Gold Price - Where is it heading?

[Ageo]

It will go down after Christmas when all the festivals around the world have finished. When the Indians and Chinese, who are the biggest users, slow down on buying it. It always does. I never chart gold.

lolol GG was that a funny answer???? Gold for the last few yrs has continued its rise in Jan & Feb.

Sell in March if your looking at selling as thats when demand slows.

 

[Edwood]

physical delivery is down 35% in the last quarter because its getting too expensive for many.
speculators (i.e. paper) have taken over the market - ala oil 2007. but wtfdik, perhaps this time its different

 

[Nyden]

You gold bugs aren't at all concerned about all of the commercials for gold on the TV? Just about every day I see an ad from that ABC mob, offering to buy / sell gold.

Looks rather toppish to me. One can only imagine how harshly gold would be decimated were the fed to actually raise rates Even if they only raised them by a hairline; the change of sentiment in gold would be astronomical, in my opinion. A flood to the exit gates

I know, unthinkable, though - right? They'll of course be at 0 forever, and gold will hit 2k by mid 2010.

 

[Ageo]

You gold bugs aren't at all concerned about all of the commercials for gold on the TV? Just about every day I see an ad from that ABC mob, offering to buy / sell gold.

Looks rather toppish to me. One can only imagine how harshly gold would be decimated were the fed to actually raise rates Even if they only raised them by a hairline; the change of sentiment in gold would be astronomical, in my opinion. A flood to the exit gates

I know, unthinkable, though - right? They'll of course be at 0 forever, and gold will hit 2k by mid 2010.

Nyden atm there is a massive influx of both selling scrap and buying bullion.

To me thow any worse news in economic data will push gold up as people now are looking for more safe havens.

 

[Nyden]

Nyden atm there is a massive influx of both selling scrap and buying bullion.

To me thow any worse news in economic data will push gold up as people now are looking for more safe havens.

Ah, but the flip side is true as well. Throw in some good economic news - and what possible reasoning does anyone have to hold gold? As far as I'm concerned, it's a hedge against fear and disaster. When fear becomes hope, and confidence - and disaster starts to turn into recovery - why would there not be a huge shift into productive assets?

I would postulate that most current holders of gold are in fact 'weak hands'. Late comers trying to capture some of the glory. All it would take is a little bit of strength in the US to simply floor it.

Can you just imagine what will happen when everyone runs for the exits, and starts selling their gold on eBay - when no one even wants the stuff?

 

[Ageo]

Can you just imagine what will happen when everyone runs for the exits, and starts selling their gold on eBay - when no one even wants the stuff?

lol pure speculation, if you have been around the real market and talk to real people (not data) you would understand that gold has gone to another level in peoples mindset. Never before have i seen people who knew nothing on gold and were never holders of it now allocate a small slice of their portfolio into it for wealth preservation.

People have become wiser and understand that paper currencies can always be manipulated which in turn can create alot of crashes to come.

Gold will never ever be the outperforming asset but it will always be the safe haven 1 which most people are starting to see that hedging a small section of the pie is better that being fully exposed to massive growth (i.e shares/real estate).

Gold now is looking brighter than ever IMO

 

[Nyden]

lol pure speculation, if you have been around the real market and talk to real people (not data) you would understand that gold has gone to another level in peoples mindset. Never before have i seen people who knew nothing on gold and were never holders of it now allocate a small slice of their portfolio into it for wealth preservation.

People have become wiser and understand that paper currencies can always be manipulated which in turn can create alot of crashes to come.

Gold will never ever be the outperforming asset but it will always be the safe haven 1 which most people are starting to see that hedging a small section of the pie is better that being fully exposed to massive growth (i.e shares/real estate).

Gold now is looking brighter than ever IMO

Pure speculation? That's exactly what gold is - a speculation. You talk as though it's wise to hold gold, and that the smart investors are the ones that are holding. That may very well be the case, but it might not be as well.

