Jump to content
House Price Crash Forum
Sign in to follow this  
spoon

The New Bubble - Gold

Recommended Posts

are we in a new bubble? it certainly feels that way. gold hit $517 today and shows no hint of even a modest pullback. i am seeing articles everywhere quoting other bullish quotes from other authors. speculation that India, South Africa, Russia, Argentina are all set to accumulate vast amounts of gold. i suspect it's all a case of chinese whispers. gold is the new property. plenty of people out there that disagree with the bullish sentiment but equally happy to sit on the sidelines while the big boys ramp it up.

Citigroup today published a very bullish piece on gold. all the bullish research is surfacing after the event. i'm always sceptical of such post-rationalisation. Citigroup, strangle also forecast an average price of $470 for 2006 and $490 for 2007. Hardly bullish is it? By implication they expect some hefty pullbacks in the months ahead.

i agree. unless you're prepared to cop $450 before you see $600, stay out.

Share this post


Link to post
Share on other sites

are we in a new bubble? it certainly feels that way. gold hit $517 today and shows no hint of even a modest pullback. i am seeing articles everywhere quoting other bullish quotes from other authors. speculation that India, South Africa, Russia, Argentina are all set to accumulate vast amounts of gold. i suspect it's all a case of chinese whispers. gold is the new property. plenty of people out there that disagree with the bullish sentiment but equally happy to sit on the sidelines while the big boys ramp it up.

Citigroup today published a very bullish piece on gold. all the bullish research is surfacing after the event. i'm always sceptical of such post-rationalisation. Citigroup, strangle also forecast an average price of $470 for 2006 and $490 for 2007. Hardly bullish is it? By implication they expect some hefty pullbacks in the months ahead.

i agree. unless you're prepared to cop $450 before you see $600, stay out.

I think as long as you hold less than 10% of your portfolio in Gold then you should be ok. I agree it appears to be the start of the bubble, but one which hasn't taken off yet in any real way - wait until the common people get wind. When you hear your taxi driver, the Daily Mail and your hairdresser talk about it then is the time to sell! Gold doesn't really have a huge amount of uses other than a hedge against inflation so it is worrying really.

Anyway should this not be in the investment section. Personally I shall wait for the first Dr Bubb "reached the top e-mail" then dump the lot

Share this post


Link to post
Share on other sites

I think you are right spoon...it probably is the new bubble.

...BUT.......the sheep are still obsessed with property and so haven't yet noticed it materialising.

it's got some way to go yet before "the man in the pub" stage.

I was in the pub over the weekend and know that property is still the hot topic,so for now I am quietly loading up with gold,resources and jap equities.

...once I get wind of the new buzzword,then I will begin to look for the exit....I'm pretty sure it's one of these three,but I don't know which will be the big one.

Share this post


Link to post
Share on other sites

I think it will be Gold. Gold has an almost irrational attraction about it. More than tha the BBC have started to notice, when they also start talking about easy to use websites (a la bullionvault.com) then you will see the rational rise start.

It could go on for quite along time. Remember people were calling the top of the housing 3 years ago! Gold timescales will be shorter because it is easier to buy and sell than propery, but there will be a few false peaks on the way up, just as there are false troughs on the way down.

This is just starting to really get underway.

Share this post


Link to post
Share on other sites
Guest Riser

The problem with gold as an investment IMO is that you can't live in it. :lol::lol::lol:

No but you can sell it same day and not spend months watching thousands fall from its price each week as you try and chase to market down B)

Share this post


Link to post
Share on other sites

Question for gold bugs...

In your opinion is gold due for a pullback or is it now on it's way to new heights?

and

Shouldn't this be on a different thread?

Share this post


Link to post
Share on other sites

The problem with gold as an investment IMO is that you can't live in it. :lol::lol::lol:

You can't eat oil either, or stuff Uranium down your underpants (well not safely anyway). ;)

There was a very recent article that suggested that the world's potenital total argricultural land usage was reaching its peak, opens up some other avenues in food oils, grains and rice. Quite bizarrely this is at a point where it is becoming economically unviable in much of the West to actually farm land and land is being taken out of use.

