Hargreaves Landsdowne Ramping Gold

[dr ray]

My heart sank today when I read on Bullionvault advertorial that Hargeaves Landsdowne are recommending gold to private clients.

I havent the original HL document but this is part of the press release:

Financial adviser Hargreaves Lansdown (HL) leaves share tips off the front page of its latest newsletter to small clients, and makes a case for gold instead. “Given the current economic environment, it is time to revisit the merits or otherwise of the ‘yellow metal’,†says HL’s Richard Hunter.

“It has proved a remarkably resilient store of value over hundreds of years, and, in addition, is an asset where investors seek protection when they need it most.â€

I have read the HL recommendations for about 15 years and they invariably recommend at the top of the market and they deal with the small investor who typically gets burnt in a bubble.

I have been burnt when I followed their advice to buy deutsche post, deutche telecom and Standard Life with profits bond many years ago. Lost a lot of money on all but they made their commission.

Last few months they have been recommending high yield corporate bonds but I have got wise to them and ignored their advice

Now I am horrified that they are ramping gold. Presumably Black Rock Unit Trusts as they don't sell physical.

What should I do with my physical? I really dont want to sell but my head tells me its time.

[Markie6]

Gold story from marketwatch.com

Just for information regarding gold...

quite an interesting read

[dr ray]

Gold story from marketwatch.com

Just for information regarding gold...

quite an interesting read

Odd article IMHO.

2% up in 3 months is a good retrn if maintained.

Reason writer gives for loss of golds allure is: "with a drop in oil prices providing another sign of gold's faltering appeal as a bulwark against inflation"

Correct me if I'm wrong but hasn't the oil price doubled in the last few months?

[Number79]

Odd article IMHO.

2% up in 3 months is a good retrn if maintained.

Reason writer gives for loss of golds allure is: "with a drop in oil prices providing another sign of gold's faltering appeal as a bulwark against inflation"

Correct me if I'm wrong but hasn't the oil price doubled in the last few months?

another wave of deflation coming over the summer, gold will get spanked but I don't see sub $800 at all.

should regain value later this year and new highs early next year.

if you sell your physical now then you may make/save a few pounds but what happens when you try to replace it?

either you won't be able to or the commision will be way up. Price has dropped a lot in sterling terms recently but look at the bullion houses prices, drops have been swallowed by increased commision so gold has remained relatively unchanged to purchase.

i am looking forward to a big drop in the summer so that I can load up although I fear that the drop will be in $ but sterlings relative strength will not make for much reduction.

[Old Nis]

Yes, seen a lot of comments about lower prices during the summer months; I too, have been adding a little to my stocks during the dips.

My biggest concern is that this market may not always proceed the way other commodities do. Many commentators feel that one day the silver market will accelerate markedly in a way such that those who have not already jumped on board, will be unable to do so.

Those who have got their pms will be ok. Those that have sold, will have locked in their gains; but there is a very high risk that they will have also locked themselves out of any stupendous rise. I am not an expert, but just looking at any of the long-term charts will show that silver and gold will make healthy long-term gains in the next few years anyway, so I would not sell.

[Take Me Back To London!]

I have read the HL recommendations for about 15 years and they invariably recommend at the top of the market and they deal with the small investor who typically gets burnt in a bubble.

I have been burnt when I followed their advice to buy deutsche post, deutche telecom and Standard Life with profits bond many years ago. Lost a lot of money on all but they made their commission.

Last few months they have been recommending high yield corporate bonds but I have got wise to them and ignored their advice

Have you considered doing the opposite to Hargreaves Landsdowne's advice and short what they recommend?

[dr ray]

Have you considered doing the opposite to Hargreaves Landsdowne's advice and short what they recommend?

Not brave enough to go that far but I certainly steer clear of their recommendations now.

Stayed out of commercial property a couple of years back and corporate bond over the last few months because they were pushing them

[Number79]

Not brave enough to go that far but I certainly steer clear of their recommendations now.

Stayed out of commercial property a couple of years back and corporate bond over the last few months because they were pushing them

bbc r4 were just talking about gold, I only caught the last couple of seconds when the presenter posed the question "do you think that gold is a better investment than most investment opportunities" and asked for people to email.

