Injin Posted February 27, 2009 Share Posted February 27, 2009 As already stated by me about 4 posts in, it's a great way to no tlose as much money as everyone else - it in no way maintains, gains or saves you anything. You just lose a bit less than others will. Whoop de ******ing doo, frankly. Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 27, 2009 Author Share Posted February 27, 2009 Why are you citing examples of high inflation - what is the point of that? Do you not understand the basics of index-linked bonds? Do you know what they are? Clue is in the title by the way. Quote Link to comment Share on other sites More sharing options...
InternationalRockSuperstar Posted February 27, 2009 Share Posted February 27, 2009 Clue is in the title by the way. yes, they're linked to a gov't index, not to inflation. Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 27, 2009 Author Share Posted February 27, 2009 pure comedy! Erm, so you think that Icelandic investors in inflation-linked bonds have lost money in them? Explain please...(oh and don't mention the value of the Krona versus anything else, you'll just look stupid). Quote Link to comment Share on other sites More sharing options...
Injin Posted February 27, 2009 Share Posted February 27, 2009 Erm, so you think that Icelandic investors in inflation-linked bonds have lost money in them? Explain please...(oh and don't mention the value of the Krona versus anything else, you'll just look stupid). I can't actually believe that you are going to ***** on about the fact that technically you will get slughtly more units of currency than you put in even though they buy you less stuff when your thread title is HOW TO PROTECT YOURSELF FROM INFLATION. Pure lols. Quote Link to comment Share on other sites More sharing options...
InternationalRockSuperstar Posted February 27, 2009 Share Posted February 27, 2009 Erm, so you think that Icelandic investors in inflation-linked bonds have lost money in them? Explain please...(oh and don't mention the value of the Krona versus anything else, you'll just look stupid). of course who cares about the value of the currency. maybe I'll go and buy some Zimbabwe dollars Quote Link to comment Share on other sites More sharing options...
InternationalRockSuperstar Posted February 27, 2009 Share Posted February 27, 2009 I can't actually believe that you are going to ***** on about the fact that technically you will get slughtly more units of currency than you put in even though they buy you less stuff when your thread title is HOW TO PROTECT YOURSELF FROM INFLATION. Pure lols. the funniest part is the fact that EDM won't even admit that Icelandic Index-Linked investments were a bad idea. I mean...seriously Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 27, 2009 Author Share Posted February 27, 2009 yes, gold is easier to store than cash but it makes no sense to pay the spreads/premiums simply as an answer to storage. Buying at 5% over spot only to sell at 5% below spot (even if spot does not move) is not a wise move if it is simply a matter of it taking up less space. People were converting cash because they feared currency collapse aswell.The big players in the market are the banks. That aside, if you mean that people were converting to etf's then I disagree, people were taking delivery because they didn't trust the likes of the comex or bullionvault or a vault in zurich either. Paper gold is no safer than fiat. Many many more are now of the disposition that if you don't hold it then you don't own it. No, sorry, you are wrong on both counts. I have traded this stuff often. Firstly, I don't know anyone who pays a 10% bid/ask spread in gold - even spot gold - you ought to change your broker, or trade futures instead. Even the far contracts (e.g. 1y) have a bid/ask spread of 0.05% (that's 5 hundredths of one percent, not 5%). Secondly, standard settlement in the wholesale markets is via vault. Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 27, 2009 Author Share Posted February 27, 2009 (edited) of course who cares about the value of the currency. maybe I'll go and buy some Zimbabwe dollars the funniest part is the fact that EDM won't even admit that Icelandic Index-Linked investments were a bad idea.I mean...seriously When you are in a hole it's a good idea to stop digging. Why do you bother with this? You have made an utter fool of yourself. You are completely alone in saying that Icelanders were "derstroyed" when buying index-linked bonds. Why are you alone in this? Because it is self-evident: For an Icelander, index-linked bonds would have been a very good idea. Iceland has not defaulted and investors in these bonds are being protected from inflation. You can put up as many smiling faces as you like, but it won't change these facts. In the meantime, you have not produced a shred of evidence to suggest that this "fact" - which you made up - is in any way true whatsoever. The approach to the discussion which you have taken is mind-blowingly idiotic. Edited February 27, 2009 by Extradry Martini Quote Link to comment Share on other sites More sharing options...
