carry on bag) at ALL times and exercise common sense and you will be fine.

Cheers

TTrader

02-05-2009, 08:04 PM

TT, the poster Peat is referring to may have been me . . .

Firstly, I would NOT contact anyone at Air NZ and disclose any information about what you are carrying or what flight you are on. The best security you have in carry PM's is complete anonymity. Nobody can steal what they do not know about. While Air NZ is a great company full of mostly honest people, you don't know who is on the other end of the phone and who they may later talk to . . .

You need to understand and be confident in the fact that there is absolutely NOTHING illegal about traveling with gold. People seem to think they are sneaking something or getting away with something illegal. Have no such fear.

About 2 years or so ago, I bought 72 Kangaroos from Jaggards in Sydney and flew back to NZ with them. I have made this kind of trip several times before without incident but on this particular trip I was stopped at the security area in SYD and asked for my bag to be opened. I indicated that I was carrying valuables, and asked if we could move to a private room for the search. The security officers could not have been nicer or more obliging. They made sure they had two officers present and that my wife was also present so there could be no issues of impropriety. After opening the bag and seeing the sealed rolls of coins at the bottom, they smiled and said "no problem". One of the guys even mentioned that he was a silver collector and wished us well. They were looking for drugs, they could care less about gold.

On arrival in AKL there were no issues. There is no GST on .999 gold or silver so there is nothing to worry about. Just be careful to keep the gold in your personal possession (carry on bag) at ALL times and exercise common sense and you will be fine.

Cheers

Hello Aussie and thanks, I am aware of the situation and the risks involved. I have simply queried whether a private screening can be done using business class seats.

Dr_Who

05-05-2009, 05:35 PM

TTrader

07-05-2009, 12:30 PM

Article Over At MarketWatch (6th May 2009)

ANNANDALE, Va. (MarketWatch) -- Gold has frustrated both the bulls and the bears over the last couple of weeks, as bullion has remained within a fairly narrow trading range.

http://www.marketwatch.com/news/story/Contrarian-analysis-bodes-ill-gold/story.aspx?guid={C8864AF2-D396-4A44-BA82-A8ACDBCE57BA}

arco

07-05-2009, 07:21 PM

Interesting to see gold holding up so well with the rally of the market.

I assume the Chinese and Indians are gold lovers and buy gold when they are wealthy. Also the Chinese govt are buying gold to up their reserve.

China are only No.7 in their holdings with 1054 tonnes, whereas USA are No.1 (if you can believe the figures) with a massive 8133 tonnes

Chart here (http://www.moneyandmarkets.com/why-gold-looks-ready-to-move-higher-33588)

Aussie

08-05-2009, 01:51 AM

China are only No.7 in their holdings with 1054 tonnes, whereas USA are No.1 (if you can believe the figures) with a massive 8133 tonnes

Chart here (http://www.moneyandmarkets.com/why-gold-looks-ready-to-move-higher-33588)

Thanks for the bullish article Arco. He seems like an impassion-ate fellow . . . I notice that Australia and NZ don't even figure on that chart. Not even close. From memory I think Peter Costello sold 2/3 Australia's gold reserves several years ago leaving them with about 84 tonnes. I expect that NZ's holding would be far lower than that.

http://www.gold-eagle.com/analysis/aftermath.html

The question that I keep asking and no-one seems to have an answer or even a theory on is . . . if the USD has a crash or a "disorderly decline", what happens to the AUD & NZD as both the RBA & RBNZ as far as I know has reserves made up primarily of USD instruments like Dollars, Treasuries and probably US Agency debt.

Anyone wanna take a stab?

peat

08-05-2009, 08:19 AM

http://broadcast.ino.com/education/gold_200905/?campaignid=3

lakedaemonian

08-05-2009, 09:56 AM

Thanks for the bullish article Arco. He seems like an impassion-ate fellow . . . I notice that Australia and NZ don't even figure on that chart. Not even close. From memory I think Peter Costello sold 2/3 Australia's gold reserves several years ago leaving them with about 84 tonnes. I expect that NZ's holding would be far lower than that.

http://www.gold-eagle.com/analysis/aftermath.html

The question that I keep asking and no-one seems to have an answer or even a theory on is . . . if the USD has a crash or a "disorderly decline", what happens to the AUD & NZD as both the RBA & RBNZ as far as I know has reserves made up primarily of USD instruments like Dollars, Treasuries and probably US Agency debt.

Anyone wanna take a stab?

That's the approximately 20.50 kilo question :)

Short-term, I have absolutely NO idea whatsoever.

My GUESS for gold over the next 5+ years is US$2k+ as I think it will have to play some sort of role in the transition to "what's next".

I think that as inflation kicks into high gear our commodity exports will help prop up currency values.....but I worry a good bit about our lack of savings and a reliance on foreign funds weighing heavily on the Kiwi.

I've been thinking that the lesson learned from the Great Depression is to try and avoid barriers to trade.......but will we suffer from barriers to credit?

If banks are being nationalized.........how will citizenry feel about lending to foreigners?

Guessing on the Kiwi portion of the gold equation equilibrium "feels" like .60c against the USD...round about where we are right now.

But in the next couple of years I wouldn't be suprised to see us head a good bit lower again.....under .50c for a bit....when, how long, and how low? who knows :|

I view gold not as a speculative opportunity, but as an opportunity to retain liquidity, protect against inflation, preserve our purchasing power, and preserve capital to be deployed once we get to the other side of this ongoing mess.

Just my 0.02c

JBmurc

08-05-2009, 10:17 AM

Baa_Baa

08-05-2009, 11:27 AM

Hi all,

The answer to the question of the potential collapse of the USD, FRN - ergo the global reserve currency can only be speculative, however some of the best sources of intuition come from those who have experienced the role of the Gold Standard, and those who know why the Royals would abolish the Gold Standard and then subsequently the Gold Exchange Standard.

I have enjoyed reading Ferdinand Lips famous work, "Gold Wars" and recommend it highly. Here is an excerpt from a Gold-Eagle article, and interestingly while the answer isn't specific the question implies or suggests the answer. At the end of the article are some other recommended readings. Attribution to: http://www.gold-eagle.com/editorials_05/silberinfo061805.html

silberinfo:
The IMF recently decided not to sale any Gold. It is widely known that the USA officially owns most of the Gold worldwide and have (in big contrast to other central banks) not sold any Gold in the past years. What do you think about the assumption that the USA deliberately do not sell Gold, but push others to do so, as to have most of the Gold "in the end" - to be able not to lose its "empire status" in the case of a remonetization of Gold? Is it imaginable that the USA are deliberately inflating their horrendous foreign debts with a collapsing U.S. Dollar as to settle these debts with a highly appreciated Gold price and after a new Gold Standard has been established? What are your scenarios?

