Monday, Nov 24, 2008
Currency collapse imminent
Bullionvault: Gold Ends Week 6.6% Higher as Stocks Lose 8% to 11-Year Low; UK Gold Price Hits Record Closing High - Saturday 22nd November 2008
Gold is now trading at £545. On its way to £1000 and beyond. So, Icelandic conditions on the way. Recent price slump was desperate manipulation to keep the economy from presidential debates. But, in reality, gold prices aren't rising, they are remaining stable, the supply of gold and its value is always stable. What is happening is that currencies are slumping and asset prices are deflating in real terms. But you only benefit if you have a real store of value. Anybody without at least 10% of their wealth in gold and other real assets will be left totally exposed. Physical coins are best because the institution holding your gold in a vault could fall if they have cash reserves in a bank that goes under.
Posted by planning4acrash @ 11:59 AM (1433 views) Add Comment
36 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. theboltonfury said...
this is the first thing new people see when they come to this site.
It's headline is irresponsible and without foundation other than in the heads of gold VI's
2. James said...
Bobbins.
3. mountain goat said...
There is a nice price discovery site available for bullion coins. It uses ebay data, one of the free markets left...
gold
silver
4. bellwether said...
Ramping from P4AC. If there is a real run up on gold from here there will be time to get in. It assumes too much to jump in right now. Mind you I have a Bullion Vault account just in case.
5. drewster said...
mg,
The other day you mentioned a few websites where you can buy gold and silver coins. However I'm concerned about liquidity - it seems easy to buy, but how would you sell it again? I'm not massively trusting of the postal service and eBay is a notorious home for scoundrels and scammers. Where are the coin dealers?
6. matt_the_hat said...
Gents lets be in no doubt after today pre-budget announcement if you have any saving you value (i.e. for a deposit) then you need to move swiftly into some kind of asset class.
That maybe property - but personally I would want something of value that I could transport across boarders easily - does anyone have a better suggestion than Gold?
7. planning4acrash said...
Up to £548.
This isn't ramping, its a real visible sign of economic collapse. This isn't a report about gold rising, its a report about fiat money collapse. Just as I predicted, after a short turnaround period, gold goes to the moon and currencies collapse once the president is elected.
Drewster, this one is good: Gold Coin Exchange
And there's one just round the corner in the next street up to the north. I may pay a visit today to get some silver coins! people are saying that it could rise from the current price of below $10 up to the dizzying heights of $50.
8. planning4acrash said...
Matt, Gold/silver are the best, if things get really bad, then a good vintage of Whisky is good, because it takes 10yrs for a good vintage to mature, so, its supply is super inelastic. Maybe this is a reason for control of spirit import/export?! Be careful taking gold through France, I understand that they have restrictions on taking it out of the country.
Storable foods and guns are obvious ones.
Folks, the Baltic Dry Index fell 98% and global trade has stopped. This is the calm before the storm. Use it to collect firewood before the winter sets in. Don't delay.
9. digdug said...
Anyone in iceland that had the foresight to put some of their wealth in Gold will have done well. Are we the next iceland?, hopefully not but the powers at be seem to be giving it a good try! Buying some gold is a no brainer.. if this isnt a big problem then you may lose a few quid.. if it is a big problem then you'll preserve some wealth.. 10% of your wealth seems totally sensible..
10. denzil said...
p4ac said:
"This isn't ramping, its a real visible sign of economic collapse. "
Don't really know or care whether you are ramping but if it was due to an economic collapse then don't you think the price of gold would be heading towards the stratosphere?
11. str 2007 said...
boltonfury
You make me laugh at times when you're having a go at uber doom mongers, but on this occassion I think I've got to side with the fact that the movement in Gold (25% up in a couple of weeks against GBP) is very significant.
Anyone with some sort of savings for a house is concerned about retaining some value and so I think it is fair to post at least one Gold article a day to keep abreast of things.
12. Digdug said...
Denzil, in £s gold is doing very nicely indeed. To satisfy GBs insane debt plans, the amount of Bonds that are going to have to be issued will put even more pressure on the £. (who exactly wants to buy UK treasuries at feck all % anyway??) The only way out is through the printing presses (I use the term "way out" loosely here) So printed inflation combined with imported inflation = a lolla lolla inflation.. The inflation vs Delfation argument is very interesting. I personally think that what we have now is fored sales of pretty much ALL assets that appears to show a deflationary trend when nothing could be further from the truth.. once the force sales stop then prepare for the real fun and games... it may well transpire that buying gold wont make a hell of a lot of difference anyway.. but you gotta do something... shame houses are still very much overpriced.. coz anything with any intrinsic value is worth having.. and property certainly has that..
13. str 2007 said...
Denzil
You're making the same mistake I did.
