Gold Crashes On Fears Of Cyprus Sales: Time To Buy?

By TRANG HO
INVESTOR'S BUSINESS DAILY
Posted 04/12/2013 06:58 PM ET

The bears pounded the gold bugs to a pulp Friday. Gold prices cratered to a 15-month low on fears Cyprus and other indebted European countries will be forced to sell their gold reserves to cover their bailouts.

Spot gold prices plummeted 4.79% to $1,487 an ounce � the lowest level since July 2011. The yellow metal has tumbled 23% from its all-time high of $1,924 an ounce, officially signaling a bear market.

"It broke below key chart support at $1,525 an ounce, and we could see a measured move down to $1,250 an ounce during the next year or two," Mark Arbeter, chief technical strategist at S&P Capital IQ, wrote in his weekly report.


SPDR Gold Shares (GLD), tracking a 10th of an ounce of bullion, crashed 4.72% to 143.92 in five times normal trade. Market Vectors Gold Miners ETF (GDX) collapsed 5.88% to 32.17 � a four-year low � in double average volume.

Traders blamed overreaction to news and automatic selling that was triggered when prices broke below key support at the September 2011 lows. Western central bank agreements limit annual gold sales to 400 tons a year and 2,000 tons over five years.

Lower prices would likely spur buying by South Korea and Brazil, said KC Chang, a Toronto-based senior economist at IHS. They only have 1.7% and 1.0% of monetary reserves, respectively, stored in the yellow metal. He believes prices will rebound in the next month or so.

Central Banks Hesitant
Central banks would be reluctant to sell in the face of falling prices and in such significant amounts that would drive prices lower, says Bill Witherell, chief global economist at Sarasota, Fla.-based Cumberland Advisors with $2.2 billion in assets under management.

"Central banks cannot afford the gold price to move lower," Miguel Perez-Santalla, vice president of business development at BullionVault, a precious metals exchange in New York, said in an email. "It devalues their holdings and makes their currency weaker. Gold sales, if done by central banks, will be done amongst themselves to avoid destruction in the marketplace."

Cyprus owns 13.9 tons of gold, amounting to nearly two-thirds of its monetary reserves, according to the World Gold Council. That's a speck compared with the European Central Bank's holdings of about 500 tons and the International Monetary Fund's 2,800 tons.

"The Cyprus news is not positive for gold, but the overall size of the gold sales is pretty minor, considering China continues to import upwards of 100 tons of gold a month through Hong Kong," Peter Spina, president of Littleton, Colo.-based GoldSeek.com, said in an email.

Demand remains strong overseas and Japanese investors are thrilled to own gold rather than the yen, Spina added. The island nation's currency has plunged 18% against the dollar in the past year.

PowerShares DB U.S. Dollar Index Bullish (UUP), tracking the greenback against a basket of major foreign currencies, slipped 0.13% to 22.34. It tends to trade opposite gold.

Its rally off its February lows could run out of steam soon from a contrarian perspective, says S&P Capital IQ's Arbeter. Trader sentiment has reached its most bullish level since July.

The Commitment of Traders (COT) data show commercial hedgers, the so-called smart money, are heavily short the dollar, while the speculators, or so-called dumb money, are the most bullish they've been in at least eight years, Arbeter wrote.

"Many times in the past, this combination of sentiment and COT data has led to decent-sized pullbacks," he said.

Overabundance Of Silver
Silver plunged 5.64% to 26.20 an ounce � its lowest price since November 2010. IShares Silver Trust (SLV) gapped down 5.32% to 25.28 in 3-1/2 times average volume. Global X Silver Miners ETF (SIL) nose-dived 4.68% to 16.27 in triple usual trade.

Silver supplies have hit a 15-year high in Comex warehouses. Until industrial demand returns, silver prices will be linked to gold, ETF Securities' weekly precious metals report stated.

Glad I dumped my silver at $43 per ounce.

When the [bleep] really hits the fan all that is going to be worth crap is food, guns, ammo and some sort of energy source. This other stuff is all carp!

True that,but you may still want enough on hand to buy passage to a better place under some circumstances.

Yes, but you forgot gold and silver. Paper currency will be useful to start the wood stove.

Well, how long before Italy and Spain are dumping much more than Cyprus?

Great buying opportunity. You need to take advantage of these gifts. Only suckers buy when it's up. Buy when it's down.

It's already gone.....to the east.....

Tony

PS....500tons of "paper gold" was sold yeasterday.

For every seller is a buyer.

If the buyers stand for delivery, where is the 500tons of real gold going to come from ?

Someone needs to cover the naked short positions with a schit load of physical.

They better hope no one calls their bluff...

Tony

True but try wiping your ass with gold or silver even on a warm morning.

I think if Spain and Italy had already unloaded gold, the price would have declined before now. Do you have any information you can share supporting your contention?

Fox Business Video: Has gold lost its luster?

It's not just the threat of Cyprus and other week Euro Zone nations selling off their gold that's driving the price down, it's the bull market as well. Outside of central banks, most gold bullion and coins are held by investors as a hedge against inflation, but when the stock market is in a bull rally as it has for the last three months then there's more money to be made in stocks and investors start selling off gold. As gold prices drop, fear starts to motivate further sales.

It's a good thing the markets are closed for the weekend to give traders time to analyze the situation rather than just react to the dropping price of gold. Come Monday gold could recover much of this week's loss, but if it drops another $50 bucks or more then it may start a panic sell off and we could see 2009 prices again.

If gold prices get down to their historic relationship with platinum then it might be a good time to buy.

The reason Gold has declined is the feds have printed so much money and propped up the stock market with a false bond market. It is built on a house of cards. It is very similar to the tech bubble. Nothing tangible to support it.

When the stock market shows any sign of weakness gold/silver will start to climb again. I believe silver is a better investment than gold right now, it is undervalued as far as it's historic ratio to the price of gold

Buying gold is what you do with money for years after the SHTF occurs. If you don't have that much money, you are better off buying AR's, ammo, food, solid 4x4 etc. And if you have enough money to buy gold, and don't "prep" as above, you are an idiot.

Give me a call when it reachs $800.00 per oz.

Jim

The "save haven" of gold and silver will always trump paper currency - even on a warm morning.

Lead trumps them all.

I prefer lead free - - - - - TSX!

I hear you, but I can't cast them in my backyard.

That's the conventional story, but if the price of gold is dropping on the threat of Cyprus selling its gold what do you think would happen if the U.S. got into trouble and started selling its gold?

Here's another mind bender. Central banks are creating gold out of thin air. Well not directly, but they create money out of thin air and they buy gold with it. In printing the money they drive up the markets and, as we are seeing now, that can drop the price of gold so the banks can buy it up for even less. The public ends up with the thin air and the banks end up with the gold.

Wow... I can't believe how uninformed people are about the reality of what is happening.

Y'all need to stop believing everything you hear on CNBC....

Tony

So inform us.

MacLorry, I wish you would pm me re some interesting info.

Riddle me this.........does killing the canary in a coal mine make the gas any less toxic ??

Tony

PS: the canary has nine lives, BTW...and will tweat when the schit really hits the fan....

Exactly. Gold serves no utility, much like diamonds. At least you can turn diamonds into sandpaper, haha.

I love you anti-gold bugs. Whenever your views catch on and spread, I get to jump in at fire sale prices.

When schit really hit the fan, a bottle of booze or antibiotics will be worth ten times gold.

Six thousand years of history disagrees, but I'm glad your kind is out there talking negative about gold. I love a sale.

Ya gotta clench your jaw and go long on PM's.

The money [bleep] will be jerkin' 'em, around until the crash of the dollar.

They'll fool everybody who is subject to bein' fooled.

But you need to hang on.

That paper money stuff is going to be reduced to its intrinsic value before Bernanke gets done with it.

He's printing 85 billion a month of fiat currency and casting it upon the waters.

He can't print up gold and silver.

I'd just assumed Bob had finally bought some gold


thus causing it to tank


I think all those other ideas are just a bunch of hoohah

Last I heard, he was investing in cologne.

Way he tells it,..if things are goin' down,..you might as well go down stinkin'.

I cain't make no sense out of it,..but then,..I cain't make no sense outta livin' in the D.C. metropolitan area either.

Knee jerk- Cyprus which holds over 13.9 tons (about 65% world gold reserves) of Gold has to sell it off to raise 400 million Euro in financing to prevent an economic meltdown. The fear is that other struggling countries such as Portugal, Ireland, Italy,Spain and Greece will follow suite.

You think the current prices are "fire sale" prices? If it hits $500, then it might be on sale, and $300 is a fire sale.

Pretty much. As a commercial harvester of food myself, I'm thinking it take a fair amount of shiny gold to get some of my fish.

I ain't giving up my teeth anyways.

Well for every boom there is a bust. Its not surprising , just another cycle. The trick is to recognize when the cycle starts and position yourself accordingly. Easier said than done. Seen this sort of thing before.

agreed, but you'd be surprised how many boats and petrol a guy can buy when he's got some shiny stuff

I need to save this thread and revisit it in five years. I think it is a riot.

Tony,

I think you are so wrong on the direction of gold that I am willing to make a bet with you. I think we both trust Bob. If he is willing (and I bet he is) I will send him a one ounce gold coin to hold until April 15, 2018.

The S&P 500 and the price of gold are so close that I say the S&P 500 will be higher than an ounce of gold on that date. If I am wrong then he can send you the coin. If I am right, then you pay me the equivalent of the S&P 500 in dollars and I get my coin back.

The near term odds are in your favor with the S&P 500 at record levels.

This right here!! kwg

But we have been told by the gold bugs on here that the Fed printing so many dollars would crush the dollar and cause gold to skyrocket. Hmm...something just didn't work out that way.

Did you watch the Peter Schiff vid?

I think higher production spurred by the high prices have led to a decline inthe price, but hey not to many people believe in the fantasy of supply and demand anymore, so I am sure I will be seen as ridiculous.