Now I am gtting concerned, gold could dump much lower than anticipated this summer.

[Take Me Back To London!]

bbc r4 were just talking about gold, I only caught the last couple of seconds when the presenter posed the question "do you think that gold is a better investment than most investment opportunities" and asked for people to email.

Now I am gtting concerned, gold could dump much lower than anticipated this summer.

I personally hope the price of gold stops mucking about and makes a decisive price dump which will be a very nice buying opportunity and set-up gold to burst through and consolidate above $1,000.

Edited July 1, 2009 by Take Me Back To London!

[dr ray]

I personally hope the price of gold stops mucking about and makes a decisive price dump which will be a very nice buying opportunity and set-up gold to burst through and consolidate above $1,000.

I wonder how many suckers have been lured in so far. I thought buying physical was quite a big step for me and not an easy decision. You hand over enough cash to buy a decent car and get less than a matchbox full of coins. Somehow a thousand shares of some company seems more tangible and better value.

Maybe we havent even got to the euphoria phase of gold buying yet and we still have the bubble phase to come when the punters are convinced gold is the next hot investment.

If the punters buy on bullion vault or buy paper gold they wont realise what a pitiful small amount their money buys and it wont put them off.

[matroskin]

I personally hope the price of gold stops mucking about and makes a decisive price dump which will be a very nice buying opportunity and set-up gold to burst through and consolidate above $1,000.

How about 95% price dump?

Who in his/her right mind would sell a gold mine producing 30K ounces annually worth USD27.9m in current prices, for just USD1.5m unless s/he expects a huge drop in gold price?

[thod]

How about 95% price dump?

Who in his/her right mind would sell a gold mine producing 30K ounces annually worth USD27.9m in current prices, for just USD1.5m unless s/he expects a huge drop in gold price?

It says "We're looking for the mine to produce around 30,000 ounces of gold a year. We're not going to be the biggest gold producer in the world, but we're happy to be profitable at that level." I read this to mean they need to produce that much to make a profit. This calculation will take into account mining costs and projected gold price. It is not cheap to mine in Greenland, you need to ship everything by air, house workers, deal with perpetual night and freezing temperatures in the workers compound. You have to ask if the costs of running such an isolated mine are going to exceed the sales.

For example, the oceans have far greater quantities of dissolved gold in them than this mine. You cannot however take the value of that gold as being profit. The cost of extracting it from seawater is orders of magnitude above the value of the metal. Someone has done their sums and decided the risks are such that they will only pay 1.5m USD. Canada is awash with such gold strikes by the small exploration companies. They call them moose pastures because that's all they are good for. They frequently produce marketing blurb saying how much gold is down there and please buy the shares, they neglect to say it cannot be extracted economically at today's prices.

[endgame]

I wonder how many suckers have been lured in so far. I thought buying physical was quite a big step for me and not an easy decision. You hand over enough cash to buy a decent car and get less than a matchbox full of coins. Somehow a thousand shares of some company seems more tangible and better value.

Maybe we havent even got to the euphoria phase of gold buying yet and we still have the bubble phase to come when the punters are convinced gold is the next hot investment.

If the punters buy on bullion vault or buy paper gold they wont realise what a pitiful small amount their money buys and it wont put them off.

You could always buy some silver where you get more metal for your money, or copper even. If you want less metal, try platinum. These metals would not be precious if you paid £100 for a lorry load.

[matroskin]

You have to ask if the costs of running such an isolated mine are going to exceed the sales

...at current or below current prices. I'm sure if both parties were convinced that gold price is about to go to USD10K per ounce or even to USD1.5K per ounce, the deal would look different or seller would hold on longer for asking price.

Shame such bargains aren't happening with property (yet).

[Vagabond]

What should I do with my physical? I really dont want to sell but my head tells me its time.

This tends to be the problem with gold IMO. People find it hard to seperate buying it as an investment or buying it as insurance.

If its the former, and you think the top has been reached, then sell and buy back in later, either making a profit or taking the loss on the chin. If its the latter, then you hold come what may, as anything short of TSHTF type scenario is just background noise.

I have a small % of phyiscal gold, which I bought as insurance, and I would be willing to buy both gold and silver as an investment if the prices go down to levels I see as entry points.