Share this post


Link to post
Share on other sites

are we in a new bubble? it certainly feels that way. gold hit $517 today and shows no hint of even a modest pullback. i am seeing articles everywhere quoting other bullish quotes from other authors. speculation that India, South Africa, Russia, Argentina are all set to accumulate vast amounts of gold. i suspect it's all a case of chinese whispers. gold is the new property. plenty of people out there that disagree with the bullish sentiment but equally happy to sit on the sidelines while the big boys ramp it up.

Citigroup today published a very bullish piece on gold. all the bullish research is surfacing after the event. i'm always sceptical of such post-rationalisation. Citigroup, strangle also forecast an average price of $470 for 2006 and $490 for 2007. Hardly bullish is it? By implication they expect some hefty pullbacks in the months ahead.

i agree. unless you're prepared to cop $450 before you see $600, stay out.

Absolutely, money is being shepharded left, right and centre in huge quantities from an awful lot of people who think they are being smart, and it's not just real estate. Classic illiquidity trap. If we are looking at an asset deflationary scenario then keep your money in the bank. If you have a lot of money (lucky you!) and are concerned about the state of your bank then divide it up.

If you feel having cash on tap is too tempting then give it to me and i'll look after it for you :)

I hear all the time how gold is a stable currency. Well, if it is then how come it's price collapsed by 75% from over $800 dollars twenty years ago ?

You can't eat oil either, or stuff Uranium down your underpants (well not safely anyway). ;)

I'm not sure what you're proving here.

Food is useful because you can eat it. Oil is useful because you can burn it. Uranium is useful because you can either kill people with it or use it as fuel.

Gold has a few applications in minute quantities (electronics? you'd have to educate me on this) I suppose it's also useful for getting girls into bed also (you here that fred!)

Share this post


Link to post
Share on other sites

slapper slater

Merely infering that something is worth what somebody is willing to pay for it and that can change under different circumstances. Agreed gold in many respects is just a shiny metal, it has a few useful properties but on the ohter hand it has been used in teh past as a portable store of wealth, one that can easily be trasnsported across borders and exchanged for other goods. Also as much as credit is being limited to a certain extent the world is still awash with paper currency and "asset" wealth of many forms some of which may not be easily retrieveable if a mere fraction were to leak into the commodities market current prices would look tame in comparison.

Share this post


Link to post
Share on other sites

So what are we saying here? Is it time to get on the gold ladder before the first rung moves out of reach? Do I need to buy gold now or face a lifetime of renting it? If I buy some gold in need of a bit of work, give it a lick of magnolia, then can I sell it on at a huge profit?

Can anyone offer me advice on this? I need to know!

Share this post


Link to post
Share on other sites

It is quicker, easier and cheaper to buy Gold. It will be widely owned, before the Bull is done

This is exactly the point. If you need to sell a little gold to raise cash, just ring your broker. I can't ring an estate agent and get them to just 'sell a bedroom please'.

Share this post


Link to post
Share on other sites

GOLD has a long, long way to go IMO.

But a brief pullback here (to under $500 to shake out the nervous nellies) would not be surprising.

GOLD will not be in a bubble comparable to property until:

+ It is mentioned every night on the news,

+ Most of your friends own it,

+ It has exceeded 1980 prices ($850), and maybe is at least double that

Try bringing it up at a drinks party or dinner, and see how many have any idea about owning gold.

Compare that with the number of people who are in BTL.

It is quicker, easier and cheaper to buy Gold. It will be widely owned, before the Bull is done

I agree, Gold at $1000 would be a bubble, gold between $450-550 is within historical norms, $250 was abnormally low, just as $750-800 will be abnormally high, right now it's around the mean.

Although some contrarian indicators are beginning to show, Japanese investors are piling in, they're great canaries historically, and yes the 'Sunday's' are also starting to mention Gold.

BUT........ and Bubb you'll be aware of this the US decision to stop compiling the M3 looks suspiously like a sign that the US will start printing $ to inflate away the US debt. That could be a trigger for the $ falling.

Share this post


Link to post
Share on other sites

BUT........ and Bubb you'll be aware of this the US decision to stop compiling the M3 looks suspiously like a sign that the US will start printing $ to inflate away the US debt. That could be a trigger for the $ falling.