Dude, just wait 'till interest rates start going through the roof. You must not remember 1980. This hasn't happened yet because the Fed has forced interest rates down. When no one will buy US bonds anymore (and that day is coming SOON), that little song and dance will come to a screeching halt. Actually it'll be more like musical chairs, except there will be a LOT of morons standing, not just one.

Dude, this is what I do for a living. I know a little bit about how these things work and I remember 1980. I also know the Fed isn't the only thing that affects yields and the yield curve.

No, I didn't watch the video. Peter has a long ways to go to get back any credibility. He has been predicting the dollar going to zero and hyperinflation for so long that it has become laughable.

I am not saying that the US is doing it all right. Far from it. We done so many things wrong it is frightening. The only saving grace is that we aren't the only ones doing it wrong. The gold bugs and doomsayers are missing one important aspect to all of this. They are acting like the US is the only one printing the money. Of course, this makes us the tallest midget in the room, but we also have something ahead of us that no other major industrialized country has and that is a major energy boom.

The energy boom is a huge shift in the balance of payments and other economic benefits. That is one of the major factors in the strengthening of the dollar and further weakening in precious metal prices.

This is the only thing that has forestalled hyperinflation, because it has allowed the dollar to remain the world's reserve currency. That WILL NOT LAST.

Your position is a lot like Wil E Coyote's, in the desert, with the shadow of an anvil over him. You might want to move.

For the last several years I've heard radio adds bragging about how much gold prices have climbed, and encouraging buyers to jump aboard before it climbs even more. Being a skeptical sort, I've never trusted an investment that tries so hard to drum up excitement. Sure, I wish I'd bought a few pounds of gold 10yrs ago, and I'd have sold it by now for a fancy profit. But as a hedge against TEOTWAWKI, I'd rather invest in more practical things.

Only a moron would do that, that is like going to Vegas with next years mortgage money. You are a dumbass if you don't provide for the reasonable material needs of you and yours FIRST. Then, you invest in precious metals for your needs AFTER TEOTWAWKI. There always is an "after".

Not if the chit hits the fan, and people focus on what they need. food, water, shelter, and security. Shiny isn't a need.

No times were harder on folks than during the Dark Ages in Europe, yet you could still buy some chickens for a small piece of silver, and a plot of land for a couple of small pieces of gold. Hard to argue with six thousand years on the basis of the tiny slice of time (the last forty-two years) during which the world has been on a pure fiat currency.

PS Much of the gold and silver coinage in circulation during the Dark Ages had images of Roman emperors on it, i.e., it mattered not that there was no longer a Roman Empire to back it with its "full faith and credit." All anyone cared about was that it was gold and silver.

A day is coming when the only thing that will matter is whether you believe in Jesus Christ or not. Revelation will soon unfold before the eyes of the world and most will not even know it.

Qtip
Soli Deo Gloria!

The doomsday scenarios are correct and the dollar will crash, and the U.S. will go extinct. The problem is when will this happen. Will it be in a few years, a decade, a few decades, a century or when the Sun goes into its red giant phase? Any fool can predict the crash of the dollar with 100 percent accuracy as long as they don't give a date or time frame and other fools can spend their lives living in a cave waiting for it to happen.

Peter Schiff predicted gold would be at $5,000 an ounce as of a few years ago. When that didn't happen he moved his forecast to be a few more years down the road, and if that doesn't happen he'll find a reason and move it further into the future. Peter Schiff is to gold what Al Gore is to global warming. It doesn't matter what happens it always proves their case. As with any investment, timing is the key. By low and sell high. Those who horde gold for doomsday are missing the opportunity to profit from the usual market cycles that occur in all commodities.

Big government is not going away and if there's a collapse of the dollar, government will impose price controls and rationing as it has done in WW2 and other times in our history. You won't be able to buy foreign made goods with dollars, but you'll be able to buy domestic goods. The U.S. is not Cyprus or Greece in that we have the ability within our borders to feed, clothe, house, transport, employ, and defend our own population. With no competition from foreign goods and labor the bust could quickly turn into a boom.

Any plausible economic collapse would produce minimal hardships compared to a catastrophic natural disaster on the order of a Yellowstone eruption or pandemic on the order of the black death. Being no one can predict the timing of such events, my advice is to make prudent preparations, but don't waste your life living in a bunker be it the physical or the mental kind.

You will need to back that statement up. I've been a follower of his since he proved correct in predicting the housing bubble crash, not to mention its course and cause, and he has always been clear in stating that he cannot predict the year of the dollar's crash, to which his $5,000 per ounce gold price prediction is attached. He has always said that there are too many variables involved for that.

This assumes you have a kickass plan for converting fish into fuel, other food, water, shelter security, parts, labor, yadda yadda. Store of value, medium of exchange stuff here. Stinky fish has limits as a store of value.

Also, it is pretty easy to find information on various countries efforts to trade directly in their own currencies and bypass the use of the dollar as a reserve.

What do you think the real reason for regime change in Iraq and Libya was? Gaddafi and Hussein were both whacked for attempting to trade their oil for something other than US petrodollars.

I used to joke that .22 ammo would be the currency of the new millennia.

I didn't realize that it would ever really come close to being just that.

============

Kind of seals the deal as to how closely Hawkeye follows things.

So what caused his hair to turn gray in just a few short years?

Economics is tricky business and I don't claim to be any type of expert at it.

But I know this.

You can't produce vast quantities of *anything* and expect them to have a lot of value per unit in a free market.

Dollars are no different than anything else in that regard.

Dump a trillion .22 cartridges in the market,..they're not going to have much value per unit.

Dump a trillion dollars in the market, they're not going to have much value per unit.

Well said. Exactly right. A simple economic principle that, for some reason, so few are able to grasp.

March 2009 said that "I would not be surprised to see [gold] at $5,000 over the next several years..." In 2008 when asked about future prices of gold, Schiff stated, "I think it could be $2,000 an ounce sometime next year". In 2010, Schiff predicted that gold could "reach $5,000 to $10,000 in the next five to ten years".

October 25, 2012 Peter Schiff said gold would rise to $5,000 per ounce within the following two years.

Most of Schiff's predictions are vague, and when they are not they have been proved wrong. When wrong Peter doesn't change his theory to match real world results, he just makes longer term indefinite predictions.

As for predicting the 2008 equity market crash, Schiff didn't believe his own predictions or he would have made lots of money for Euro Pacific Capital Inc. investors, of which he is CEO and chief strategist. Here's an actual portfolio of one of Schiff's clients from 1/24/2009.



An investment of $70,000 went down to $27,000. Other Schiff investors claim their portfolio went down 72% and others 40%. In other words, investors with Schiff had declines in their portfolios similar to investors with mainstream Wall Street brokers. So how did Schiff see the crash coming? Bottom line is that Schiff makes predictions he doesn't actually believe himself enough to take action on them, so why would anyone else take action on Schiff's predictions?

See this?

http://bullmarketthinking.com/comex-gold-inventories-collapse-by-largest-amount-on-record/

Any commodities including Gold is only worth what someone will pay for it. Weapons , Ammo , Water and Food will be the best assets you can have when the chit hits the fan.

Gold, Silver And Bears Oh My: What Is Behind The Huge Sell-Off?


Christopher F. Davis
Apr 13 2013, 14:53

Gold was slammed on Friday (4/12/13). So was silver. The SPDR Gold Trust (GLD) bled 4.70% to close at $143.95 and the iShares Silver Trust (SLV) lost 5.32% to close at $25.28, both making brand new lows. The most frequently traded gold futures, the June 2013 gold contracts, fell below $1,500 an ounce for the first time in almost two whole years. This move appears to be largely technical in nature but has also been motivated by some important fundamentals.

On Friday, there was no real economic news at all that should have resulted in such a volatile move, but there were some economic trends and pieces of news that fundamentalists took note of that likely started the selling. First, the U.S. dollar has continued to strengthen in 2013, which is usually always bad for gold and has pressured the metals all year. There has also been a wave of price target downgrades by major firms, including Goldman Sachs, UBS and Societe Generale among others. These downgrades all pushed gold lower in the last few weeks. Further, this past week Goldman outright called for a short of gold, which impacted the metals further. With the action on Friday in the metals, their call was well timed to say the least. But, the fundamental "icing on the cake" to spark selling Friday was a report that Cyprus might sell over 10 tons of gold to help its deficit issues. This certainly caused some overnight selling Thursday into Friday and continued throughout the morning. Once the selling pushed gold below $1550, it most likely triggered massive sell stops to initiate. As the market slipped first through last week's lows selling intensified and then further picked up steam once gold penetrated the $1525 and $1510 levels. Interestingly, the broader equities markets were under some pressure Friday and in recent similar sessions gold has performed well. But today was a complete liquidation sale.

The move in gold really caught my eye around 11:30 am on Friday when I saw that gold dropped under the $1500 mark and was down $70.00 at $1,495 an ounce. Although it tried to muster a small comeback above $1500, gold went on throughout the day under high volume selling pressure to close at a new low of $1476. This is the lowest gold has traded since April 2011. Silver, following gold's move down, also made new lows. The May 2013 silver contract printed a 25 handle for the first time in years as silver took a beating to close at $25.76. As it stands now, the charts and the technicals are currently in control of the action, at least in the short-term. They are driving the price of gold and silver lower and have some support fundamentally to move lower in the way of a perceived stronger U.S. economy and the belief that the Federal Reserve may slow or end its quantitative easing this year. Further pressuring gold has been the fact that the GLD is seeing record outflows, resulting in the fund selling physical holdings. On the bullish side for gold, U.S. economic conditions are still overall weak but there have been some negative reports lately, such as the last jobs number. Further, the US debt situation hasn't gone anywhere, and with all of the money printing that the Federal Reserve and central banks globally have done, inflation will eventually return.