F. Lips:
I have no idea about how much Gold reserves the USA really have. There was no audit of these stocks since Eisenhower. There is great uncertainness regarding these reserves. Regarding the huge internal and external debts, the official politics at the moment rather seems to be in inflating off the debts.

silberinfo:
In general, do you see the possibility of a Gold Standard or a coupling of the major currencie(s) to an index or even a new innovative attempt to anchor fiat-money in the system (i.e. Euro-Dollar)? What would you recommend?

F. Lips:
I have always recommended the return to the pure Gold Standard.

Buy a copy of Gold Wars.

BAA

Aussie

10-05-2009, 09:18 PM

1531

Here is a very ominous chart indeed. It will be familiar to all Privateer subscribers as being one of the charts we update with each new issue of the newsletter. Please note the far right column of "Os". This is the fall in the USDX which as taken place over the past week, sending the US Dollar well below the trading range in which it has been trading for most of the year. This week, the USDX lost 2.06 points or 2.4 percent. Most of that fall came on Friday, May 8 when the USDX lost 1.46 points. What happened to Gold on the day? Almost nothing, the spot future contract fell by $US 0.60. Longer-term Treasury yields were quiescent too. After rising precipitously for most of the week, yields on the Treasury's 10 and 30-year paper fell slightly on the day. And of course, over on the stock market, the Dow bounded upward another 165 points to a new post March 9 high of 8574.

Last week was the week of the "swine flu" distraction. This week, the whole thing has evaporated and the "economy" has come back onto centre stage. The reason for this is, of course, a plethora of "encouraging" numbers. While the latest US unemployment RATE is up - to 8.9 percent - job losses are reported to have fallen from an average of 700,000 in the first three months of the year to 539,000 in April. Three hundred million people in the US are asking each other - "do you know anyone who's been employed lately?" - with overwhelmingly negative results. But these figures are OFFICIAL - and as such, not to be either questioned or examined.

In another development, the major US banks have all passed the "stress test" administered by the US Treasury. Again, this is OFFICIAL. Any suggestion that the tests were specifically designed to be "passed" by the banks is not to be discussed by anyone. Certainly nobody on Wall Street would be so crass as to question them.

And so, we have the fatuous claim that the "green shoots" of economic recovery are now starting to poke into the sunlight above the detritus of the now soon to be nothing but a memory "recession". This must be true. All the government numbers say so. Mr Obama, Mr Geithner and Mr Bernanke say so too. And in case anyone has any qualms about the possible future implications of the $US TRILLIONS which have been thrown at the economy already, Mr Obama has recently declared that he has found $US 17 Billion worth of "cuts" which he is going to apply to his 2009-10 budget. That should fix everything.

Do you read the financial news? You should - one can estimate pretty closely the true situation from the lengths the powers that be are going to in order to hide it. It is tempting to conclude that the government and their sycophants in the financial system regard their "audience" as ready and willing to swallow literally ANYTHING. In reality, of course, they are stuck with their policies, from which they dare not veer, so they have no choice but to dress them up as best they can and hope that they can continue to be made palatable. The last resort is to rely on the old conviction that "you can't fight city hall", no matter how absurd their actions become. But the problem for the powers that be is that they have to "deliver", and on their present policies, that is impossible. You cannot "fix" a collapse in credit by refusing to value so called "assets" which are dependent on the continuing flow of this credit to have any value at all. Nor can you do it by throwing worse "money" after the bad has already been exposed as worthless. But you can destroy a financial system and a money with such policies.

This week, we have seen the two biggest markets in the world, the market for Treasury debt paper and US Dollars, take a severe hit. Treasury yields have been rising inexorably since the Fed lowered its rates to the vanishing point last December. This week, that rise accelerated. That proved too much for the exchange value of the US Dollar which plummeted this week. Gold did no more than "mirror" this US Dollar fall, it barely moved in terms of most other world currencies. In terms of some of them, the Gold "price" actually fell this week.

It has been said here many times but cannot be repeated too often. There is a gargantuan global consensus that the "price" of Gold in terms of all paper "moneys" in general and against the US Dollar in particular MUST be kept under control. The global and monetary system which has been built up since the last official connection between Gold and ALL forms of paper money was erased in 1971 would be utterly impossible under any type of Gold discipline. The level of power which has been amassed by governments released from this discipline would likewise be impossible. "They" have got it. "They are not going to give it up lightly.

There is only one recent historical precedent for an entrenched political establishment in control of an empire giving up their power without a (literal) fight. That is the abdication of the Communist party of the USSR in 1991. The equivalent at present would be for the governments and central banks of the world to give up, get out of the way, and let inexorable economic LAW run its course. It will anyway, but the longer it is delayed, the harsher the final sentence will be.

