Where Is Gold Going In This Market

[Naam]

That of course is an attempt to create a straw man and then knock it down to serve the purposes of inflating your own ego.

Gold was $277 in early January 2002. Even with the recent correction, it is up an average of 17.86% per year every year for the last decade. That is a remarkable return on investment for such a long time. And there is absolutely no reason to assume the trend is not going to continue.

bla-bla-bla... Gold was 850 dollars mid/end january 1980. since then Gold has neither yielded a single freaking inflation adjusted copper penny or a tiny bowl of rice. this is a remarkable shitty³ return on investment for such a long time when triple rated gilts in major [fiat] currencies raked in -during the same period- for more than a decade fat double digit returns. even with the recent yada yada... there is absolutely no reason to assume bla-bla-bla... and based on that assumption absolutely no reason to write an essay stating irrelevant facts to inflate your yakety-yak bla-bla ego.

[flying]

Is it not apparent to all "gold bugs" that Gold is absolutely aligned with the "risk on" trade? How do you account for that?

Never really considered my self a "bug" but will give an opinion....

Yes I agree all commodities are aligned with risk on/risk off for now & may well continue long after I am dead but....

It is not surprising that for now these things are risk aligned as a large if not majority if what is represented is in paper form.

As with Stock trading.....Investing IMHO is long been dead.

There is only gambling now....Not investing in any company or product....Just an internet game/casino for most.

As long as Metals are represented in said casino we will see such antics.

But I would guess most gold bugs have a more catastrophic view....As such they are not concerned nor do they hold paper representation of gold....

As for myself it is just my freak flag.... I no longer want to take part in the game/mess/corruption/crisis or that which caused it anymore than absolutely necessary....which these days is pretty much next to nothing.

[theblether]

Back to the OP,

As soon as there is some type of resolution to the Euro crisis Gold will start dropping. My prediction is that by 1 Jan 2015 Gold will be trading at $1250 per ounce, probably less.

Beware of the lemmings that rushed in, rushing back out again. Anyone that has purchased recently at the $1800 mark should start worrying.

" As soon as there is some type of resolution to the Euro crisis "

but there is the rub......what kind of resolution and what about the debts?

theblether your prediction is based on nothing more than wishful thinking and pixie dust

The Euro Crisis: No End In Sight

" The Chinese government is actively encouraging its citizens to invest their savings in gold. Once the Pan Asian gold exchange goes live in June 2012, Chinese citizens will be able to purchase gold with the click of a mouse. We covered the launching of this exchange and the ramifications (we believe it's going to be a huge game changer and challenge the dominance of the COMEX and London metals market) it could have on the price of gold in a very recent article titled Positioning To Profit From The Pan Asia gold exchange."

http://seekingalpha....no-end-in-sight

Quite frankly, laughable.

Wishful thinking?.......what does it matter to me what happens to the price of gold? I've closed my position......and my opinion is going have exactly the same effect on the gold market as yours.........zero.

Pixie dust? Is that the same as the stuff all the gold dusters have been sniffing? They've been watching the market peak and jumped on the bandwagon convinced it's going to go higher.

In reality there is only one event that will put gold through the $2000 barrier, and that is a war of the first order. ie Between serious first tier rivals, or in the Middle East.

As for China, there's a serious, and I mean serious property slump unfolding in China. The seriousness of it is increased as the Chinese have no experience of this type of slump. I talked two of my business partners in China out of a property investment last November and they are kissing my feet now. Unrest is already unfolding there and now it's affecting the entreprenurial class, ie connected class, and there will be consequences. Don't rely upon China but I'll come back to them in a minute.

There are only 4 outcomes for the Euro....

1. Status quo........no chance, the market will attack it and bring it crashing down.

2. German capitulation.......decent chance......if the Germans agree to underwrite the Euro the sting will come out of the crisis

3. Fragmentation.....decent chance........the weak countries such as Greece leave the Euro, leaving a strong core.

4. Complete collapse......unlikely........if it happens though the Germans will emerge massively stronger.

There seems to be a mis-reading of the market here, the Germans are going to go through the 1 trillion export barrier this year, and the UK is exporting at record levels too. Look deeeper than the headlines, the Western economies are sharpening up, getting rid of waste and excess spending. They'll come back stronger.

