Kauri
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lol, wasnt it also GS who have been shorting gold since like $800
I have no idea.. if they were it was probably because they were decoupling..
Cheers
...........Kauri
Gold Price - Where is it heading?
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I have no idea.. if they were it was probably because they were decoupling..
Cheers
...........Kauri
Sean K
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I wonder if we'll ever see a $100 a day jump?
Or fall....
Is there a current limit on how much the central banks can sell? Not sure of what the policy is at the moment?
Or fall....
Is there a current limit on how much the central banks can sell? Not sure of what the policy is at the moment?
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I have no idea.. if they were it was probably because they were decoupling..
Cheers
...........Kauri
The Fed is GS
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All this makes for nail biting investing.
On another note IB and have issued a statement http://www.interactivebrokers.com/download/IB08-102.pdf
I wonder if they are about to go bust?
On another note IB and have issued a statement http://www.interactivebrokers.com/download/IB08-102.pdf
I wonder if they are about to go bust?
GreatPig
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Some thoughts on the releationship between gold and oil quantified that may be of interest to some of you from Ian Wyatt,Chief Equity Strategist,Top Stock Insights
Cheers
BT
Gold and Oil Move in Tandem
As you may have figured out already, the price of gold bullion and crude oil are highly correlated. Over the past 60 years, one ounce of gold has on average purchased 15.2 barrels of oil. With gold trading at around $1,000 per ounce and crude oil trading at $106, this ratio today stands at 9.4:1 as of this writing.
Even if you're not an oil person, you know that oil is on the rise. Now, the price of oil continues to break all-time highs. While some have stated that oil may not continue to trade over $100 indefinitely, its unlikely to retreat much below $80 anytime soon, especially when looking at the huge demand coming out of the booming Asian economies including China and India combined with supply issues.
The price of gold has not been sitting out the commodity rally through. It's up 32% so far in 2008. In spite of gold's recent gains, the ratio remains out of whack.
The idea here is that with oil unlikely to decline below $80 anytime soon, the price of gold is likely to rally in the coming years - and in a big way. Historical data shows that when the ratio falls below 11 (meaning one ounce of gold will buy you 11 barrels of oil), the ratio not only will come back in line with the average, but that speculation drives the ratio above the historical average of 15.2, as has been evidenced every time that the ratio fell below 11.
One could argue that we now live in different times with the global commodity markets, and ratios such as gold-to-oil are no longer meaningful.
I disagree and am willing to bet that commodity prices are in fact highly correlated, and that historical relationships between prices are likely to remain intact for the foreseeable future.
Cheers
BT
Gold and Oil Move in Tandem
As you may have figured out already, the price of gold bullion and crude oil are highly correlated. Over the past 60 years, one ounce of gold has on average purchased 15.2 barrels of oil. With gold trading at around $1,000 per ounce and crude oil trading at $106, this ratio today stands at 9.4:1 as of this writing.
Even if you're not an oil person, you know that oil is on the rise. Now, the price of oil continues to break all-time highs. While some have stated that oil may not continue to trade over $100 indefinitely, its unlikely to retreat much below $80 anytime soon, especially when looking at the huge demand coming out of the booming Asian economies including China and India combined with supply issues.
The price of gold has not been sitting out the commodity rally through. It's up 32% so far in 2008. In spite of gold's recent gains, the ratio remains out of whack.
The idea here is that with oil unlikely to decline below $80 anytime soon, the price of gold is likely to rally in the coming years - and in a big way. Historical data shows that when the ratio falls below 11 (meaning one ounce of gold will buy you 11 barrels of oil), the ratio not only will come back in line with the average, but that speculation drives the ratio above the historical average of 15.2, as has been evidenced every time that the ratio fell below 11.
One could argue that we now live in different times with the global commodity markets, and ratios such as gold-to-oil are no longer meaningful.
I disagree and am willing to bet that commodity prices are in fact highly correlated, and that historical relationships between prices are likely to remain intact for the foreseeable future.
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So, GP, what implications can we draw from the piercing the top of the channel - a potential retrace?