JBmurc

10-05-2009, 09:34 PM

Doc 100.0.5.2..........10 of 37...
About Fort Knox Gold: http://www.fgmr.com/right2know.htm
In the 1970's a very courageous gentleman named Edward Durrell claimed that
substantially all of the US Gold Reserve being stored at Ft. Knox was gone.
Only 1,000 tonnes or so of the 8,500 tonnes supposedly being stored there
remained. The rest had been secretly taken from Ft. Knox and shipped to
London in 1967 and early 1968 for sale by President Johnson in an ill-fated
attempt to keep the price of Gold at $35 per ounce.
http://hardtruth.topcities.com/nelsonrockefellerandfortknoxscandel.htm
First, about Fort Knox. You know, the Fort Knox Gold Scandal is just like
the Watergate Scandal in one respect: There is a desperate cover-up going on
right now just as happened with Watergate. The Fort Knox Gold Scandal
cover-up really passed the point of no return last September when the United
States Treasury perpetrated the Fort Knox gold inspection hoax in an attempt
to discredit my charges that there's no gold in Fort Knox because it had all
been illegally removed. Since that time the Government has been getting in
deeper and deeper and deeper, involving more and more people in all sorts of
maneuvers to try to keep the lid on. For example, when the Congressmen and
newsmen visited Fort Knox last September, news stories promised everybody
that the visit would be followed up by an audit of the Fort Knox gold by the
General Accounting Office, but what they actually did was just a very
superficial exercise just to make the record look good, and the group of 15
men that did it had only two (2) General Accounting Office representatives
on it. All the rest were from the Treasury itself--in other words, the fox
went into the henhouse to count our chickens for us.
http://www.skolnicksreport.com/hoodwink.html
It may come as a shock to some, but the U.S. has very little so-called
"U.S. government" gold bullion in Fort Knox. A brave outspoken journalist,
Tom Valentine, in the 1970s, exposed as a fraud that there was
world-trade-quality gold at Fort Knox. All they have left are poor quality,
orangish-looking, melted down coin metal from the seizure in 1934, of gold
coins from America's common people. [The American aristocracy, warned in
advance, shipped THEIR gold out of the U.S.] The U.S. governmentt gold is
gone. Why? Because it was shipped, under the supervision of a ply-able U.S.
General, to the private central octopus called the Bank of England, in 1968,
to stem a run on that bank which had somehow lost all their own gold.]
http://www.freedomdomain.com/News/nnorfed.html
The organization chaired by Alan Greenspan is a coalition of private
international banks, that does not answer to the United States Government.
And there is no precious metal warehoused in Fort Knox or elsewhere that
backs the money that they issue.
http://www.anomalous-images.com/text/NAZNWO08.TXT
Large shipment of gold leaves Fort Knox, public doesn't know that their
national gold 'reserves' are being secretly depleted by one-world national
socialist agents working in U.S. government. Gold at Fort Knox replaced with
gold-plated lead bars, making it the biggest heist in history. Rockefellers
involved. James MacDonald becomes critical of Air Force and the CIA.
http://hardtruth.topcities.com/treason_new_world_order.htm
Throughout the 20th century this movement toward a one world government has
been marching on. This is not new or recent. In his book Critical Path
Buckminster Fuller gives a very impressive sweep of the 20th century, about
the large corporations and their agents and the lawyers who basically
control the country far more than the people understand. He talked about how
all the gold was removed from Fort Knox by the 1960's.
Where did it go?
It went to the banks. They own the country. Fuller called the CIA,
"capitalism's invisible army."

Aussie

10-05-2009, 11:26 PM

JBmurc

11-05-2009, 08:14 AM

Thanks JB, a majority of those links seem bad but the story is quite plausible IMO and possibly true. I have read anecdotal stories of US "melt" bars turning up recently in the physical markets of middle east and other places via GATA.

No audit since the 1950's of the supposed largest gold stock in the world, the one that supposedly backs the world's reserve currency . . ? It has a bad stink to it.

If this is true, then it would be far bigger than watergate . . !

Yeah and far worse for the USD and massive for the gold price ,all the time you here of investors stating that the USD still has massive weath because of there world largest gold holding yet the US government are so anti-gold & silver why because they have very little left.......JPmorgan & AIG plus alot of the other have been massive paper shorters of gold & silver over the last many yrs...
if they did have the massive gold holding they could have sold alot to reduce their massive dept......

Aussie

11-05-2009, 11:34 AM

Yeah and far worse for the USD and massive for the gold price ,all the time you here of investors stating that the USD still has massive weath because of there world largest gold holding yet the US government are so anti-gold & silver why because they have very little left.......JPmorgan & AIG plus alot of the other have been massive paper shorters of gold & silver over the last many yrs...
if they did have the massive gold holding they could have sold alot to reduce their massive dept......

You're onto it . . . my guess is that the true status of the US gold supply is THE best kept secret in government. Everything financial in this world hinges on the continued belief that those 8,300 tonnes are there . . . if it's not - then it's difficult to imagine how big, how far and how wide the repercussions would be. If I had to bet on it, I'd say it has been long gone and the whole Fort Knox thing is a massive charade.

patsy

11-05-2009, 03:06 PM

You're onto it . . . my guess is that the true status of the US gold supply is THE best kept secret in government. Everything financial in this world hinges on the continued belief that those 8,300 tonnes are there . . . if it's not - then it's difficult to imagine how big, how far and how wide the repercussions would be. If I had to bet on it, I'd say it has been long gone and the whole Fort Knox thing is a massive charade.

I believe that the US does have a significant gold reserve, and politicians protect it like they protect the strategic oil reserve. A significant gold reserve is what they will use to protect the USD against collapsing, just like they'd use the oil reserve to protect themselves against OPEC's and Middle Eastern games. Politicians absolute hate the discipline that a gold standard imposes so they will use gold to fight against the demise of the USD. The USD has lost 95% of its value in the last 76 years and, for them, that's OK because the proles can be easily duped by using the the boiling frog analogy - however, if it lost another 95% in 76 MONTHS or WEEKS, then they'll only have Fort Knox to protect them from a popular revolt. That's why I believe the do keep a reserve. Selling gold to avoid any substantial gold price increase hence masking the devaluation of the USD is what they'll surely do.

Baa_Baa

11-05-2009, 03:17 PM

Aussie

11-05-2009, 06:39 PM

I believe that the US does have a significant gold reserve, and politicians protect it like they protect the strategic oil reserve.

I was going to start by saying "no-one knows for sure" but that's not true. Probably a few current and ex US Treasury people know but aren't saying anything.

Over the past decade, GATA has meticulously monitored governments and central banks known gold inventories against their Washington accord sales and factored in global mine production, the scrap market etc . . . and after some careful math, come to the conclusion that the world's central banks have less than 50% of the gold that they say they have.

A significant gold reserve is what they will use to protect the USD against collapsing, just like they'd use the oil reserve to protect themselves against OPEC's and Middle Eastern games.

You are assuming that this is not what has been occurring already.

If you research who has been in charge of the US Treasury and economic policy on and off for the better part of 20 years the names Rubin and Summers continually pop up. Both are experts in the manipulation of the gold markets and both have used this expertise to manipulate the dollar and interest rates via gold price through their surrogate Wall St. banks.

Rubin learned this while he was in charge of the London gold desk at Goldman Sachs and Summers was the author of "Gibson's Paradox and the Gold Standard" which basically explored the correlation between the gold price and interest rates. Control inetrest rates and you control the USD, control the USD and the BIG ponzi scheme gets to continue for a few more years - and this is exactly what has been happening.

Summers and Rubin are now both back in government as special advisors to President Obama - special indeed!

That's why I believe the do keep a reserve. Selling gold to avoid any substantial gold price increase hence masking the devaluation of the USD is what they'll surely do.

You are right on . . . but it's not going to happen - it has been happening and is happening now!

patsy

11-05-2009, 08:07 PM

So, if the gold is gone, where and whom has it gone to, and why? Gold cannot be destroyed, so whatever there was there still is, somewhere. It doesn't neccessarily stand to reason that whomever owned the gold doesn't still own it just because the gold was moved somewhere, even to a different country. Nor does it stand to reason that the gold was ever there, or that it even existed in the first place, anywhere.