Gold has had these sorts of run ups in the past, as you know. I'm sure many people jumped on the band wagon back then as well - were they wise? Nope. Would've been hit for 50% of their money. What's worse, is that had they held on till now - they would be substantially worse off because of inflation. Even though gold is allegedly a hedge against such things?

Gold was $750USD in 1978-80 (somewhere thereabouts), and had you bought from any date after 78', and held on until 2002 you would have lost an absolute boat load. A 20 year down trend, wow. Protection against inflation? Maybe, if you can time it just right. Enough said


Heck, even if you bought gold in 76' for $150, it was 350 in 2000! A term deposit would have multiplied your money a whole lot more than that.

 

[sinner]

I would postulate that most current holders of gold are in fact 'weak hands'. Late comers trying to capture some of the glory.

I completely agree. Any gold holder who has not been following the "10% of your money in gold" rule for their investment history is by definition a weak hand and will generally go underwater very quickly on their initial investment.

Gold is not merely a commod, it is a central bank held currency, you can't treat it like "assets" in your portfolio, and you can't expect the CBs to play the worlds sucker on this one. The same lesson everyone learnt around this time last year. Central bank currencies ARE NOT YOUR NORMAL ASSET CLASS. CBs are holding gold at 10% of total world CB reserves, and have been for pretty much ever. Even the much maligned sell off of gold at low low prices was just a matter of keeping gold at 10% of reserves (of course irrational gold bulls never seem to let reality in the way of a good "gold is manipulated" story).

Having seen numerous "this is the top" for gold calls over the last month, as well as numerous just today about buying gold/silver/copper put basket and all this business. FRANKLY, I would love for precious metals to go down in price (especially gold), as I haven't bought any gold in over a year. Too expensive. Bring on the gold crash, I will stand on the other side of anyones put at 10% of my total asset base.

 

[cuttlefish]

if their debt is in yuan strong dollar means they pay less dollars to pay off debt
is it not so?

As I understand it the majority of the debt is in USD denominated instruments - US Govt Bonds, TBills etc.

 

[Beej]

Pure speculation? That's exactly what gold is - a speculation. You talk as though it's wise to hold gold, and that the smart investors are the ones that are holding. That may very well be the case, but it might not be as well.

Gold has had these sorts of run ups in the past, as you know. I'm sure many people jumped on the band wagon back then as well - were they wise? Nope. Would've been hit for 50% of their money. What's worse, is that had they held on till now - they would be substantially worse off because of inflation. Even though gold is allegedly a hedge against such things?

Gold was $750USD in 1978-80 (somewhere thereabouts), and had you bought from any date after 78', and held on until 2002 you would have lost an absolute boat load. A 20 year down trend, wow. Protection against inflation? Maybe, if you can time it just right. Enough said


Heck, even if you bought gold in 76' for $150, it was 350 in 2000! A term deposit would have multiplied your money a whole lot more than that.

Article in today's SMH making the same arguments as you Nyden!

http://www.smh.com.au/business/gold-a-useless-asset-to-own-20091207-ke07.html

Gold a 'useless asset to own'
December 7, 2009 - 12:10PM, SMH

Gold’s best year in three decades has yet to match the returns of an interest-bearing checking account for anyone who bought the most malleable of metals coveted for at least 5000 years during the last peak in January 1980.

Investors who paid $US850 an ounce back then earned 44 per cent as gold reached a record $US1226.56 on December 3 in London. The Standard & Poor’s 500 stock index produced a 22-fold return with dividends reinvested, Treasuries rose 11-fold and cash in the average US checking account rose at least 92 per cent. On an inflation-adjusted basis, gold investors are still 79 per cent away from getting their money back.

“You give up a lot of return for the privilege of sleeping well at night,” said James Paulsen, chief investment strategist at Wells Capital Management in Minneapolis. “If the world falls into an abyss, gold could be a store of value. There is some merit in that, but you can end up holding too much gold waiting for the world to end. From my experience, the world has not ended yet.

