Where Is Gold Going In This Market

[churchill]

You're a brave man / I hope you win -

I still have in my mind to sell in the coming weeks as QE ends but ............I am not sure - Markets seem to do the opposite - thinking the next step ahead ?/-

I wonder why Greece/Portugal who have lots of Gold reserves do not seem to be using it as collateral to reduce their loan rates ? Unless their gold is already loaned ? If so what about US ..............etc

[lannarebirth]

You're a brave man / I hope you win -

I still have in my mind to sell in the coming weeks as QE ends but ............I am not sure - Markets seem to do the opposite - thinking the next step ahead ?/-

I wonder why Greece/Portugal who have lots of Gold reserves do not seem to be using it as collateral to reduce their loan rates ? Unless their gold is already loaned ? If so what about US ..............etc

Are you joking? Why would anyone would put up collateral if it were not required? Especially when you can just as easily default?

What's gonna change about the Greek economy if they default? people gonna stop vacationing there? Ships gonna stop home porting there? What's Greece's downside, save for the fortunes of some Euro tied elites? If they get thrown out of the EU and float their own currency I'll be vacationing there next year. I just don't see their downside to telling the ECB et al to shove it.

[Naam]

Churchill,

reserves, whether cash or gold, are under the jurisdiction of the relevant central bank and neither meant to be used as collateral nor to service sovereign debt. but you are excused, the misconception is quite common.

[Naam]

What's gonna change about the Greek economy if they default?

theoretically Greece could do an "Argentina 2001/2003" and get rid of 70% of its sovereign debt.

[lannarebirth]

What's gonna change about the Greek economy if they default?

theoretically Greece could do an "Argentina 2001/2003" and get rid of 70% of its sovereign debt.

Hopefully that will cause them to get a new currency, which then gets crucified. If that should happen, which I place the odds at 1:10, you may find me here for an extended vacaction:

http://www.google.com/search?q=greek+isles&hl=en&rls=com.microsoft:en-us&rlz=1I7ADBF_en&prmd=ivns&tbm=isch&tbo=u&source=univ&sa=X&ei=vtHHTZXmKcbRrQfwzdWzBA&ved=0CDkQsAQ&biw=1259&bih=853

[Naam]

What's gonna change about the Greek economy if they default?

theoretically Greece could do an "Argentina 2001/2003" and get rid of 70% of its sovereign debt.

Hopefully that will cause them to get a new currency, which then gets crucified. If that should happen, which I place the odds at 1:10, you may find me here for an extended vacaction:

we might also look at a couple of islands at bargain prices

[jcon]

Just when those folks are patting themselves on the back and digging up holes for the ''heavy duty trolleys," then begins the shanking. Just like a real shanking, it won't be pretty. Rejoice a pop to 38/oz, then a left-right-center shankfest.

5:55pm 37.98728 - what happened afterward? SHANK FEST.

This trade happened so fast it's just violent. I believe that's as close to 38.x that we're going to get. I could not even make the trade though my bank so I did it on O_da. 6:50pm 100K HKD (equiv) @ 37.30716 10x leverage. Just a small trade but I said I'd do it and I did. This thing (IMO) is so over. It will be 5-handle in no time (35, that is).

[jcon]

What's gonna change about the Greek economy if they default?

theoretically Greece could do an "Argentina 2001/2003" and get rid of 70% of its sovereign debt.

Hopefully that will cause them to get a new currency, which then gets crucified. If that should happen, which I place the odds at 1:10, you may find me here for an extended vacaction:

we might also look at a couple of islands at bargain prices

The biggest shame is that the Greek women just aren't as attractive as the Argentinian ladies (that also applies to the currency should they get a new one....)

[Naam]

The biggest shame is that the Greek women just aren't as attractive as the Argentinian ladies (that also applies to the currency should they get a new one....)

if it's ladies we should wish that Brazil defaults! but then i have to sell my Reais first.

[churchill]

'Those diversifying into gold and silver bullion would be advised to continue to ignore those who simplistically call gold and silver bubbles. Many have been calling gold and silver bubbles since early 2008 when gold rose above $850/oz and silver rose above $20/oz.

Most failed to warn about the bubbles in equity and property markets and therefore do not have a good track record in this regard.