Once the Euro battle is sorted out the real battle will begin......if we get a Republican President in the US we'll have the pleasure of seeing a currency war explode between the US and China.

Too many people are reading the wrong signals, and if you disagree, before reaching for google.......did you know that the UK has set a an export record as many as three times this year? Did you know the Germans have done the same?

[manarak]

What sites do you use to display historical graphs?

I use yahoo finance for almost everything because it is free and so easy, just type EURCHF or AUDCHF and you get the quote, and then click on 1 year graph , 3 months graph or whatever to get a graph. a basic one, but I don't need more.

Problem: yahoo finance is for some reason unable to show historical data/graphs for XAUCHF or even XAUUSD.

What do you use?

[hhgz]

"Gold was $277 in early January 2002. Even with the recent correction, it is up an average of 17.86% per year every year for the last decade. That is a remarkable return on investment for such a long time. "

Apple computer has done much better.

[midas]

“We’re in the most manipulated markets. We’re in the most fraudulent markets in history. There has never been a time when you can have assets disappear from people and modest inquiries take place of the leaders of that company. What you are seeing go on right now favors the bankers and disfavors all others.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/12/22_Jim_Sinclair_-_The_Gold_Panic_%26_What_to_Expect_in_2012.html

[HelloAgainItsME]

John Paulson, the billionaire money manager mired in the worst slump of his career, lost 10.5 percent in his Gold Fund this year even as the metal heads for its 11th straight annual gain, according to people familiar with the fund’s performance.

The fund, which invests in mining stocks and other gold- related securities, remains the best performer in Paulson’s $28 billion fund family this year. His Paulson Advantage Fund, which seeks to profit from corporate events such as takeovers and bankruptcies, has fallen about 35 percent. The performance numbers for the two funds are from Dec. 28, 2010, through Dec. 20, 2011, and may not reflect returns for all shareholders, said the people, who asked not to be identified because the information is private.

Taken from a Bloomberg report today.

Any comments from the wise?

[phomsanuk]

Gold peak in the 80's was about 850 considering inflation that's 2200 today which is what Bangkok bank is predicting.

[fritter1970]

That of course is an attempt to create a straw man and then knock it down to serve the purposes of inflating your own ego.

Gold was $277 in early January 2002. Even with the recent correction, it is up an average of 17.86% per year every year for the last decade. That is a remarkable return on investment for such a long time. And there is absolutely no reason to assume the trend is not going to continue.

bla-bla-bla... Gold was 850 dollars mid/end january 1980. since then Gold has neither yielded a single freaking inflation adjusted copper penny or a tiny bowl of rice. this is a remarkable shitty³ return on investment for such a long time when triple rated gilts in major [fiat] currencies raked in -during the same period- for more than a decade fat double digit returns. even with the recent yada yada... there is absolutely no reason to assume bla-bla-bla... and based on that assumption absolutely no reason to write an essay stating irrelevant facts to inflate your yakety-yak bla-bla ego.

Naam, do the world a favour and go back to Germany so you can be with your equally dismissive and arrogant brethren

[udonguy]

Back to the OP,

As soon as there is some type of resolution to the Euro crisis Gold will start dropping. My prediction is that by 1 Jan 2015 Gold will be trading at $1250 per ounce, probably less.

Beware of the lemmings that rushed in, rushing back out again. Anyone that has purchased recently at the $1800 mark should start worrying.

whoops - only a few days to go to drop by 350 US? I can see it going higher in 2012 (above 2000) then dropping to below what it is now - but who knows???

[midas]

" 40,000 MF Global customers had their money stolen—there’s no polite way to characterize what happened. And this theft was not carried out by MF Global—it was carried out by the authorities who were charged with handling the firm’s bankruptcy.

These 40,000 customers were not Big Money types—they were farmers who had accounts to hedge their crops, individuals owning gold (like Gerald Celente—here’s his account of what happened to him)—

—in short, ordinary investors. Ordinary people—and they got screwed by the regulators, for the sake of protecting JPMorgan and other big fry who had exposure to MF Global."

That, in a nutshell, is what happened.