BAA

There are reports that the Chinese are snapping up via over-the-counter (i.e., off market) transactions the gold that some central banks are selling. You may recall that the FMI said that there would be selling gold to raise capital to assist some economies... guess what, that gold has been purchased by the Chinese off-market.

Dr_Who

11-05-2009, 08:26 PM

There are reports that the Chinese are snapping up via over-the-counter (i.e., off market) transactions the gold that some central banks are selling. You may recall that the FMI said that there would be selling gold to raise capital to assist some economies... guess what, that gold has been purchased by the Chinese off-market.

The Chinese have been replenishing their gold reserve for a number of years now. They are currently holding just over 1,000 tons of gold in their reserve. I assume they will continue to buy more similar to their interests in copper, iron ore and other commodities.

Aussie

11-05-2009, 10:14 PM

The Chinese have been replenishing their gold reserve for a number of years now. They are currently holding just over 1,000 tons of gold in their reserve. I assume they will continue to buy more similar to their interests in copper, iron ore and other commodities.

I read that an important aspect of the Chinese announcement is that their Central Bank has moved this gold from the "commodities" column of their balance sheet to their "monetary assets" column. This signals that they now consider gold as a reserve asset in competition with other monetary assets such as US Treasury Bonds and likely to be accumulated more aggressively . . .

JBmurc

11-05-2009, 10:27 PM

IMHO In time both India & China will hold more true gold an not just US paper which is all the USD will have left---
---- if the massive USD holders want to exchange their trillions of dollars for more of the US gold reserves at fort Knox the yanks will soon be out, just like the US Silver reserve they had the largest in the world back in the good old days now their a net buyer....

thing is the yanks aren't going let all their gold go not while the FED will loan them trillion's so really the China's an other massive USD holders are out looking for other real assets to spend their devaluing cash on .........which their doing

As they will be the new world empire ,superpower etc as they will own more of what the world needs

Baa_Baa

12-05-2009, 10:09 AM

Aussie

12-05-2009, 10:22 AM

Let's assume for a moment that the USA does has 8000 tonnes of Gold, that is 257,205,973 troy ounces * $910 per t.ounce = 234,057,435,020. That's a big number right, 234 billion USD's? Now figure out what percentage that is of the total debt of the USA. Uh oh! I guess they're not relying on Gold to bail out their financial system, at least not at this price of $910 they're not.

BAA

Of course, but I think it's a symbolic, confidence thing that at least the US and a lot of European central banks have something! What do we have in NZ? Zip. Australia sold 2/3's of their gold in 2000 at the rock bottom of the market leaving them with about 43 tonnes.

I read a little while ago that one of the solutions to reduce or eradicate global government debt is a radical revaluing of gold. A raising of the base line so that $234B has an extra couple of zeros . . . of course that would be a tip of the hat to gold as a monetary asset and tantamount to an admission that that fiat currencies have been horribly mismanaged and many of the countries (like us) who don't have any gold would miss-out. Another side effect would be the likely nationalization of every gold-mine in the world!

Interesting concept though.

TTrader

12-05-2009, 11:20 AM

patsy

12-05-2009, 01:45 PM

Let's assume for a moment that the USA does has 8000 tonnes of Gold, that is 257,205,973 troy ounces * $910 per t.ounce = 234,057,435,020. That's a big number right, 234 billion USD's? Now figure out what percentage that is of the total debt of the USA. Uh oh! I guess they're not relying on Gold to bail out their financial system, at least not at this price of $910 they're not.

BAA

Surely not! However, they can well use those reserves to influence the supply and demand of gold so that gold's price stays within a psychological acceptable range for as long as practicable.

I guess a more useful exercise is to calculate what proportion of the total gold in existence is represented by 8,000 tons. This will possibly be a better indication of what they can do with the gold in reserve as far as gold price manipulation is concerned. Add that to the gold reserves of the UK, IMF, and some Western European central banks (which more likely than not will get in cahoots with the Fed) to get an indication as to for how long politicians can keep on spending IOU money.

The whole fiat money idea plus the fractional banking system represent the true terrorism against liberty, progress and wealth... but some keep on looking around the Middle Eastern deserts for terrorists yet we have them right here on our own backyard!

Dr_Who

12-05-2009, 06:33 PM

The whole fiat money idea plus the fractional banking system represent the true terrorism against liberty, progress and wealth... but some keep on looking around the Middle Eastern deserts for terrorists yet we have them right here on our own backyard!

You are on to it Patsy.

They like to work their evils under the radar and to keep the public in the dark and ignorant. I suppose if you have to choose between the two evils, you choose the lesser evil.

Aussie

12-05-2009, 07:00 PM

Take into account Silver and Platinum reserves...

Not to mention materials required for nuclear production and their large oil reserves.....

It isn't just gold they have stockpiled the question really is how much of everything do they have...

My take on that statement is that none of those are monetary assets which could or would ever be used in the course of commerce to settle international trade. With the possible exception of silver (which there are no global reserves to speak of) they are all commodities.

Certainly no-one would be happy to see the US pay their bills in Plutonium . . . :eek:

patsy

12-05-2009, 07:16 PM

They like to work their evils under the radar and to keep the public in the dark and ignorant. I suppose if you have to choose between the two evils, you choose the lesser evil.

I get absof*ckinglutely outraged every time I hear Obama, Bernanke, Geithner, Gordon. Brown, etc. talking about bailouts, increase in govt spend and other euphemisms like "quantitative easing". They are raping all of us with complete and utter impunity. And one of the reasons they do it is because there is the belief that, whenever there is a problem/crisis, governments "have to do something". Just like this other clown Phil Goff, asking in Parliament to Key "what are you doing about unemployment?"

The proles have been inculcated that that "it is the government responsibility" to do such and such.... Don't they f*cking realise that times of crisis are times when the markets and economies are flushing out misallocation of resources? Don't they realise that bubbles represent misdirection of investments? and the sooner they let it de-inflate the better? But, no, we have some economic Nostradamus like Bollard, who is bending himself backwards to reinflate the property market and is forecasting that the economy will reinflate by the end of 2010 by which time he will have pumped enough money into the economy that the NZD will be toilet paper.

All this with total impunity because the politicians love fiat money and the proles love to open their legs and be raped by them.

Aussie

12-05-2009, 08:44 PM

Don't they realise that bubbles represent misdirection of investments? and the sooner they let it de-inflate the better? But, no, we have some economic Nostradamus like Bollard, who is bending himself backwards to reinflate the property market and is forecasting that the economy will reinflate by the end of 2010 by which time he will have pumped enough money into the economy that the NZD will be toilet paper.