Their analysis continues to be selective and simplistic and can occasionally be biased. The fundamentals of supply and demand and the small and finite physical bullion markets being confronted with robust increased demand internationally and particularly in China, India and wider Asia are ignored.

As is ultra lose monetary policies and currency debasement on a scale not seen in modern history.

Rather than continually attempting to call the top of the gold and silver markets and thereby discouraging people from owning the financial insurance that is gold and silver – it would be wiser to admit that they cannot predict the future and that people should be diversified in order to protect against the extraordinary degree of macroeconomic, monetary and geopolitical risk in the world today.'

http://www.zerohedge.com/article/euro-gold-targets-record-eur1072oz-risk-forced-greek-default-and-eurozone-debt-contagion

[Naam]

people should be diversified in order to protect against the extraordinary degree of macroeconomic, monetary and geopolitical risk in the world today.

words of wisdom! once in a while Tyler gets it right

[teletiger]

words of wisdom! once in a while Tyler gets it right

Tyler?? What happened to Turden? No denying facts or straight-up maths I suppose.

Actually it was a guest posting from "Goldcore".

As the astute bondsman that you are Herr Naam, I was just wondering on your take on the position Bill Gross has taken on shorting treasuries. 'And the news this week that he has actually increased his position. It must be hurting....so what is he expecting?

Regards.

[flying]

I wonder why Greece/Portugal who have lots of Gold reserves do not seem to be using it as collateral to reduce their loan rates ? Unless their gold is already loaned ? If so what about US ..............etc

As LB pointed out why would they?

None sell things to pay off credit cards ( unsecured debt )

The US will not either....the so called asset fire sale will never happen.

Treasury: No asset 'fire sale' to postpone debt-limit hike

Tim Geithner Releases Latest Mutual Assured Destruction Threat: Says “Debt Ceiling To Be Breached No Later Than May 16″

Treasury has been asked whether it would be possible for the Treasury to sell financial assets as a way to avoid or delay congressional action to raise the debt limit. This is not a viable option. To attempt a “fire sale” of financial assets in an effort to buy time for Congress to act would be damaging to financial markets and the economy and would undermine confidence in the United States.

Selling the Nation’s gold, for example, would undercut confidence in the United States both here and abroad. A rush to sell other financial assets, such as the remaining financial investments from the Emergency Economic Stabilization Act programs, would impose losses on American taxpayers and risk damaging the value of similar assets held by private investors without generating sufficient revenue to make an appreciable difference in when the debt limit must be raised. Likewise, for both legal and practical reasons, it is not feasible to sell the government’s portfolio of student loans.

Edited May 10, 2011 by flying

[Naam]

words of wisdom! once in a while Tyler gets it right

Tyler?? What happened to Turden? No denying facts or straight-up maths I suppose.

Actually it was a guest posting from "Goldcore".

As the astute bondsman that you are Herr Naam, I was just wondering on your take on the position Bill Gross has taken on shorting treasuries. 'And the news this week that he has actually increased his position. It must be hurting....so what is he expecting?

Regards.

based on the information available i conclude that PIMCO is not really "shortening" UST but reducing exposure. short term effects do not irk a giant like PIMCO which is owned by the giant Allianz. what i would like to know is who is behind that policy. is it really Bill Gross or Mohamed el-Erian?

[churchill]

I wonder why Greece/Portugal who have lots of Gold reserves do not seem to be using it as collateral to reduce their loan rates ? Unless their gold is already loaned ? If so what about US ..............etc

As LB pointed out why would they?

None sell things to pay off credit cards ( unsecured debt )

The US will not either....the so called asset fire sale will never happen.

Treasury: No asset 'fire sale' to postpone debt-limit hike

Tim Geithner Releases Latest Mutual Assured Destruction Threat: Says “Debt Ceiling To Be Breached No Later Than May 16″

Treasury has been asked whether it would be possible for the Treasury to sell financial assets as a way to avoid or delay congressional action to raise the debt limit. This is not a viable option. To attempt a “fire sale” of financial assets in an effort to buy time for Congress to act would be damaging to financial markets and the economy and would undermine confidence in the United States.