It is a difficult time to be in there buying. However, the key technical support level to watch is $1470. A break below this could send gold down to $1340, at least. I see this as unlikely. Buyers with risk tolerance could initiate a position but be prepared to take a loss if the $1470 level breaks down. At this time, with such a large move down, there could be some buyers seeking opportunity this week which could give a small lift to prices. Silver seems to be the safer metal at this time, as there is still record buying of the metal. Further, unlike gold it has industrial demand, which will support prices. Silver is not just a precious metal, but also is one of the most conductive metals out there. It is thus utilized in photography, electronic devices, optics, medical devices, nanotechnology and cellular/smart phones. This use in electronics is a new phenomenon of just the last 30 years. With the growth of cell phone use, there has been record industrial demand. In fact, about 20 cents of silver is utilized in every new device. Thus, there will always be demand for silver, not just as a safe haven (like gold), but also in the event of a strong economic recovery. I recommend buying physical assets in this space or one of the ETFs.

Finally, a high beta way to play could be to buy some of the mining equities, even though there is "blood in the streets right now." Some of the highest returns can be had when you buy when everyone is selling. However, the charts are against this trade in the short term. Despite this, if gold can hold and rebound up to the $1550 level or $1600 level, or silver to the $28-$30 level three highly profitable trades could be buying shares of (or call options in) the Gold Miners Index (GDX), the Junior Gold Miners Index (GDXJ) or the Silver Miners Index (SIL). They are risky given the recent price action, but the long-term fundamentals are intact. If one does not wish to risk capital on the miners then one can stick with the more conservative approach of adding to physical silver and gold holdings as the price drops, due to the long-term tailwinds in place from central bank action and worldwide debt.

The few actual quotes you provide don't show Schiff predicting anything by a particular date. He says things like "I wouldn't be surprised if ..." The rest are mere interpretations of what someone said he indicated. If you don't have a quote, just say so and admit you were wrong.

Shows the power of Goldman Sachs to manipulate markets by merely uttering a word about them. The fundamentals are all for a huge rise in gold and silver, so this push down is akin to pushing a beach ball down below the water's surface. When it comes up again, it will fly well above its surface before returning to its natural price level based on fundamentals.

When Goldman Sachs and "the boys" buy as much gold as they want at the deflated prices they caused, the price will go back up.

http://www.cnbc.com/id/100632397

Should Traders Trust Anything Goldman Says?

"Their calls have been suspect at best, so I'm not giving this one much merit," said Jeff Kilburg of KKM Financial. "Traders out here in Chicago are not lending much credibility to their calls, because they've been so inaccurate lately."

Peter Schiff of Euro Pacific Capital goes one further. "Goldman obviously wants to buy more gold, so it needs to convince other to sell it to them," Schiff said. "It also wants to buy low, so it needs sellers to drive down the price."

So do Goldman's commodity calls have any validity�and is there a reason for investors to listen?

"In general, the calls that analysts make on both currencies and commodities tend to be some of the less successful calls that are made," said Princeton Professor of Economics Burton Malkiel. "I have a great deal of suspicion about the usefulness of directional calls."

You mean apart from his prediction that in 2008 when asked about future prices of gold, Schiff stated, "I think it could be $2,000 an ounce sometime next year". If you check the link you'll find its from Schiff's own blog.



Which is the M.O. of a shyster. Never say anything specific enough to be proven wrong, but if something turns out correct than claim they predicted it.

I say I wouldn't be surprised if a sinkhole opens up on or near your property within several years. Same type of predictions Schiff makes and has the same value.

Here's an example of Schiff hyperventilating about the rise in gold prices.



If someone were to tell them that within 6 months gold would be trading under $1500 an ounce they wouldn't believe it.

Again, "could be ..." No predictions. He generally gives responses like you quote when hard pressed by an interviewer to say something about future prices of gold.

Another fail on your part. It was the news chick that said that "Peter's predicting $5,000.00 gold in the next two years." Peter said two things at two different times that she morphed into one misquote. He said 1) "$5,000.00 in the next few years." How many years in a few? Later he said 2) "Big move in the next two years." She combined them to make "$5,000.00 gold in the next two years."

Just be a man and admit you were wrong.

it gets emotional for a lot of folks investing, because most everyone works hard to earn a living, pay their taxes, pay their bills, enjoy a little of the good life and hopefully save some $$ after all that to invest and finally perhaps have your money work for you instead of you working for your money.


easy to get highly emotional about it, most folks either are scared that in they're in the wrong investment vehicle, or so convinced they're in the correct vehicle they refuse to hear anything other than what supports their position.


I'm a bit surprised my MacLorry, he normally comes across as pretty devoid of emotion in these matters. And in my personal opinion, it's very few guys that will predict both time and price in almost any vehicle. And even when they do get it correct, tis amazing to me how folks will nitpick about amazing predictions.

case in point, Tony/hicountry turned me onto a guy named Jim Sinclair (who yes owns a gold mine, so it's not like he doesn't have bias either) but I was amazed when I read Sinclair, he predicted gold to hit $1650 per oz. by Jan. 11 or 14th ? (don't remember the exact date) 2011

that's when gold was trading at 3-500 oz.! back in circa '02-'03 thereabouts.

he missed it by something like 3 weeks! and I've seen bloggers and investment "gurus" take issue about those 3 weeks indicating that he was WRONG, WRONG, WRONG about his prediction


there's a guy on here Steelhead IIRC that says "people are [bleep]"

I think he's correct, some people really are [bleep].


I fully expect that I may be wrong, even when you're correct the herd is a powerful force. Many folks have it correct, any given commodity, entity, stock whatever is only worth what someone else is willing to give you for it.

doesn't matter whether it's your house that you have locked into your head is worth 350K cause you gave 300K for it and it was quality construction and by GOD it's worth that much.

your Acura or Lexus

your rifle

an ounce of gold

or your stocks that you hold


the market (all of us collectively) determines the worth of something


when everyone qualified for a house whether they had a down payment or income sufficient to buy that house, houses were in short supply no matter how fast they could build them, and house prices went up,up, up! When it turned out a lot of those buyers couldn't afford those houses, it seemed to create an oversupply of house inventory and prices dropped. Same number of folks, same number of houses all that had changed was perception and thus reality.

in a bull market, you pay a premium for stocks, PE ratios that just don't make sense to this guy that's had to learn to read a balance sheet, but it doesn't matter whether it makes sense to me or not, if I think stocks are too high and aren't worth it, I can easily be outvoted by those that think there's still value and room for that stock price to appreciate.

often things go from under valued to over valued and back again only passing what's perhaps "actual fair and reasonable value" on the way to overbought or oversold conditions.


we that have invested in gold to "hopefully" preserve purchasing power of our savings may indeed have it wrong. If Goldman Sachs, the FED, Buffet and others can convince the majority that gold has little to real value, it won't matter a whit, what we paid for our gold, it's only worth what someone else is willing to buy it for.

but we (collectively the market, remember) are constantly changing our mind about stuff and the value of that stuff. We buy stuff new all the time that we must have really wanted only to sell it for a fraction of the original cost years later at a garage sale or we just haul it to the dump even though it's still functional. It was worth the retail price to us once upon a time, but sometimes we end up just throwing that item away.

I really never thought I'd hold an ounce of gold if it hit $1500, but I also really never thought our gov't would continue to spend and spend and spend or the FED to print money QE for so long and so much.

but they have and I have continued to hold.


Gold is not in favor at this moment, folks are running for the exits that held positions in the paper market, I've yet to find evidence of actual bullion being redeemed, if you can show me those figures and of actual delivery of someone that's buying the gold that's been selling I'd appreciate it.

I think gold may go much lower, but I also think there's a case for it to go much higher. We've been the driver of the world economy and in many ways we still are as we're the largest consumer block.

but the Russians, Chinese, and emerging markets as Schiff alluded to have the bulk of wealth through trade surpluses at this particular time.

if they indeed decide "we don't care what Americans think, and we want to divest ourselves of our dollar holdings" and put even small percentages of that surplus into gold, we may find ourselves wondering why we didn't buy or buy more.

but if they decide along with GS and Buffet, that gold has no value and don't want to buy gold, we may see gold drop incredibly

we're a bit arrogant imo thinking that whatever we want or has value is what the world wants and values.


only time will tell, and there'll be winners and losers.

I'm hoping all of you end up winning regardless of what vehicles you choose to invest within.

Jesus H. Christ, Randy. When someone asks you for the time, you don't need to be telling them how to build a frikken clock.


We've been having this same old tired talk since 2006. Same old,same old. It will play out the way it plays out.

I hope everyone's style of investing pays off big time. With the exception of one rental where I'm 80K in the hole, the others are serving me quite well. maybe tomorrow,Obama could fix that too.

Folks have no worries when they're dead. The key is to live when you're living.

You might want to go back and review Jim Sinclair's bet. I believe he made it on April 2, 2008 and gold was approximately $900/oz. He said it would reach $1,650 by the 2nd week in January 2011. It was approximately $1,360 during that week. Three weeks later it was still about the same price.

Gold didn't reach $1,650 until the beginning of August 2011.

TRH, you have chosen to ignore the video I posted of Schiff's failed predictions that did give time frames. Don't blame you. It doesn't fit into your agenda.

I didn't post that video to support the quote that Schiff said gold would be $5,000 in two years. I have already posted that link. Here's that quote.



If it's not accurate blame the reporter Javier E. David.

In other videos that I've seen Schiff says explicitly gold will go to $5,000, but he doesn't know the time frame. Any fool can make predictions like that. Even at a steady 2% per year inflation rate gold will go over $5,000 at some point and gasoline will be over $20.00. Well, someday Californian will have a big earthquake.

Just be a man and admit Schiff is a fool and you've been taken in.

Whenever someone says Schiff said thus and so, it's always in the form you present, i.e., no quotation marks. Nice dodge.Exactly. Now just admit you were wrong.

