Gold strategy in the current economy

[killerbee]

A what? how can something permanent be a bubble?

I think it's way of saying it will always be in demand, lol.

[eztiger]

Waffle alert from the amateur psychologist...you need to give it a rest injin as you come across as a right tool

This ^

Also I feel the quoted sentence should read "Why does something that I DO NOT want provide you with financial security?"

Injin strikes me as incredibly naive / financially ignorant to make such statements, attempting to wrap it it pseudo psychological nonsense doesnt help his cause either.

[quibble]

It means that everyone who wants a more rational world and happier people in it who doesn't actually want and enjoy gold for the gold itself shouldn't have any.

So I know what I will be doing.

Does this mean that you will finally be selling your own hoard of gold?

Given your beliefs, why didn't you sell it before?

[Injin]

Well if you would care to read back you will see i have answered your question. To refute this fact makes you look nothing more than cantankerous.

No, you didn't (and I said why in my response.)

[Injin]

I have observed your experiment and am prepared to be guided by practical experience.

Perhaps a broadening of the investigation would be helpful.

Well, given I have asked the people who I can easily access who are most interested in gold and they are coming up with not a right lot (or are even admitting that gold doesn't have much organic demand) I can't see why it would be helpful to go asking people on the high street a la market research. I'm not averse to doing so, but I'd need convincing of the reasons why.

Considering one context in which the subject under investigation is a factor, can anyone summarise:

a. why central banks were thought to be necessary

Because of poor parenting coupled with centralising philosphies taking hold of popular thought - marx, smith etc

b. why co-operation among them evolved

Because they don't work and can only continue to operate by crowding out any free market system - this means total dominion or bust.

c. what developments would render them or their current function obsolete.?

Better parenting, a withdral of collectivist thinking from society. Not happening any time soon.

[Injin]

Uses of gold & reasons why others may want a position in it too.

Most cell phones, computers, calculators, television, and other electronic items contain gold.

Gold is used in window glass and astronaut helmets to reflect infrared rays while allowing sunlight to pass through.

Gold is a good conductor of electricity and heat.

There is a monetary system called the ‘gold standard’ which fixes a unit of money to a certain weight of gold.

Injectable gold has been proven to help reduce pain and swelling in patients suffering from tuberculosis and rheumatoid arthritis.

Gold won't tarnish, rust, or corrode and is very strong when alloyed. In fact, it is also surprisingly the most malleable of all metals.

Gold melts at 1064.43° Centigrade. It can conduct both heat and electricity and it never rusts.

Dentists use about 2 per cent of the gold mined each year (about 60 tons). A gold crown is usually 75 per cent gold, with a mixture of silver, palladium and zinc to harden it.

All the world's gold and platinum ore came from outer space after a mammoth meteorite shower battered the Earth more than four billion years ago.

Nearly one billion cell phones are produced each year and most of them contain about fifty cents worth of gold. Their average lifetime is under two years and very few are currently recycled

Absolutely superb answer, thank you.

There is indeed some organic demand. I highly doubt whether it has much of anything to do with golds price, which is sentiment (i.e. scared investor with a head full of marbles) driven.

You are completely correct, though.

[Injin]

A what? how can something permanent be a bubble?

A bubble is when something is priced beyond that which it's fundamentals indicate is appropriate.

That is, inorganic demand far outstrips organic demand. So for example - house prices have been going up because people with no interest in housing per se for the housing itself have been seeking returns based on ever increasing prices, BTL and the like (a lot of whom as particleman has pointed out are seeking retirement income.) The fundamentals of the housing market are the ability of the average wage earner to buy the average house - plenty of metrics around showing that's 3-4x single blokes earnings, not 11x joint. We can say it's a bubble, therefore.

Gold doesn't ever seem to have been priced based on the jewelers/industrial demand for it. Or did I miss something?

[Injin]

Waffle alert from the amateur psychologist...you need to give it a rest injin as you come across as a right tool

I don't care how I come accross and I am a professional psychologist.

[Injin]

I think it's way of saying it will always be in demand, lol.

Yes, yes it is.

It's also a way of saying that gold is as volatile as ******, being based on nothing more than fools seeking greater fools.

Plenty of other PM's will do the job, without the corrosive effect on the personality that being invested in the decline of your own society and the foolishness of others will have on you. Yes, you might miss an upside, but you won't be *****ing into a sock at the thought of your neighbours going hungry.

What's your humanity worth, hmm?

[Crashman Begins]

Absolutely superb answer, thank you.

There is indeed some organic demand. I highly doubt whether it has much of anything to do with golds price, which is sentiment (i.e. scared investor with a head full of marbles) driven.

You are completely correct, though.

Thanks injin

Thought that's what you wanted.

