Gold

[JBmurc]

They look just as bad.

right forgot you think your a guru Gold share picker LOL

[Skol]

right forgot you think your a guru Gold share picker LOL

Try WDR, my pick for the competiton. LOL

Talking about the competition. Aaaah, maybe we won't talk about that then.

[JBmurc]

Try WDR, my pick for the competiton. LOL

Talking about the competition. Aaaah, maybe we won't talk about that then.

--the comp's not over till last trading day of the year....3 months nearly down 9 to go..heaps a time for my picks

as for a $50 silver bet well after winning 2 years running I thought I'd give you a better chance

[Skol]

Here's something from Barron's indicating gold is overpriced.

Wells Capital Management’s Jim Paulsen takes a few different yardsticks to the price of gold. His conclusion: “[T]he price of gold on a relative basis is either nearing or is at one of its highest valuations of the last 50 years.” To wit, a few of his observations:
Work: It took less than 20 hours of work in 2000 at the average hourly wage rate to buy an ounce of gold. Today, the same figure is 90 hours. “In a similar fashion, the price of gold relative to the basket of consumer goods and services comprising the Consumer Price Index is near its all-time record high reached in the early 1980s.”
Stocks: “Relative to stocks, gold is almost as expensive today as it was in the late 1970s when the price of gold had surged after its peg was eliminated and after the stock market was ravished by a decade of runaway inflation.”
Bonds: “[T]he price of gold currently trades near an all-time post-war record high surpassing its old relative valuation record established in the late 1980s when bonds were incredibly cheap.
Homes: “Although the price of gold relative to U.S. homes is not yet as high as it reached in the late 1970s, its current relative valuation compared to house prices leaves little optimism about the future potential for gold prices.”
Other commodities: “[T]he price of gold is nearing its all-time record relative price reached in the late 1980s. Even though commodity prices in general have increased significantly in the last decade, the price of gold has risen even more dramatically.”
Fear: “Surprisingly, since 2000, the price of gold has only significantly outpaced other commodity prices during a few months in late 2008 when the ‘Great Financial Crisis’ erupted. Between 2000 and late 2008, the relative price of gold to other commodities remained flat at about 1.5 implying both gold prices and other commodity prices rose by equal amounts during the period. Similarly, the relative price of gold was also unchanged between early 2009 and today.”

For what it’s worth, gold settled today at its third straight loss and is now nearly 13% below the late-August record settle high. The SPDR Gold Trust (GLD) is down 0.1% at $161.33 in late-Thursday trading.

[elZorro]

Not so sure about gold, Skol, maybe shares are still overpriced. The Dow/Gold ratio still has some room to go to match previous dips, and it doesn't usually turn around quickly. It has bounced up off its trendline in the last few months, but if it corrects back to the trendline, most stocks will be in trouble.

Skol has not found a good counter argument for the Dow/Gold ratio? If nothing else, waiting for the right part of this long-term cycle is a recipe for making easier money from stocks. It's fairly hard at the moment.

[Skol]

As Jon Nadler prognosis are mostly always wrong ..I won't be losing any sleep

Gold's in another 'smackdown' after the Fed minutes release, amongst another raft of bearish data for gold, the HUI getting massacred again.

I think it might be all over JB, one chartist predicting a 'sudden drop'.

[Skol]

I think it might be all over JB, one chartist predicting a 'sudden drop'.

The sudden drop's here, $1618. Silver $31.

One commentator on Fox saying 'avoid gold'.

[elZorro]

The sudden drop's here, $1618. Silver $31.

One commentator on Fox saying 'avoid gold'.

From the Goldmoney Newsdesk:

The minutes from the Federal Reserve’s March 13 meeting were released yesterday. Though they again emphasised the Fed’s intention to keep rates “at exceptionally low levels through late 2014”, the absence of any QE3 indicators was what the market focused on, with stocks, commodities and bonds all selling off, while the US dollar rallied. The gold price lost over $40 (2.25%) in a matter of minutes after the news at 13:00 EDT, though the silver price held up better than gold – only down around 1.45%.

The weary predictability of all this becomes tiresome, and is summed up nicely by this graphic from ZeroHedge. Rest assured that the big picture as far as US monetary policy is concerned hasn’t changed. Real interest rates in developed countries will remain in negative territory for years to come, something that Casey Research’s Jeff Clark says will encourage more gold buying. In his words:

. . . . When real interest rates are at or below zero, cash or debt instruments (like bonds) cease being effective because the return is lower than inflation. In these cases, the investment is actually losing purchasing power – regardless of what the investment pays. An investor's interest thus shifts to assets that offer returns above inflation… or at least a vehicle where money doesn't lose value. Gold is one of the most reliable and proven tools in this scenario.

So when you hear talk of economic recovery leading to higher interest rates, and how this is bearish for gold and precious metals, consider real interest rates instead. In particular, the real return on 10-year US Treasurys. In the words of Forbes contributing author Victor Sperandeo, eventually the “long run” that Keynes so famously disparaged catches up with you.

Oil's dropped back a bit too, but until it's a lot lower I can't see the developed world getting back into their old manufacturing and service industries. Without higher employment on good incomes, this tightening up effect ultimately affects shares.

[Pumice]

Skol, JBmurc, Skol, JBmurc, Skol, JBmurc, Skol, JBmurc, Skol, JBmurc, Skol, ElZorro, Skol, Skol, ElZorro, PUMICE!!!

On a more serious note, what do the Gold bulls think of the dwindling odds on QE3?
Turning point in Gold, or just a minor setback?
I’m glad my USD is starting to show some value again. Let’s hope it mirrors gold’s run over the last few years. (At a guess, I’m thinking its only Skol that is the other person long USD)

[Skol]

Despite what oddballs like Marc Faber say (QE1, QE2,QE3, QE58 etc,) it's not gonna happen, they're taking the training wheels off and it's one way gold - down.

The USD is still the world's reserve currency and will continue to be.