[dr ray]

This tends to be the problem with gold IMO. People find it hard to seperate buying it as an investment or buying it as insurance.

If its the former, and you think the top has been reached, then sell and buy back in later, either making a profit or taking the loss on the chin. If its the latter, then you hold come what may, as anything short of TSHTF type scenario is just background noise.

I have a small % of phyiscal gold, which I bought as insurance, and I would be willing to buy both gold and silver as an investment if the prices go down to levels I see as entry points.

Nail on head. I bought as insurance but can't help watching the price. I'm still buying and its easier now as the green shoots story is more clearly media crap and Sterling seems to be inevitably going down the pan.

[DiggerUK]

This tends to be the problem with gold IMO. People find it hard to separate buying it as an investment or buying it as insurance.

If its the former, and you think the top has been reached, then sell and buy back in later, either making a profit or taking the loss on the chin. If its the latter, then you hold come what may, as anything short of TSHTF type scenario is just background noise.

I have a small % of physical gold, which I bought as insurance, and I would be willing to buy both gold and silver as an investment if the prices go down to levels I see as entry points.

One of the most lucid comments on gold I have seen in a long time.

Very honest, very accurate.

[d2thdr]

I have a small % of physical gold, which I bought as insurance, and I would be willing to buy both gold and silver as an investment if the prices go down to levels I see as entry points.

What levels (range) do you think would be reasonable entry points?

[Spot]

For me, i'll consider buying when it's (hopefully) around the £500 per ounce area again.

[Vagabond]

What levels (range) do you think would be reasonable entry points?

I was looking for $750/oz gold and $10.50/oz silver +/-10%.

Please bear in mind though, I have no idea what I'm talking about so please don't consider that advice in any way shape or form

[DiggerUK]

Rule 1. Buy when it's low.

Rule 2. Sell when it's high.

How you make the judgement cannot be defined, you take info and advice were you can get it from. At the end of the day you have to hold your own counsel and live with your call. There is no answer.

[Number79]

I was looking for $750/oz gold and $10.50/oz silver +/-10%.

Please bear in mind though, I have no idea what I'm talking about so please don't consider that advice in any way shape or form

if we ever see those levels again then it will be difficult to find much physical. I don't see that we could go sub $800 again.

August will be the low for gold, the last low imho, I think that we may get to $85x although many believe that $900 will hold.

I am beginning to think that our focus should not be on gold but sterling. Isn't looking good and while gold acts as a currency itself for us it certainly isn't straight forward when working in sterling.

[Vagabond]

Rule 1. Buy when it's low.

Rule 2. Sell when it's high.

How you make the judgement cannot be defined, you take info and advice were you can get it from. At the end of the day you have to hold your own counsel and live with your call. There is no answer.

+1 Spot on.

if we ever see those levels again then it will be difficult to find much physical. I don't see that we could go sub $800 again.

August will be the low for gold, the last low imho, I think that we may get to $85x although many believe that $900 will hold.

I am beginning to think that our focus should not be on gold but sterling. Isn't looking good and while gold acts as a currency itself for us it certainly isn't straight forward when working in sterling.

I thought October was the traditional low month for gold?

I didn't think £ was looking too bad at the minute. I guess a lot will depend on whether the BOE decide to print more QE though.

[dr ray]

+1 Spot on.

I thought October was the traditional low month for gold?

I didn't think £ was looking too bad at the minute. I guess a lot will depend on whether the BOE decide to print more QE though.

Has anyone watched the Hugh Hendry interview from a couple of days ago? (link somewhere on main forum)

He was bearish on Gold partly because the MSM is bullish on it, as was worrying me, and partially because the POG now is the same as a year ago, despite the biggest financial collapse any of us has ever lived through in the meantime.

This may seem circular but as wealth is destroyed globally (lets not argue whether it was ever real) will people be able to support the current high price of gold. For example if India becomes poorer surely less gold will be bought if its a choice between food or gold.

I'm being a devil's advocate here because I want some critical discussion rather than religious belief

[DrGUID]

HL tips are sometimes good, if you'd followed the corporate bond ramping earlier in the year you'd be a happy bunny now .