Selling the Nation’s gold, for example, would undercut confidence in the United States both here and abroad. A rush to sell other financial assets, such as the remaining financial investments from the Emergency Economic Stabilization Act programs, would impose losses on American taxpayers and risk damaging the value of similar assets held by private investors without generating sufficient revenue to make an appreciable difference in when the debt limit must be raised. Likewise, for both legal and practical reasons, it is not feasible to sell the government’s portfolio of student loans.

I suppose I was just thinking what I would do in their situation , with a large debt - increasing interest rates but a large value asset doing nothing - I would try to use it to reduce interest payments -

Why doesn't the US value their Gold at it's correct value- are they afraid of doing an audit ?

Edited May 11, 2011 by churchill

[flying]

I suppose I was just thinking what I would do in their situation , with a large debt - increasing interest rates but a large value asset doing nothing - I would try to use it to reduce interest payments -

Why doesn't the US value their Gold at it's correct value- are they afraid of doing an audit ?

Yes that was the old morally correct thinking...Today after folks have seen how the corrupt were rewarded for their greed many do as they do & walk/default on their non-secured debt....some even walk on their secured debt if it is under water valuation wise.

( I am not one of those as I live debt free )

As for the US & their valuation of their gold....I have often wondered the same thing.

Could be as you say & the gold has been leased or used long ago to fund things they cannot speak of or....

Perhaps they do not want such a show of competition against their own currency? I do not know...

But it is as you say....The Treasury still values their gold way back at $42.22 an ounce on their books.

Edited May 11, 2011 by flying

[Naam]

Why doesn't the US value their Gold at it's correct value

a number of central banks value their gold holdings @ purchase price even if the purchase was made in the 60s. but don't ask me why!

[flying]

I just found that at stockcharts.com

you can get a weekly GSR chart going back a few years by typing in $GOLD:SLV at stockcharts.... $WTIC:SLV gives the light crude to silver ratio.

Here is the GS ratio chart

And light crude to silver

[churchill]

Why doesn't the US value their Gold at it's correct value

a number of central banks value their gold holdings @ purchase price even if the purchase was made in the 60s. but don't ask me why!

So that if prices rise .... they have room to sell a little without declaring any change in value ...

[Naam]

Why doesn't the US value their Gold at it's correct value

a number of central banks value their gold holdings @ purchase price even if the purchase was made in the 60s. but don't ask me why!

So that if prices rise .... they have room to sell a little without declaring any change in value ...

isn't it an established fact that central banks only buy gold nowadays?

[churchill]

Why doesn't the US value their Gold at it's correct value

a number of central banks value their gold holdings @ purchase price even if the purchase was made in the 60s. but don't ask me why!

So that if prices rise .... they have room to sell a little without declaring any change in value ...

isn't it an established fact that central banks only buy gold nowadays?

Yes - But only those that can afford to

[teletiger]

Steve Forbes: "The US Will Likely Have A Gold Standard Within The Next Five Years"

Hmmm....or as one poster put it..."The US, as currently structured, will not return to TGS. It would be like turning on the lights in a dark roach-infested kitchen".

http://www.zerohedge.com/article/steve-forbes-us-will-likely-have-gold-standard-within-next-five-years

Regards.

[midas]

You're a brave man / I hope you win -

I still have in my mind to sell in the coming weeks as QE ends but ............I am not sure - Markets seem to do the opposite - thinking the next step ahead ?/-

I wonder why Greece/Portugal who have lots of Gold reserves do not seem to be using it as collateral to reduce their loan rates ? Unless their gold is already loaned ? If so what about US ..............etc

Are you joking? Why would anyone would put up collateral if it were not required? Especially when you can just as easily default?

What's gonna change about the Greek economy if they default? people gonna stop vacationing there? Ships gonna stop home porting there? What's Greece's downside, save for the fortunes of some Euro tied elites? If they get thrown out of the EU and float their own currency I'll be vacationing there next year. I just don't see their downside to telling the ECB et al to shove it.

this is exactly what the economist David McWilliams also says here :-

Greeks turn tragedy into a drachma

http://www.davidmcwilliams.ie/2011/05/09/greeks-turn-tragedy-into-a-drachma#comments

Edited May 11, 2011 by midas

[churchill]

Just when those folks are patting themselves on the back and digging up holes for the ''heavy duty trolleys," then begins the shanking. Just like a real shanking, it won't be pretty. Rejoice a pop to 38/oz, then a left-right-center shankfest.

