Gold Price - Where is it heading?

[notting]

Looking for some big shorts. Already started a small one on NCM.
Gold’s bounce for today is simply Euro strength. Has nothing to do with Gold.
Either risk comes off and people think Euro is OK for a while so Gold will continue to be weak.
Or Euro$ tumbles gold is weaker cause US$ is stronger.
That's me thinking at this moment!

 

[explod]

Looking for some big shorts. Already started a small one on NCM.
Gold’s bounce for today is simply Euro strength. Has nothing to do with Gold.
Either risk comes off and people think Euro is OK for a while so Gold will continue to be weak.
Or Euro$ tumbles gold is weaker cause US$ is stronger.
That's me thinking at this moment!

NCM, interesting punt, has not really been below $30 since 2009. A lot of support at this level.

Will watch with interest.

 

[young-gun]

And a quick rip around the commentators and you will find that it is virtually all paper trading on the London exchange and on the comex with little or no gold changing hands. How much longer this false paper market can last will be interesting but when it comes undone ???

we will see.

Anyway good to see you are still awake there Tysonboss1 and doing a bit of searching I see too. Would never bother to back track on someone myself but each to his own of course.

A merry Christmas to yourself and Family.

bullion all the way! the only true way to ensure your hard earned cash is completely removed from this crazy financial system we are running. i wonder if there is even any gold backing these paper transactions these days

explod, if economies deflate would you still be bullish? this uncertainty is all that prevents me from buying in. after all gold has most definitely inflated along with the credit boom, and could very well prove to be just as big a bubble as any.

where would it get its legs from to be the only thing in the world increasing in value during a deflationary period? although it may not fall quite as hard as everything else given its 'safe haven' reputation. is picking investments that crash the least what the world could come to?

would gold not be one of a few assets that would be sold by investors desperately trying to meet margin calls in a crash?

of course if we were able to eventually return to sound money gold would indeed...well be worth its weight in gold

ps i cant remember who posted it, but europes gold reserves dont even begin chip away at the surface of their debt, italy for example carrying just 6.7% of gdp in gold.

 

[explod]

=young-gun;677238]explod, if economies deflate would you still be bullish? this uncertainty is all that prevents me from buying in. after all gold has most definitely inflated along with the credit boom, and could very well prove to be just as big a bubble as any.

I remain bullish to the extent that it preserves equity value. I have quoted Prector and his book masny times on this thread, although dated 2002 from memory, is well worth reading on this aspect. However the deflation we experienced in 2008 was not across the board. Many statistical figures are distorted for appearances, example; US unemployment at around 8% only includes those looking for work over the last 12 months, after that they are dropped off the total. Recently it was noted that the US were refiguring the way they put property figures together then sure enough in the last couple of days they say building approvals are up by 8% and yee haar takes the Dow up 300 points.

We know that food rises are not reflected in our Aussy inflation rate of a few percentage points. So intoto the debate is subjective.

where would it get its legs from to be the only thing in the world increasing in value during a deflationary period? although it may not fall quite as hard as everything else given its 'safe haven' reputation. is picking investments that crash the least what the world could come to?

There are still going to be needs in huge demand, food and energy for starters but the problem to ponder is what will happen to the paper value of money. It is accepted that gold will not make you money in effect but will preserve your capital as it has done in spite of deflation or inflation since records of this effect were kept from 1792.

would gold not be one of a few assets that would be sold by investors desperately trying to meet margin calls in a crash?

Commentator opinion seems to indicate that those buying gold are wary of the markets and in the main gold hoarders. Certainly there are sell offs when the market is spooked but remember the majority of this is within the paper gold market with little physical actually being exchanged to satisfy this issue.

of course if we were able to eventually return to sound money gold would indeed...well be worth its weight in gold

ps i cant remember who posted it, but europes gold reserves dont even begin chip away at the surface of their debt, italy for example carrying just 6.7% of gdp in gold

The day of gold backed money would appear to be a long way off as I see it and there are no clear opinions on this issue. If you are not familiar with Austrian Economics it is well worth reading up on to form your own views on this subject.

 

[Starcraftmazter]

A point to consider is the possibility or even probability of heavy gold selling to reduce soverign debt and or provide more stimulus.