Nyden
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How can anyone claim that holding physical gold protects you against world wide economic meltdown?
Surely in such a case - the masses would be looking for food, & energy; & not a useless shiny metal?
In such an instance; there would be the possibility for war, gold confiscation / mandatory selling ... so many unknowns, one would be dreaming to assume they'd be safe in such a case.
Actual demand; as in jewelry, & probably even the use in electronics, has slumped dramatically ... & the POG is based entirely on speculation (which is apparently labelled as not hot money ... yet we see 4% rallies in single days)
I don't believe the masses would ever go for gold on a whole; as it simply serves very little purpose? Gold has a very limited use, & can essentially be substituted in most cases.
I guess my point here, is rather that of a question - why does the price of gold need to increase? Why, psychologically ; do we see gold as something precious? What makes a shiny metal ... more valuable than a piece of "worthless" paper? Both have the same purpose; to exchange for goods, services, food, & land. Currency, & the accumulation of currency has zero purpose if not to be used this way.
& Another thing; does not gold face the same risks any other currency does? A government can inject more money into the system; therefore diluting the value. A gold mining company can discover a new mass amount of gold; therefore injecting more gold into the system ... (of course, what with population growth ...)
Surely in such a case - the masses would be looking for food, & energy; & not a useless shiny metal?
In such an instance; there would be the possibility for war, gold confiscation / mandatory selling ... so many unknowns, one would be dreaming to assume they'd be safe in such a case.
Actual demand; as in jewelry, & probably even the use in electronics, has slumped dramatically ... & the POG is based entirely on speculation (which is apparently labelled as not hot money ... yet we see 4% rallies in single days)
I don't believe the masses would ever go for gold on a whole; as it simply serves very little purpose? Gold has a very limited use, & can essentially be substituted in most cases.
I guess my point here, is rather that of a question - why does the price of gold need to increase? Why, psychologically ; do we see gold as something precious? What makes a shiny metal ... more valuable than a piece of "worthless" paper? Both have the same purpose; to exchange for goods, services, food, & land. Currency, & the accumulation of currency has zero purpose if not to be used this way.
& Another thing; does not gold face the same risks any other currency does? A government can inject more money into the system; therefore diluting the value. A gold mining company can discover a new mass amount of gold; therefore injecting more gold into the system ... (of course, what with population growth ...)
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How can anyone claim that holding physical gold protects you against world wide economic meltdown?
Surely in such a case - the masses would be looking for food, & energy; & not a useless shiny metal?
In such an instance; there would be the possibility for war, gold confiscation / mandatory selling ... so many unknowns, one would be dreaming to assume they'd be safe in such a case.
Actual demand; as in jewelry, & probably even the use in electronics, has slumped dramatically ... & the POG is based entirely on speculation (which is apparently labelled as not hot money ... yet we see 4% rallies in single days)
I don't believe the masses would ever go for gold on a whole; as it simply serves very little purpose? Gold has a very limited use, & can essentially be substituted in most cases.
I guess my point here, is rather that of a question - why does the price of gold need to increase? Why, psychologically ; do we see gold as something precious? What makes a shiny metal ... more valuable than a piece of "worthless" paper? Both have the same purpose; to exchange for goods, services, food, & land. Currency, & the accumulation of currency has zero purpose if not to be used this way.
& Another thing; does not gold face the same risks any other currency does? A government can inject more money into the system; therefore diluting the value. A gold mining company can discover a new mass amount of gold; therefore injecting more gold into the system ... (of course, what with population growth ...)
This is just my view. Gold is a very inert metal and relatively rare. Hence it is a good store of value. How much food can you eat in a day? How much energy can you use in a day? You probably won't be able to consume all that you can buy or own with your cash in a short period of time. This is perhaps where the gold as a store of value comes into play?
My 2cents worth.
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I have no idea.. if they were it was probably because they were decoupling..
Cheers
...........Kauri
Shorting I beleive based on historical trends (seasonality).