All this with total impunity because the politicians love fiat money and the proles love to open their legs and be raped by them.

Nice rant patsy . . . :D

As I understand it, the problem is that the global economy is based on a monetary debt system that relies on continually expanding levels of debt to increase economic growth. This is simply unsustainable and we appear to have reached the practical limits of growth under that system.

Trouble is, it's the TPTB's or "The Establishment's" system. They created it, they benefitted the most from it and the last thing they want to see is it go under. So they continue do the only think they know how to do to start it up again by inflating.

Today we are at a fork in the road. There are only two directions to go . . .

1) further down the fiat money rat trap with a completely cashless society where bank runs are rendered impossible because money will become just a concept. A that point TPTB can create all the money they want under a global authoritarian system that will completely destroy the idea of nation states, individual freedom and privacy. Eventually we will have no more money, just a system of credits on a card or chip the number of which will depend on how well you co-operate with the authorities.

2) a return to a sound money system that places serious limits on government while returning real prosperity and economic freedom to the hands of the masses instead of the few.

Which way do you think we are headed . . ? :mad:

patsy

13-05-2009, 04:59 PM

we have some economic Nostradamus like Bollard, who is bending himself backwards to reinflate the property market and is forecasting that the economy will reinflate by the end of 2010 by which time he will have pumped enough money into the economy that the NZD will be toilet paper.

This may be slightly off topic but this link (published today) supports my rant yesterday:

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10572011

This evidence suggests the obsession with reinflating the property market and the overall focus on doing so using the power of the monetary base and the fractional banking system at the expense of consumer price inflation and real wealth.

Aussie

13-05-2009, 08:53 PM

This may be slightly off topic but this link (published today) supports my rant yesterday:

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10572011

This evidence suggests the obsession with reinflating the property market and the overall focus on doing so using the power of the monetary base and the fractional banking system at the expense of consumer price inflation and real wealth.

NZ Sharetraders, have a think about the following paradox. I would welcome any comments on these thoughts . . .

The current low/zero interest rate conditions around the world are reflecting what "the market" (if left to it's own devices) would normally determine to be a low debt, high savings environment. Such an environment would normally only occur where there was glut of capital and so is therefore extremely cheap.

However, we know that today this is far from being the case.

In our present environment we have banks, governments and companies all around the world desperately competing for a decreasing pool of global capital. Normally, the market would interpret this as a high interest environment with interest rates rising to a level that begins to attract savings and investment capital until the economic system becomes re-balanced or neutral. So far this hasn't been happening, although in the last week or so the US Treasury market is starting to show signs of a turn.

If you understand and agree with this basic free market economic concept, then you are also seeing just how radically central banks around the world and the governments and the bankers who run them have distorted and ruined the world economy. You can see that it has in fact been been completely inverted, everything is upside-down, white is black and black is now white. Negligence and fraud is being rewarded while honesty and savings are punished. This is the new economic paradigm that "they" have created.

The NZ property market and Bollard's wishful thinking is nothing but an expression of our government's wish to continue distorting our so called "free economy".

It's my opinion that we either abolish central banks and have a truly free market system in every respect including sound money and interest rates that are related to the available pool of savings and capital or we don't have a free market at all.

Aussie

16-05-2009, 12:48 PM

The next down-leg.

To all; GM and Chrysler are eliminating over 2,000 dealerships between them, this will be a huge blow to the economy at large. Think of the ramifications, this will lead to several hundred thousand more unemployed and then the ripples will start to move outward. This also represents quite a substantial amount of commercial real estate square footage that will become empty. The loss of jobs, franchises, suppliers, etc. all the way down to the local coffee shops is a definite body blow to any recovery or so called "green shoots".

This is absolutely a deflationary event, the Fed and Treasury will now need to create even more Dollars. Can anyone see where this is going? The more things deflate, the more the Fed and Treasury will need to inflate to counter this. This inflation, once into the system cannot be withdrawn. What they are doing now will result in hyperinflation, tomorrow, next week, next month, whatever, it makes no difference when, as long as you know where we are going. We are moving very rapidly to a completely different financial environment that will include totally different perceptions and thoughts regarding all financial assets. Psychology will change.

The equity market is rolling over from a loss of momentum, I believe we are primed again for a waterfall event very soon. If you thought the March lows exhibited panic, just watch what happens on this next downleg! You cannot trade here, you can't try to be fancy, you must have maximum exposure to anything precious metals related. We should witness a complete disconnect between Gold related assets and virtually everything else in this coming downleg. I am looking for "the day" where the equity market gets pummeled and everything precious metal moves hard to the upside. The bell will have rung!

Have a nice weekend,

Bill H.

JBmurc

16-05-2009, 01:25 PM

well within 3hrs I will have another 1kg perth mint silver bullion an maybe a .3oz $200 gold coin an more silver coins
Also will look to buy some NEM etc shares from my Oil&gas holdings

Aussie

17-05-2009, 09:57 PM

Can't Spend - Can't Save - Need MONEY!
On May 15, spot future Gold in New York rose $US 2.90 on the day to close at $US 931.30. This is Gold's highest close in nearly two months - since March 26. With the exception of a $US 10.40 jump on May 12, Gold's rise this week has been slow and steady, seemingly impervious to the goings on around it in other investment markets. Gobal stock markets have been inreasingly erratic this week. The US Dollar saw ominous weakness before a turnaround at the end of the week. US Treasury bond yields, although they fell this week, remain distressingly high. Through it all, Gold has climbed gradually in $US terms.

This is ominous - for the financial powers that be - since the distractions have calmed down for the moment. Two weeks ago it was the flash in the pan which was the "swine flu" scare. It is difficult to decide which aspect of this phenomenon was more outlandish, the speed of the buildup to global hysteria or the even greater speed with which it dissipated. Last week there was the (obviously preordained) "results" of the US Treasury's bank "stress tests". To expect any of the banks to have "failed" this test is tantamount to expecting the US rating agencies to downgrade the AAA rating of US Treasury debt paper. Yes, they occasionally make noises in that exact direction. But that's as far as it ever goes.

Without distractions, the inherent contradictions of the global financial and economic collapse are getting harder to ignore by the day. On the one hand, we have governments and central banks growing ever more profligate in trying to fill the hole which has been left by the collapse of the credit money system. How? By creating out of thin air grotesque amounts of new credit money. On the other hand you have the rest of us, those who do NOT have the ability to "print" our way out of debt or to create "markets" which maintain the value of our paper assets at levels which nobody is willing to pay - unless they can create the means of payment out of thin air.