[snip rest of article].......

I'm gold "agnostic" (hold a couple of miners though), but thought the above article was relevant to this discussion.

Cheers,

Beej

 

[Nyden]

Article in today's SMH making the same arguments as you Nyden!

http://www.smh.com.au/business/gold-a-useless-asset-to-own-20091207-ke07.html



I'm gold "agnostic" (hold a couple of miners though), but thought the above article was relevant to this discussion.

Cheers,

Beej

There's obviously a journalist reading my posts! I posted mine before they posted theirs :

 

[jancha]

Ah, but the flip side is true as well. Throw in some good economic news - and what possible reasoning does anyone have to hold gold? As far as I'm concerned, it's a hedge against fear and disaster. When fear becomes hope, and confidence - and disaster starts to turn into recovery - why would there not be a huge shift into productive assets?

I would postulate that most current holders of gold are in fact 'weak hands'. Late comers trying to capture some of the glory. All it would take is a little bit of strength in the US to simply floor it.

Can you just imagine what will happen when everyone runs for the exits, and starts selling their gold on eBay - when no one even wants the stuff?

What do you think about the article in the Bull Nyden?

''Where to from here with gold price?''

 

[Bolivia]

Near term - maybe a bit weaker.

But nothing is going to stop the relentless march down of the US dollar.

The US Gov now has an annual interest bill approaching $600 Billion/year.

In the most profitable year - 2000, the annual surplus was approx 250bill.

So it is highly likely the USA has finally cornered themselves WRT their debt.

If over time the US dollar goes down, then Gold will steadily appreciate. It will have it's ups and downs. But over the next few years, while the world contemplates a new currency paradigm, the world will look to gold.

 

[Bolivia]

And just to add to the USa's woes, they have unfunded liabilities - Healthcare, social service, war pensions etc of approx 45-50 Trillion.

Thats trillion!

Unless their economy suddenly explodes with manufacturing, which will happen eventually when the dollar gets low enough, they are going to be in a serious jam for the next few years.

 

[Ageo]

smart[/I] investors are the ones that are holding. That may very well be the case, but it might not be as well.

Nyden i said its wise to hold a "small allocation (10-20%)" of your portfolio to act as a hedge. But everyone has different views, i mean personally whats next best to say a massive debasment of our local currency if it were ever to occur? Gold. Will it ever happen? probably not but the last thing you want is to have tons of cash tied up and nothing covering yourself.

Look at Central Banks and Countries, why do they hold gold? i mean if its a useless investment why is India and China and Russia still stocking up on it??? is it because they know nothing and just enjoy wasting their spare cash??

Nyden like alot of investment classes gold has its place be it big or small.

 

[Nyden]

Nyden i said its wise to hold a "small allocation (10-20%)" of your portfolio to act as a hedge. But everyone has different views, i mean personally whats next best to say a massive debasment of our local currency if it were ever to occur? Gold. Will it ever happen? probably not but the last thing you want is to have tons of cash tied up and nothing covering yourself.

Look at Central Banks and Countries, why do they hold gold? i mean if its a useless investment why is India and China and Russia still stocking up on it??? is it because they know nothing and just enjoy wasting their spare cash??

Nyden like alot of investment classes gold has its place be it big or small.

Governments hold it because, well - what else can they hold? Central Banks and Governments can't go around buying up 100s of billions of dollars worth of stocks, now can they?

Gold does have its place, like I said - as a hedge against disaster. However, this is not what the average buyer is going for lately. Everyone is chasing the hot money, and to me at least - that has alarm bells going off.

Jancha, I have yet to read that article.

All I'm saying, is that having 20% of my entire portfolio tied up in something that virtually did nothing for 30 years doesn't sound entirely appealing.

 

[Supra]

Bid/Ask 1156.30 - 1157.30

Change -5.10 -0.44%

Today we have seen gold shares fall in line with the Friday fall in Gold.