Injin Posted February 27, 2009 Share Posted February 27, 2009 When you are in a hole it's a good idea to stop digging. Why do you bother with this? You have made an utter fool of yourself. You are completely alone in saying that Icelanders were "derstroyed" when buying index-linked bonds. Why are you alone in this? Because it is self-evident: For an Icelander, index-linked bonds would have been a very good idea. Iceland has not defaulted and investors in these bonds are being protected from inflation. You can put up as many smiling faces as you like, but it won't change these facts. In the meantime, you have not produced a shred of evidence to suggest that this "fact" - which you made up - is in any way true whatsoever. The approach to the discussion which you have taken is mind-blowingly idiotic. You might also find "De Nile" here - http://earth.google.com/ Quote Link to comment Share on other sites More sharing options...
uncle rogi Posted February 27, 2009 Share Posted February 27, 2009 Why are you citing examples of high inflation - what is the point of that? Do you not understand the basics of index-linked bonds? Do you know what they are? Clue is in the title by the way. you dont understand that by the time you get your money back it has been virtually destroyed by the inflation on the ground in the economy etc as the metric to pay you has been manipulated or abandoned, thus holding hard assets is by far the best way to protect you from inflation, clue is in the title by the way. the only way to fully protect yourself from domestic currency issues is to hold hard assets or another currency that you know will maintain its buying power in line with your expectations of said buying power at the time of your choice of how to hold your "cash". the best you can expect as other people have pointed out from goverment index linked bonds is to get slighty less shafted than someone holding cash.... not really protection from inflation though is it... a crisis in sterling or a banking collapse etc like argentina etc is why people should consider hard assets etc as you said youself...the risk was and still is real.. Quote Link to comment Share on other sites More sharing options...
Number79 Posted February 27, 2009 Share Posted February 27, 2009 No, sorry, you are wrong on both counts. I have traded this stuff often. Firstly, I don't know anyone who pays a 10% bid/ask spread in gold - even spot gold - you ought to change your broker, or trade futures instead. Even the far contracts (e.g. 1y) have a bid/ask spread of 0.05% (that's 5 hundredths of one percent, not 5%).Secondly, standard settlement in the wholesale markets is via vault. I am talking physical bullion not trading paper. No one can buy bullion at 0.05% above spot that is just bs. I do realise though that people were moving cash into paper gold but that does not have anything to do with gold being easier to store than cash. If gold is easier to store than cash, like in a safe which was mentioned, then you have to take delivery of physical which makes no sense when paying dealer premiums on the trades. Wholesale market is banks. Banks were not buying gold because there were fears over banks were they? For your point that gold is easier to store than cash be any sort of arguement then it means that people were taking physical delivery in which case they were storing it at home. Many were and are. Many americans do and most indians do. Quote Link to comment Share on other sites More sharing options...
uncle rogi Posted February 27, 2009 Share Posted February 27, 2009 When you are in a hole it's a good idea to stop digging. Why do you bother with this? You have made an utter fool of yourself. You are completely alone in saying that Icelanders were "derstroyed" when buying index-linked bonds. Why are you alone in this? Because it is self-evident: For an Icelander, index-linked bonds would have been a very good idea. Iceland has not defaulted and investors in these bonds are being protected from inflation. You can put up as many smiling faces as you like, but it won't change these facts. In the meantime, you have not produced a shred of evidence to suggest that this "fact" - which you made up - is in any way true whatsoever. The approach to the discussion which you have taken is mind-blowingly idiotic. as already pointed out they would have been better holding in another currency or hard assets this point is obvious they lose slighty less than someone holding cash but not nearly as well as someone protected from all the inflation/problems with the currency by not holding an instrument denominated in it... a rather obvious point that you simply must concede. Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 27, 2009 Author Share Posted February 27, 2009 I am talking physical bullion not trading paper. No one can buy bullion at 0.05% above spot that is just bs. I do realise though that people were moving cash into paper gold but that does not have anything to do with gold being easier to store than cash. If gold is easier to store than cash, like in a safe which was mentioned, then you have to take delivery of physical which makes no sense when paying dealer premiums on the trades.Wholesale market is banks. Banks were not buying gold because there were fears over banks were they? For your point that gold is easier to store than cash be any sort of arguement then it means that people were taking physical delivery in which case they were storing it at home. Many were and are. Many americans do and most indians do. Spot gold is currently 935.79-936.52 - right now and I could trade either side. That's a bid ask spread of 0.08%. "Taking physical delivery" means taking it in the fault, much like "taking physical delivery" of securities means having them in your account at the clearing house. Lastly, the wholesale market are not the just banks, they are the metals houses, the commodities traders, the mines and some banks - among others Gold now 933.99-934.67 Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 27, 2009 Author Share Posted February 27, 2009 as already pointed out they would have been better holding in another currency or hard assets this point is obvious they lose slighty less than someone holding cash but not nearly as well as someone protected from all the inflation/problems with the currency by not holding an instrument denominated in it...a rather obvious point that you simply must concede. Rogi, you don't even understand the point that Injin was making, so I'd avoid quoting him on it.... Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 27, 2009 Author Share Posted February 27, 2009 It's gone 5pm on a Friday - the time when the forum just turns into a lunatics playground. I'm off - have a good w/e all. Quote Link to comment Share on other sites More sharing options...