Now, what does this mean?

It means that nobody’s money is safe. It means that regulators care more about protecting the so-called “Systemically Important Financial Institutions” than about protecting Ordinary Joe investors. It means that, when crunchtime comes, central banks and government regulators will allow SIFI’s to get better, and let the Ordinary Joes get f*kced."

http://gonzalolira.blogspot.com/2011/12/run-on-global-banking-systemhow-close.html

[theblether]

Back to the OP,

As soon as there is some type of resolution to the Euro crisis Gold will start dropping. My prediction is that by 1 Jan 2015 Gold will be trading at $1250 per ounce, probably less.

Beware of the lemmings that rushed in, rushing back out again. Anyone that has purchased recently at the $1800 mark should start worrying.

whoops - only a few days to go to drop by 350 US? I can see it going higher in 2012 (above 2000) then dropping to below what it is now - but who knows???

Try reading what is said before you answer, I would suggest to you it's a few days + 3 years before 1 Jan 2015.

[midas]

Did Bankers Deliberately Crash MF Global to Crash Gold and Silver Prices?

" As crazy as this sounds, a closer investigation of some key data seems to imply this possibility. Though bankers claim that they created futures markets to provide a mechanism for commodity producers to hedge against volatile market prices, I have never bought the kool-aid the bankers were selling in this explanation for the rationale behind their creation of futures markets. Given that today, futures and spot prices for gold and silver in the short-term are entirely set by banker manipulation of the supply and demand for paper derivatives that often have no backing of any physical metal, I believe that bankers created futures markets for the explicit intent of allowing themselves to manipulate the prices of commodities and to enrich themselves, and themselves only, through the process of alternately and artificially inflating and deflating prices as would not be allowed in any type of free market."

http://archive.aweber.com/sku_newsletter/6sL.c/h/Did_Bankers_Deliberately.htm

[udonguy]

Back to the OP,

As soon as there is some type of resolution to the Euro crisis Gold will start dropping. My prediction is that by 1 Jan 2015 Gold will be trading at $1250 per ounce, probably less.

Beware of the lemmings that rushed in, rushing back out again. Anyone that has purchased recently at the $1800 mark should start worrying.

whoops - only a few days to go to drop by 350 US? I can see it going higher in 2012 (above 2000) then dropping to below what it is now - but who knows???

Try reading what is said before you answer, I would suggest to you it's a few days + 3 years before 1 Jan 2015.

ah ok I read it quickly and as everyone is predicting closer to NOW I assumed you were too - how about a year prediction we could all be dead by end 2012!

[theblether]

Back to the OP,

As soon as there is some type of resolution to the Euro crisis Gold will start dropping. My prediction is that by 1 Jan 2015 Gold will be trading at $1250 per ounce, probably less.

Beware of the lemmings that rushed in, rushing back out again. Anyone that has purchased recently at the $1800 mark should start worrying.

whoops - only a few days to go to drop by 350 US? I can see it going higher in 2012 (above 2000) then dropping to below what it is now - but who knows???

Try reading what is said before you answer, I would suggest to you it's a few days + 3 years before 1 Jan 2015.

ah ok I read it quickly and as everyone is predicting closer to NOW I assumed you were too - how about a year prediction we could all be dead by end 2012!

I reckon it's going to kick around the $1600 mark for most of the year. I've never seen such relentless negative financial coverage in my lifetime and my three businesses had a shocking turnover collapse between approx 24 October and 15 November,( I'm in retail ). One of the businesses should have been at peak durong that time and in reality it dropped 45% from the median.

I can only remember four other collapses of that intensity in my lifetime, The Death of Princess Diana, 9/11, The Dunblane Shootings and the 2008 collapse around about September/October of that year. What's my point? The High Street tends to be a good barometer of economic activity, and people took fright during the October/November period as the financial headlines were terrifying. People get terror fatigue, and the High Street lifted well towards the end of the month through till December. ( Before I get shot down in flames with details of individual retailers such as Sears, if you don't sell what customers want, then they won't buy, that's Sears problem ).

Anyway, the market sentiment has been gloomy to say the least, so people have rushed to Gold, spiking the price. I predict a resolution ofthe Euro crisis in March, because Europe has no choice but to take the medicine, the markets will settle down and look for the next victim. That's what markets do.