I think we are seeing a correction in long term bull market, not a bubble popping. A lot of speculators headed for the doors last week, most of those guys are short term traders. All the major economies are manipulating their currency, we are just the one eye'd man in the land of the blind right now. We may be printing money, but we are in better shape than Europe and safer than China.

I think you will continue to see money flowing into the US market for a while as a international safe haven. No one trusts the Chinese, the Euro Zone is a mess, so the dollar is still king for the time being. I've heard Florida is favorite place to buy properties for Europeans right now. The big money isn't going to hide out in southern Europe anymore after Cypris, it has to go somewhere.

You asked for links and I provided them. You don't know what conversation Javier E. David had with Schiff before they agreed to put him on the air where he hedged his prediction. If Schiff was misquoted provide a link where he refutes the two year time frame. If he didn't refute such a blatant misquote then he owns the quote. Likely he gave the two year time to Javier E. David to get the airtime.



So you admit Schiff is making predictions no different than any fool who doesn't give a time frame. Now explain why you post predictions from a fool.

Perhaps people should pay attention to this fellow.......

http://www.globalresearch.ca/fed-orchestrated-smash-in-gold/5331174

A worldwide run on physical gold will prove the Emperor has no clothes.

Are you expecting this to happen?

Yes, I am, and it will bring down the house of cards. The NY money-changers have been selling paper too long and too much of it.

People don't realize that all the physical gold mined so far through history just fills an Olympic sized swimming pool, with a little now splashing over.

you may be correct Longbob, I didn't get "introduced" to Sinclair's writings for quite some time, I'd already purchased the bulk of my bullion holdings circa 02-03 and it was a few years later, before Tony directed me to his website.

sorry I wasn't trying to mislead anyone, I'm getting old and memory is foggy, I just seem to recall being incredulous him making that prediction, again IIRC it hadn't even broken $1000 per oz. when he made the 1650 call

yes with a little research it appears weekly gold on a 10 year chart didn't but barely penetrate 1000 per oz. Longbob during 08 and pulled back, it wasn't till mid 2010 that it ever penetrated 1300


neither of us was quite correct, but gold was under 1K per oz. when I can find reference of Sinclair making his call 3 years away, and he was calling for a 60% increase on something that was at it's all time high already.

guess I'm easier impressed than some, but even though he missed it by a few months, I thought it was fairly prescient. tis evident the mileage varies.

the one thing I'll say about prognosticators, investment gurus etc.

it seems to me the sun shines on a different dog's azz everyday

being correct once or a few times is no guarantee you'll be right forever or even for very long.


hey Bob, what time is it? (grin)

Not sure what I said was wrong by reading your last message. Can you clarify? Here are my references.

Jim Sinclair's Bet

rereading your post and looking at the charts you provided you were spot on Longbob, sorry my memory didn't serve me well.

and I'd forgotten about the million dollar bet, wonder if anyone took him up on it and collected their winnings?


I guess in my mind a 3 year prediction that missed by 7 mos. or so I thought was pretty impressive, particularly as I noted when that particular commodity was in the levels of its all time high price.


your recall of the situation was far superior to mine, good job and thanks for providing the links you did, I did some research but my google fu is weak compared to yours.

I do think you may be onto something about the S&P 500, liquidity provided by the FED seems to be doing a very good job of helping our stock indices. And folks have to look for a return on their savings somewhere. Money in the bank is a losing proposition these days even with the govt's published figures of inflation.

anyway I enjoy these discussions and appreciate the opportunity to learn.

those dang Chinese, we do live in interesting times and they are a driver of a good part of the interest

Gold plunges to lowest in more than two years

By The Associated Press
Posted 09:57 AM ET 15 Apr 2013

The price of gold is plummeting its lowest level in more than two years.

The precious metal extended its decline after plunging on Friday, when the U.S. government reported that wholesale prices fell in March by the most in 10 months. Investors tend to buy gold when they expect inflation to increase. Any indication that prices aren't rising prompts investors to sell gold.

A proposal that Cyprus sell some of its gold reserves to support its banks also rattled the market. Traders worry that Spain, Italy and other weak countries might do the same.

The price of gold plunged $90, or 6 percent, to $1,410 an ounce as of 9:45 a.m. EDT Monday. The price of the metal has dropped 10 percent in the last two days.



Read More At Investor's Business Daily: http://news.investors.com/newsfeed-...n-more-than-two-years.aspx#ixzz2QXjdJlzQ
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook

No worries bud. The best thing that can happen to precious metals is if North Korea fires off a missile. That may put the brakes on the slide. If not, there will be buying at some point for people that are convinced of the ultimate demise of the US/world.

I think the next five years will be a disaster for the precious metals market when the US doesn't fail. Price prediction is a loser's game, but I won't let that stop me. I can see gold at $500 to $800 and silver at $9 to $12 within the next 5 years.

how low can she go???


my guess is somewhere in the $1250 range

China needs to fall out from underneath it's finacial troubles. Their implosion seems to be occurring earlier than expected.

Dropping under $1,400 is likely to trigger more automatic selling. We'll know in a day or two if there is going to be a panic sell off of gold.

Dropping like a rock. 1367 right now. If I thought I could find a bottom safely on Gold, I'd go in to make a buck.. as I love things crashing. But, no safe play exists for this. Stay away.. You've been warned.


Here's a hint, when you start seeing ads on TV for some investment, you've long missed that boat..

Gold Miners Tumble As China Economic Growth Slows

By KEVIN HARLIN,
INVESTOR'S BUSINESS DAILY
Posted 12:25 PM ET 4-15-2013


Gold miner shares tumbled, leading major indexes lower, as commodity prices fell and economic growth in China slowed, spooking investors.

Gold fell to as low as $1,355 an ounce in morning trade on the futures market before recovering slightly.

United Kingdom-based Randgold Resources (GOLD) gapped lower and was down 8.2% intraday on the stock market today. Arizona-based Freeport-McMoRan Copper & Gold (FCX) tumbled 7.4%. Colorado-based Newmont Mining (NEM) was down about 6%.

Timmins Gold (TGD), the Canadian firm that mines gold in Mexico, tumbled 16%. Fellow Canadian-based miner Alamos Gold (AGI) tumbled 6%.

Gold prices fell to about $1,400 an ounce for the first time since March 2011. The miners began sell-off last week. The tumble continued Monday, with data showing China's growth slowing.

Beijing said gross domestic product grew by 7.7% in the first quarter, down from the 7.9% growth a year ago. Economists were forecasting 8%.

The Mining-Metal Ores group was down 5% intraday Monday. The group is currently ranked No. 193 out of the 197 sectors IBD tracks. The Mining-Gold, Silver, Gems group was ranked last at No. 197. The companies in that group collectively were down 8% intraday.



Read More At Investor's Business Daily: http://news.investors.com/business/...andgold-newmont-alamos.htm#ixzz2QYVJNKIL
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook

An adjustment in the market? Of course! A crash? Hardly.
And besides, what fundemental has changed that drove the last run? Nothing. The country is still broke and they are still printing money faster than it can be authorized. This is a buying opportunity.

Speculation of a coming rise in interest rates, mostly.

Problem is, the only thing keeping our phony economy on life support is near zero interest rates. Raise them, and the market goes into cardiac arrest.

It's already in cardiac arrest, Hawk.

Gold Dives As Weak China Growth Spurs Latest Selling

By JASON MA AND TRANG HO,
INVESTOR'S BUSINESS DAILY
Posted 06:01 PM ET
4-15-13



A surprise deceleration in Chinese first-quarter growth added to signs of a weakening global economy, the latest reason to dump gold amid a bear market for the precious metal.

The world's No. 2 economy expanded by 7.7% in Q1 from a year ago, below expectations for 8% and Q4's 7.9% pace. The unexpected slowdown dampened hopes China is rebounding from a relative soft patch to help pull the rest of the world with it.

The news also comes as U.S. data have deteriorated, including job growth, retail sales and now housing. Homebuilder sentiment slid for the third straight time in April to a six-month low.

U.S. stock indexes fell sharply, led by miners. Gold tumbled $140.30, or 9.3%, to a two-year low of $1,361.10 an ounce. Oil, copper and other commodities fell hard on expectations for less demand, especially from China.

Gold fell last week on fears Cyprus and other indebted European countries will be forced to sell their gold reserves to meet bailout conditions.

Speculators are selling other commodities to cover gold margin calls, analysts said. The Shanghai Gold Exchange may hike gold and silver trading margins .

The stock market's prior robust gains have spurred a shift away from gold, analysts noted. While gold's correction could drive demand in China, India and other emerging markets, doubts remain about future buyers.

"Anyone who wanted it had bought it already," said Ed Carlson, founder of Seattle Technical Advisors. "At some point, no matter how fundamentally attractive an asset class is, there is just no one left to buy it."

Gold is selling off despite central banks in the U.S. and Japan creating massive amounts of money to inject in their respective economies. Lending in China is also ballooning.

Such stimulus had made gold attractive as an inflation hedge, but inflation has cooled or remained subdued recently. The latest decline in oil should contribute even more downward pressure on prices.

"Deflation is the keyword now, and all the talk of hyperinflation has gone out the window for now," Janice Dorn, a veteran gold trader, told IBD. "Until this changes, gold will continue to underperform."

China's March consumer prices rose 2.1% annually vs. 3.2% in the Lunar New Year month of February and 2% in January.

Industrial production in Q1 grew 9.5% annually, down from 10% in Q1 2012. Retail sales rose 12.4% vs. 14.3% a year ago, despite efforts to make the economy more reliant on consumption instead of investment.

While bank and non-bank credit more than doubled in March to a near-record high, real estate seems to be benefiting more than the real economy. Q1 property sales revenue leapt 61%.

Beijing has tried to stem real estate speculation, but the Chinese still have relatively few investment options, said Sung Won Sohn, an economist at California State University Channel Islands.