This contradiction is slowly but surely seeping into the consciousness of more and more people everywhere. The questions being asked - if not out loud then definitely in the privacy of the mind - are getting harder to answer.

"Why do I have no choice but to cut my borrowing and spending when 'they' are borrowing and spending like there's no tomorrow?"

"Why is it that I can see the REAL economy where I live slowing down every day while the paper markets are not reacting to any of it?"

"Why do I read about the situation getting better when it is obviously getting worse?"

"Why are 'they' still rewarding people who borrow and spend while making it totally uneconomic for those of us who want to save?"

"And if I do save, what will happen to the purchasing power of what I am saving if the government persists with these policies?"

This last question is the most dangerous one, to the financial powers that be. In the English-speaking nations in particular but to varying degrees all over the world, "saving" is a concept which has been all but obliterated over the past three decades. Less than forty years ago, the exchange rates between currencies were actually fixed. In the twenty years before that, prices in most advanced economies were relatively stable. The combination of these two factors meant that anyone could actually save "money" in the confident expectation that the purchasing power of that money would remain relatively stable over time. Amazing as it might seem from the perspective of the almost four decades since 1971, most consumer prices moved hardly at all in the period between the end of WWII and the mid 1960s.

Even more amazing, there were a huge number of individuals in the US and everywhere else who never concerned themselves with the state of the stock market or bond market or the exchange value of the currency or the rates of interest available to them. They simply went about their business, consumed less than they produced, and stuck the difference in their savings accounts in the expectation that when they needed the money, it would be there - AND IT WOULD BUY THEM THE SAME AMOUNT OF GOODS AND SERVICES AS IT HAD AT THE TIME THEY WERE SAVING IT!

In short, they had the incentive to save and they had a money worth saving.

Contrast that to the present situation. The global collapse is in the process of radically changing the attitudes of most people. For three decades, living beyond one's means was regarded as the norm. It was taken for granted that in order to keep one's head above the inexorable erosion of the purchasing power of money, the investment markets had to be utilised up to the hilt. "Risk aversion" was whittled away progressively until, by the mid 1990s, it had all but ceased to exist. At the height of the insanity, less than two years ago, everyone was routinely using amounts of leverage that would have made the most daredevil investors in the futures markets of the 1980s (let alone the 1950s and 1960s) recoil in horror.

Now, that whole outlook has changed - RADICALLY. But it has ONLY changed amongst the individual citizens of the nation concerned. Those in charge of the "system" have not changed their methods of operation in the slightest. They have merely accelerated them to a grotesque and unsustainable extent. They are, in their attempt to "save" the system, destroying it.

Anyone who wants to preserve his or her purchasing power today faces two seemingly insoluble problems. First, with official interest rates at or below 1.0 percent in nearly all major nations, it is all but impossible to gain any type of a return on savings unless one takes HUGE risks. Second, and much more important, the actions of governments and central banks everywhere is guaranteeing a catastrophic collapse in the purchasing power of the money they are borrowing into existence. Inexorably, the only financial safety is to be found OUTSIDE the financial system altogether. There is the alternative of putting one's wealth in physical economic goods. And there is the choice of putting one's wealth in an alternative medium of exchange, one which CANNOT be created out of thin air. In essence, the choice is between real wealth and government promises.

As the choice becomes more stark, the attraction of the precious metals will increase. Just as real physical economic goods cannot be created out of thin air, neither can a viable money. And until the debate over what constitutes a viable and SOUND money emerges to centre stage in the current frantic debate over how to "solve" the current crisis, that same crisis will continue to worsen.

peat

18-05-2009, 08:17 AM

http://broadcast.ino.com/education/gold_200905/?campaignid=3

according to this video the close above 929 is important....

airedale

21-05-2009, 10:18 AM

Gold closed above US$935. in overnight trade. Even the Nymex couldn't hold it down when it opened yesterday.

JBmurc

23-05-2009, 05:52 PM

What are the best ways to gain exposure to gold?

It’s a question of risk profile. If you’re a person with a high risk profile you would buy explorers. Drop it down a notch and you would buy junior producers. Down another notch and you would buy a major gold producer. Drop it right down to the bottom and you would buy physical

SPARKY

23-05-2009, 07:47 PM

best way to own gold?

G O L D on ASX represents 1/10 oz, is this a good option?

shasta

23-05-2009, 08:35 PM

best way to own gold?

G O L D on ASX represents 1/10 oz, is this a good option?

Buying physical stuff can be expensive, depending where you get it.

AGG & NEM have 5m+/oz per year gold production operations

Aussie

24-05-2009, 08:05 PM

best way to own gold?

G O L D on ASX represents 1/10 oz, is this a good option?

SPARKY, If I'm not mistaken, GOLD is an ETF. It's not the same as owning physical gold in your possession, it's a paper derivative. You will never be able to take delivery from an ETF. They are mostly used as a trading vehicle to gain exposure to the gold price.

If you want to own real gold that you can hold in your hand, then there is only one way to go . . . buy the real deal.

devito

24-05-2009, 09:30 PM

If you count on gold to be your financial life saver, remember that its qualities as a flotation device are similar to those of lead.

Aussie

24-05-2009, 10:32 PM

If you count on gold to be your financial life saver, remember that its qualities as a flotation device are similar to those of lead.

OK. Impart your wisdom devito, don't hit and run . . . what's your lifesaver? I'd be most interested to hear.

devito

25-05-2009, 09:54 PM

Just a joke Aussie:) I was reading about Gold on another site and came across the saying.
cheers
Devito

arco

26-05-2009, 09:07 PM

Hourly is trying to break through the cloud. Nice trade

Aussie

26-05-2009, 09:46 PM

Gold down $15 in less than 2 hrs . . .

I think we have 80 on the USDX being defended . . . anything below would have seen gold moving through the US$1K barrier. I think there are some US Bond sales on the horizon. Dollar needs some wood!

1597

airedale

26-05-2009, 10:02 PM

Hi Aussie, agree that the USDX is being defended at 80. There may be a short-lived battle, but I think the USDX is going down further towards the low 70's sooner rather than later.

Aussie

26-05-2009, 10:59 PM

Hi Aussie, agree that the USDX is being defended at 80. There may be a short-lived battle, but I think the USDX is going down further towards the low 70's sooner rather than later.

I'm with you on that one.:D

arco

28-05-2009, 11:08 AM

.

Some nice short term trades in the last 24 hrs.

arco

29-05-2009, 12:31 PM

.
Good day trading environment over the last few days.
Another blast overnight.

Aussie

29-05-2009, 11:58 PM

Southwards movement . . . 80 looks to be breached. Will the Fed's defend it?

