Gold

[Skol]

JB,
Berkshire Hathaway avoided the 2000 NASDAQ techwreck by refusing to believe in the 'new era' tech shares.
Here's what Charlie Munger said 2 days ago about gold.

"I don't have the slightest interest in gold. I like understanding what works and what doesn't in human systems. To me that's not optional; that's a moral obligation.
If you're capable of understanding the world, you have a moral obligation to become rational. And I don't see how you can become rational hoarding gold.
Even if it works, you're a jerk".

I guess he just doesn't understand, right, JB?

[ENP]

http://theinfounderground.com/forum/...=12270&start=0

Robert Prechter- Elliott Wave International

If anything, we should be buying USD right now.

[upside_umop]

http://theinfounderground.com/forum/...=12270&start=0

Robert Prechter- Elliott Wave International

If anything, we should be buying USD right now.

If anything, we shouldn't listen to Robert Prechter!

If you had done the exact opposite of what he advocates, with a couple of grand you would be a millionaire (of course, a lot of his losses could be to do with trading costs/slippage etc). But the point is, his losses are substantial and his comments should be taken with a grain of salt, eh?

[macduffy]

Here's someone else who's bullish on gold.

Personally, I don't worry too much about trying to predict the PoG. Just hold my goldies so long as the trend continues!

http://www.businessspectator.com.au/...cument&src=tnb

[Skol]

All well and good but how do you know when there is a correction or if it's 'it'?

No one does otherwise the goldbugs would all be rich and the GFC would have been a minor affliction.

I know a guy who threw everything at shares prior to the '87 crash and when the 'correction' started he threw even more at it on the advice of his sharebroker.

That man is still working and he's 78.

[Lego_Man]

Might as well just all top ourselves then.

No rewards without risk.

[upside_umop]

Might as well just all top ourselves then.

No rewards without risk.

There is risk and then there is calculated risk. If you don't understand the risks (calculated somewhat)...then you shouldn't be in it.

If you can't understand that gold is speculative, and based a lot on expectation and human emotions...you shouldn't be buying it.

No gold bug has still told me what happens when the net hoard turns to zero?

By the way...I have some NAV and NAVO. They look undervalued...but I'm watching that gold price as they're a highly leveraged producer. I.e. Greater risk.

Rare Earths looks to be a bit of a bubble too, although its actually based off some fundamentals. Its hard not to be nervous when some of the REO have increased 4500% in a short space of time...it all depends how the demand will react to prices like that over the medium/long term. A general thought of my own is it shouldnt have too much effect, as they're non-subsitutable (most). NAV have some REO but like gold...I'm watching that too closely.

[Skol]

If you want to get into gold I think the best way would have to be via shares, PM too dangerous to store and illiquid.
A gold share that caught my eye some time back was RDR, should have bought some, not to worry though.
There are some signs that gold hoarding is getting out of hand.

www.sovereignman.com/finance/gold-mania-in-china

[Lego_Man]

You dont need to believe in the gold story to make money off gold speccies. Im sure most here dont hold gold ETF's. I dont care if it goes to 2000 an ounce or stays where it is, as long as i get my pound of return on my resource punts in the meantime.

[upside_umop]

You dont need to believe in the gold story to make money off gold speccies. Im sure most here dont hold gold ETF's. I dont care if it goes to 2000 an ounce or stays where it is, as long as i get my pound of return on my resource punts in the meantime.

This is true, I have the same philosphy. I think gold valuation is crazy, which is why I'm not attempting to price it. Instead, buy a gold producer which derives its income off the gold price....that doesn't mean to say you should not understand the risks surrounding the gold price. I.e. I won't try justify in my head why its going up or down....because simply I don't understand how people can value it - in other words, the price of gold is speculation and investing in gold stock use a fundamental analysis.

But yeah, you should at least understand the short comings of how people price it LM. I like that quote by Charles Munger that skol put up earlier....I assume he's reffering to the physical stuff.

I'll have a look at RDR...looks like it has taken a bit of a hit but has the trend changed now?