Please can you explain what this means?

Sorry - macro economics is not my strong point

Thanks

Share this post


Link to post
Share on other sites

You have to remember that the gold bulls tend to be obsessed with the 1970s - higher inflation, rising gold and oil prices. I'm not sure they're right, but I suppose that they could be. For what it's worth, I think we're in an oil bubble. People are using 'peak oil' to justify a new paradigm, that can justify ever-rising prices. Their arguments sound excellent, but I'm not convinced.

As for gold, remember that the late 1970s rise was very brief. And immediately prior to the rise the price crashed - check the graph. So while Gold might hit $1000+ by the end of the decade, it might go to $400 or lower by the beginning of 2007.

Personally, I'd rather have my money in technology shares, at least until the Spring/Summer of 2007.

Share this post


Link to post
Share on other sites

2005,

The M3 was a statistic released by the FED of money supply increases.

Printing lots of dollars is inflationary.

Seems the FED no longer wants joe public to know just how many dollars are being printed, to protect the dollar from devaluation (as much as is possible) while still printing lots of dollars.

This strategy will eventually fall apart as the inflation becomes apparent through other measures... but in the short term removal of the M3 reporting might provide some support for the dollar.

Although I am very suspect that they removed M3, and this may get priced into the market anyway.

Share this post


Link to post
Share on other sites

2005,

The M3 was a statistic released by the FED of money supply increases.

Printing lots of dollars is inflationary.

Seems the FED no longer wants joe public to know just how many dollars are being printed, to protect the dollar from devaluation (as much as is possible) while still printing lots of dollars.

This strategy will eventually fall apart as the inflation becomes apparent through other measures... but in the short term removal of the M3 reporting might provide some support for the dollar.

Although I am very suspect that they removed M3, and this may get priced into the market anyway.

Thanks :)

Share this post


Link to post
Share on other sites

Aren't UK house prices a UK phenomena?

Aren't Gold prices an international phenomena?

So when the "ordinairy" bloke in the pub starts talking about *GOLD* will that make any difference to the price of GOLD?

Surely the "buying power" of the ordinairy bloke in an ordinairy (UK) pub has absolutely no impact on the "price of gold" which is an international phenomena controlled by HUGELY wealthy international dudes such as Asian central banks etc

Maybe UK based sheeple can affect UK house prices, but can they make the slightest impact on the internationally traded commodity that is GOLD? :ph34r:

Share this post


Link to post
Share on other sites

Got into gold just recently.

I'm a bit concerned to hear that its being talked of in bubble proportions.

I feel all its done so far is caught up with the vast amount of US$ that have been printed lately.

The average man in the pub isnt yet talking about gold but as someone stated they arent the ones that affect the price.

Small trader such as me could quite possibly be the shoe shine boy of the gold boom which means I should exit.

If I'm in when its first questioned as to being a bubble does that mean it will be at least another few years before it crashes?

Share this post


Link to post
Share on other sites

No but 'sheeple' in every developed/developing country in the world placing a share of their wealth into the new bubble can effect the price of gold. Plus a combination of the dollar falling due to over supply and the gradual realisation of peak oil will force OPEC to raise their prices and this will be inflationary. A double whammy to force both central banks and private investors to buy gold as a hedge against deflation of their currencies.

Share this post


Link to post
Share on other sites

Gold has underperformed base metals ISTR in last few years - which I guess you could see as bullish (e.g. if lead/ copper have gone up more, then gold should have room to increase)

Or bearish, in that price is effected more by supply/ demand, and the demand for "useful" metals is stronger than gold. IMHO, largely due to China, it is clear that Chinese demand for commodities has been stronger than their demand for gold. The tradition of gold as store of value in China is not as strong as India or Europe (currency was silver backed, not gold backed)

Indian demand for gold will be the one to watch.

Share this post


Link to post
Share on other sites

Well you all know housing has had its day.

Gold looks likely to be the next mugs game played by the VI's for the suckers.

If you bought before the Autumn - you are already quids-in.

Just be very wary and set a point to sell at as the herds get "Gold Fever"!!!!

Share this post


Link to post
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...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • 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.