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cgnao

Gold - Extremely Important

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A report by Credit Agricole (a highly regarded financial institution whose research unit is the second highest rated in Western Europe) is just being circulated around the world (emphasis added):

Central banks have loaned out 10,000–15,000 tonnes of their gold reserves, between a third and a half of the reported total. Gold loaned by central banks to bullion banks or their counterparties is immediately sold into the physical market for conversion into jewellery, etc. This creates a short position between the central bank and the bullion bank/its counterparty. This short position is the foundation for the gold derivatives market which grew rapidly in the 1990s and currently has a notional value of c.USD300bn. Non-gold producers account for the majority of the short position and may not be able to cover their shorts without causing a spike in the gold price. Since the mid-1990s, much of this gold lending has been aimed at suppressing the gold price.

A low gold price has served to:

− calm financial markets during several periods of financial crisis in the last decade (e.g. Japan, Asian currency crisis, Russia and LTCM);

− improve the perception of US monetary policy; a low gold price suggests a benign inflation outlook, keeps US interest rates low and is supportive of a stronger US dollar;

− prevent substantial losses in the gold derivatives market (notably from the gold "carry trade").

The leader in the fight to expose the suppression of the gold price is the Gold Anti-Trust Action Committee (GATA). GATA was established in 1999 in the US, but is little known outside the world of "gold bugs". Despite official denials, there is much evidence to back the gold price suppression claims. Support for GATA has come from senior Russian officials. Our analysis confirms the view that central banks have loaned out 10,000-15,000 tonnes of gold, although the settlement of some of these lease contracts may be being made in cash rather than physical gold.

We estimate that there is a substantial supply deficit in the gold market of around 1,300 tonnes p.a. before any central bank selling and perhaps 700 tonnes p.a. after the publicly announced sales, but before covert selling. This compares with world gold mine output of only 2,500 p.a. Unlike their unlimited ability to create paper money, central banks' gold reserves are finite and the 7-10 year lead time on new mining projects rules out any quick fix. In addition, there is no way that the market can accommodate renewed buying by central banks like Russia…

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A report by Credit Agricole (a highly regarded financial institution whose research unit is the second highest rated in Western Europe) is just being circulated around the world (emphasis added):

Here is a link. Read the whole thing. Nothing here that HPC readers did not already know. Nice to see it entering the mainstream

http://www.gata.org/CheuvreuxGoldReport.pdf

BAB

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Wonderfully supportive to see a document by a recognized institition that mirrors a lot of what you see on financialsense.com!

Thanks for the link, some reading to do later.

Pent

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Wonderfully supportive to see a document by a recognized institition that mirrors a lot of what you see on financialsense.com!

I find this odd, in that the entire document appears to be lifted from opinion elsewhere. Is this guy saying anything new? I suppose that point has been made, but I then struggle to understand what this firm’s reputation is based on. As this report percolates through the financial echelons as yet further fodder for a rush to gold, I can only presume there will be a spike in price. Also, does Bernanke read this stuff?

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Guest Riser

This is the first report I have seen that provides evidence, from a credible source, that many of the rumours and conspiracy theories put forward by gold bugs may have some truth to them. You see all sorts of posts on the Kitco boards and it is easy to come to the conclusion that the gold bug community is a collection of eccentric nutters whose brains have been addled by the dark side wishing for world conflict and disasters that will increase the value of their gold investments.

Many remember that earlier this century the US government banned the US public from holding physical gold and set about confiscating hoards and placing it in the secretive Fort Knox. The bottom line is that Governments control the masses by controlling the money supply, as gold can't be printed in the same way as money gold it is a threat to that control. The recent increase in the price of gold could be the first indication that the central banks which lurk behind the governments of the world are starting to lose their grip on the global economy. Derivatives, ETFs, and the speed of modern communications, will just add volatility to the mix, we could be in for one hell of a ride.

Yahoo Groups - Word is spreading

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This is the first report I have seen that provides evidence, from a credible source, ....

Could Credit Agricole’s credibility, or more to the point, the author’s credibility, be undermined by this report, in so much it even uses hearsay? Don’t get me wrong, I weigh heavily towards believing this stuff until I understand evidence to the contrary. It would be interesting to know the impact of this report in the boardrooms of investment/hedge firms etc, other than to watch out for gold movements.