"There are too many vacant condos and office buildings," he said. "They surely have a real estate bubble."



Read More At Investor's Business Daily: http://news.investors.com/economy/0...ur-latest-gold-selloff.htm#ixzz2QZgTbKSH
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook

Why is gold crashing? Historically happens when the dollar gets stronger. I do not see a strong dollar. Economists please explain.

Thanks,
Geo

Note: I will still buy gold.

even though i confess ... I'm not selling any gold.

Geo...you might want to rephrase your question. Don't let the TW issue fluster yourself.

You're right. There are no fundamentals driving the dive. It's pure emotion (started by a move by Goldman Sachs designed to spark just this sort of reaction, which helps them in two ways, 1) by driving folks back into the stock market, and 2) permitting the financials to scoop up gold at bargain prices). Take advantage. Eventually, when emotions stabilize, the fundamentals will reassert themselves.

Laffin...folks are losing their asses right now based on that silliness.

All I know is that I'm gonna buy a bunch of gold just as soon as it gets back down to $300 an ounce again.

I'm still kicking myself for not doing it the last time.

Bob, I recommend you wait till gold reaches its very bottom, like $400.00. Don't be fooled when the dip slows at around $1200.00 and starts to reverse itself. Just a bump in the road. Wait till it reaches $400.00. And this is just for you. As for others at the Fire, buy now.

Stop it Bob

Let's see, gold has been THE standard of wealth since, well, the beginning of recorded history. I don't think it's going to become worthless overnight. This may be a "golden" oppportunity.

I've not been known as a gold bug, however, I'd rather carry a few pounds of gold as a few pounds of dollars at this point in time.

Guess it don't matter too much as you can't carry any of it with you!

My will specifies that my gold, silver, and guns, get buried with me.

============

Still laffin...just last week you didn't know the difference between inflation and deflation.

The US won't stop printing money for another 2 years. Combined with China's financial woes and the clear financial strength of the Dow,I can't imagine anyone having any confidence in your Schiff copy and pastes.

An addendum to your will... GPS numbers please

Bob, if you believe that, I've got some land in the Everglades I'd like to interest you in.

Wouldn't you like to know. It will remain secret.

Geo-caching? Common TRH, you can't take that stuff with you ... It may burn up

You mean by the fire of divine presence, right? That's supposed to burn up only the chaff, leaving the gold alone.

POP............

I often wondered why there are so many advertisements out there advising people to buy gold because it keeps going up. now I aint a genius, but I figger on 2 things,
A: if you know gold is going up, buy it rather then spend money on telling others to buy it. which bring me to....

B: if you have to spend money in order to get other folks to buy gold in order to make it valuable, is that a good idea?

granted there is an influx in the gold market and it's rising, so if it's sound why all the commercials? kinda makes me leary.

The number of ads advising people to buy gold and silver seemed about even with the number of ads advising people to sell their gold for cash. In fact, driving around near shopping centers you will usually see a man holding a sign near the main road advertising cash for gold for a shop inside the mall, but I don't ever recall seeing anyone holding a sign advertising gold for cash. Likely because none was necessary. In fact I once tried to buy some gold from one of those "cash for gold" shops and was told they don't sell, only buy. I told them I felt exactly the same way and left.

With your gold, silver, and gun holdings, it'll take a hole the size of a lime sink to bury you and all of it in.

Gold's Price-Plunge Is A Good Thing, As History Shows

By LAWRENCE KUDLOW
Posted 04/15/2013 06:42 PM ET


In the last two days gold has plunged so deep that it's being called the worst drop � at least in percentage terms � in 30 years.

That brings us back to the early Reagan period, when falling gold was regarded as a good thing.

Back then, lower gold showed inflation coming down after the horrible 1970s. It also showed confidence in the economy recovering and greater respect for the dollar.

Over the next two decades, in the '80s and '90s, gold basically dropped in round numbers from $800 an ounce all the way to $250. Stocks soared. So did jobs and the economy. It was one hell of a good period.

But markets have reacted a bit differently this time. On Monday, stocks fell over 200 points in tandem with gold's $150 drop.

Maybe it was tax-selling in the stock market. Or the constant rumor of Cyprus gold-selling to raise bailout cash.

But investors aren't happy. It doesn't look like the '80s and '90s. And I'm hearing the usual cacophony of impending catastrophe.

But I'm not buying it. I still think falling gold is a good thing. And whatever the short-term turbulence, a more subdued price for gold (and commodities) bodes well for the future economy.

There is no end-of-the-world scenario here, as there was after the financial meltdown.

Nor is there an end-of-the-U.S.-dollar scenario, as many investors fear, nor an end to euro. Nor is there any massive inflation scenario, supposedly from the Fed cranking up all those printing presses.

The reality is that all those Quantitative Easing reserves from the Fed never circulated through the economy. Most of them are on deposit at the central bank.

And because everyone is still risk-averse, the demand for cash is so high that the turnover, or velocity, of money keeps falling.

Last I looked, the M2 money measure was growing at less than 7%. And the Fed's favorite inflation target, the personal consumption deflator, was only 1.3% over the past 12 months.
The much-heralded printing-press/roaring-inflation episode hasn't happened � at least not yet.

The U.S. economy is growing slowly at 2% to 3%, but at least it's growth.

Profits have propelled stocks to all-time highs. Housing is gradually recovering. Jobs are erratic, but rising.

And even the dollar is up over the past year against the broad trade-weighted index of currencies.

It's not a Reagan recovery, nor is it a Clinton recovery.
But it's not the end of the world either. A friend of mine calls gold an end-of-the-world insurance contract. We don't need it. That's a big reason why gold is falling.

And here's a key point regarding gold and the dollar: Hat-tip to economist David Goldman for reminding us that the U.S. will become energy independent in the next 10 years. The fracking revolution for oil and gas has already put us well on that path.

Among its many benefits, in addition to growth and jobs, energy independence means U.S. oil imports from Saudi Arabia and elsewhere, which have already dropped substantially, will continue to fall more and more.

This could lead to a current-account trade surplus and a continuous rise in the exchange value of King Dollar.

Energy independence and a strong dollar are negative signs for gold. The peak in the yellow metal actually occurred at about $1,900 in August 2011.

It's been gradually moving lower since then. But this recent plunge is probably attributable to rumors that financially strapped Cyprus and Egypt will sell gold to raise cash. It is possible that Italy and Spain will join in. So no one knows where the current sell-off will end.

But economist Scott Grannis calls this the end of the second great gold rally. The first was in the 1970s, when Nixon unhinged the dollar from gold.

The second one began in 2001, with an over-easy Fed, and continued until recently.

There are plenty of challenges ahead, regarding all manner of money, fiscal and regulatory policies � entitlements, tax reform, Obama-Care, you name it.

But falling gold is a market signal that gives me some confidence that these are solvable problems, and that our economic and stock market story will turn out okay.

I think that's the real message of the gold sell-off. It's a good thing, not a bad one.

If only.

much ado about the big sell off this last week and it may indeed be the start of a bear market in gold


but according to charts, gold topped 1000 per oz. in 2008 and then proceeded to drop by 30% back down to around 700 per oz.


you can look and see what it did from there, it had passed it's all time high, and then dropped 30%

it wasn't over then, but perhaps it is this time


only time will tell. but you guys collectively have a lot more faith in the FED, and the big banking institutions than I can muster.

still shaking my head that I have an ounce left, but still shaking my head at how our deficits continue to rack up our debt and the amount of purchases the FED makes each month.

holy chit, 85 billion a month and you guys think everythings hunky dory with this economy. I wish I had that kind of faith in gov't and the very rich.

but my lying eyes tell me neither are very benevolent


luck to all

What effect would a global recession have?

Well said.

I figured eventually as long as the total collapse didn't come around and the economy kept struggling people would sell off for cash. Gold prices are going to be hyper sensetive for a while because a ton of people bought gold in the last few years that had never owned gold and a lot of people had a huge percentage of their wealth tied up in gold as well.

Gold: Where Are We Now?

Seeking Alpha
Apr 18 2013, 04:37

It's the question on everyone's minds. Whatever your view of the markets is will most likely determine your answer to the question in the title. Those bullish on gold (GLD), like me, will say that this is a gift from the powers that be and it represents one of the best buying opportunities you will ever see. If you are bearish, it will serve for you as a corroboration of your position, even if your reasons for being bearish were all wrong (and believe me I heard nearly every gold bearish theory in the first three months of this year).

Obviously the bulls were blind-sided by this move down. I am both not surprised and shocked by this turn of events. However, I remain circumspect of any bear who thought we would see this level of rout - or the size of the orders needed to accomplish it - in so short a period of time. That kind of volume can only hit a market to move price, regardless of the reason you may ascribe for wanting the price so moved.

The price was moved and it took an effort far in excess of anything many were expecting to pull it off. If the reports out of London of potential failure of the LBMA are correct, then it is very possible that the major central banks had to choose between that and a very disorderly gold and, by extension, commodities market. I note that two days after every gold bearish statement possible could be made in the press, St. Louis Fed president Bullard makes a statement about needing even more QE because of low inflation.

It is also possible that this article by Jeffrey Snider at Alhambra Investment Services holds some other clue as to what is going on. In it, he argues that in the past few years, gold's major moves have been strongly tied to massive changes in repo collateral liquidity and that gold is sold in response to a tight market.

"While central banks and politicians have proclaimed the Great Crisis as a relic of the past, there is an element to all this "liquidity" coming from central banks that acts in a counterproductive fashion. We saw this with QE 2, and the Federal Reserve itself has studied liquidity under these large scale asset purchases (such as QE) and determined that QEs actually disrupt collateral chains. The bigger the QE, the less liquid the financial system grows because QE essentially removes usable collateral from the aggregate collateral pool.