Disillusioned Posted February 27, 2009 Share Posted February 27, 2009 sure:http://www.bonds.is/MarketOverview.aspx?ca...derBookId=27458 please be aware though that since most if not all of the graphs are in Krona, you'll need to look at them alongside a Krona exchange rate chart to a more stable currency make any sense of them (e.g. Krona/EUR or Krona/USD). It looks like the data (and therefore the bonds) only goes back to 2004. Is that true? This is my point about inflation being subjective. If the money you have saved is to buy a house in the future, then you don’t care what happens to RPI or CPI or any other measure of consumer price change, you only care about the change in house prices. My view is that house prices will fall to 3 times average earnings or lower. When they are there, they will be cheap and it will then be a case of re-assessing and seeing whether things are so bad both in the market and in the economy itself that prices may fall much further relative to earnings. If that’s what the situation looks like, then I’ll stay out for a while longer.A word of warning on this though – the bottom will be when the outlook for the market looks the worst, but do not hesitate in buying. Look for the capitulation – i.e. huge amount of forced selling – the bottom will not be far away. This is because, much as bubbles burst because of a lack of further buying (not because of selling as some believe), bottoms in crashes form because of a lack of further sellers. So, look for the forced selling and repossessions to start slowing from some recent peak over a meaningful period such as 2 quarters (you may need to do a rough seasonal adjustment on it). That will almost certainly be a good place to pick a bottom, but it will feel at the time like it’s the worst idea in the world to buy real estate. Thanks for the info. See bolded bit: I care with respect to my mortgage. i.e. whether I choose a fixed rate or a tracker, since a tracker is governed by the BoE base rate which is likely to go up if RPI of CPI goes too high - if you get my drift. Quote Link to comment Share on other sites More sharing options...
Number79 Posted February 27, 2009 Share Posted February 27, 2009 (edited) Spot gold is currently 935.79-936.52 - right now and I could trade either side. That's a bid ask spread of 0.08%."Taking physical delivery" means taking it in the fault, much like "taking physical delivery" of securities means having them in your account at the clearing house. Lastly, the wholesale market are not the just banks, they are the metals houses, the commodities traders, the mines and some banks - among others Gold now 933.99-934.67 To trade paper gold yes. Look at a bullion dealer and see if you can buy kilo bar to be delivered to your door for that price. You can not buy physical gold at those prices. How exactly would taking physical delivery in the vault have anything at all to do with your point about gold being easier to store than cash? so the metals houses, traders and mines converted all of their cash into more gold because of fears over the banks? are you even thinking about this? Edited February 27, 2009 by richyc Quote Link to comment Share on other sites More sharing options...
InternationalRockSuperstar Posted February 27, 2009 Share Posted February 27, 2009 (edited) When you are in a hole it's a good idea to stop digging. Why do you bother with this? You have made an utter fool of yourself. You are completely alone in saying that Icelanders were "derstroyed" when buying index-linked bonds. Why are you alone in this? Because it is self-evident: For an Icelander, index-linked bonds would have been a very good idea. Iceland has not defaulted and investors in these bonds are being protected from inflation. You can put up as many smiling faces as you like, but it won't change these facts. In the meantime, you have not produced a shred of evidence to suggest that this "fact" - which you made up - is in any way true whatsoever. The approach to the discussion which you have taken is mind-blowingly idiotic. edit: there aren't enough smiley faces in the world for me to appropriately reply to the above post! the Icelandic Krona crashed so hard that people were stripping the supermarket shelves. and you think Icelandic index linked savings were a good investment. EDM, you are a joker. Edited February 27, 2009 by InternationalRockSuperstar Quote Link to comment Share on other sites More sharing options...