Gold is heading up sharply but you're looking at it's price in dollars (dollar has strengthened considerably recently hiding the rise in Gold)
Or to put it another way check out what Gold will cost you in Sterling (the currency I assume you would wish to preserve) and you'll find Gold is up 25% over the last couple of weeks. That is fairly Stratospheric. I can't decide if it's going to keep going or fall back and neither can the experts from what I've read over the last few days.
With hindsight though I wish I had 25% of my savings in Gold a month ago, cause I'd be feeling pretty smug right now if I had.
14. theboltonfury said...
don't disagree with you, but hasn't gold been there before, before doing a big drop? P4AC is relatively harmless but reporting opinion as fact in the body of the post can give the wrong impression. That's what the posts are for? But hey, I'm aware of my own lack of importance in the grand scale of this blog so people can do what they like.
P4AC - how's the canning going by the way? Button mushrooms in a can - yum yum!
15. mountain goat said...
drewster - At the end of the day I can't advise on selling coins since I have been a buyer for the past 2 years. If you are worried about liquidity then best stick with bullionvault or the ultimate liquid asset cash. Bullion coins are my doomsday insurance rather than investment. I have most of my precious metals in bullionvault and ETFs. But I will bail out of those early.
IMO ebay is not the home of scamsters because I have had trouble only once in over 100 transactions on ebay. But I only buy on auction (not buy it now) from people with good feedback ratings. I have not sold my coins on ebay but in general I have found selling very straightforward by using signed for mail service. Ebay uses a bidding system so is very good for judging the price of coins.
The only dealer I have used is ATSbullion in London but they ran out of coins when I wanted to buy silver and were therefore very expensive. That's why I switched to www.coininvestdirect.com and have been happy with them as I said.
16. digdug said...
Bolton,
What we are experiencing is a once in a century event.
17. flintster1994 said...
digdug,
Once in a century event might be rather optomistic. Hope not though.
18. mountain goat said...
Boltonfury if you want to know what ramping is then read this! - Today Silver and Gold Blew Everybody's Ears Back - All You Could Hear Was the Whining Roar of the Silver and Gold Price Jets
19. doom&gloom said...
due to the doom-mongering from the normally well-balanced contributors here, I've decided to reduce my sterling holding before Darling takes to the airwaves at 3.30pm. Think it may have to be gold (already have plenty of gold ETFs). But also considering dollar or euro short-term, as it takes a long while to work out the most lowest-risk/lowest-margin gold-buying options.
Incidentally BV have a good referral scheme. If anyone hasn't opened an account yet and wants to do a profit-share scheme on new accounts, let me know...
20. denzil said...
str 2007 said
"Denzil
You're making the same mistake I did."
Initially before I commented I did look at it's value in $ but I wasn't really making the mistake and was aware it was in relation to the pound.
The pound has been walloped of late but a consequence of that is due to the malaise in sterling in general. Does that make the bloggers original comment of "currency collapse imminent" realistic? Personally I don't think so as the value (£) would have to rise into the stratosphere first.
I'm completely unconvinced of a currency collapse and just see a bunch of people getting burned with gold like the did a few months back.
21. theboltonfury said...
historians amongst us will no doubt that over a 1000 year period this sort of thing is absolutely par for the course. Human nature hasn't changed in that time. We've had countless political wars and numerous bankruptcies of UK Plc.
Are you reading this Richard The Lion Heart?? Are you?? You know what you did and I hope you're ashamed, look what you started! (note actually he was about the 10th head of state to clean us out, some of the early Angles were spectacularly stupid)
22. bellwether said...
The people I know in the real world that bang on about gold tend to be introverts who fantasize about needing no-one. Equities on the other hand tend to be for extroverts or possibly sociopaths.
23. James said...
Goldbugs...
The vast majority of gains in gold recently are due to sterling's decline against the dollar (which it is priced in). You would have experienced basically the same results from simply putting your money in dollars, without worrying about looking after physical gold, the enormous spreads you pay to buy the stuff on the high street and whether those internet sites that are constantly recommended by certain people are pukka or not.
Of course though p4ac can't admit this because it means he's benefitted from the strength of a fiat currency, which rather goes against all of his dogmatic, silly, millenarian beliefs.
24. James said...
And if we're talking about 'protecting a deposit', str2007, well, last I checked, people selling houses still wanted to get paid in Sterling. So my saved deposit is already very nicely protected for its purpose, thank you very much. By contrast, moving into any other asset class exposes me to volatility, which endangers its value.
25. mountain goat said...
James everything, oil, GBP, housing, etc is volatile at the moment so you have to keep yourself a bit blinkered to think you are not exposed to this. Although I keep a fair bit of cash savings myself, having investments like gold give a sense of security and satisfaction when I see the gov manipulating its value. Also most investment advice I have read recommends keeping some (5-20%) precious metals so you are wrong to describe gold bugs as silly or even contrarion. This is a conservative well established wealth preservation strategy.