The Bank of Japan and the Federal Reserve have been embarking upon the largest combined QE ever conceived - there has to be a drain on effective collateral liquidity at some point. We saw an atypical shortage of 10-year U.S. Treasuries for repo just last month. It is very possible, and in my opinion likely, that QE is again wreaking havoc on collateral systems across the globe. If that is the case, then the collapse in gold prices both indicates this illiquid stance and portends something worse developing down the road."

If Mr. Snider is correct, then we are both on the verge of a very serious credit event, as gold repos have pushed the price down to extreme levels and, more importantly, that when that crisis event is responded to by the central banks to alleviate it, gold will begin moving higher to match the amount of money printed and the repos unwound. In the meantime, there will be extreme levels of volatility. Now, the big question is what is driving this sudden drying up of repo collateral?

Is it the massive QE of the Fed and the Bank of Japan? Or is it the rise of the Petro-Yuan (CYB) which has risen steadily - now �6.178 - since the announcement of a bilateral oil deal between China and Russia was announced? Let's not forget the timing of the announcement by China and Australia to trade directly in the Yuan and the Aussie, either. I note that Australian bond yields have dropped strongly since the commodity markets began rolling over with subsequent selling of the Australian Dollar (FXA). The 7-year yields - which are a comfortable term to look at as it is not being targeted by either the Fed or the BoJ - have dropped 10.7% from since March 23rd to 3.057%. This nicely explains the lack of follow through by the Aussie through $1.06.

Note also that the Yuan, Malaysian Ringgit, Thai Baht and Singapore dollar (FXSG) are all trading lower as the ASEAN region continues to divest itself of the U.S. dollar. Thai and Malaysian debt has also been rising in price during all of this as well.

But, but back to gold.

I am not big on traditional technical indicators anymore for making trading decisions but I still believe that the 144 and 288 period exponential moving average have more significance than other more commonly used ones like the 50 and 200. See the current weekly chart of gold below. The 144 was the important breakdown level, coinciding with the strong support band near $1525. The two-day plunge took us to the extreme in price and very close to the 288 EMA.



(click to enlarge)

Does this mean the selling is over? No, but in extreme - and fragile - situations like this, my experience tells me that the 288 period EMA is a support level far more reliable than looking back at a low price from 2 years ago. The amount of damage done to the structure of this market has a low probability of being unwound in a few days. Whatever caused the massive short selling to occur it is obvious now, two days later that there will not be a quick rally in response. The repeated intra-day selling near $1400 this week again tells me, that like $1620 a few weeks ago, there is an important supply level that must not be breached to keep momentum-based bulls out of the market.

Physical demand has gone ballistic- which makes sense- and the CME group raising margins after the crash on both gold and silver (SLV) means that the COMEX has moved closer again to being a cash market than it has been in years. With the amount of physical off-take happening around the world and on the COMEX, I would expect margins to continue to rise and cash settlement to take over at some point if prices remain in this range for any length of time.


(click to enlarge)


A 25-year chart of gold, monthly candlesticks. The annotations show
the important points that need to be compared with the action in silver.



(click to enlarge)

A 25-year chart of silver, monthly candlesticks. Here we have detailed the divergences at the long-term lows, as well as the more recent ones.

As an aside to the above, gold stocks too have produced such divergences with the metals, both at the long-term lows of 1999-2000 and the highs of 2011. One cannot simply dismiss these technical warning signs out of hand at this point.



(click to enlarge)

Gold, June contract daily -- trading volume hit an all-time high on Monday

LINK

well, hard to say what all the wheelers, dealers, and tinfoil hatters will do - let alone the EU, Russian mafia, and the "lords of high finance".

But if it hits $800 an ounce I might buy some $20 gold pieces. They are pretty. Doubt they will ever become worthless.

We haven't had a better buying opportunity since February 2011.

The days of $800.00 per ounce gold are long gone, my friend.

Somehow I think that this ^^ post might be brought up to haunt you.

When I typed it I knew a bunch of folks here would be thinking precisely that. We'll see.

Well , just looking at the charts , and the charts of every other bubble I'd say the smart investors are already out the door and complete gold price collapse is coming sooner rather than later. The slow decline is the smart guys getting out , the current big drop is the not brain dead getting out and the total morons will sit around waiting for the apocalypse to drive gold back up. Of course it will be their own personal financial apocalypse so that part will come true for them.

Bump

I still don't feel like a chump for having picked up some gold at $1,340.00 an ounce.

How Low Can Gold Go?

George Kesarios
Apr 19 2013, 16:39

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...)

Before I continue let me bypass all the conspiracy theories about gold (to which I do not subscribe) and let me also put aside the controversial issue of if gold (GLD) and silver (SLV) are money or not. In today's article I will concentrate on just one thing and that is, what might the price of gold be, based on the cost of production. Also, how low can gold possibly go, assuming maximum downside bearish market pressure.

Generally, the price of any mineral or precious metal is a function of the cost to get it out of the ground plus a markup for the nice people doing all the hard work (the mining company). If gold corrects below the cost of production, then miners will not make any money. And when miners don't make money -- because they cannot cover their cost -- they stop mining and production falls. And when production falls to such an extent that demand outstrips supply, then prices will go up again and the miners will once again start production.

So in a sense, the absolute bottom for gold is the level required for miners to bring it out of the ground. If gold were to trade below that level, production would stop. So one question is, what does it cost to get gold out of the ground?

Taking a cue from a recent article written by fellow SA contributor Hebba Investments -- and if his numbers are accurate -- the true cost to produce an ounce of gold (excluding write-downs) was $1287 for 2012. However, he also states that the true cost to mine gold is actually less than $1287. In most cases the true cash cost is under $1000 an ounce for most miners.

On the other hand, the CEO of Barrick in a note to shareholders, said that:

In 2011, the company performed well against this strategy. Barrick met its operating guidance for the ninth consecutive year, producing 7.7 million ounces of gold at total cash costs of $460 per ounce, positioning Barrick as one of the lowest-cost senior gold producers. (emphasis added)

So we are getting some very conflicting numbers here. And while I have no reason to doubt the CEO of Barrick, if Barrick's cash cost of gold production is that low, why has Barrick's stock returned to 1990 levels and the other big miners such as Newmont (NEM), AngloGold (AU), Gold Fields (GFI) and Harmony Gold (HMY) have retreated to 2003 levels?

In any case, for the purpose of this article I will use the data from Hebba Investments. Having said that, I will use the $1000 mark as the absolute minimum gold must trade for, in order for most miners to be in business and for the world to have a steady supply of gold.

The next question is, can gold fall below the cost of production? Absolutely. Gold as well as silver can under certain conditions trade below the cost of production. It happened more than a decade ago. In fact silver was trading below the cost of production for many years and was only produced as a byproduct of other mining activities.

But prices cannot fall below the cost of production for long. It can happen for a few months, but it's not something that can last for a very long time.

So assuming maximum bearish pressure by market forces, I would have to say that the worst case scenario for the price of gold is in the $1000 mark.

But there is another question that needs to be answered. Can the cost of production fall, whereby we will then need to establish an even lower absolute rock bottom baseline for gold -- even below the $1000 mark -- assuming production costs fall?

The answer is also yes. In fact, I think the cost of production will probably fall over the next several years, for the same reason that production costs skyrocketed over the past decade.

When gold prices started rising in 2003 -- after a two decade siesta -- there were no mining engineers to be found. All of a sudden companies were in desperate need for mining engineers, because the old timers were retiring and colleges and universities didn't have mining curriculums, because there was no demand.

The same thing applies to many companies that provided products and services to mining companies. Many companies did not invest in their business because they could barely make any money due to low demand.

Then all of a sudden it caught everyone off guard. There was tremendous need for everything in the mining space and the pent-up demand increased prices for these products and services much more than anyone imagined.

As long as the price of gold was going up, more and more mining companies were forming and getting in on the act to produce gold and more and more products and services were needed.

Now if and when gold prices will retreat (and we have indications of such as of late), then the need for these products and services will be lower and I think the cost of mining will start falling.

Of course for this to happen, we need to see the price of gold falling over the long term. Currently we only have indications that this might happen and we do not yet have an established trend.

Bottom line

Assuming the data from fellow SA contributor Hebba Investments is correct, then the worst-case scenario for the price of spot gold -- assuming maximum bearish market sentiment -- is probably in the $1000 range, for a maximum period of several months.

However, lower gold prices over the long term might also lower the cost of production. If this is confirmed, then the absolute rock bottom price for gold might even be less than the $1000 mark.

I'm in agreement with Daveinjax...chart wise gold is a popped bubble. Will continue to move lower over the long term.That being said, the FED, monetary policy,and ignorance in general all add up to gold being higher. I don't have a crystal ball, but I'm going with the chart until the downtrend is broken/exhausted.

I'm more into actual physicals on hand anyway...lead and powder. Paper gold in an ETF will be worth less than TP if something big happens anyway. Guy has to have it in possession, IMO

Don't worry,when hawkeye said he bought gold at the fire sale a few days back, most knew not to buy.

I feel sorry for the ones who thought he called it.

I'm going to save this post for posterity. We'll all have a good laugh at it a year from now.

PS For the record, "a few days back" was Monday, April 15th, 2013.

Oh,don't you worry. As you know,a good many have already saved some of your posts for posterity sakes.

It should settle the question for those couple of folks who thought you might have been making sense.

A year from today, then. We'll see.

Do You Believe In The 12 Rules Of Goldbuggery?

Seeking Alpha
Apr 21 2013, 01:32

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

An investing mantra many equity investors live by is to "buy on the dip." It appears the same is true in the world of physical gold. As investors in gold futures and ETFs such as GLD and IAU seem to be tripping over themselves to get out of gold, demand for tangible gold is skyrocketing. A Reuters article from Friday morning highlights the rush across Asia to buy physical gold. In the United States, the Mint has already sold 153,000 ounces of gold coins in April, more than the combined totals from February and March. In fact, in the midst of the gold price collapse, on April 17, the United States Mint sold 63,000 ounces of gold. That one day total, by itself, eclipsed the 62,000 ounces of gold sold by the Mint in March.