All fascinating stuff to observe though.

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...

You see all sorts of posts on the Kitco boards and it is easy to come to the conclusion that the gold bug community is a collection of eccentric nutters whose brains have been addled by the dark side wishing for world conflict and disasters that will increase the value of their gold investments.

...

Im a Kitco poster. For six years I have been following the discussions and reading the linked sites. Ive almost doubled my net worth in the last six months after tax and dont intend working again. Should I give the money back?

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Ive almost doubled my net worth in the last six months after tax and dont intend working again.

I'm normally a watcher rather than a contributer to investment forums, but this sort of statement is beginning to remind me of the dot com boom.

Don't get me wrong, if you can do it good luck to you.

This is all fascinating stuff. 2006 is starting to get interesting already!

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Im a Kitco poster. For six years I have been following the discussions and reading the linked sites. Ive almost doubled my net worth in the last six months after tax and dont intend working again. Should I give the money back?

They have had to be patient but I am glad things seem to be paying off. Should also say there are some fantastic posters on the Kitco boards I always look forwards to the market report from Goldfish. Kitco is a fantastic resource for gold rellated news and they nearly always have thenews first, if gold is moving it is the first place I look to see why.

You must admit there are some off the wall threads B)

Was 911 an inside job?

Edited by Riser

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...

Don't get me wrong, if you can do it good luck to you.

...

Im not exactly charging into a bubble and being lucky. Many books, I estimate millions of share prices charts, years of making observations to try to gain an understanding of whats really going on. But speaking of bubbles gold stocks could well form one.

The xau completed a massive base by "jumping a creek" from 115 to 130 which will be major support during any pullback. This is equivalent to the stock market in Jan 86. And we know what happened after that. A bubble in gold stocks is very likely to form here. Look to the crash of 87 for the shape of things to come.

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You see all sorts of posts on the Kitco boards and it is easy to come to the conclusion that the gold bug community is a collection of eccentric nutters whose brains have been addled by the dark side wishing for world conflict and disasters that will increase the value of their gold investments. Yahoo Groups - Word is spreading

You see all sorts of posts on the HPC.co.uk boards and it is easy to come to the conclusion that the housing bear community is a collection of eccentric nutters whose brains have been addled by the dark side wishing for world conflict and disasters that will increase the value of their STR investments.

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All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident. - Arthur Schopenhauer

I guess we are in stage two now..... It will be a few more years before the end of stage three. Only then will I sell my gold.

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I guess we are in stage two now..... It will be a few more years before the end of stage three. Only then will I sell my gold.

But would you buy gold now?

Or wait a few weeks?

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But would you buy gold now?

Or wait a few weeks?

We may get a pull back or we may not. I'm waiting. But I can afford to, because 75% of my capital is in gold now with an average purchase price just below £240/ounce. For me now it's a case of head I win, tail I don't lose.

Those who did not listen to my advice and own little or no gold have now little choice besides chasing the market. Being out is riskier than staying invested because gold is heading for the stratosphere now that the manipulation has been acknowledged in the mainstream investment community.

This is just history repeating: http://www.anglofareast.com/0139.html

Good luck.

RocketLaunch.jpg

post-2055-1138908000.jpg

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Guest Riser

....Those who did not listen to my advice and own little or no gold have now little choice besides chasing the market. Being out is riskier than staying invested because gold is heading for the stratosphere now that the manipulation has been acknowledged in the mainstream investment community....

RocketLaunch.jpg

This quote is relevant to the manipulation of the housing market through Brown setting artificially low interest rates:

It has been said that "the greater and the longer the manipulation, the greater the eventual price is going be".

Of course in the case of housing we are talking about the depth and duration of the inevetable correction.

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We may get a pull back or we may not. I'm waiting. But I can afford to, because 75% of my capital is in gold now with an average purchase price just below £240/ounce. For me now it's a case of head I win, tail I don't lose.

Those who did not listen to my advice and own little or no gold have now little choice besides chasing the market. Being out is riskier than staying invested because gold is heading for the stratosphere now that the manipulation has been acknowledged in the mainstream investment community.

I did "follow your advice" and have some goldmoney holdings and some gold shares. However if what you say is true and gold is heading to the stratosphere then nobody has missed out at all.