The next victim so to speak will have to be a war, or a currency war, to see market sentiment reach levels lower ( worse ) than this year. If you see a short term blimp/return to anything like the $1800 level sell and get out. Gold is not going higher than that in the forseeable future, and it's three year forecast in my opinion is down.

As for the posts regarding market manipulation, that's what markets do too. I think you'll find a fair few office parties this year were funded at the expense of the guys that invested at $1800.

[mccw]

Does the fact that all these futures and un allocated gold , leasing, lending, rehypothicating etc exist not mean that the true physical metal of gold/ silvers true value is infact many times higher than current trading prices? Looks that way to me anyway. Same like a currency is devalued by increased money supply; only gold has something real behind it unlike currencies of today. Boggles my mind that even with commodities, bits of paper can be endlessly created as if real but multiplied many times over. How can the value of anything really be assessed and traded upon under such circumstances? Only gambling on the phycology of markets and world events.

[Naam]

the price of anything is not necessarily based on scarcity or actual intrinsic value but exclusively on offer and demand. the price swings of various precious metals are excellent examples for that claim.

Silver: ~$50 more than three decades ago, below $5 a few years later, up to $48 apr11, presently ~$27

Rhodium: $444 in 2003, $10,000 in 2008, back to $1,350 today

Gold: $850 in 1980, 20 years later $250, sep11 $1,900, today $1,550.

[midas]

Anyway, the market sentiment has been gloomy to say the least, so people have rushed to Gold, spiking the price. I predict a resolution ofthe Euro crisis in March, because Europe has no choice but to take the medicine, the markets will settle down and look for the next victim. That's what markets do.

.

much much easier said than done

"It's a Mistake To Pursue a United States of Europe" says German Supreme Court Justice in Spiegel Interview ; Interpretation of Interview from Saxo Bank Chief Economist

http://globaleconomicanalysis.blogspot.com/2011/12/german-supreme-court-justice-says-in.html

[midas]

the price of anything is not necessarily based on scarcity or actual intrinsic value but exclusively on offer and demand. the price swings of various precious metals are excellent examples for that claim.

but has there ever been a time before in history when sovereign debt around the world has been so huge simultaneously ,

in the most powerful countries and regions and can the " faith and trust " in the pieces of paper in your pocket be maintained

indefinitely when the government's behind them worse than the mafia and is there a guarantee the digitally represented figures in your bank account will still be there tomorrow?

Edited December 29, 2011 by midas

[udonguy]

good points - but if not Gold what? I live here in Thailand and have a few condos (used to have 10) but now sold down to 4 as I don't see them going anywhere. Hold cash? that doesn't seem sensible either - so where (within Thailand) I still see Gold as 'insurance' as much as anything but would be far too nervous to hold above 1700 as I do believe that it will sink in next 3 years to sub 14/1500 (time to buy back in).

[Naam]

the price of anything is not necessarily based on scarcity or actual intrinsic value but exclusively on offer and demand. the price swings of various precious metals are excellent examples for that claim.

but has there ever been a time before in history when sovereign debt around the world has been so huge simultaneously ,

in the most powerful countries and regions and can the " faith and trust " in the pieces of paper in your pocket be maintained

indefinitely when the government's behind them worse than the mafia and is there a guarantee the digitally represented figures in your bank account will still be there tomorrow?

that's besides the point Midas. even assuming whatever you stated is or will come true, it does not change the fact that Gold has no stable intrinsic value as pointed out and proved in my posting. i admit that Gold has its place among diversified holdings but it's not the paramount solution for each and every financial problem we might face in the future. plus there is no way that anybody who is well off can convert all his net worth into physical Gold and store it or transport it safely not to mention to spend it safely if need should arise.

[Naam]

if not Gold what?

i did my best to diversify but ran out of ideas. there's is no way squaring the circle and if you read what a dozen gurus have to say you end up with a shitload of "advice", most of it out of reach for the average Joe.