In terms of silver, retail demand has also been quite remarkable, despite the breathtaking drop in price. If you want to purchase 1 ounce Silver American Eagles from APMEX (American Precious Metals Exchange), you'll have to wait a while or pay a hefty premium. Most of the years for which the 1 ounce Silver American Eagle exists are sold out. And for those years that are not sold out, you will pay premiums in excess of 25%. A 2007 Silver American Eagle, for example, has premiums as high as $8.49 over spot. That is a 36.55% markup based on the current silver price of $23.23. While there are other dealers offering prices a bit lower (the $28 per ounce region), the markups, on a percentage basis, are still quite steep.

I know there are those who get their physical gold exposure through GLD, IAU, or other exchange-traded products. In the world of silver, I know some investors buy SLV or SIVR for physical silver exposure. What the current spike in demand in the face of falling prices tells me is that the group of investors who believe you don't own physical gold and silver until you can hold it in your hand is alive and well. Instead of breaking the spirit of precious metals enthusiasts, the recent price drop seems to be viewed as a buying opportunity. I guess someone forget to send these people a copy of Barry Ritholtz's "The Rules of Goldbuggery."

You may recognize Ritholtz's name from his appearances on CNBC and Bloomberg. If you would like to read a copy of his lengthy curriculum vitae, you can do so here. While I don't consider myself a gold bug, gold is one holding in my diversified portfolio. As a gold owner, I would like to take this opportunity to address Ritholtz's 12 rules of "Goldbuggery" from the perspective of one investor (myself) who is neither obsessed with gold nor full of the hatred toward gold that some seem to possess.

Ritholtz's twelve rules are in italics, followed by my comments:

1. Gold is a currency - In his comments supporting rule number one, Ritholtz says, "[Gold] is a permanent store of value." It appears to me that Ritholtz believes people who own gold view it both as a currency and as a store of value. That is not necessarily true. I, for example, do not own gold because I view it as an easy to use medium of exchange or because I want it to become the world's future medium of exchange. Instead, I view it solely as a store of value.

2. The price of gold cannot fall, it can only be manipulated lower - I recognize that the price of gold can both fall and be manipulated lower. Whether one or the other is happening at any given time is irrelevant to me. The price is what the price is. As I explained in "Gold's Epic Plunge Should Cause Reflection On Why You Own It," I find it important to have an appropriate balance of how much in precious metals I own relative to my entire portfolio. If you truly own gold as a store of value and you manage your liquidity in a way that does not require you to sell it, then the recent plunge in price should have no negative consequences for you. In fact, in the aforementioned article, I noted one positive that results from the recent declines: "My cash flow will improve as my storage costs, which represent a percentage of the total value of my precious metals holdings, will now decline."

3. If the price of gold is rising, it is doing so despite enormous and desperate efforts by manipulators to prevent the rise - See my comments in number two.

4. The world MUST return to the Gold Standard one day - I own both gold and silver, and I would much rather see a fiat currency system that was managed in a way in which I would feel as if I could own the fiat currency as a store of value rather than owning precious metals as stores of value. Unfortunately, such a system does not yet exist.

5. Central Bankers are printing money relentlessly, and this can only drive Gold prices higher - I disagree. If the massive amount of money being printed was actually getting into the hands of the majority of the world's citizens, rather than just into the hands of the financial sector and investors, I would venture to guess that gold's price would be heading much higher from here. Until everyday people start to get their hands on the trillions in fiat currency being electronically printed, then gold will likely fall in and out of favor with institutional investors (who have more influence on the price than do retail investors), as those institutional investors continually change their minds about whether high inflation is a near-term risk.

6. Gold works whether the economy is good or bad - In his comments supporting this rule, Ritholtz had this to say: "When we have a red hot economy, Gold is your hedge against inflation. When we have a bad economy, Gold is a safe harbor against collapse. It is a one way trade that never fails!" If you come across gold investors who think in that way, they have likely learned the tricks of the trade from equity investors. The die-hard, buy-and-hold-stocks-forever investors, more than any type of investor I have ever come across, are fabulous at playing the "good news is good news" and "bad news is good news" game. When I read Ritholtz's comments for rule number six, it immediately reminded me of the comments we often hear from equity bulls regarding oil prices: If oil prices are declining, it is a tailwind for the consumer and good for stocks. If oil prices are rising, it is indicative of a strong economy and good for stocks. From my point of view, gold is a store of value. Whether the economy is good or bad, I don't care how gold's fiat currency price performs.

7. Gold will survive after the world economy crumbles - In the comments that followed this rule, Ritholtz again poked fun at gold investors. I remain open to the possibility that should the current monetary system collapse, gold will, for some reason, not be convertible into whatever new fiat currency system comes into existence. There are risks to every investment one makes. Regarding that risk to gold, I have carefully considered it and decided the likelihood of that occurring is not enough to cause me to sell my gold.

8. Never admit that Gold is essentially a sucker's bet - To support rule number eight, Ritholtz said, "Never discuss how in the last century, gold has run up only be to trounced in repeated massive sell offs (always blame rule #2 for this). Do not discuss how this has happened in 1915-20, 1941, 1947, 1951-66, 1974-76 1981, 1983-85, 1987-2000 and 2008." His focus on gold's price performance over the decades tells me he does not view gold as a store of value, but rather as a financial asset that must generate a sufficient return in fiat currency terms. Owning something as a store of value has nothing to do with betting.

9. Gold is a rejection of government, and [its] control of fiat money and finance - In my opinion, gold is not a rejection of government and its control of fiat money. Instead, gold is a form of protection against the possibility that those who control the money supply mismanage their important responsibility.

10. All Gold discussions must contain ominous macro forecasts - Ritholtz supports this rule with the following comment: "Your description of why Gold is going higher must consist of spurious correlations, unprovable predictions, and a guarded expectation of bad things in the future." In a way, with just a few modifications, his comment reminds me of what some would claim equity analysts do (questionable correlations, unprovable predictions, and an eternally optimistic view of the future). I am a gold owner who prefers to remain neither hopelessly optimistic nor consistently pessimistic. Instead, I strive to be realistic.

11. Gold is always rallying in one currency or another - Who actually believes this?

12. China & India know the value of Gold; the Western world does not - Perhaps that is largely true. Although judging by the recent demand at the U.S. Mint and APMEX, it appears that some people in the West share China's and India's views on gold.

As a result of the recent price declines in gold and silver, they have become a very hot topic in the financial media. If you are someone considering a purchase of precious metals, be careful of the big premiums in silver. Additionally, remain aware that some commentaries (such as Ritholtz's) are seemingly more intent on capturing attention and arousing emotions than on helping you become a better investor.

Additional disclosure: I am long gold and silver

There is a clear disconnect since last Monday between physical gold/silver and the paper stuff hocked by the financial houses. Like I said when all this was going on, there was no shortage of buyers during the price dip. Problem, in fact, was a shortage of physical supply for them to buy. Oh, there was plenty of the paper gold and silver available, but that's because they can print those up at will, which was the cause of the dip to start with, and intentionally so, i.e., it was an engineered dip designed to get the weak-kneed to sell their physical at bargain basement prices to the financial houses. The smart money was buying.

Are youlanning on taking any positions in stocks mentioned AFTER 72 hours?

Are you buying gold at these prices, if I may ask.

Are you expecting a severe stock market downturn any time soon.

Thanks for a great post.

eyeball, I think you are asking me this question, (maybe not.) The article was written by a contributor to Seeking Alpha. Click on the underlined link and you can read his background and intentions.

Ok

Here's my take on some of Ritholtz's rules.

Value is a concept not found in nature apart from humans. There is no definition of value apart from a market, and thus, everything derives its value from the market where it's traded. Gold is just another commodity and not a particularly useful one, which is why Native North Americans had little use for the stuff.

Ritholtz doesn't understand the concept of value and markets, or at least pretends not to understand. Yes, there are ways of manipulating markets, but only on a temporary basis. A large amount of gold being offered for sale is not market manipulation, its supply and as long as that supply exceeds demand the price will fall.

Highly unlikely, but if that came to pass the first step would be to force all private holders to sell their gold to the government at a price the government would set. This has happened in the U.S. and it's an absolute requirement for going back to any commodity standard.

Those who think they will get rich by holding gold in hopes of the world returning to a gold standard are living a pipe dream. Get caught trying to keep and then sell gold after the gold standard is established and you'll be spending long years behind bars as an example to others. If you think we have big government now just wait until you have to get a government permit to keep any gold dental work you have.

Fiat money is not a commodity, it's an idea not subject to the normal rules of supply and demand. Central banks don't print money, at least not that much of it. Most of the money is created without any physical form from thin air just by entering numbers on a computer. What comes from thin air can just as easily go back into thin air. When the time comes Central Bankers will evaporate a lot of the excess money on their books through complex manipulations that would result in prison time for any private party.

Of course this is nonsense from someone who thinks gold is money and a store of value apart from the market. In a good economy investors sell gold because they can make more gains in stocks. In bad economies the price of all commodities falls. The period from 2008 to now is the exception with fear driving up demand for gold, and thus, its price. Fear is a form of market manipulation and it can only work for a while.

Yes, the gold will still exist, but so will any commodity. Assuming there's any kind of market the value of any commodity depends of on supply and demand. Likely food, clothing, fuel, medicine, tools, equipment, guns, ammo, and spare parts will be in much higher demand than gold, which is relatively useless to people in such a scenario. Likely the U.S. will declare emergency powers and impose price controls and rationing just as they did in WW2. With no competition from foreign goods and labor the domestic economy could go from bad to boom in short order. The collapse would have the benefit of ridding us of foreign debt.

These are all part of the market manipulation surrounding gold. In time, as the fear of economic collapse fades the price of gold will fall back to its historic relationship with other commodities such as platinum.

http://www.reuters.com/article/2013/04/17/us-gold-coins-idUSBRE93G15Z20130417

"U.S. gold coin sales surge after historic sell-off."