26. denzil said...
Rightly said MG.
It's always good to keep some gold, probably up to 10% IMHO at present but I always work on the assumption that if people are crowing about rushing to gold then there is a damn fine chance of getting burned.
27. James said...
MG - don't get me wrong - I have some gold and the diversification it provides is welcome. However - it's not protecting my house deposit. Because the house I'll be buying is priced in sterling, and my savings are in sterling, there's no need to do anything else on that account.
What I was referring to as silly are p4ac and his ideas that currency's about to be hit by hyperinflation and we'll see the end of iat money, yadd yadda yadda ad infinitum.
28. str 2007 said...
James
Yes sterling deposit for a uk house was always my presumption and providing house prices are falling all is ok.
The interest on savings went a long way to covering rent (on a bit of a dingy house but in a good area), I'm prepared to make that sacrifice.
However there was a big change to plans a couple of weeks ago when they lopped 11/2% off interest rates with the strong hint of more to follow and the promise of virtually anything else that's required.
All of a sudden I've effectively become trapped in this country (as my money now won't buy what it did in Europe) and although it hasn't happened yet savings rates are likely to plummit.
That changes alot for me and hence why I am now interested in all comments on the subject.
I like your down to earth no nonsense approach James but things are changing quite fast and as savers and renters our positions are not as good as they were.
29. planning4acrash said...
James, Sterling has not been strong since the link with gold to dollar was ended in the 70's, ever since then, its weakened.
The most recent blip was simply massive manipulation prior to the presidential election. This is clear because mints can't buy gold at this price, so have suspended sales, and coins sell at massive premium. Ounce of silver for example, selling for £10, at almost 100% premium. If this goes according to the last few bouts of volatility, silver should leverage gold's gains by 1.5-2x, so we could see silver at $20/ounce soon.
Oh, and it is true, most of the falls in gold have been against the dollar recently, election ramping. Remember that deadlines for COMEX delivery are Nov 22nd, it could default, ending the price manipulation, sending gold to $2000 or over £1000, and beyond.
30. mountain goat said...
P4C I think golds manipulation leading to the big discrepancy between futures and physical price is to do with deleveraging rather than gov manipulation. The futures market was basically all going on with borrowed money, so a big leveraged betting market that sent gold through $1000 thanks to hedge funds and the like. The big banks have squeezed out the little guys in this market by shorting it all, knowing the hedge funds were long in gold and other commodities with leveraged money. Thanks to the physical market holding up traders are now going to ask for delivery in December so things should get honest for a while. IMO the spike in prices over the summer was due to a leveraged bubble that has since started deflating.
31. malct said...
MG - re leverage
This is the story of the housing crisis, the banking crisis and the global financial meltdown.
Mortgage Lender: Rolfe talks leverage:
Everyone, everywhere was levered to the hilt, using piles of borrowed money to make leveraged bets on everything from real estate, to stocks, to currencies, to bonds, to companies themselves (LBOs), etc. With so many people maxing out leverage to drive returns, all it takes is a small decline in asset prices for all of them to go bust. Unfortunately, the decline in asset prices isn’t going to be small. Consequently, the value of equity capital will continue to get hammered.
Posted by malct @ 03:43 PM 0 Comments
32. planning4acrash said...
This, from Bob Chapman who was the world's largest gold dealer, gold is being manipulated, ALL markets are manipulated, it is clear that houseprices are manipulated, its all about derivatives, fractional futures markets. When fractional reserve futures markets exist, there is more product than the physical market, so supply is artificially increased, suppressing prices, but if there is a run on the system, delivery can't be made, and you can't print gold to make up for it:
33. Pete said...
Doesn't 80% of Gold Production go into industry and jewelery? Won't a crash yield less demand = lower price. Also, like oil etc, as price goes up won't production go up? I see less demand & more production ... any thoughts?
34. mountain goat said...
I think the characteristics of a bubble are when the "shoe shine boy" climbs in. In the leveraging area we had 18 year old maths genius' doing this and dinner party dabblers doing it for BTL. I think we have a making of a gold bubble too as fear takes hold and cash gets trashed by bailouts. But we are no where near there yet, we need a few more Iceland style collapses closer to home to happen.
35. mountain goat said...
Maybe 2 gold posts in one day is too much so I will post the link here from the FT Bring back the link between gold and the dollar " 'free market' capitalism under a fiat money regime does not produce the same blessings (sustainable prosperity) that are produced by true free market capitalism within a monetary system anchored by gold,"
36. Urban Bear said...
Pete,
From what I read the majority of Gold is in bullion vaults. No production cannot be ramped up, at will, because it takes years and big money * to bring a new mine to full production, that's why the real price of Gold is so high! * The mining companies have been starved of cash due to absurdly low share prices (less than cash assets), so some productive mines have been run down and even mothballed, until the price of Gold rises to value for value levels.