1624

airedale

01-06-2009, 08:59 PM

POG at $987 right now. A mere whisker away from $1,000. Be interesting to see how it goes on the US market over night. I suspect that the 1,000 resistance mark will soon be support.

Aussie

01-06-2009, 10:35 PM

POG at $987 right now. A mere whisker away from $1,000. Be interesting to see how it goes on the US market over night. I suspect that the 1,000 resistance mark will soon be support.

Looks good airedale but as bullish as I am, it has come a long way quickly and normal convention would say that it is due a breather - but what is normal today?

The HUI has been rocketing and I am getting nervous. I'm getting prepared to sell off 50% of some profitable positions into the current strength and await a correction and repurchase before the fall termoil begins in earnest.

Barring an "event" of some kind, I think this is a tough time of year for gold to be consolidating above US$1K.

Aussie

02-06-2009, 08:06 AM

Yep! POG drops $10 to 975 and Goldcorp get whacked overnight by 7.1%, Yamana by 3.1% while the DOW rises 250 . . . seems like a little over-reaction and some profit taking.

TTrader

05-06-2009, 12:14 PM

Ended up going home last night and trading gold/silver. I am glad I did... Finished the night up with some good results..

-> Looking at the way things were going last night it only has to be a matter of time before gold hits the 1k mark again..

At this point even a bad day on wall street should push the POG up over 1k!

TTrader

05-06-2009, 01:25 PM

CNN Money
Gold surges to near record territory
Last Updated: June 4, 2009: 4:02 PM ET

http://money.cnn.com/2009/06/04/markets/gold/index.htm?section=money_markets

airedale

05-06-2009, 02:05 PM

POG at $987 right now. A mere whisker away from $1,000. Be interesting to see how it goes on the US market over night. I suspect that the 1,000 resistance mark will soon be support.

It might not happen this week but I am picking it will happen this month;).

TTrader

05-06-2009, 03:42 PM

It might not happen this week but I am picking it will happen this month;).

Indeed... On another note..

Today marks the day the gold standard was thrown out back in 1933...

ananda77

06-06-2009, 11:43 AM

...only a decisive push above 1007 will prevent gold to abandon the 680 target

Kind Regards

...after the gold counter trend rally appears to have run out of steam, only a decisive push above US$ 991 will negate gold's US$ 680 target now

Kind Regards

JBmurc

06-06-2009, 12:54 PM

...after the gold counter trend rally appears to have run out of steam, only a decisive push above US$ 991 will negate gold's US$ 680 target now

Kind Regards

680 LOL more likely 1680 I know the chart says

shasta

06-06-2009, 01:36 PM

...after the gold counter trend rally appears to have run out of steam, only a decisive push above US$ 991 will negate gold's US$ 680 target now

Kind Regards

What are the ther potential support targets going back down, i would have thought $900, $850 & $800 would provide some comfort?

Wasn't $US750 a major resistence/turned support?

Can't see $US680/oz with he US & others still printing money :rolleyes:

Mick100

06-06-2009, 04:53 PM

i think its too risky sitting on the sidelines waiting for a pullback, although gold is usually weak through june-july, it could be different this yr.
Weekly chart showing an almost complete inverted H&S pattern
When it goes its going to go hard and fast.
Can't see a pullback to 680

ananda77

06-06-2009, 08:30 PM

...entry point US$1007(+) did not happen despite an almost perfect storm around the gold market

...now give me US$ 991(+) for an entry

as John Hussman mentions:

You simply cannot have an economy lend out trillions of dollars in bad debt, and then make the lenders whole with public funds (while still facing a massive second wave of probable mortgage defaults) without destructive repercussions. There is very little chance, in my view, that the current downturn is over. We have enjoyed a nice reprieve – if over a trillion dollars in redistribution could not accomplish even a reprieve, it would be a surprise. It's clear that investors are hopeful that we can simply return to rich valuations, debt-financed economic expansion, and abnormal profit margins based on excessive leverage. From my perspective, this hope is as thin as those that we observed at the peak of the internet bubble, the housing bubble, and the profit margin peak of 2007.
http://www.hussman.net/wmc/wmc090601.htm

...and although the timing is difficult to determine now, the next, even more devastating leg down is in the making right now and I think, we all know what another down leg will do to the price of gold...

Kind Regards

Mick100

06-06-2009, 09:14 PM

http://www.gold-eagle.com/editorials_08/images/martens060309a.gif

arco

07-06-2009, 05:37 PM

srotherh

07-06-2009, 07:32 PM

Arco
What would happen if you charted it in NZD terms

TTrader

08-06-2009, 02:58 AM

I don't think we know for sure if gold has finished the recent up-move, but it has broken below the steep up-trend line and is currently testing it. Here is a chart looking at a scenario where it might fall back. The chart should be self explanatory and shows a possible Gartley at around 850. The more shallow green slatted line is the long term up-trend.

I cant see it dropping much lower that 850 if its doing a retrace.

http://iforce.co.nz/i/yowr5vmy.gif

I really can't see the POG going bellow 850 any time soon. Even high 800's will be pushing it, by that time I think we will see another large buy up in Asia which should hold the price.

Gold is at the point now where it will only drop so far before we see large buys on consumer and government levels.

arco

08-06-2009, 02:53 PM

Arco
What would happen if you charted it in NZD terms

Action is just holding on the long term line uptrend and in an area of potential support.

Interesting to note the MA's have crossed (Dead Cross) and are currently acting resistively. Oscillators are dithering below their centre lines.

Could go either way at this point.

Post the updated chart again in 7-10 days, lets see if anything has broken one way or the other.

Lego_Man

08-06-2009, 03:33 PM

arco

08-06-2009, 03:51 PM

How does the logic of trying to do TA on the price of gold in NZD work?

How can there be "support" and "resistance" of something when that thing is solely the function of 2 other independent variables?

It makes about as much sense to me as charting the S&P in terms of the spot price of live hogs and trying to make projections.

You can chart a comparison with anything you like - e.g. DJIA relative to Gold.

.
http://bigpicture.typepad.com/photos/uncategorized/djia_gold_relative_ratio.PNG

srotherh

08-06-2009, 07:35 PM

How does the logic of trying to do TA on the price of gold in NZD work?

How can there be "support" and "resistance" of something when that thing is solely the function of 2 other independent variables?

It makes about as much sense to me as charting the S&P in terms of the spot price of live hogs and trying to make projections.

And does every other market not have more than one variable.
Surely charts are a historical map of the interaction of all variables which people watch to indicate the areas of support and resistance going forward.
why study the $US- Gold chart only when investing in $NZ. Why not observe both.???