Here is one interesting peice of seasonality fact for you guys:
If, from 1928-1994, you invested $10,000 for the first 4 days of each month and the last day of each month, plus the two days preceding each public holiday and were ONLY invested in those days - which is 28% of all trading days, your money would now be worth $4.6 million.
Now if you were NOT invested in ANY of these days and in every other trading day throughout that period, so the other 72% of trading days, your $10,000 would now be worth a mere $569.
Based on the S&P500 index.
Mind-boggling?
Pulic holiday approaching
As for GOLD, WTF!!!!!
Come on Fed, give it to us good!
explod
explod
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Nyden, gold as a store of wealth goes back 4000 years. It has never failed to hold it's value. Ancient Rome tried to control as the US has today and they have both failed.
In Germany in 1924 money lost its value, period, gold did not. Many of the Jewish community had gold and became very well protected against the currency ravages. Hitler was most upset at this and I believe it had a lot to do with the sinister direction he went to.
I have been sitting on Bllion for over 4 years in my Super fund and thankfully it just grows and grows as other Super funds just keep contracting because the basis of many of them is the financial sector.
There are too many things to properly cover in a short message but do youself a big financial favor and read through this gold thread which contains the lot. Better than any book. A short history of gold that is good is on the website of "The Privateer", you will find it via Google.
In Germany in 1924 money lost its value, period, gold did not. Many of the Jewish community had gold and became very well protected against the currency ravages. Hitler was most upset at this and I believe it had a lot to do with the sinister direction he went to.
I have been sitting on Bllion for over 4 years in my Super fund and thankfully it just grows and grows as other Super funds just keep contracting because the basis of many of them is the financial sector.
There are too many things to properly cover in a short message but do youself a big financial favor and read through this gold thread which contains the lot. Better than any book. A short history of gold that is good is on the website of "The Privateer", you will find it via Google.
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Ditto Explod re Nyden why gold - the reasons are all out there already.
Some idle rambling and conjecture, in lieu of more X factors from Bernanke and Friends (could be a new TV reality show, 'watch me pull a rabbit out of my hat').
As per previous post of mine about entering a consolidation phase, it looks like we got a false breakout after the 'surprise' interest rate decision. Normally I would think the pattern would follow previous patterns in that the price would oscillate around a price 'mean' while in consolidation mode (almost always around the big numbers eg 800 & 900; 994 an oscillation point too? ), but things are too volatile to 'assume' anything these days.
Without any more X factors, still looking to maybe touch 980-985 area for mid trendline around 20th March or so, as recent push & retrace has a breather. The trick is to align macd direction & level to boll extremes for low risk entry points. Maybe wave type people can enlighten more? Anyone??
Some idle rambling and conjecture, in lieu of more X factors from Bernanke and Friends (could be a new TV reality show, 'watch me pull a rabbit out of my hat'
).As per previous post of mine about entering a consolidation phase, it looks like we got a false breakout after the 'surprise' interest rate decision. Normally I would think the pattern would follow previous patterns in that the price would oscillate around a price 'mean' while in consolidation mode (almost always around the big numbers eg 800 & 900; 994 an oscillation point too? ), but things are too volatile to 'assume' anything these days.
Without any more X factors, still looking to maybe touch 980-985 area for mid trendline around 20th March or so, as recent push & retrace has a breather. The trick is to align macd direction & level to boll extremes for low risk entry points. Maybe wave type people can enlighten more? Anyone??
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Nyden
G.E. Money Genie
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I do of course appreciate the reasoning behind it, & am looking into furthering my gold exposure (why fight a trend) ... but, I guess I'm just getting a little philosophical here
Humans really are strange creatures, we place such value in natural diamonds, based purely on rarity / the fact that others can't have them (selfish, spite, & greed!) ... yet, man-made diamonds are basically frowned upon / worthless, even though they can be near-identical to the naked eye?
Looking for an entry point! Little too hot right now ... got a feeling it's going to come down quite a few %
I truly believe we should return to a more basic barter system, I guess it goes against capitalism a little though.
Humans really are strange creatures, we place such value in natural diamonds, based purely on rarity / the fact that others can't have them (selfish, spite, & greed!) ... yet, man-made diamonds are basically frowned upon / worthless, even though they can be near-identical to the naked eye?
