Jump to content
House Price Crash Forum

Gold strategy in the current economy


Recommended Posts

2001? :)

As soon as Joe Public gets involved in heavy investment in the latest big thing, it must, surely, go tits up.....mustn't it?? If 95% of the country all pile into gold, does not that alone reduce its value, just because everybody has it .? Prior to 2000, I was heavily into shares and thought what a clever boy am I. Then everybody was into it and we all know what happened next. Same with property - everybody piling in and maxing out in a property stampede. Is this on the cards with gold or will it just keep on climbing to unprecedented levels? Is it different with gold?

Link to comment
Share on other sites

re-read your own post. I think you've answered your own question.

Do you seriously expect me to believe that just because the UK uses pieces of paper which have no inherent value whatsoever and its monetary system is on the brink of collapse, that might be wise to purchase a small amount of a globally recognised commodity as insurance?

I suggest that you are hugely lacking in arrogance. Just because every other similar system in history has failed, and the UK is highly likely to follow, doesn't mean that you shouldn't completely ignore our current situation.

To remedy this, may I suggest you try to ignore the dull factual based information, and rather concern yourself more with what Jordan and Will & Kate are doing.

Only then will you begin to realise the error of your obsession with facts, and only then will you be able to discuss how nobody could have seen it coming over a baked rodent with your fellow tramp.

Link to comment
Share on other sites

Only then will you begin to realise the error of your obsession with facts, and only then will you be able to discuss how nobody could have seen it coming over a baked rodent with your fellow tramp.

How are you going to cook your rat though if you've exchanged all your savings for lumps of metal?. Gold doesn't burn.

bm.jpg

Link to comment
Share on other sites

As soon as Joe Public gets involved in heavy investment in the latest big thing, it must, surely, go tits up.....mustn't it?? If 95% of the country all pile into gold, does not that alone reduce its value, just because everybody has it .? Prior to 2000, I was heavily into shares and thought what a clever boy am I. Then everybody was into it and we all know what happened next. Same with property - everybody piling in and maxing out in a property stampede. Is this on the cards with gold or will it just keep on climbing to unprecedented levels? Is it different with gold?

Personal feeling is it all depends if the media start ramping. The bull run so far provides enough data for anyone to make up their own mind about Gold, obviously Joe Sixpack cannot do this and needs the Daily Wail to guide him towards the light.

I'm quite happy for Gold to continue climbing the wall of worry, when the worry goes away and the fundamental issues get fixed Gold will go down. If the issues don't get fixed (most avid bugs believe they are unfixable) then Gold will continue up and eventually go on the tear as something big blows.

As a general investment strategy I agree with the old Wall Street saying:-

  • Put 10% of your assets into Gold… and hope it doesn’t work!

At the end of the day Gold is just a basket to hold your wealth in, much the same as another currency, the stock market, a pile of bricks or a collection of paper promise. All of these baskets are good but only at certain times. You pays your money and you makes your choice...

Link to comment
Share on other sites

There's a debate in 'another place' as to whether the instating of a HPC Gold thread signify the start of the 'media enthusiasm' or even 'public awareness' phase in the gold cycle. I have to say I think it does!

Nope. :)

Link to comment
Share on other sites

BBC news now carry the gold price as part of the rolling News 24 business item.

FTSE

DOW

£

GOLD

:rolleyes:

Most popular on BBC website 'business' section

Most Popular

From Business in the last week

<br class="Apple-interchange-newline">

Link to comment
Share on other sites

BBC news now carry the gold price as part of the rolling News 24 business item.

FTSE

DOW

£

GOLD

:rolleyes:

Most popular on BBC website 'business' section

Most Popular

From Business in the last week

<br class="Apple-interchange-newline">

could they really retain any respect by ignoring something like gold right now?

gold is beimg mentioned because if they dont then they risk embarassing themselves rather than this being anything to do with shiny toe caps.

the bbc are starting to run bearish stories about property but it doesnt mean that it is a good time to buy does it? just that they have to admit reality and report otherwise risk ridicule.

I still think that there may be a correction, maybe hope is more accurate than think, but the longer term direction is clear for now.

why doesnt this mac correct spelling when i right click a word? £1600 and it cant spell check ffs

Link to comment
Share on other sites

This is pretty cool, I can barely believe that the mods have allowed a gold thread on the main forum.

I only hope that the trial can be used well and we can argue points properly rather than descending into spats and giving the excuse to be cancelled.

I think that the mods have had to yield to figures and reality but dont for one minute believe that things cant change if the thread becomes full of pointless chest beating.

I have nothing profound to add right now, nothing of any relevance at all in fact, but I do hope that we can all discuss well and keep this thread forever.

Link to comment
Share on other sites

could they really retain any respect by ignoring something like gold right now?

gold is beimg mentioned because if they dont then they risk embarassing themselves rather than this being anything to do with shiny toe caps.

the bbc are starting to run bearish stories about property but it doesnt mean that it is a good time to buy does it? just that they have to admit reality and report otherwise risk ridicule.