That will never happen in a million years. They will let people starve on the streets before they sell physical gold. Every single country knows, and in the end, if anything should happen to the world financial system - the only thing which gives them power to issue and control currency are their gold reserves.

 

[Smurf1976]

That will never happen in a million years. They will let people starve on the streets before they sell physical gold. Every single country knows, and in the end, if anything should happen to the world financial system - the only thing which gives them power to issue and control currency are their gold reserves.

Which explains why many countries have already sold off much of their gold in recent years?

 

[Starcraftmazter]

Which explains why many countries have already sold off much of their gold in recent years?

If by recent years you mean decades ago, and by countries you mean privately ran central banks, then no - no it doesn't.

 

[Smurf1976]

It was only a few years ago that the Reserve Bank of Australia, the Bank of England and others were selling plenty of gold at bargain basement prices.

 

[young-gun]

I remain bullish to the extent that it preserves equity value. I have quoted Prector and his book masny times on this thread, although dated 2002 from memory, is well worth reading on this aspect. However the deflation we experienced in 2008 was not across the board. Many statistical figures are distorted for appearances, example; US unemployment at around 8% only includes those looking for work over the last 12 months, after that they are dropped off the total. Recently it was noted that the US were refiguring the way they put property figures together then sure enough in the last couple of days they say building approvals are up by 8% and yee haar takes the Dow up 300 points.

We know that food rises are not reflected in our Aussy inflation rate of a few percentage points. So intoto the debate is subjective.




There are still going to be needs in huge demand, food and energy for starters but the problem to ponder is what will happen to the paper value of money. It is accepted that gold will not make you money in effect but will preserve your capital as it has done in spite of deflation or inflation since records of this effect were kept from 1792.



Commentator opinion seems to indicate that those buying gold are wary of the markets and in the main gold hoarders. Certainly there are sell offs when the market is spooked but remember the majority of this is within the paper gold market with little physical actually being exchanged to satisfy this issue.



The day of gold backed money would appear to be a long way off as I see it and there are no clear opinions on this issue. If you are not familiar with Austrian Economics it is well worth reading up on to form your own views on this subject.

indeed my knowledge of gold and its history is limited, can you point me in the direction of a few good books? i am becoming increasingly curious about gold, and honestly believe it will as you say be the one thing that may preserve your capital, or potentially, depending on the circumstances, go up substantially in the near future.

if economies deflate it will simply make a countries dollar worth more will it not? just as hyper-inflation renders them worthless, deflation strengthens? this is bad news for the aussie dollar, as our crash seems to be lagging that of others. deflation would see the greenback become very valuable, as they write down their debt and destroy who knows how many $$$'s.

 

[Wysiwyg]

honestly believe it will as you say be the one thing that may preserve your capital

That depends on what price you bought the ounces for and how long you want to wait or have left to live. Bought 1980 to 1981 you would have waited 25 years to get back to break even.

 

[Wysiwyg]

Bought 1980 to 1981 you would have waited 25 years to get back to break even.

And then the purchasing power of the underlying dollar would be substantially reduced. The catch is paying for the stuff in dollars and then what purchasing power those dollars have in the future when changing it back.

 

[explod]

indeed my knowledge of gold and its history is limited, can you point me in the direction of a few good books? i am becoming increasingly curious about gold, and honestly believe it will as you say be the one thing that may preserve your capital, or potentially, depending on the circumstances, go up substantially in the near future.

if economies deflate it will simply make a countries dollar worth more will it not? just as hyper-inflation renders them worthless, deflation strengthens? this is bad news for the aussie dollar, as our crash seems to be lagging that of others. deflation would see the greenback become very valuable, as they write down their debt and destroy who knows how many $$$'s.