Looking for an entry point! Little too hot right now ... got a feeling it's going to come down quite a few %
I truly believe we should return to a more basic barter system, I guess it goes against capitalism a little though.
Why gold had to hit US$1000 (Robin Bromby)
I read the article is wrote by Robin Bromby yesterday. It may help you who holds Gold Mining Shares. For your info.,
full article LINK: http://www.theaustralian.news.com.au/story/0,25197,23375886-643,00.html
Why gold had to hit $US1000
Robin Bromby | March 15, 2008
IT was no big surprise when it happened. It's doubtful that anyone, anywhere, popped a cork when, briefly in New York on Thursday night, gold went through the $US1000 an ounce mark.
We were expecting it. The only issue was when it would happen -- this week or next.
Now that the $US1000/oz level is done and dusted, gold bulls will already be recalibrating their expectations. Any day now there will be talk of $US1200 gold. Then $US1500. And, again, when (not if, they'll argue) those levels are reached, it will have been anticipated and talked about so much that, like this week, it will all seem faintly anticlimactic.
There'll be more joy among the miners, especially if they are not hedged.
Greater Bendigo Gold Mines is as tinny as they come.
First, it is coming to production this month. Second, it decided not to hedge that production so it -- and its shareholders -- will be getting full exposure to the spot price for the planned 20,000oz output a year.
And while the credit well is fast freezing over for sectors such as property, the stellar run by gold made it possible for Greater Bendigo to pull off a trifecta this week. ANZ loaned it $2.1 million, investors opened their wallets for a $1.07 million placement and British managed fund Pacific Capital Investment Management put up $10 million for convertible notes.
Not bad for a company whose shares have been struggling to stay above 20c and which has a market capitalisation of $19.5 million.
"I love gold," chairman Ian Smith said yesterday. And he believes he will keep on doing so. "We are not about to see an outbreak of world peace and financial stability".
Barrick Gold chief executive Greg Wilkins said in a New York television interview that he expected gold to climb a good deal further. And he ventured that the metal might find a lucrative industrial use -- replacing platinum (now more than $US2000 an ounce) in the manufacture of catalytic converters that reduce car exhaust emissions.
Why would you expect gold to stay at these levels or go much higher? Let us count the ways.
I read the article is wrote by Robin Bromby yesterday. It may help you who holds Gold Mining Shares. For your info.,
full article LINK: http://www.theaustralian.news.com.au/story/0,25197,23375886-643,00.html
Why gold had to hit $US1000
Robin Bromby | March 15, 2008
IT was no big surprise when it happened. It's doubtful that anyone, anywhere, popped a cork when, briefly in New York on Thursday night, gold went through the $US1000 an ounce mark.
We were expecting it. The only issue was when it would happen -- this week or next.
Now that the $US1000/oz level is done and dusted, gold bulls will already be recalibrating their expectations. Any day now there will be talk of $US1200 gold. Then $US1500. And, again, when (not if, they'll argue) those levels are reached, it will have been anticipated and talked about so much that, like this week, it will all seem faintly anticlimactic.
There'll be more joy among the miners, especially if they are not hedged.
Greater Bendigo Gold Mines is as tinny as they come.
First, it is coming to production this month. Second, it decided not to hedge that production so it -- and its shareholders -- will be getting full exposure to the spot price for the planned 20,000oz output a year.
And while the credit well is fast freezing over for sectors such as property, the stellar run by gold made it possible for Greater Bendigo to pull off a trifecta this week. ANZ loaned it $2.1 million, investors opened their wallets for a $1.07 million placement and British managed fund Pacific Capital Investment Management put up $10 million for convertible notes.
Not bad for a company whose shares have been struggling to stay above 20c and which has a market capitalisation of $19.5 million.
"I love gold," chairman Ian Smith said yesterday. And he believes he will keep on doing so. "We are not about to see an outbreak of world peace and financial stability".