I still think that there may be a correction, maybe hope is more accurate than think, but the longer term direction is clear for now.

why doesnt this mac correct spelling when i right click a word? £1600 and it cant spell check ffs

You're exhibiting a bias.

I was simply reporting the fact.

Link to comment
Share on other sites

BBC news now carry the gold price as part of the rolling News 24 business item.

FTSE

DOW

£

GOLD

:rolleyes:

Most popular on BBC website 'business' section

Most Popular

From Business in the last week

<br class="Apple-interchange-newline">

I can just imagine the 1920s German version of RK. The canny contrarian - still reeling from the death of Rosa Luxembourg - is writing in an article for his local Spartacist newsletter. Noting that coal keeps hitting new highs and making headlines in the business section of Die Welt, he boldly urges his loyal readers to offload hard assets, prepare for the oncoming deflation and invest everything they own into War Loan :)

Link to comment
Share on other sites

http://www.npr.org/templates/story/story.php?storyId=7397200

supernova_500.jpg?t=1248630636&s=51

Galactic Gold: A Valentine Story

Ever wonder where the gold in your wedding ring came from? This Valentine's Day, we ask Neil deGrasse Tyson, director of New York City's Hayden Planetarium, to explain the history of the rare element.

In the Beginning

According to Tyson, author of Death by Black Hole and Other Cosmic Quandries, all gold on Earth started out in the center of a star; he says stars are "in the business of cosmic alchemy."

When the universe began, there were only two kinds of atoms: hydrogen, which has one proton, and helium, which has two protons.

The problem was that hydrogen and helium couldn't combine to make a new kind of atom of three, four or five protons. The two atoms resisted each other because they were the same charge.

Unless, of course, it got very, very hot. How much heat would it take to get two protons to sit together?

About 10 million degrees, Tyson says. And that's where stars come in.

Fiery Fusion

Stars like our sun are so hot that protons collide with such force and have no choice but to combine. It's called fusion. Inside the sun's furnace, protons turn into heavier and heavier atoms: Hydrogen atoms combine to become helium, and then those helium atoms combine to become carbon.

"It keeps going," Tyson says. "Carbon and oxygen and nitrogen and silicon, and [fusion] just plows its way up the periodic table of elements."

Carbon has six protons, nitrogen seven protons, oxygen eight protons. A hot star can cook all the way up to iron, a 26-proton atom. But that's where it stops.

"When you reach iron, nobody can do anything... It's dead matter. You can't fusion it. You can't fission it," Tyson explains.

Once a star has converted all its atoms into iron, it's out of fuel.

"That's a bad day for the star," Tyson says. "And at that moment, the entire star collapses, and in that collapse, the star reaches stratospheric temperatures and blows its guts to smithereens."

The Collapsing Star

A collapsing star is called a supernova. The explosion is so powerful and cataclysmic that you can see it across the universe.

Supernovae outshine whole galaxies, because the atoms inside are colliding furiously, creating intense heat — hundreds of millions of degrees.

Only in a supernova is it possible to create atoms with 30 protons, 40 protons, 50 protons or even 60 protons. Nature prefers even numbers for stability, but every so often, the star will forge an odd-numbered atom, a real rarity: gold!

Gold is a rare, odd-numbered atom with 79 protons. For every single gold atom in the universe, there are 1 million iron atoms, Tyson says.

A Long Journey

After the explosion, those few gold atoms are cast deep into the universe where they sit in empty space for eons. Eventually, some of the atoms may join a cloud. That cloud may condense into a planet.

Once inside a planet, some of the atoms may make it near the surface where we can come and dig them up.

So every atom of gold in your wedding ring was forged in a collapsing star, and then traveled across the universe to get to your finger. All the gold we wear and all the gold we give has made this same journey.

So how many miles and how many years are represented in a ring?

Calculating the path from several supernovae around our galaxy back to our solar system, Tyson concludes, all told, it's a journey of 3 million light years.

-------------------------------------------------

More rare than you thought & older than earth itself :)

Link to comment
Share on other sites

This is money article this week:

Gold breaks record £1,000 an ounce on debt crisis fears. How much higher can it go?

Patrick Connolly, Head of Communications, AWD Chase de Vere

Gold is considered by many to be a safe haven but if you look back you will see that the complete opposite is true.

The price of gold has suffered from high levels of volatility resulting in investors potentially making or losing huge amounts of money over some very short periods.

From 20 July 1976 to 21 January 1980 the price of gold rose by a staggering 688 per cent, an annualised return of about 80 per cent, this rise being due to strong oil prices, high levels of inflation and geopolitical issues. This compares with a return of about 17 per cent per annum for the current bull run.

However, from its peak in 1980 the price of gold fell by 65 per cent in less than two and half years and it took more than 28 years for the 1980 peak to be reached again and investors to get their money back, not even taking into account the effects of inflation; so much for gold being a reliable hedge against inflation.

It is easy for advocates to justify the rise in the price of gold and it is possible we still have further to go, based on the rise to 1980 we could see the gold price reaching $2,000.

It is possible that we are now in a ‘gold bubble’ and those investing face the risk of losing far more on the downside than they could potentially gain on the upside.