I know these young-gun

The Coming Collapse of the Dollar and How to Profit from It: Make a Fortune by Investing in Gold and Other Hard Assets by James Turk

Gold: The Once and Future Money (Agora Series) by Nathan K. Lewis

Conquer the crash: you can survive and prosper in a deflationary depression
Robert Rougelot Prechter

Check these web sites:

http://www.financialarmageddon.com/

http://www.the-privateer.com/gold.html

http://mises.org/

 

[drillinto]

Gold Future: Last Six Months

http://www.bespokeinvest.com/thinkbig/2011/12/21/gold-strike-two.html
***

 

[Uncle Festivus]

bullion all the way! the only true way to ensure your hard earned cash is completely removed from this crazy financial system we are running. i wonder if there is even any gold backing these paper transactions these days

explod, if economies deflate would you still be bullish? this uncertainty is all that prevents me from buying in. after all gold has most definitely inflated along with the credit boom, and could very well prove to be just as big a bubble as any.

where would it get its legs from to be the only thing in the world increasing in value during a deflationary period? although it may not fall quite as hard as everything else given its 'safe haven' reputation. is picking investments that crash the least what the world could come to?

would gold not be one of a few assets that would be sold by investors desperately trying to meet margin calls in a crash?

of course if we were able to eventually return to sound money gold would indeed...well be worth its weight in gold

ps i cant remember who posted it, but europes gold reserves dont even begin chip away at the surface of their debt, italy for example carrying just 6.7% of gdp in gold.

Gold has 2 hats - commodity & currency. When it's a commodity it's influences are inflation/deflation, geopolitical risk & natural risks. When it's a currency it's the final alternative to all other currencies. Right now the transition from one to the other is progressing gradually ie eventually it will act according to 'final currency' status alone. For example, if you were a Greek, how would you like to be paid - in Euro's, Drachma's, USD's or gold?? And then there were 2?

So right now we have the highly inflationary tactics of the CB's with QE & other elaborately named 'save the system' schemes balanced with the deflationary bust that has been going on for the last 5 years or so (the so called 'recovery' is merely the dimming glow of previous QE's - unless they keep doing that ad infinitum then there is no intrinsic 'recovery').

There will/should be one final leg down for gold as the Fed will attempt to finally discredit gold as an alternative currency to $USD's. Unless of course there is a game changing event (black swan) that means we go straight to currency collapse, then all bets are on gold........

Forgive my crude TA analysis, but a cursory glance at the following chart looks like a descending triangle in a downtrend forming, which is (short term?) bearish???

 

[explod]

Well gold is only up 16% US for this year and in Aussie up 20%. Overall not too bad but a bit down on previous years.

I tend to be a bit bullish at times myself so it is good to have a look around to get the feet on the ground as we come to the end of a year.

Just read an interview of Peter Grandich which does just that and recommend it to all interested in the gold sector and he has some interesting insights on gold stocks too.

http://resourceclips.com/2011/12/21/grandich-on-2011/

Compliments of the season to everyone.

 

[notting]

I find that the best way to be in tune with something on the markets is when you have almost no interest in it but are reminded regularly of where it is at.

If gold is no longer the safe haven and the US dollar is then both those things spell lower gold prices if the environment is going to remain tumultuous. Even the Chinese are turning again to the US dollar for a safe haven, they have been strong on gold up till now.

I reckon gold will find 1350 and rotate between that and 1600 for a while.

If the Fed looks like printing again then I would change my opinion. I have not thought the Fed was going for QE3 ever.
If that changed then it would be at least 1 year away which give plenty of time for gold to deflate! I guess that's a medium term view.
Longer term some much smarter people than me expect it to be higher.

 

[explod]

notting

If gold is no longer the safe haven and the US dollar is then both those things spell lower gold prices if the environment is going to remain tumultuous. Even the Chinese are turning again to the US dollar for a safe haven, they have been strong on gold up till now.

Who is telling you the US$ is a safe haven?

Short term yes, but their debt is worse than the Euro zone, and China through the back door is buying every ounce of gold they can get thier hands on. As producers of gold they used to be an exporter but now keep all of their own and buy every other available ounce.

They are desperately trying to get out of their US dollars and gold is one of the vehicles.
As with Gloucester Coal in the last few days, they want tangilbe assets as paper money is becoming trash.

 

[notting]

You need to turn the page its not yesterday any more.

 

[explod]

You need to turn the page its not yesterday any more.

Convince me

 

[prawn_86]

but their debt is worse than the Euro zone,

Nope. The Greeks, Irish etc had worse debt situation than the USA. But if you are talking about Europe as a whole bloc then you are correct