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Thread: Gold

  1. #4181
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    Quote Originally Posted by Fudosan View Post
    Thanks elZorro. Very useful information helping me to know where to start my research. Much appreciated.
    No problem Fudosan.

    Gold is linked to the oil price quite well, and in the past I'd found some charts showing the effect of the US oil reserves being depleted over time. Easy profits reduced, as seen in the markets. Oil production in the states hit its peak in 1970, and then the proverbial hit the fan.

    In the early 1970s, inflation caused by rising prices for imported commodities, especially oil, and spending on the Vietnam War, which was not counteracted by cuts in other government expenditures, combined with a trade deficit to create a situation in which the dollar was worth less than the gold used to back it.
    In 1971, President Richard Nixon unilaterally ordered the cancellation of the direct convertibility of the United States dollar to gold. This act was known as the Nixon Shock.

    U.S. dollar value vs. gold value
    The sudden jump in the price of gold after the demise of the Bretton Woods accords was a result of the significant prior debasement of the US dollar due to excessive inflation of the monetary supply via central bank (Federal Reserve) coordinated fractional reserve banking under the Bretton Woods partial gold standard. In the absence of an international mechanism tying the dollar to gold via fixed exchange rates, the dollar became a pure fiat currency and as such fell to its free market exchange price versus gold. Consequently, the price of gold rose from $35 per troy ounce (1.125 $/g) in 1969 to almost $500 (29 $/g) in 1980.
    Shortly after the gold price started its ascent in the early 1970s, the price of other commodities such as oil also began to rise. While commodity prices became more volatile, the average exchange rate between oil and gold remained much the same in the 1990s as it had been in the 1960s, 1970s and 1980s.
    Fearing the emergence of a specie gold-based economy separate from central banking, and with the corresponding threat of the collapse of the U.S. dollar, the U.S. government approved several changes to the trading on the COMEX. These changes resulted in a steep decline in the traded value of precious metals from the early 1980s onward.
    In September 1987 under the Reagan administration the U.S. Secretary of the Treasury James Baker made a proposal through the International Monetary Fund to use a commodity basket (which included gold).[citation needed]
    Note that around 1970, unemployment in the USA started rising too.
    Last edited by elZorro; 24-09-2012 at 09:47 PM.

  2. #4182
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    Meanwhile, gold hits a 2012 high.

    http://news.smh.com.au/breaking-news...922-26d51.html

  3. #4183
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    An article in Barron's ponders various 'extreme' prices for gold. The maximum 'extreme' price is $2390, the minimum is $1455, so we may already be at the 'extreme' level.

    If the bubble chart is anything to go by, gold may be at the edge of the precipice.

    HUI down 3.14% , GDXJ down 4.32% and GDX down 3.38%.
    Last edited by Skol; 25-09-2012 at 08:12 AM.

  4. #4184
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    Quote Originally Posted by elZorro View Post
    No problem Fudosan.

    Gold is linked to the oil price quite well, and in the past I'd found some charts showing the effect of the US oil reserves being depleted over time. Easy profits reduced, as seen in the markets. Oil production in the states hit its peak in 1970, and then the proverbial hit the fan.
    .
    The Russian economic service update says there is around 1.2mbbl of surplus in the market at present and is budgeting on DEC prices in the mid 90,s
    The 2013 forecast has US domestic production both as new build coming onstream and Gulf production back to pre isaac level.
    The decrease in european demand (around 400000bbl per day at present) is expected to decrease further. The RES suggests 85 for first portion of 2013.

    So if the link between gold and oil stands we could see a drop in gold

  5. #4185
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    Quote Originally Posted by CAM View Post
    The Russian economic service update says there is around 1.2mbbl of surplus in the market at present and is budgeting on DEC prices in the mid 90,s
    The 2013 forecast has US domestic production both as new build coming onstream and Gulf production back to pre isaac level.
    The decrease in european demand (around 400000bbl per day at present) is expected to decrease further. The RES suggests 85 for first portion of 2013.

    So if the link between gold and oil stands we could see a drop in gold
    Yes Cam, I agree that's possible. However the pressure has temporarily come off oil because of the gas production in old fields from fracking, lower productivity and employment in the states, efficiency of motor vehicles, etc. Against that, the currency war rages, and those in the know have decided to increase their gold holdings as security against inflation and the devaluation of currencies.