Barrick Gold chief executive Greg Wilkins said in a New York television interview that he expected gold to climb a good deal further. And he ventured that the metal might find a lucrative industrial use -- replacing platinum (now more than $US2000 an ounce) in the manufacture of catalytic converters that reduce car exhaust emissions.
Why would you expect gold to stay at these levels or go much higher? Let us count the ways.
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That bit sums it up - what people are willing to barter with. You can barter for more with a gold coin in your hand than dragging a barrel of oil around. If you want oil you pay with gold. You want food, you pay with gold. Not some bit of paper that a group of people have agreed a value to, and who then dictate the rules for how to use it eg taxes. Electronic fiat currency is not rare - it's just nobody can agree what it's worth any more...
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Nyden, careful about looking for further weakness. You may have just got your chance right now with this current slide. A feeling never took over fundamentals. Sounds like famous last words to me.
No point questioning why we "value" certain things, supply/demand control the market and that is that. Im sure if we went into a deep deep depression and food became that hard to come by, there would be complete chaos and only those with arms would do well if you get my drift! But that is FAR from the cards!
If we return to a more basic barter system, transactions costs will go through the roof, but that is another story.
I did and continue to expect a very strong week for gold equities! Could be wrong, this is based on fundamentals, seasonality and sentiment. For now, I throw my technical analysis hat out the window!
No point questioning why we "value" certain things, supply/demand control the market and that is that. Im sure if we went into a deep deep depression and food became that hard to come by, there would be complete chaos and only those with arms would do well if you get my drift! But that is FAR from the cards!
If we return to a more basic barter system, transactions costs will go through the roof, but that is another story.
I did and continue to expect a very strong week for gold equities! Could be wrong, this is based on fundamentals, seasonality and sentiment. For now, I throw my technical analysis hat out the window!
explod
explod
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I do of course appreciate the reasoning behind it, & am looking into furthering my gold exposure (why fight a trend) ... but, I guess I'm just getting a little philosophical here
Humans really are strange creatures, we place such value in natural diamonds, based purely on rarity / the fact that others can't have them (selfish, spite, & greed!) ... yet, man-made diamonds are basically frowned upon / worthless, even though they can be near-identical to the naked eye?
Looking for an entry point! Little too hot right now ... got a feeling it's going to come down quite a few %
I truly believe we should return to a more basic barter system, I guess it goes against capitalism a little though.
Gold came in to being as a currency in (the barter system) exchange off good. Cows for Spuds etc, when an imballance occurred in the production of goods against the provision of services gold coins started. The early ones had holes in them so that they could be carried on a string around the neck. I wonder if that is how necklaces started ?
People need food, then shelter, next is clothing and looking good. Gold made people feel good, and when they made ornaments from it they thought they looked good. The basic feelings for these things have not changed.
Gold is rarer by the day, the good mines are almost depleted or now very deep. So yep gold may correct a bit and consolidate at this level but the trend will contiue for many years now as the financial chaos plays out.
And I see Sunday markets (called farmers markets here) springing up in opposition to supermarket more of late as things get much worse, necessity will drvie such directions.
Nyden
G.E. Money Genie
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Too much short-term risk at the moment in my opinion; the looming rate cuts could have an effect on POG ... good, or bad, depending on how much they cut them by.
explod
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On the contrary, rate cuts are what is causing the $US index to drop and it is the US dollar index drop that has been the mirror image of the gold price all the way back to 2001.
For a currency to restore value interest rates need to rise. Its why the Aussie $ has been rising these last few years.
Absolutely no risk in that for me but each to his own. And I have been wrong before.
Nyden
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Yes, but gold is not immune to sentiment. If the rates are cut an amount less than expected ... it's kind of like news not being as bad as already factored in.
If it were as straight forward as many seem to think; why not sell up the house, & put it all in gold today? If after the upcoming rate cut, it's almost assured that gold is going to rally? Because it may not.
People are talking about a whole 1% cut, what if it's only .25, or .5? Will the lemmings of the market see this lesser damage to the USD, as somehow something to strengthen it?
Whilst, here in Australia; I'm reading nothing but views that interest rates are only going to go up, or remain flat for at least 1-2 years ...
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