The latest gold price is down another 0.44%! not very significant, so it may be just consolidating before the next leg of its bull run.

After recent runs in the price of gold miners, a pause or correction had to happen, this is just a reaction to the US unemployment data, which in turn made people think a rate hike may be in the wind for the US, which in turn sent the $US higher & gold lower.

There will be further rises & falls in the spot price of gold!

The current pull back does not indicate the long term up trend has been broken.

 

[explod]

Since 1970 gold has gone up 33 times to 1 or US$35 to US$1,250 today. In 1970 you could buy the average good home for $35,000, to day $500,000 or 14 times to 1, looks like gold has been the winner by a long way and history has told this same story for over 2000 years. And I have family who have held gold for that period too and no way will they sell.

And of course later in the week as it did last week it will be rising again.

 

[sinner]

All I'm saying, is that having 20% of my entire portfolio tied up in something that virtually did nothing for 30 years doesn't sound entirely appealing.

Jeez! You're as bad as explod! Unconvinced of anything but your own view and damned sure if you don't have to repeat it a hundred times. Seriously Nyden, how many times are you gonna litter this thread with the same junk?

If it doesn't sound appealing, then don't do it! But please stop posting your "view" here, because just like explods opposite, equally vehement and ignorant viewpoint, have heard it all before, still don't care.

As if an article in the SMH is supposed to convince me of anything. Gold deniers are gold deniers been around just as long as gold bugs. At least the gold bugs seem to have the capacity for contrarian thought process. Gold used to be "the no earner, no mover" now that it's moving its a bubble and everyone should get out quick. What a joke. You missed the boat, too bad for you sucker.

The worst bit of all is that you're not actively involved in gold in anyway. You aren't buying it, or selling it, you don't contribute analysis or anything useful to this thread.

Governments hold it because, well - what else can they hold? Central Banks and Governments can't go around buying up 100s of billions of dollars worth of stocks, now can they?

They can't? Are you living in fairy land Nyden? So how is the US Treasury holding equity stakes in BofA, Citi and other major banks? How does the US government manage oil reserves if not by buying and selling oil? How did Treasury rescue Chrysler in the 80s then and why do they want an equity stake in GM now? Why is the Feds balance sheet ballooning full of everything but gold if that's all they can hold? Show me one Western government that hasn't gone around buying up 100s of billions of dollars worth of stock in the last 30 years and I will eat my hat.

I am sure PBOC is sitting there thinking "****, we better buy some gold today, after all, what else could we do with this USD2trillion pile of money"

 

[Uncle Festivus]

All I'm saying, is that having 20% of my entire portfolio tied up in something that virtually did nothing for 30 years doesn't sound entirely appealing.

Your example is irrelevant. It's the same as assuming that you had bought and held the DOW at 14500 - you would now need the market to rise another 40% just to break even. You could also have used the example that the USD has 'lost' approx 94% of it's 'value' since the inception of the fed, or that gold has risen from approx $35 to $1200 etc etc. Inflation adjusted, many of the worlds stock markets have not outperformed as they are largely relative to the growth in money supply?

I'm waiting for the break down to jettison the 'weak hands', before the real gold bull starts in earnest and surprises even the nay sayers? The fundamentals for the USA are those of a declining empire, and as history shows, empires are not forever. Only technology has condensed the timeline from hundreds of years to several decades. They simply cannot repay their debts, and when the charade is publicly acknowedged then the next leg down, or the real GFC, will begin and capitalism as we know it in this form will end.

There is an glut of global production capacity, thanks to China, which will ensure global deflation will be with us for many years. Thanks also to China there is massive stimulis fed misallocation of production & resources that will inevitably lead to a commodity glut (aluminium) as well, which will be devastating for Australia, and cause the exchange rate to fall even further relative to a terminal USD.

Now selling to build a war chest for buying. Too high too fast?