I like your arguments. You've helped me to remember golds special qualities

& i think balanced arguments are always needed when investing in anything.

With regards to the price being driven by investors, I think there are definitely giants

Accumulating gold for the reasons I listed & more ( Gold for oil & vice versa )

when it becomes scarce I want a piece of the action

Edited January 29, 2013 by Crashman Begins

[Erewhon]

There is a monetary system called the ‘gold standard’ which fixes a unit of money to a certain weight of gold.

You are completely correct, though.

No country currently uses the gold standard as the basis of its monetary system

The History of the obsolete gold standard

Perhaps this is a better starting point for understanding the role of this particular element and the traditions in which it became embedded. Or as one commentator by name of Bernanke asserted, it is itself "a tradition".

[Injin]

The History of the obsolete gold standard

Perhaps this is a better starting point for understanding the role of this particular element and the traditions in which it became embedded. Or as one commentator by name of Bernanke asserted, it is itself "a tradition".

A gold standard is a fiat money system - that is gold has value because you have to pa taxes, licences, fines and debts with it.

Again, no evidence of organic demand. Quite the reverse, in fact.

Do you really want your wealth to be based on a one way punt that if it succeeds will only do so because of violence enacted on others?

[Stay Beautiful]

I don't care how I come accross and I am a professional psychologist.

I know a married couple who are both professional psychologists. This tells me all i need to know about you. Happy hpc posting injin

p.s. When you asked the question, why would anyone hold gold? I answered it based on why i (i being anyone) would hold gold.

[Injin]

I know a married couple who are both professional psychologists. This tells me all i need to know about you. Happy hpc posting injin

p.s. When you asked the question, why would anyone hold gold? I answered it based on why i (i being anyone) would hold gold.

No, you didn't.

[azogar]

I don't care how I come accross and I am a professional psychologist.

practising?

where do you find the time?

[Erewhon]

Well, given I have asked the people who I can easily access who are most interested in gold and they are coming up with not a right lot (or are even admitting that gold doesn't have much organic demand) I can't see why it would be helpful to go asking people on the high street a la market research. I'm not averse to doing so, but I'd need convincing of the reasons why.

I would suggest asking people on the high street is looking in precisely the wrong place though it has a bearing on one aspect of the bubble debate.

Warren said about the housing bubble:

"The only way you get a bubble is when a very high percentage of the population buys into some originally sound premise…that becomes distorted as time passes and people forget the original sound premise and start focusing solely on the price action

My conjecture is that if you did go asking people on the high street a neutrally worded question about finding a gold shop, you would find they assumed you wanted to sell not to buy. I'm open to refutation on this should there be any actual research to cite.

[wherebee]

No, you didn't.

Injin! NEVER confess you are a professional psychologist! Destroys my illusion that you are a mad amateur one with a dungeon in which you lock people up until they can choose an item of value which they can prove to you is money!

[killerbee]

Does this mean that you will finally be selling your own hoard of gold?

Given your beliefs, why didn't you sell it before?

Has this question been ignored?

Edited January 30, 2013 by killerbee

[Erewhon]

Considering one context in which the subject under investigation is a factor, can anyone summarise:

a. why central banks were thought to be necessary

Because of poor parenting coupled with centralising philosophies taking hold of popular thought - marx, smith etc

[/Quote]

b. why co-operation among them evolved

Because they don't work and can only continue to operate by crowding out any free market system - this means total dominion or bust.

[/Quote]

c. what developments would render them or their current function obsolete.?

Better parenting, a withdrawal of collectivist thinking from society. Not happening any time soon.

[/Quote]

[/Quote]

The lady on the left below was a parent with a centralising philosophy. Her name was Agrippina and she was arguably obsessed with attaining total dominion for her son.

Against what standard should we measure her parenting or is there even a "gold standard" for parenting?

Argument: She was not a poor parent as:

Agrippina successfully manipulated and influenced Roman Emperor Claudius (the other head on the gold coin) into adopting her son. His name was changed to Nero Claudius Caesar Drusus Germanicus and he became Claudius’s adopted son, heir and recognised successor.

Argument: She was a poor parent as:

According to Suetonius, Nero tried three times to poison Agrippina, but she took the antidotes in time and survived. He then tried to crush her with a mechanical ceiling over her bed at her residence. After this failed, he devised a collapsable boat, which would either have its cabin fall in or become shipwrecked. Nero then ordered captains of a different boat to ram this boat while Agrippina was aboard. Nero heard Agrippina survived the wreck so he ordered her to be executed and framed it as a suicide.

If we view poor parenting as exemplified by the desire of one's offspring to kill their parent, then she was a failure.

If we view good parenting as encouraging and enabling one's offspring to rise to the top of a centralising coercive system when that was generally recognized as the epitome of success, then she was the archetypal good parent.

