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You're confusing "foolishness" with "confidence". I'm confident it'll drop again. The recent rise is just a "dead cat bounce" (that's pretty much already out of steam) - a temporary respite before beginning the next leg down. The trend is CLEAR - and there's really no rationale anymore for gold to rise up to it's past heights - the deficit is falling, tax revenues are rising, the economy continues its (admittedly slow - though steady) recovery, and the dollar is STRONG. There's just no reason for gold to go up anymore - that's why the smart players have already gotten out of gold.
Ken
Gold will bounce around so, yeah, your dream of gold "dropping" will come true...then it will go up again...then it will go down again and so on.
But as long as the dollar printing presses are running full blast and politicians continue to bury Americans (and their children and grandchildren) in debt the TREND will continue HIGHER.
Gold will bounce around so, yeah, your dream of gold "dropping" will come true...then it will go up again...then it will go down again and so on.
But as long as the dollar printing presses are running full blast and politicians continue to bury Americans (and their children and grandchildren) in debt the TREND will continue HIGHER.
Of that I am CONFIDENT.
Good luck with that. I suspect that this will repeat what happened last time gold fever struck - gold will continue to drop and it will STAY down for YEARS (maybe - like last time - for DECADES). The highs of a couple of years ago will not be repeated anytime soon.
Shall we review it again in say 3 months and then 6 months and gthen a year to see where we stand?
Good luck with that. I suspect that this will repeat what happened last time gold fever struck - gold will continue to drop and it will STAY down for YEARS (maybe - like last time - for DECADES). The highs of a couple of years ago will not be repeated anytime soon.
Shall we review it again in say 3 months and then 6 months and gthen a year to see where we stand?
Ken
Your post reveals your lack of understanding of gold prices, interest rates, inflation vs. disinflation and how it all relates to a guy named Paul Volcker:
Your post reveals your lack of understanding of gold prices, interest rates, inflation vs. disinflation and how it all relates to a guy named Paul Volcker:
Even ASSUMING all that in your post is true, it sure doesn't help support the case for GOLD - which means indeed, just what I said, gold prices are on the way down (and they won't get back to their previous highs for YEARS (probably more like DECADES). There is just no rationale any more for gold to rise significantly, and LOTS of rationale for it to fall - which is why it HAS been falling.
Gold will bounce around so, yeah, your dream of gold "dropping" will come true...then it will go up again...then it will go down again and so on.
But as long as the dollar printing presses are running full blast and politicians continue to bury Americans (and their children and grandchildren) in debt the TREND will continue HIGHER.
Of that I am CONFIDENT.
Just an FYI update for you.
The new CBO projections for the 2013 FY deficit have just been cut substantially - down to $642 billion (down $200 billion from the estimate that was just done in February), which will mean that the deficit has been cut in HALF since 2009 - and it will CONTINUE to fall, with the new estimation putting the 2015 deficit at $378 billion (lower than Bush's last "full year" deficit of $458 billion in 2008 and wayyyyyy lower than the peak 2009 deficit of $1,413 billion).
This trend of increasing revenue and falling deficits (a trend which actually seems to be accelerating) is the REASON I'm confident gold will continue to tank (in fact, this latest news will probably speed up the process). As you show in your post, the main rationale for holding gold is the fear of inflation from endless money-printing - but there has BEEN no major inflation and with the endless printing process winding down, it erases the justification for gold to be at the high price it's been at. Consequently, as the realization sinks in that there will be NO major inflation and that the US is getting its' financial house in better order, gold is collapsing - and will CONTINUE to do so.
"...The Congressional Budget Office cites higher tax revenues and better-than-expected bailout repayments by mortgage giants Fannie Mae and Freddie Mac as the key reasons for the improved outlook. The budget office now predicts a 2013 budget deficit of $642 billion, more than $200 billion below its February estimate. This year's shortfall would register at 4.0 percent of the economy, far less than the 10.1 percent experienced in 2009 when the government ran a record $1.4 trillion deficit..."
Even ASSUMING all that in your post is true, it sure doesn't help support the case for GOLD - which means indeed, just what I said, gold prices are on the way down (and they won't get back to their previous highs for YEARS (probably more like DECADES). There is just no rationale any more for gold to rise significantly, and LOTS of rationale for it to fall - which is why it HAS been falling.
Ken
You can't argue gold is going to plummet back to "pre-(so called) bubble" levels while the Federal Reserve has AS A POLICY the intention to debase the currency for a long time.
Perhaps if the debt to GDP ratio wasn't so high you could get away with it but when you have interest rates pinned to the basement floor AND hardcore money printing in effect you CAN'T totally crash precious metals prices. How can gold fall back to the hundreds of dollars per ounce with the threat of "tapering" hovering over the heads of institutional bond investors?
Why do you think EVERY CENTRAL BANK IN THE WORLD holds gold???
You can't argue gold is going to plummet back to "pre-(so called) bubble" levels while the Federal Reserve has AS A POLICY the intention to debase the currency for a long time.
Perhaps if the debt to GDP ratio wasn't so high you could get away with it but when you have interest rates pinned to the basement floor AND hardcore money printing in effect you CAN'T totally crash precious metals prices. How can gold fall back to the hundreds of dollars per ounce with the threat of "tapering" hovering over the heads of institutional bond investors?
Why do you think EVERY CENTRAL BANK IN THE WORLD holds gold???
You can't argue gold is going to plummet back to "pre-(so called) bubble" levels while the Federal Reserve has AS A POLICY the intention to debase the currency for a long time.
Perhaps if the debt to GDP ratio wasn't so high you could get away with it but when you have interest rates pinned to the basement floor AND hardcore money printing in effect you CAN'T totally crash precious metals prices. How can gold fall back to the hundreds of dollars per ounce with the threat of "tapering" hovering over the heads of institutional bond investors?
Why do you think EVERY CENTRAL BANK IN THE WORLD holds gold???
Sure I can. I suspect gold will fall to $1100/ounce - where it was roughly in July of 2008 (ie BEFORE the stock market crash) - giving up all its' gains since the crash - and there it will sit (range-bound). Gold is a TERRIBLE investment - full of high risk. That's what Warren Buffet believes and he didn't get to be the 4th riches man on earth by "not knowing what he's talking about" - and I agree with him.
Those banks hold gold because it's TRADITIONAL that they hold gold. If they just wanted to hold wealth they could just as easily do it with another metal. There's no reason they couldn't stockpile their wealth in the form of platinum but banks have just always kept gold, so banks still keep gold. It's just tradition.
Indeed - and US dollar debasement is not GOING to occur.
Just as those same folks were wrong when they thought the shadow inventory was going to crash the housing market, so they are wrong about the dollar collapsing.
That's what comes of "black and white" thinking - they don't understand "shades of gray" and "thinking outside the box" - and they they are dumbfounded when their predictions don't pan out.
Sure I can. I suspect gold will fall to $1100/ounce - where it was roughly in July of 2008 (ie BEFORE the stock market crash) - giving up all its' gains since the crash - and there it will sit (range-bound). Gold is a TERRIBLE investment - full of high risk. That's what Warren Buffet believes and he didn't get to be the 4th riches man on earth by "not knowing what he's talking about" - and I agree with him.
Those banks hold gold because it's TRADITIONAL that they hold gold. If they just wanted to hold wealth they could just as easily do it with another metal. There's no reason they couldn't stockpile their wealth in the form of platinum but banks have just always kept gold, so banks still keep gold. It's just tradition.
Ken
Banks hold gold because its "tradition".
Wow.
You've run out of steam in this thread...
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