Is it the sucker rally, or the sharp guys, is the question.

Three points.

1) There is only one gold market. There is not a paper gold market and a physical gold market. If there were two separate gold markets then the price of physical gold wouldn't have dropped to under $1,400 per ounce on April 15th and people wouldn't be buying all these coins.

2) Gold prices are set by supply and demand and being the price of gold is still down around $1,435 this morning, the buying of physical gold this past week has been small compared to the amount that was sold off last Monday.

3) Where gold prices go from here depends on where the stock market goes. Did the 4 month rally end last week, or just pause for profit taking? Anyone who can answer that question can make a lot more money in stocks than in gold.

Patience, my friends--Patience.

Wait, you mean. Wait for what?

Jim Rogers: This is when I'll buy more gold

The Daily Crux
Thursday, April 25, 2013


From Bloomberg:

Jim Rogers, who predicted a commodity rally in 1999, said he may buy gold if a bear market deepens and prices fall to $1,300 an ounce or below.

Bullion for immediate delivery tumbled to $1,321.95 on April 16, the lowest since January 2011, stoking a frenzy among coin and jewelry buyers from the U.S. to India and Australia. Rogers, the chairman of Singapore-based Rogers Holdings, hasn't bought any bullion after the slump, he said in an interview.

"If it goes to $1,300, I hope I am smart enough to buy some," he said in Singapore. "If it goes lower to $1,200, I hope to buy even more. If... that's not a prediction."

Bullion lost 14 percent in 2013 as investors including the University of Texas Investment Management Co., the third-largest U.S. academic endowment, sold the metal after a 12-year rally. Gold coin sales by the U.S. Mint are heading for the highest since December 2009 as buyers took advantage of the worst two- day slump in three decades on New York futures.

"Gold was acting very unusually for the last 12 years and was overdue for a decline," Rogers said in a separate interview on Bloomberg India TV. "Gold will make a proper bottom before resuming the bull market."

Paulson's Bet

Morgan Stanley said this week the peak in the price "has now passed," while Goldman Sachs Group Inc. said April 23 it exited a bet on lower prices while saying bullion may fall even more. The declines in prices are attracting retail investors, while billionaire John Paulson has stuck with his view that the metal will climb as a hedge against inflation.

Spot gold traded 1.2 percent higher at $1,448.44 an ounce at 6:39 p.m. in Singapore. Prices are 7.2 percent below the April 11 close of $1,561.45 an ounce that preceded a 14 percent slump in two sessions through April 15, the worst since 1983.

Demand for gold in India, the biggest consumer, is double the level for this time of year, said Rajesh Mehta, chairman of Bangalore-based Rajesh Exports Ltd (RJEX)., the nation's largest exporter of gold jewelry and a retailer. Nationwide daily sales of jewelry, coins and bars may be about 4 metric tons, compared with normal levels of about 2 tons to 2.5 tons, he said today.

"The rush is reasonably good," said Mehta. "Last week was unprecedented. The frenzy seen last week is not there but volumes are good and almost similar to last week."

India Premium

UBS AG said April 23 that physical-gold flows to India, the world's biggest importer, approached the highest since 2008, while Standard Chartered Plc said shipments last week were 20 percent above a previous record.

The surge in demand is forcing jewelers to pay a premium of as much as $10 an ounce for immediate delivery, compared with $1 an ounce to $1.5 before the price slump, said Mehta. The precious metal may drop to $1,370 within three months if funds continue to exit gold-backed securities, he said.

Holdings in the SPDR Gold Trust (GDTRGOLD), the biggest bullion-backed exchange-traded product, are set for the largest monthly decline since trading began in 2004. Russia and Kazakhstan expanded reserves for a sixth month in March, International Monetary Fund data show.

The strength of the US dollar is surprising people. That has a lot to do with falling gold prices.
That decreases speculation.

China and India are traditionally big investors in the world gold market, and their economies are slowing.

We're now, not even a year later, above the point where I recommended buying last April. I imagine an apology is forthcoming.

Good thing I saved this post for posterity. Gold just hit $1370.00 amidst a solid upward trend starting in December.

When you can take a chunk of gold, put it in a safe, and it makes little baby gold pieces every 3 months without you doing a thing, then I'd be interested in it.

Calvin would that be gold porn?


sheesh! (grin)

Money's purpose is (among other things) to be a safe store of value over time. Gold and silver (i.e., real money) do what they're supposed to do.

Rumors of an investigation concerning banks fixing gold prices etc. Russia might try to kill US dollar etc... Who knows; this might be the year for Gold to reveal its real value in relation to US fiat. Time is on the gold-bug's side. It always has been.

And...

Once the flim flam banksters buy up the stuff at discount and then put all their unholy weight on manipulating gold UP... all bets are off. Breaking through 2000 is not unreasonable at that point. Easy.

They manipulated it down via naked shorts... they will find a way to make it go way up again.

that certainly seems a plausible scenario.

guess we'll see, time takes care of all predictions.

If you are sure about that, then you'd better be selling the house to buy gold.

lol, I'm not "sure" about anything


last Presidential election confirmed that


Bob said it was a lock pick, and i've never know Bob to be wrong on his prognostications!

me I like diversification, little bit of this, little bit of that, heck I even like having a roof over my head!

http://www.kitco.com/charts/livegold.html

Just spiked upwards to 1382 this morning

Great conductor of electricity. In fact lots of those test strips for diabetes have small amounts of gold in them. miles

I suspect that it could be utilized to make a passable cast bullet in a pinch?

Absolutely!

Gold has a specific gravity of 19.3, lead is just 11.4, so gold bullets will be great penetrators unless you buy a smaller bullet mold to make your (heavy,gold) bullets. This is the 'Fire, and "over penetration" is often mentioned!

However, your melting pot had better be able to reach 948F (1065C) if you are going to make gold bullets.

John

Well [bleep]; that just goes to show you how much I know or care about gold. I guess that means I will have no particular use for metal when the US melt down occurs.

I'll take a guess - Because it was overvalued......and in my opinion it still is. Somewhere in the $7-800 per ounce range is were it should be. If we have another stock scare people will over pay again but in the end the brokers will make money on the purchase and the sale and be the only real winners.

[bleep] me! GOLD IS CRASHING!!

Imagine that!!

The sky is falling!!

Gold crashed? Was there a fire?

I'm still waiting for Bob to eat his crow.

Hawk, you just went above break even for the past year. I made 30% in the stock market over the same period, yet you seem happier than I am?

The only conclusion I can draw is that money doesn't make you happy, but gold does....

I identified a point in the dip when it would be wise to begin buying gold, i.e., there and lower. The key word is begin. Those who've been buying at key dip points since last April 15th, through the spring, through the summer, through the fall, and through the winter, are pretty happy right now.

The course of events also demonstrates that Bob was all wet when he suggested that a buy recommendation starting in April of last year was inadvisable. Well, he didn't phrase it quite as politely as that, but you get my meaning. I was right and he was wrong, but he won't admit it. He won't step foot anywhere near this thread.

Good thing I saved this post for posterity. Gold just hit $1382.00 amidst a solid upward trend starting in December.

Here's what I said last April:

"There are no fundamentals driving the dive. It's pure emotion ... Take advantage. Eventually, when emotions stabilize, the fundamentals will reassert themselves."

"Sanctions could lead to retaliatory action, and that would trigger a spiral with unforeseeable consequences," warns China's envoy to Germany adding that "we don't see any point in sanctions." On the heels of Merkel's warning that Russia risked "massive" political and economic damage if it did not change course, Reuters reports ambassador Shi Mingde urged patience saying "the door is still open" for diplomacy (though we suspect it is not) ahead of this weekend's referendum. Russia's Deputy Economy Minister Alexei Likhachev responded by promising "symmetrical" sanctions by Moscow. So now we have China joining the fray more aggressively.

Via Reuters,


China's top envoy to Germany has warned the West against punishing Russia with sanctions for its intervention in Ukraine, saying such measures could lead to a dangerous chain reaction that would be difficult to control. In an interview with Reuters days before the European Union is threatening to impose its first sanctions on Russia since the Cold War, ambassador Shi Mingde issued the strongest warning against such measures by any top Chinese official to date.



"We don't see any point in sanctions," Shi said. "Sanctions could lead to retaliatory action, and that would trigger a spiral with unforeseeable consequences. We don't want this."



...



Using her [Merkel's] toughest rhetoric since the crisis began, she warned in a speech in parliament on Thursday that Russia risked "massive" political and economic damage if it did not change course in the coming days.



Russia's Deputy Economy Minister Alexei Likhachev responded by promising "symmetrical" sanctions by Moscow. But Shi urged patience, saying the door for talks should remain open even after a referendum on Sunday in which Ukraine's southern region of Crimea could vote to secede and join Russia. Merkel and other western leaders have denounced the referendum as illegal and demanded that it be canceled.

The way I see it last years take down was pure manipulation in London and New York. Once China teams up with Russia and decides to "punish" the dollar gold is going to explode to the upside.

I have been wrong before...

Alright I went and did it. Swapped $100k in equities for gold. We shall see.

http://kingworldnews.com/kingworldn..._To_Sue_Banks_For_Gold_Manipulation.html

Gold manipulation investigations getting serious. I tend to believe it. Gold is going to 2200??? I kinda think so.

==========
Yeah, good thing. Stick to the recipes section,screwball. You won't embarrass yourself as frequently as you do here.

I once saw a blind man walk between two speeding trains without being killed.

There is no accounting for dumb luck.

However, we're still waiting for the Negro revolt and the Fluoride wars to begin.

In his case there was.

========

TFF.

Gold is crashing because it was a bubble based on people's fears of the dollar crashing. Nothing more, nothing less. Now that people are gaining faith in the dollar, gold is sliding.