[fletchsmile]

Does the fact that all these futures and un allocated gold , leasing, lending, rehypothicating etc exist not mean that the true physical metal of gold/ silvers true value is infact many times higher than current trading prices? Looks that way to me anyway. Same like a currency is devalued by increased money supply; only gold has something real behind it unlike currencies of today. Boggles my mind that even with commodities, bits of paper can be endlessly created as if real but multiplied many times over. How can the value of anything really be assessed and traded upon under such circumstances? Only gambling on the phycology of markets and world events.

I'd say the opposite. Gold price is driven mainly by supply and demand. All these instruments are simply enablers for more demand at the moment. Hence without these instruments price would fall. Similarly, should these instruments switch so that they create an excess of short positions that would drive the price down quicker..

The difference is gold is not really a currency. It is a physical asset or hard asset. Paper based currencies are simply paper and digits - printing of more doesn't increase overall wealth and just devalues after time. All the gold based instruments may be paper or digit based, but the key difference is there is an underlying physical asset. When more paper gold is printed the amount of physical asset remains the same, whereas when paper currencies are printed the amount of paper currency increases.

the price of anything is not necessarily based on scarcity or actual intrinsic value but exclusively on offer and demand. the price swings of various precious metals are excellent examples for that claim.

Silver: ~$50 more than three decades ago, below $5 a few years later, up to $48 apr11, presently ~$27

Rhodium: $444 in 2003, $10,000 in 2008, back to $1,350 today

Gold: $850 in 1980, 20 years later $250, sep11 $1,900, today $1,550.

Agree and that's what makes forecasting precious metals prices one of the most difficult forecasts going...

Edited December 29, 2011 by fletchsmile

[midas]

the price of anything is not necessarily based on scarcity or actual intrinsic value but exclusively on offer and demand. the price swings of various precious metals are excellent examples for that claim.

but has there ever been a time before in history when sovereign debt around the world has been so huge simultaneously ,

in the most powerful countries and regions and can the " faith and trust " in the pieces of paper in your pocket be maintained

indefinitely when the government's behind them worse than the mafia and is there a guarantee the digitally represented figures in your bank account will still be there tomorrow?

that's besides the point Midas. even assuming whatever you stated is or will come true, it does not change the fact that Gold has no stable intrinsic value as pointed out and proved in my posting. i admit that Gold has its place among diversified holdings but it's not the paramount solution for each and every financial problem we might face in the future. plus there is no way that anybody who is well off can convert all his net worth into physical Gold and store it or transport it safely not to mention to spend it safely if need should arise.

But surely it is not about what happens to be convenient or inconvenient ? it's what people will ultimately have faith in

when

there are enough examples from history of bank accounts being frozen in the blink of an eye - Weimar Republic , Zimbabwe, Argentina. and why should it be any different this time from the past?

in fact as I read this headline yesterday I just thought tick tock tick tock…….

" in a few days, the US debt ceiling will be raised from $ 15.194 trillion to $16.394 trillion "

[Naam]

Agree and that's what makes forecasting precious metals prices one of the most difficult forecasts going...

forecasts are most difficult... especially if the pertain to the future

[Naam]

there are enough examples from history of bank accounts being frozen in the blink of an eye - Weimar Republic , Zimbabwe, Argentina. and why should it be any different this time from the past?

put up now Midas! what viable solution do you suggest?

[smokie36]

So is it rising or falling this week Naam?

[Naam]

But surely it is not about what happens to be convenient or inconvenient ?

it is not a matter of convenience or inconvenience. it is a matter of "feasible solution? yes/no". please answer to the points i raised and present a solution instead of forecasting apocalypse and armaggedon!

rice and vegetable fields are not a solution if you can't protect your crop. gold is not a solution if you can't hold or spend it without getting robbed. immobile property is not a solution if the tenants can't pay the rent. storing baked beans, potatoes and smoked ham is not a long term solution as you rund out sooner or later. cash only is not a solution in case of hyperinflation. guns and ammunition are not a solution to protect your valuables because it is only a matter of time till you run out of ammunition.

[Naam]

So is it rising or falling this week Naam?

that depends whether i pop a blue pill (courtesy Messrs. Pfizer) or not.

[smokie36]

So is it rising or falling this week Naam?

that depends whether i pop a blue pill (courtesy Messrs. Pfizer) or not.