If they pile in now at an average price of 300 odd or if they have your average price of 240 odd it won't make much difference when one is glancing down from the said stratosphere.

From a plane, mountains and valleys both look a long long way down. Today 2 February 2006, nobody should feel they have missed the gold boat.

This may not be true later of course.....

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Wow. Central banks playing dirty tricks? Never.

So, all explains why gold has shot up today!

Edited by Jason

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Wow. Central banks playing dirty tricks? Never.

So, all explains why gold has shot up today!

do not understand the above quote but anyway.......

I have £20k worth of physical coins. most are maples and the rest is eagles. are you saying having the overseas gold account better than holding the gold in your hand?

I just do not trust anyone in this world to hold my gold in some far away land.

Therefore this goldmoney bank account is better than holding your gold in your hand?

thanks.

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do not understand the above quote but anyway.......

Ok, cgnao correct me if i'm wrong (i'm no expert):

+Central banks have been loaning gold they have not got, hence practicing fraction reserve banking. This increases the supply of gold in the market, hence keeps the price down.

+The price needs to be kept down so 'people' don't lose faith in fiat money (cash), hence the central banks don't lose control of the money supply.

+If everyone wanted to get their hands on the physical gold, there would be a real shortage (of 1,300 tonnes). This would drive up the price of gold dramatically.

This report has probably pushed up the prices in the last couple of days.

All good, if you have already bought gold.

Edited by Jason

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I have £20k worth of physical coins. most are maples and the rest is eagles. are you saying having the overseas gold account better than holding the gold in your hand?

I just do not trust anyone in this world to hold my gold in some far away land.

Therefore this goldmoney bank account is better than holding your gold in your hand?

thanks.

To answer the other part of your question:

I'm not sure. Physical gold is fine, but I would be worried about it being stolen? Goldmoney for me is purely for convenience.

My only worry is the Government making the possession of gold illegal, but I don't think that would happen.

Edit:

I've just worked out the value of 13,000 tonnes of gold = £134,000,000,000

Edited by Jason

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To answer the other part of your question:

I'm not sure. Physical gold is fine, but I would be worried about it being stolen? Goldmoney for me is purely for convenience.

My only worry is the Government making the possession of gold illegal, but I don't think that would happen.

Edit:

I've just worked out the value of 13,000 tonnes of gold = £134,000,000,000

My only worry is the Government making the possession of gold illegal, but I don't think that would happen. !!!

What makes you think this will not happen again! It happened before when the tough gets going for governments loosing their most important national assest to tom dick and harry!!!

as I said before I do not trust anyone with my cash let alone my GOLD.

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Those who did not listen to my advice and own little or no gold have now little choice besides chasing the market.

RocketLaunch.jpg

*make mental note*

must listen to anonymous bloke on bulletin board to put 75% of wealth into one asset.

I have £20k worth of physical coins. most are maples and the rest is eagles. are you saying having the overseas gold account better than holding the gold in your hand?

Really - dont say stuff like that on a public BB -Its not a good idea. People get stabbed for rolex watches.

Edited by Flick

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Guest Riser

*make mental note*

must listen to anonymous bloke on bulletin board to put 75% of wealth into one asset.

You could always listen to the Government and banks instead and have 100% of your wealth in one asset i.e. your House. :blink:

If your really brave you could even listen to the media and have 800 to 1000% of your wealth in BTL so just a 10% drop in property prices could wipe you out.

Edited by Riser

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What makes you think this will not happen again! It happened before when the tough gets going for governments loosing their most important national assest to tom dick and harry!!!

British Asians are very fond of gold. You should see Soho Rd in Birmingham it's chock a block full of Asian owned gold sellers.

For this reason alone you can rest assured that you will never be asked to surrender your gold. The political power of ethnic minorities seems to be in the ascendant at the moment so I doubt that the British government will be contemplating the confiscation of gold any time soon.

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*make mental note*

must listen to anonymous bloke on bulletin board to put 75% of wealth into one asset.

Really - dont say stuff like that on a public BB -Its not a good idea. People get stabbed for rolex watches.

Of course, it is far safer to keep your wealth either as a number on a computer screen or a pile of paper with nice pictures on it. ;)

People have long forgotten the wheelbarrows full or marks even though the collapse of fiat money which relies purely on confidence still happens with frighteningly regular occurrence. Zimbabwe.....

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  • 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%



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