uncle rogi Posted February 27, 2009 Share Posted February 27, 2009 edit: there aren't enough smiley faces in the world for me to appropriately reply to the above post!the Icelandic Krona crashed so hard that people were stripping the supermarket shelves. and you think Icelandic index linked savings were a good investment. EDM, you are a joker. i hope this gets close to the level of smiley faces you had in mind bonfire night at EDM's house... Quote Link to comment Share on other sites More sharing options...
Guest Daddy Bear Posted February 27, 2009 Share Posted February 27, 2009 i hope this gets close to the level of smiley faces you had in mind bonfire night at EDM's house... As I said on another post. You may lose your shirt buying into property, gold or other hard assets at the moment, but if you stay in cash for much longer you may well lose you wardrobe...... Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted February 28, 2009 Author Share Posted February 28, 2009 (edited) To trade paper gold yes. Look at a bullion dealer and see if you can buy kilo bar to be delivered to your door for that price. You can not buy physical gold at those prices. How exactly would taking physical delivery in the vault have anything at all to do with your point about gold being easier to store than cash?so the metals houses, traders and mines converted all of their cash into more gold because of fears over the banks? are you even thinking about this? Erm "spot gold".... Do you know what that means? The word "spot" there? It means on the spot - physical gold for delivery vs payment. I buy it, I take delivery in the vault and that's it. And yes, a gold bar is a lot easier to store than paper notes. You seem to think that gold has gone up because of lots of people buying a few thousand dollars worth of the stuff to "keep at home". I'm sorry but you have absolutely no idea of the scale of that market! so the metals houses, traders and mines converted all of their cash into more gold because of fears over the banks? are you even thinking about this? No, I didn't say that. Grow up. Edit: I find it weird that you so dogmatically disbelieve what I say. As I say, I have actually traded this stuff (in sizes that no one would want to keep at home, I can assure you!), and while that is of no particular relevance, the point is that I do know what I am talking about here, and everything I say is easily verifiable with a few google searches. Why don't you look it up rather than just saying that I must be wrong? Edited February 28, 2009 by Extradry Martini Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted March 1, 2009 Author Share Posted March 1, 2009 It looks like the data (and therefore the bonds) only goes back to 2004. Is that true?Thanks for the info. See bolded bit: I care with respect to my mortgage. i.e. whether I choose a fixed rate or a tracker, since a tracker is governed by the BoE base rate which is likely to go up if RPI of CPI goes too high - if you get my drift. I was under the impression that you were asking with regard to an STR fund - you said that you wanted to use the money to buy real estate in the future. What are you doing with a mortgage now? If you do have one, then I'd use your money to repay it first and foremost. I don't understand your first question here. What data only goes back to 2004? Quote Link to comment Share on other sites More sharing options...
Extradry Martini Posted March 1, 2009 Author Share Posted March 1, 2009 edit: there aren't enough smiley faces in the world for me to appropriately reply to the above post!the Icelandic Krona crashed so hard that people were stripping the supermarket shelves. and you think Icelandic index linked savings were a good investment. EDM, you are a joker. You are amazing. Truly amazing! You come back timr and time again for this punishment. Let me say it once again: An Icelander who is protected against domestic inflation does not care what happens to the value of his currency. This is so utterly basic and your consistent denial of it is so moronic that it is indeed amazing that you still choose to wear this great big dunce's cap whenever you speak about it. Quote Link to comment Share on other sites More sharing options...
'Bart' Posted March 1, 2009 Share Posted March 1, 2009 Erm "spot gold".... Do you know what that means? The word "spot" there? It means on the spot - physical gold for delivery vs payment. Hi EDM. By the above, do you mean the price of full sized gold bars? At the moment the spot price is around £669.00, but you would have to add about another £100.00 to that to buy a 1oz coin (bullion grade), which is the sort of thing the average buyer would be after. BullionVault are currently charging around £658.00 an ounce, but I believe that they buy full sized bars. Quote Link to comment Share on other sites More sharing options...
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