Danny Cox of Hargreaves Lansdown

The gold price continues to climb due to the growing financial crisis in the eurozone. Gold has always been as a safe haven in times of crisis and we have seen many in recent years.

At the moment there doesn’t seem anything that could stop this flight to safety, this suggests that it will continue to climb.

However, it does look expensive. What is interesting is that the price of gold mining companies has lagged behind the gold price – normally they are very closely correlated. This means there is potentially a buying opportunity for funds such as the Blackrock Gold and General fund.

Stephen Barber, who advises Selftrade on markets and economics

There are very good reasons why gold continues to rise. Gold is a store of wealth, is limited in supply and becomes attractive in times of uncertainty.

Inflation, US deficit, political unrest, volatile equity markets and eurozone sovereign debt crises all drive the commodity price up.

While demand comes from jewellers and central banks, recent price hikes have been investor led.

When everyone on the Clapham Omnibus knows an asset's value it is time to think twice. I have thought we are in a gold bubble for a couple of years but that has not meant the value wouldn't increase or indeed stop it from inflating further.

Gordon Bowden, director of Quainton Hills Financial Planning

Gold will continue to grow in value as long as investors continue to believe it to be a safe haven.

With all the problems in Greece and the eurozone and the debt problems in the USA investors are worried about where to invest.

Western economies are troubled, property prices are static or declining, cash interest rates are derisory and emerging markets have hidden risks.

The gold bandwagon may have more months to go. However the long term prospect for gold is not as good. It offers no income yield and has relatively few industrial uses. When the momentum runs out the speculators will scurry away and the price could fall – I would not buy at this price

http://www.thisismoney.co.uk/money/investing/article-2016411/As-gold-breaks-record-1-000-ounce-barrier-high-go.html

Link to comment
Share on other sites

I can just imagine the 1920s German version of RK. The canny contrarian - still reeling from the death of Rosa Luxembourg - is writing in an article for his local Spartacist newsletter. Noting that coal keeps hitting new highs and making headlines in the business section of Die Welt, he boldly urges his loyal readers to offload hard assets, prepare for the oncoming deflation and invest everything they own into War Loan :)

I've said I think we're now in the blow off phase.

I'm quite satisfied (from reading extensive testimony from goldbugs) they have little idea at all how to exit their positions.

Gold performance has more or less been pegged to equity performance since the great deflationary scare of Sept/Oct 2008. That ought to tell you something about what the driver is/are.

Grantham's bubble study (which appears to be the most comprehensive on the planet - unless you've got a better one) tells you all you need to know about durations.

I hope you get rich(er). Genuinely. But I hope far more that many multiples of you don't get considerably poorer as the small number of very big players in this tiny market offload onto them having read the bugs extensive delusionary bullsh1t.

If you think this is 1920s Germany then I'll simply not read anything else you write. For obvious reasons. :)

Link to comment
Share on other sites

http://www.npr.org/templates/story/story.php?storyId=7397200

supernova_500.jpg?t=1248630636&s=51

Galactic Gold: A Valentine Story

Ever wonder where the gold in your wedding ring came from? This Valentine's Day, we ask Neil deGrasse Tyson, director of New York City's Hayden Planetarium, to explain the history of the rare element.

Fiery Fusion

Stars like our sun are so hot that protons collide with such force and have no choice but to combine. It's called fusion. Inside the sun's furnace, protons turn into heavier and heavier atoms: Hydrogen atoms combine to become helium, and then those helium atoms combine to become carbon.

-------------------------------------------------

More rare than you thought & older than earth itself :)

So, using the LHC, I presume that base metal really can be turned into Gold!

Link to comment
Share on other sites

It has now hit the main headlines on the BBC business page - surely this now deserves merit to be discussed in the main page of HPC? After all, I'd like to think that we are "ahead of the curve"..

Gold price climbs to new record on debt uncertainty

Mixed signals here - on the one hand they are flying the warning flag, saying "prices are higher than they have ever been before", but then almost in the same breath saying that the price will go higher, and that it is "considered a safe investment"... Note that they don't put any disclaimer on it - it is therefore "never" an unsafe investment...

I worry about gold at high prices. I think that is quite risky

Link to comment
Share on other sites

I've said I think we're now in the blow off phase.

I'm quite satisfied (from reading extensive testimony from goldbugs) they have little idea at all how to exit their positions.

Gold performance has more or less been pegged to equity performance since the great deflationary scare of Sept/Oct 2008. That ought to tell you something about what the driver is/are.

Grantham's bubble study (which appears to be the most comprehensive on the planet - unless you've got a better one) tells you all you need to know about durations.

I hope you get rich(er). Genuinely. But I hope far more that many multiples of you don't get considerably poorer as the small number of very big players in this tiny market offload onto them having read the bugs extensive delusionary bullsh1t.

If you think this is 1920s Germany then I'll simply not read anything else you write. For obvious reasons. :)

Relax RK, just baiting you (successfully it seems).

My gold holdings aren't sufficient to make me rich or poor. Just a weighting.

Edited by 50sQuiff
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
 Share

  • Recently Browsing   0 members

    No registered users viewing this page.

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.