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If the dollar isnt crashing then how did you disprove the theory that if it crashes then gold wouldnt go sky high?
The theory was not "IF the dollar crashes, gold will go sky high". The theory was "The dollar WILL crash and drive gold sky high" - that's WHY so many people flocked to gold.
Yes I am. My gold, the actual metal, not some paper saying I own gold, is worth in excess of $100,000. I have reduced my TSP contributions to 0 and I have been buying gold steadily. If I had left my TSP alone, it would be worth significantly less. I did the math.
And I was shorting the market but have stopped.
You must really suck at math.
With gold prices down from their peak 2 years ago, the ONLY way your investment has gone up over that time is because you apparently pumped more money INTO IT over that time. It sure isn't because gold prices have risen - because they haven't. All that money you put into it over the past 2 years would have been better used simply putting it under your mattress.
Ah...I see where you are making your mistakes now.
You are popping the champagne every day when the price falls...you aren't a long term investor.
For you, long term is a week. I thought you had some sort of a clue about the long term effects of out of control money printing. My mistake.
I hope for your sake that interest rates never go up again even though that has never happened before in history.
Nope, not thinking "short term" at all - thinking BOTH.
Tell me how long gold sat with virtually no gain after the LAST "gold rush"?
A quarter of a century?
You have a strange definition of "short term".
Gold was in a bubble - it was the hot investment of the day (for a while) - and that day is OVER. Will it ever become the "hot" investment of the day again? Sure - but not for a longgggggg time. That's the nature of bubbles - they have their hayday then they languish for a long time while other things have their hayday. It was that way with internet stocks, it was that way with housing and it was (and is again) that way with GOLD.
But go ahead and hold on to your gold if you want to - it's YOUR money
Ken
Last edited by LordBalfor; 05-15-2013 at 10:49 AM..
The theory was not "IF the dollar crashes, gold will go sky high". The theory was "The dollar WILL crash and drive gold sky high" - that's WHY so many people flocked to gold.
Try and keep up.
Ken
Then the title of your thread is very poorly written because thats not at all what it says.
The theory that the Federal Reserve is keeping interest rates artificially low by buying government bonds was put to the test two summers ago when the Fed temporarily suspended bond purchases. Nothing happened to rates.
Niall Ferguson of Harvard, in 2009, declared the government's "tidal wave of debt issuance," would cause U.S. interest rates to soar. Over two years ago, Erskine Bowles, the co-chairman of the deficit commission, warned that unless action was taken on the deficit soon, "the markets will devastate us," probably within two years. I'm still waiting. The fact is, selling bonds is exactly what the federal government is doing to fund the deficit and investors are willing to lend the government money at very low rates.
So make up your mind as to what you want to get upset about, buying or selling bonds.
Wow.
The STATED REASON BY THE FED ITSELF for the purchase program is to keep KEEP INTEREST RATES DOWN to spur home buying and to entice retail investors to buy stocks.
How is depending on the hope that investors keep buying sky high bonds different from the hope that investors keep buying pets.com stock in 1999 or spec land lots in Las Vegas in 2005?
Nope, not thinking "short term" at all - thinking BOTH.
Tell me how long gold sat with virtually no gain after the LAST "gold rush"?
A quarter of a century?
You have a strange definition of "short term".
Gold was in a bubble - it was the hot investment of the day (for a while) - and that day is OVER. Will it ever become the "hot" investment of the day again? Sure - but not for a longgggggg time. That's the nature of bubbles - they have their hayday then the languish for a long time while other things have their hayday. It was that way with internet stocks, it was that way with housing and it was (and is again) that way with GOLD.
But go ahead and hold on to your gold if you want to - it's YOUR money
Ken
Interesting.
So gold was in a bubble after a long period of flat prices and is now reverting back to its normal state, right?
BUT bonds after DECADES of yielding more than 5% ARE NOT in a bubble and will never again yield +5% again, huh?
So increasing interest rates are GOOD for the dollar now?
The laws of economics have suddenly changed and $20 TRILLION of debt and maximum money printing has zero consequences, agreed?
I remember when people told me I was missing the boat on "the future" in the late 1990s when tech stocks like Yahoo! traded in the hundreds of dollars per share range.
So gold was in a bubble after a long period of flat prices and is now reverting back to its normal state, right?
BUT bonds after DECADES of yielding more than 5% ARE NOT in a bubble and will never again yield +5% again, huh?
So increasing interest rates are GOOD for the dollar now?
The laws of economics have suddenly changed and $20 TRILLION of debt and maximum money printing has zero consequences, agreed?
I remember when people told me I was missing the boat on "the future" in the late 1990s when tech stocks like Yahoo! traded in the hundreds of dollars per share range.
They laughed first...
For what's worth, this analyst thinks gold could drop to $500/ounce. I don't think it will go THAT low, but I DO expect it to drop to $1,100/ounce or so.
Regarding interest rates - sure, interest rates will rise at some point - that's NOT the "end of the world", nor does it mean gold will benefit. A modest rise in rates will be handled just fine and there's just no reason to intelligently assume that a rise in rates will be either excessively sudden or excessively high.
Same with inflation. At SOME point, inflation WILL pick up - but again that's not the "end of the world", nor does is mean gold will benefit. As long as the rise is neither excessivly sudden nor excessively high, a modest rising of interest rates will cool the inflation off - as it typically does - without doing an major damage to the economy.
The problem you guys seem to have is that you are Drama Queens - you base your plans on the worst-case scenario even though that scenario is outlandishly unlikely. The fact is, with interest rates at HISTORIC LOWS, the Fed has NEVER (and I mean NEVER) been in a better position to tackle an appearance by inflation. The prime rate could be doubled or tripled and interest rates would STILL be pretty reasonable.
Yes, the debt IS high - as is the deficit, but as a percentage of the total economy NEITHER is a record - and we dealt with those much higher (again, as a percentage of the GDP) deficits and debts back then and we'll deal with both the deficit and the debt now. You folks have wayyyyyyy too little faith in your country.
Ken
Last edited by LordBalfor; 05-15-2013 at 12:34 PM..
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