    I've added to the charts 2-3 posts ago: look at unemployment in USA against their oil imports, a strong correlation. All this process started around 1970.

  6. #4186
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    Expecting to see gold reach new highs soon.

    http://www.ino.com/blog/2012/09/gold...-brien-lundin/

    The Moneychanger gives his take on austerity measures:

    Bailing out the banks is not a quiet or an easy business. Some of the "realizers" who see what's coming are raising a ruckus.

    In Greece, where an ECB/IMF dictated austerity "reform" has already been put in place, people are desperate. Hundreds of thousands marched today in protest.

    In Spain, the moment draweth nigh when the Spanish government must tell the ECB how much it needs to bail out Spanish banks and itself. Whoops -- but first, it must agree to the ECB-dictated austerity "reform." Tens of thousands of Spaniards, nervously eying what's happened in Greece, marched in protest. Head of the northwestern region of Catalonia is calling for a referendum to secede from Spain. (Why isn't he governor of Tennessee?)

    Of course, bailing out the banks creates many new jobs, for more policemen are needed to beat up protestors.

    Bailing out the banks is not easy, but it must be done. I forget WHY, but it must be done.

    I like it better the way we do it in the US, where the Fed just keeps on printing money and sends us all down the drain quietly and without a lot of fuss and fanfare.

    Y'all know what I'd like to see? I'd like to see one of those pointy-toed bankers or pointy-headed central bankers forced to put in one single day's real work. I think throwing hay would do it, following a trailer in the field picking up 80 lb. hay bales and throwing em up on the trailer to be stacked. Say, from about 7:30 a.m. till about 11:30 p.m., on a 95 degree day, but with breaks for dinner and supper, of course. I'm not inhuman. They could even wear gloves.

    Time they got finished, they'd know better than to call what they do "work."
    Last edited by elZorro; 28-09-2012 at 06:13 AM.

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    If www.mahendraprophecy.com is correct then the future for gold isn't that good.


    'We see S&P going toward 1600 but oil may hang around $100, we see next S&P moving toward 1900 to
    2100 but still we see oil remaining around $100, we would like see oils behavior when S&P move rapidly
    from 2100 to 3200. We are not worried about any other commodities. If you ask me where oil would be
    after five years, our answer will be around $15 to $30 barrell.'

  8. #4188
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    Quote Originally Posted by Skol View Post
    If www.mahendraprophecy.com is correct then the future for gold isn't that good.


    'We see S&P going toward 1600 but oil may hang around $100, we see next S&P moving toward 1900 to
    2100 but still we see oil remaining around $100, we would like see oils behavior when S&P move rapidly
    from 2100 to 3200. We are not worried about any other commodities. If you ask me where oil would be
    after five years, our answer will be around $15 to $30 barrell.'
    Skol, this must be a new site, I haven't seen it before amongst the quality financial sites we tend to refer to in our posts. I think it's very interesting - from the videos in foreign lanquages, the TV appearances, the self-promotion, the spelling mistakes, the tea-leaf reading, and then the amazing prediction that the world will, within a space of five years, wean itself off oil to the extent that they will only pay $15 to $30 a "barrell" for it, when it costs substantially more to find it and get it out of the ground.

    How many more sites can we find like this I wonder. Mahendraprophecy.com is an artistic site, of the BS type.

  9. #4189
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    Well I'm not into astrology myself but he's got a big following in 70 countries. I've noted in my diary his prediction of 1600 for the S&P500 by year's end.


    'Mahendra Sharma is known for making several predictions. Some of his predictions include:
    Assassination of Rajiv Gandhi in 1991.
    Natural disaster in Japan in 1992.
    Mortal danger to Diana's Life[7]
    He predicted extensive terrorists attacks in USA on KAYA FM and SABC before 9/11 happened in 2001 [3]
    He predicted Indian National Congress party coming back to power in 2004 in India
    In his first book '2002 World Prophesies' which was launched in 2001, he predicted commodities and oil will rise. He predicted gold to rise to $1000/ounce (when it was $275) and oil to rise to $100 (when it was $17.10).'

    He also had a few wrong predictions like the exit of Zimbabwe’s president from office and Pervez Musharraf of Pakistan would lose his job.
    Last edited by Skol; 30-09-2012 at 10:28 AM.

  10. #4190
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    Well,that settles it-Forget about the state of the US economy,horrible unemployment,and inflation,--Im going to base all my investment decisions on an Indian Prophecy website--Its all so simple!

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