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Realistbear

Metals Tanking Today

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All metals taking some big hits today. Could the bubble be about to burst?

GOLD

05/20/2010

13:16

1183.70

1184.70

-7.70

-0.65%

1174.20

1196.00

SILVER

05/20/2010

13:15

17.65

17.67

-0.55

-3.02%

17.47

17.97

PLATINUM

05/20/2010

13:14

1503.00

1513.00

-98.00

-6.12%

1484.00

1541.00

PALLADIUM

05/20/2010

13:15

412.00

417.00

-46.00

-10.04%

404.00

434.00

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Ouch! Gold down 0.65% eh? Meanwhile footsie down 1.65% and the Dow down at the moment 2.56%:rolleyes:

/me looks left at his £10 note. It appears to be worth almost the same as yesterday :P

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Maths students will be familiar with the concept that between any two real numbers there are an uncountably infinite number of real numbers.

For market reporters like say Bloomberg TV this is manna from heaven, as any period of time during which the market trades, however short, can potentally be seized upon for dramatic even crisis-like effect and keep the more naive market watchers petrified like rabbits in the headlights of an on-coming car.

Don't go away, we'll be right back after this short break.

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[quote name='ianbe' date='20 May 2010 - 08:31 PM' timestamp='1274383913' post='

One day you'll get the call right.

He already has. He claims to have sold his Gold coins on the exact day the market peaked in the 80s, getting over $720 an ounce.

I believe him, too.

Got to go, just got news of a fantastic opportunity to get a big cut from a Nigerian Prince's fortune - ker ching!

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16897_large.jpg

Obarmy wants to make tanks out of gold? ...Thought so. Therefore he needs to engineer a big fall so there will be less printing to do and less trees to cut down and the carbon footprint suitably contained.

Me thinks Gold has a great future ahead. There may be a short term fall or even a sharp one if the Dow and Ftse collapse. But then it will be the rising phoenix along with silver. The biggest bubble will then be gold and silver. Deflation did someone say? It will turn to inflation even if it starts that way with all this monetised imaginary money around. Read 'The Market oracle' inflation megatrend article.

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Let's get some perspective here folks. Gold down 0.65%, eh? hmmm.

Gold in GBP:

gold_all_data_o_gbp.png

EDIT: some real tanking action today:

Bank of Ireland (ISEQ) -12.3%

Allied Irish Bank -9.01%

As the original poster said... Are they about to tank ?

The above chart suggests that their is a huge bubble in Precious Metals. Sell.

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so the US dollar strengthens vs all currencies and metals priced in USD start to tumble , reflecting the stronger dollar that buys more goods

incredible , who would have thought it?

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As the original poster said... Are they about to tank ?

The above chart suggests that their is a huge bubble in Precious Metals. Sell.

Depends: what you are really looking at here is the collapse of the pound. I have no faith in GBP - even the best efforts of Clegg/Cameron will not stop the increase in debt, let alone pay any of it off. We need to borrow >100Bn this year and next and the next... and that's if interest rates stay low. If IR's go up (bond market) then the rollover requirements will be higher. GBP: sell.

If you think gold is in a bubble, look at this from ex-poster Goldfinger. It shows how much gold would be valued at were the US (and only the US!!) to settle it's debts to the rest of the world (not domestic!) in gold.

The bubble is in paper, dear people.

External_Debt_Equilibrium_Gold_Price.png

Edited by chris c-t

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Depends: what you are really looking at here is the collapse of the pound. I have no faith in GBP - even the best efforts of Clegg/Cameron will not stop the increase in debt, let alone pay any of it off. We need to borrow >100Bn this year and next and the next... and that's if interest rates stay low. If IR's go up (bond market) then the rollover requirements will be higher. GBP: sell.

If you think gold is in a bubble, look at this from ex-poster Goldfinger. It shows how much gold would be valued at were the US (and only the US!!) to settle it's debts to the rest of the world (not domestic!) in gold.

I'm aware of the debt, I don't think the collapse in GBP has any effect on the chart you've posted though, We're a small insignificant country with poor weather, poor education and a puffed up self of our own-importance. All the GBP collapse does is make it more expensive to buy PM's which makes it look as though the price is going up. Fair point though that it may be a hedge against that.

The bigger picture though, if you're looking at why Gold is strong/weak look at the Dollar and the Euro. If the Dollar is strengthening, then sell precious metals, if it is weak then buy.

Edited to add : The comment about 'if' the Us were to settle its debt... It's rhetorical. If the Us settled its debt the dollar wouldn't exist. They'd have to deflate so much their society would fall apart. If that happens then you may be right that Gold would rocket. (See my point about the weak dollar).

I tend to agree with the original poster, but you may well be right if you want to hedge against GBP collapse,, although that wasn't what was originally asked.

Edited by TheUsualSuspect

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The problem with gold (as with oil) is the price is distorted by all the paper ETF's - even if you buy the real stuff you can bite.

You can't escape the Ponzimonster. People only think they can.

They will blame precisely this factor when the great gold crash of 1981 repeats. It is different this time because over 7000 times more gold than exists is on paper. When the PONZI hits the buffers all will wilt in the wake of the rush to sell. Every bubble eventually bursts.

Remember the old saying:

"When platinum takes a drop the gold bubble will soon pop."

BTW, it is not a good thing to be in stocks right now. Bonds do well in deflationary times.

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      • down 5% +
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