To make such a value judgement, we need a reference point which is the relevance of this to the central banks question.

[Erewhon]

Uses of gold & reasons why others may want a position in it too.

Most cell phones, computers, calculators, television, and other electronic items contain gold.

Gold is used in window glass and astronaut helmets to reflect infrared rays while allowing sunlight to pass through.

Gold is a good conductor of electricity and heat.

There is a monetary system called the ‘gold standard’ which fixes a unit of money to a certain weight of gold.

Injectable gold has been proven to help reduce pain and swelling in patients suffering from tuberculosis and rheumatoid arthritis.

Gold won't tarnish, rust, or corrode and is very strong when alloyed. In fact, it is also surprisingly the most malleable of all metals.

Gold melts at 1064.43° Centigrade. It can conduct both heat and electricity and it never rusts.

Dentists use about 2 per cent of the gold mined each year (about 60 tons). A gold crown is usually 75 per cent gold, with a mixture of silver, palladium and zinc to harden it.

All the world's gold and platinum ore came from outer space after a mammoth meteorite shower battered the Earth more than four billion years ago.

Nearly one billion cell phones are produced each year and most of them contain about fifty cents worth of gold. Their average lifetime is under two years and very few are currently recycled

Uses of plastic & reasons why graduates may want a position in it too.

Plastic wrap helps keep meat fresh while protecting it from the poking and prodding fingers of your fellow shoppers.

Plastic bottles mean you can actually lift an economy-size bottle of juice. And should you accidentally drop that bottle, it's shatter-resistant.

Plastics help make portable phones and computers that really are portable. They help make major appliances - such as refrigerators or dishwashers - resist corrosion, last longer and operate more efficiently.

Plastic car fenders and body panels resist dings, so you can cruise the grocery store parking lot with confidence.

Heat-sealed plastic pouches and wraps helps keep food fresh and free of contamination. That means the resources that went into producing the food aren't wasted.

Plastic wraps and resealable containers keep your leftovers protected. In fact, packaging experts have estimated that each pound of plastic packaging can reduce food waste by up to 1.7 pounds.

Just 2 pounds of plastic can deliver roughly 8 gallons of a beverage such as juice, soda or water. You'd need 3 pounds of aluminum to bring home the same amount, 8 pounds of steel or 27 pounds of glass.

Not only do plastic bags require less total energy to produce than paper bags, they conserve fuel in shipping. Plastics make packaging more efficient, which ultimately conserves resources.

Since 1977, the 2-liter plastic soft drink bottle has gone from weighing 68 grams to just 51 grams today, representing a 25 percent reduction per bottle. That saves more than 206 million pounds of packaging each year.

The 1-gallon plastic milk jug has undergone an even greater reduction, weighing 30 percent less than what it did 20 years ago.

Plastic bags require less total energy to produce than paper bags, they conserve fuel in shipping. It takes seven trucks to carry the same number of paper bags as fits in one truckload of plastic bags.

Plastics also help to conserve energy in your home. Vinyl siding and windows help cut energy consumption and lower your heating and cooling bills.

The U.S. Department of Energy estimates that use of plastic foam insulation in homes and buildings each year will ultimately save close to 60 million barrels of oil versus other kinds of insulation.

The same principles apply in appliances such as refrigerators and air conditioners. Plastic parts and insulation have helped to improve their energy efficiency by 30 to 50 percent since the early 1970s.

[sign_of_the_times]

We launch in 7 days, staring from now. Watch silver. This is moment we have been waiting for all these years. It's now here. Bring it.

Good call maybe?

[Injin]

Injin! NEVER confess you are a professional psychologist! Destroys my illusion that you are a mad amateur one with a dungeon in which you lock people up until they can choose an item of value which they can prove to you is money!

I used to be a mad amateur one if that helps.

Will I be selling my gold?

Nah, but i'm done with it where it is. Lot of effort to go to for a moral equivalency no one cares about but me.

Plus you know, rockets, moon etc

[Errol]

Should be an interesting few years. Gold will exceed $3500, and then head on up to $5000+ an ounce. Just a matter of time.

[Injin]

Should be an interesting few years. Gold will exceed $3500, and then head on up to $5000+ an ounce. Just a matter of time.

Evidence?

[The Spaniard]

Here's one for the psychologists.

Why does someone bid £1241 on ebay for a coin that can be bought from a reputable dealer (Hatton Garden Metals) for £1088?

http://www.ebay.co.uk/itm/1oz-South-African-Krugerrand-/230917244739?_trksid=p2047675.l2557&ssPageName=STRK%3AMEWAX%3AIT&nma=true&si=zcNZruMBOZ53XCSV08VWR%252Ff9bHU%253D&orig_cvip=true&rt=nc