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Hargreaves Landsdowne Ramping Gold


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

The type of people they sell to tend to buy and hold (because no one tells you when to sell). The corporate bond ramping was based on the belief that the prices were factoring in a depression similar to the 1930s which was considered very unlikely at the time. I wasn't so sure.

The punters tend to be pulled in for the last great blow off before the crash and then don't get out in time to avoid big losses. HL do their ramping at that stage - when the smart money is unloading their stock and moving on.

My own worry is that corporate bonds will become worthless if inflation picks up and more companies default. Both the income and the capital values will be hit. At the moment it does look rosy I agree.

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

Corporate Bonds are all fine 'n dandy so long as they keep paying the dividends, and stay afloat.

I don't know if Woolworth's, MFI and a dozen other high street shops had Bonds in issue when they went under.

If they did, what do you think the bunnies feel like now.

There are people out there being persuaded by IFA's that Bond investments are low risk, and that gold is a foolish high risk investment.

Guess what I told my imaginary IFA friend. :lol::lol::lol:

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Corporate Bonds are all fine 'n dandy so long as they keep paying the dividends, and stay afloat.

I don't know if Woolworth's, MFI and a dozen other high street shops had Bonds in issue when they went under.

If they did, what do you think the bunnies feel like now.

There are people out there being persuaded by IFA's that Bond investments are low risk, and that gold is a foolish high risk investment.

Guess what I told my imaginary IFA friend. :lol::lol::lol:

Actually even that is not enough.

If they do stay afloat and continue to pay out at say 5-6% and inflation goes up to 10% they would plummet in value by maybe 70% so that the payout and the risk premium relative to inflation is preserved

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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

Moneyweek are on the case today.

Is Gold in a Bubble?

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If they do stay afloat and continue to pay out at say 5-6% and inflation goes up to 10% they would plummet in value by maybe 70% so that the payout and the risk premium relative to inflation is preserved

DocRay, you say 5/6%, what kind of rates can anyone expect from this class of investment. Unless in a tax free environment is it worth the risk anyway. Especially when compared to this BS A/C that pays 5% on what is in effect a 90 day notice A/C.

http://www.newcastle.co.uk/savings/5yearbond

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DocRay, you say 5/6%, what kind of rates can anyone expect from this class of investment. Unless in a tax free environment is it worth the risk anyway. Especially when compared to this BS A/C that pays 5% on what is in effect a 90 day notice A/C.

http://www.newcastle.co.uk/savings/5yearbond

Anything up to 7% and they can go into a SIPP or ISA. There is no question they are attractive now and if current low interest rates continue (so they are easy to sell at present) but my concern is that if the economy begins to recover and inflation does pick up there will be a loss of capital value while if depression gets worse some of the issuers of bonds will default and there is a loss of capital value.

Ideal scenario seems to be a Japan style decade of deflation where the return is well above anything else available.

I'm not competely against them. Many of the issuers of bonds strike me as less likely to default than the UK government and yet the yield is far above gilts (maybe not a good way to look at it but I'm no expert)

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+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.

August is generally lower than october. Aug is a low before a rally into sept, oct becomes a higher low before the end of year run. The piece below has a nice chart although it is worth looking at charts for many previous years. Occasionally seasonality can be thrown out and pretty much reverse but if you overlay 2009 chart over 2008 it is looking pretty good for business as usual this year.

http://www.zealllc.com/2008/huiseas2.htm

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