Georgia O'Keeffe Posted May 23, 2010 Share Posted May 23, 2010 (edited) http://www.zerohedge.com/article/jim-rickards-discusses-financial-warfare On May 19th we noted Goldman's most recent move to a bullish stance in gold, and we concluded that "we may well be in for a gold retracement, at least from a purely technical standpoint, as Goldman "distributes" its newfound gold holdings" as Goldman moved to sell its gold to whatever few clients it has left. Sure enough, $70 dollars lower later, Goldman's ever-angrier clients who listened to this most recent horrendous tactical call, are only left with a receipt for a metric ton of KY. The gold move is nothing more than liquidation of real assets to cover margin calls in imaginary ones, such as LBO bonds which have moved from 10 cents on the dollar to par during the melt up, and are now seeing a bidless environment, a groupthink phenomenon of which a plunging FDC is the prime example. Those who have no reason to sell gold should obviously hold right - Rickards notes: "for every seller there is a buyer. The sellers are the daytraders, speculators and people in distress who need to raise cash, buyers could be foreign sovereigns, China, Russia, India, so we could be seeing a move from weak hands into strong hands. I see gold at $2,000 in the short-term, and $5,000 in the long-term." The squid is almost as good a contra-indicator as RB you cant fault logic like that, mindblowingly informative , a modern day Jesse Livermore no doubt Edited May 23, 2010 by Tamara De Lempicka Quote Link to comment Share on other sites More sharing options...
Errol Posted May 23, 2010 Share Posted May 23, 2010 He's spot on as far as price targets are concerned. Quote Link to comment Share on other sites More sharing options...
tiggerthetiger Posted May 23, 2010 Share Posted May 23, 2010 But you get the point.. 2008, gold high + property high.... Uh? Gold is higher now than 08. So no....It should read somethig like gold still going up...property busted... Quote Link to comment Share on other sites More sharing options...
ccc Posted May 23, 2010 Share Posted May 23, 2010 Uh? Gold is higher now than 08. So no....It should read somethig like gold still going up...property busted... But its not yet, in the UK at least. Gold at the moment is high, as is property. Do you disagree with this ? All depends on what you would class as high, but I cant see how anyone can say property and gold in the UK are both anything but high at present. Quote Link to comment Share on other sites More sharing options...
Crashman Begins Posted May 23, 2010 Share Posted May 23, 2010 But you get the point.. 2008, gold high + property high.... At some point the vertically opposite bubble ride meets in the middle (2008) As they swap positions. The aim is to jump on one of those bubbles at the bottom of the ride, 2 enjoy the full ride up to the top. Quote Link to comment Share on other sites More sharing options...
Crashman Begins Posted May 23, 2010 Share Posted May 23, 2010 But you get the point.. 2008, gold high + property high.... At some point the vertically opposite bubble ride meets in the middle (2008) As they swap positions. The aim is to jump on one of those bubbles at the bottom of the ride, 2 enjoy the full ride up to the top. Quote Link to comment Share on other sites More sharing options...
ccc Posted May 23, 2010 Share Posted May 23, 2010 At some point the vertically opposite bubble ride meets in the middle (2008) As they swap positions. The aim is to jump on one of those bubbles at the bottom of the ride, 2 enjoy the full ride up to the top. I see what you are saying - but that isn't what you said before. You said when one was high the other was low. Doesn't fit in with the meeting in the middle logic as above. Anyway I still don't think it is quite as simple as you think. Compare the price of Gold and Property between 2000 and today. Not really a great example of diverging bubbles is it....they both go the same direction for 5+ years. Quote Link to comment Share on other sites More sharing options...
CokeSnortingTory Posted May 23, 2010 Share Posted May 23, 2010 At some point the vertically opposite bubble ride meets in the middle (2008) As they swap positions. The aim is to jump on one of those bubbles at the bottom of the ride, 2 enjoy the full ride up to the top. "Miss Velocity" (10/1) 14.10 Curragh. Quote Link to comment Share on other sites More sharing options...
Alan B'Stard MP Posted May 23, 2010 Share Posted May 23, 2010 Gold at the moment is high, as is property. Do you disagree with this ? I think you would have to benchmark one against the other. Typical houses are becoming cheaper priced in gold. Quote Link to comment Share on other sites More sharing options...
Realistbear Posted May 23, 2010 Author Share Posted May 23, 2010 (edited) He's spot on as far as price targets are concerned. $5000 in the "long term" may not be exciting as it may seem. Turn the clock back to the last real peak in the very early 80's when gold hit an all time (inflation adjusted) high never matched since. If someone in 1980 said it will hit $1200 in the long term it would seem like a bullish prediction. However, that prediction you concur with at $5000 in the long term may be 30, 40 or even 100 years from now which makes it too remote to be a plausible forecast. Can todays punter afford to invest and wait decedaes to make a profit? The point to gold bears keep making is that gold is not a one-way bet any more than house prices were. There is no magic in commodities of any atomic persuasion and AU is just a more expensive from of FE and moves in value according to the fiat applied on any given day. The reason for my bearish stance at these levels is that deflating bubbles usually lead to deflation along the lines of the Japanese experience and the consequences of their property bubble. No reason why we will not see the same fall for the same reasons. Edited May 23, 2010 by Realistbear Quote Link to comment Share on other sites More sharing options...
Errol Posted May 23, 2010 Share Posted May 23, 2010 (edited) $5000 is within the next 5 years. I believe more like 2-3 years. Gold performs well in a deflation. Always has done. Edited May 23, 2010 by Errol Quote Link to comment Share on other sites More sharing options...
_w_ Posted May 23, 2010 Share Posted May 23, 2010 Gold performs well in a deflation. Always has done. This is a misconception. Quote Link to comment Share on other sites More sharing options...
Crashman Begins Posted May 23, 2010 Share Posted May 23, 2010 (edited) I see what you are saying - but that isn't what you said before. You said when one was high the other was low. Doesn't fit in with the meeting in the middle logic as above. Anyway I still don't think it is quite as simple as you think. Compare the price of Gold and Property between 2000 and today. Not really a great example of diverging bubbles is it....they both go the same direction for 5+ years. Obviously its not that simple but you get the gist of it... You've got to take into account all the fiddling of bullion prices, property prices, inflation etc etc etc I said that history has shown that when Gold is high property is low. I didnt say that property is now cheap & Gold is now expensive..... theres a long way to go yet IMO According to the below graph the time to jump onto the Gold bubble was 2004 / 2005 Edited May 23, 2010 by Crashman Begins Quote Link to comment Share on other sites More sharing options...
ccc Posted May 23, 2010 Share Posted May 23, 2010 Obviously its not that simple but you get the gist of it... You've got to take into account all the fiddling of bullion prices, property prices, inflation etc etc etc I said that history has shown that when Gold is high property is low. I didnt say that property is now cheap & Gold is now expensive..... theres a long way to go yet IMO According to the below graph the time to jump onto the Gold bubble was 2004 / 2005 Jumping in and out of bubbles is a dangerous game !! Always looks so simple in hindsight. 2 obvious bubbles since 95, 12 years in all and you could retire whilst driving a Ferrari with millions in the Bank. How many have done this ? Not a lot. How many have tried ? A lot. Tells you all you need to know. You need to be amazing at working out the bubble and the timing, or just lucky as ****** - or preferably both. Good luck. Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.