Lego_Man

08-06-2009, 08:08 PM

Baa_Baa

09-06-2009, 11:24 PM

Where i am coming from is that the value of the NZD is inconsequential relative to the value of gold, thus what exactly is "resisting" gold moving above or below a point in NZD terms? Putting gold in nzd terms is almost converting it to an entirely different measure, albeit one that still retains some of its correlation to itself.

I just dont see how there can be anything but very weak TA relationships in such a derivative measure. I mean what happens when "NZD gold" reaches a resistance point? Who steps in to short it? Who even cares that such a point is reached? It just seems pretty illusory to me.

I think you've covered three important points;

1. Measuring the price of gold in NZD (NZPOG)
2. Using the language of TA to describe NZPOG
3. Applying trading analysis

For 1. NZPOG, is important to anyone who buys and sells in NZ currency, to keep tabs on the price in NZD. This is the same regardless of what the asset, service or product might be. This helps us to figure out whether we are buying or selling at a price relative to a previous high or low and factor that into a conclusion of whether it is a good, ok, or bad price. It's a number that gives a perspective of value relative to historical price for buyers or sellers using NZD's.

For 2. TA of NZPOG helps because it introduces all sorts of other indications of whether the price is a good, ok or bad price relative to your own ability, timeliness and cash to participate. On the other hand the language of TA is born out of trading and it is illusory in that it implies forces that don't exist or that play out as a by-product of other primary forces. To help illustrate this, the price of gold in NZD is not set buy the buyers and sellers of gold who use NZD to do it. The price is a factor of NZD relationship to the USD of which Gold price is set in (or Pounds). This is helpful only as a buyer or seller using NZD, and TA helps to inform a view of when to act in buying or selling.

For 3. Trading analysis of the metal is useful in the markets that the metal is actually traded in, and that's done largely on paper (etf, options, futures). The reality is that very little actual metal physically moves between counterparties as a result of a trade, but sometimes it does. It is not inconceivable that people and businesses in NZ pay for metal trade done in USD with NZD's. What trading analysis is not helpful for is the reason a person might want to have some metal, which is more akin to insurance than investment, let alone trading in the sense of ST profit gains short or long. It is very helpful for buying for inventory, or selling mined metal.

My point is that if you use NZD to participate in buying or selling precious metals, or in fact any asset class, the value of any one particular measure or method of reason for getting into, staying in, or getting out of precious metals can be questioned in isolation; however a combination of all relevant knowledge and skills, and the ability to apply them would be ideal. To buy and sell using NZD's and not to monitor the price and circumstance of ones holdings in the currencies that one is forced to consider and use is illogical.

BAA

Baa_Baa

16-06-2009, 11:12 AM

Do you Twitter? Follow me at http://twitter.com/BAA_BAA_ for quick snap shots and notifications & links to new posts and charts.

Post your twitter name here so others can follow you too.

BAA

Baa_Baa

16-06-2009, 11:16 AM

You can find TA and some discussion on precious metals here http://forum.sharechat.co.nz/showthread.php?p=17896#post17896 ... todays' chart is the ST USPOG arithmetic scale, which shows the current decline and immediate support.

Enjoy, discuss it with me and others on the dedicated 'Precious Metals' threads.

BAA

lakedaemonian

16-06-2009, 03:11 PM

I think you've covered three important points;

1. Measuring the price of gold in NZD (NZPOG)
2. Using the language of TA to describe NZPOG
3. Applying trading analysis

For 1. NZPOG, is important to anyone who buys and sells in NZ currency, to keep tabs on the price in NZD. This is the same regardless of what the asset, service or product might be. This helps us to figure out whether we are buying or selling at a price relative to a previous high or low and factor that into a conclusion of whether it is a good, ok, or bad price. It's a number that gives a perspective of value relative to historical price for buyers or sellers using NZD's.

For 2. TA of NZPOG helps because it introduces all sorts of other indications of whether the price is a good, ok or bad price relative to your own ability, timeliness and cash to participate. On the other hand the language of TA is born out of trading and it is illusory in that it implies forces that don't exist or that play out as a by-product of other primary forces. To help illustrate this, the price of gold in NZD is not set buy the buyers and sellers of gold who use NZD to do it. The price is a factor of NZD relationship to the USD of which Gold price is set in (or Pounds). This is helpful only as a buyer or seller using NZD, and TA helps to inform a view of when to act in buying or selling.

For 3. Trading analysis of the metal is useful in the markets that the metal is actually traded in, and that's done largely on paper (etf, options, futures). The reality is that very little actual metal physically moves between counterparties as a result of a trade, but sometimes it does. It is not inconceivable that people and businesses in NZ pay for metal trade done in USD with NZD's. What trading analysis is not helpful for is the reason a person might want to have some metal, which is more akin to insurance than investment, let alone trading in the sense of ST profit gains short or long. It is very helpful for buying for inventory, or selling mined metal.

My point is that if you use NZD to participate in buying or selling precious metals, or in fact any asset class, the value of any one particular measure or method of reason for getting into, staying in, or getting out of precious metals can be questioned in isolation; however a combination of all relevant knowledge and skills, and the ability to apply them would be ideal. To buy and sell using NZD's and not to monitor the price and circumstance of ones holdings in the currencies that one is forced to consider and use is illogical.

BAA

I'm not really into TA, but try to keep an eye on the opinions of those who are focused strongly on it for a further measure of confidence if my personal investment thesis is running in parallel with the trend.

I tend to think of the relationship between the NZD and Gold analogous to entering the lobby of a skyscraper like the Empire State Building.

In the building are quite a few elevators........some service the bottom portion of the building, some service the top portion of the building, some in between.

Some elevators seem to travel in predictable patterns, others not so much.

It's all rather confusing, so I try to keep things simple.

I try not to jump directly from one moving elevator to another moving elevator.

I try to exit one elevator at a level I'm happy with, and enter another if/when it passes by.

My goal is to reach the top of the building, but am willing to accept the cost of getting stuck for awhile in the lobby of Floor 72 for a while, rather than risking a ride in the service elevator to the basement.

For me getting into Gold has been firstly getting out of the NZD and into the USD at levels I'm quite happy with(especially back in Q1/Q2 2007, and then again recently), then patiently waiting for a Gold price I'm happy with.

I'm not sure if it is an appropriate way of looking at things(or even an accurate analogy!).

But for the life of me I can't see a sharp and simple relationship between the Kiwi and Gold...so I've broken in down into pieces I CAN better understand NZD/USD & USD/Gold.

Just my 0.02c

PS: Very nice chart Arco!