5:55pm 37.98728 - what happened afterward? SHANK FEST.

This trade happened so fast it's just violent. I believe that's as close to 38.x that we're going to get. I could not even make the trade though my bank so I did it on O_da. 6:50pm 100K HKD (equiv) @ 37.30716 10x leverage. Just a small trade but I said I'd do it and I did. This thing (IMO) is so over. It will be 5-handle in no time (35, that is).

The Tipping Point Has Arrived ??

http://www.comstockfunds.com/default.aspx?act=Newsletter.aspx&category=MarketCommentary&news&AspxAutoDetectCookieSupport=1

[flying]

The Tipping Point Has Arrived ??

http://www.comstockfunds.com/default.aspx?act=Newsletter.aspx&category=MarketCommentary&news&AspxAutoDetectCookieSupport=1

I am not saying that the recent spike up in Silver wasnt silly as it was.

But to now call this all a burst bubble is pretty short sighted as it was never a bubble to begin with.

Didn't CME raised margin requirements this time on oil something like 25%

As it was with their 5 margin increases in 10 days for silver....this one left a stain on oil

Not that I am against kicking the sh!t out of all these renters of commodities on their margins

but at the same time the effect on the overall markets is disruption. Can they not do it in a more orderly fashion?

That aside ...the article would like to blame all rising prices on QE2 & that is just not the case

Not that I was in favor of QE1 or 2 or TARP etc etc etc

Then to say the dollar is rising?....On what?

Edited May 12, 2011 by flying

[churchill]

US$ is in a downtrend but bouncing short term on Greece / Portugal ++++ problems which may lead to a general sell off but I think Euro problems with mean more demand again for Gold along side the $

So any falls in Gold may be just for a few days before ...I'm thinking Atom Ant /

and my Mining shares deserve a break - they fall when gold rises and fall when gold falls !

The Plot Thickens

http://thetsitrader.blogspot.com/2011/05/plot-thickens.html

Continuous Commodity Index drops below its 100 day moving average

http://traderdannorcini.blogspot.com/2011/05/continuous-commodity-index-drops-below.html

[churchill]

Asia holds its nose and keeps buying U.S. debt

""The U.S. is making the most of having the dollar as key reserve currency and such a situation would not change immediately," Japan's Deputy Finance Minister, Fumihiko Igarashi, told Reuters.

"But nothing will last forever, as with any political and economic conditions," he added. "We will closely watch developments" in the U.S. Congress.

Japan held $890.3 billion in U.S. Treasuries as of February, the most recent month for which U.S. Treasury data on foreign holdings are available, ranking behind only China on the list of the largest foreign creditors.

Igarashi said Japan should aim to diversify its reserves to reduce Treasuries exposure, perhaps by increasing gold holdings or raising the percentage invested in euro assets. But he acknowledged that a portfolio shift would be "quite difficult... because selling Treasuries would hurt our own assets."

http://www.reuters.com/article/2011/05/12/us-usa-debt-asia-idUSTRE74B0YE20110512

[Naam]

Igarashi said Japan should aim to diversify its reserves to reduce Treasuries exposure, perhaps by increasing gold holdings or raising the percentage invested in euro assets. But he acknowledged that a portfolio shift would be "quite difficult... because selling Treasuries would hurt our own assets."

another genius who keeps repeating what a dozen learned geniuses are "lecturing" since a few years ad nauseam

[Naam]

jcon, on 2011-05-06 03:56:13, said:

AUD/USD short @ 1.06528 11:01pm

XAU/USD shrort @ 1489.430 10:57pm

jcon, on 2011-05-06 18:38:15, said:

I believe the USD will shine like a rock star in the near future

jcon, on 2011-05-04 18:08:06

Spot silver is going to get a 3-handle

hats off jcon[man]!

[lannarebirth]

jcon, on 2011-05-06 03:56:13, said:

AUD/USD short @ 1.06528 11:01pm

XAU/USD shrort @ 1489.430 10:57pm

jcon, on 2011-05-06 18:38:15, said:

I believe the USD will shine like a rock star in the near future

jcon, on 2011-05-04 18:08:06

Spot silver is going to get a 3-handle

hats off jcon[man]!

Agreed. Good call.