Gold Up In 2008 , Where To In 2009 ?

[HardenedSoul]

Having a little gold (around 40% now) is a safety net for when the inevitable will happen. Investing in fiat money and having returns in fiat money works until it, ... well... not works anymore. It is just that most people think that fiat money will always work, history does not agree.

40% gold and the other 60% in what assuming that fiat money will be worthless? how long will the 40% gold last to cover the living expenses of the average investor?

I'm waiting for the next inevitable downleg in equity markets to hit oil companies and miners before loading up on their stock. Also trying to find a way into Chinese financials. Gonna keep a little cash in Canadian dollars.

[VegasVic]

Good, i can buy some more for a cheaper price. The 20$ ups and downs are already expected as many have to close their positions and there is a lot of shorting (to manipulate the price).

When the shorters have to deliver then you can see it go up a lot. Takes a while though.

Sure manipulation is rife in all sectors but thats what makes a market, if something is deemed to be expensive its the market that will decide, if gold is considered cheap at these levels then i expect buyers to step up here, as it stands buyers have failed to show up,

the bar has now been lowered $830 is your 1st step then $870 untill then i seriously cant consider gold as a buy at these levels, i would rather wait for $650 (if it happens great, if not no harm done) unless the world is falling apart

the DX is still gaining strength and you cant argue with the present facts, who knows what will happen in 6 months, maybe gold will rocket to $2000 and the US$ becomes toilet paper, but is that before gold drops to lower levels??

If youre a holder of gold from alot lower levels nice one, gold has been a great trade in the past 18 months but it may still need lower to mount a decent move past a $1000, i was a holder of physical in the past but sold out 6 months ago

All i know is the gold strugged to get back above $900 (with all the so called buying it still struggled to get back above that #) as i noted earlier in this thread and it was playing around $870 when the facts are presented one has to make a calculation based upoon the evidence that evidence is still showing weakness in gold regardless of perceived strength, those are the facts at present

So i would want to be seeing gold rally above $870 then $900 and stay above $900, to feel comfortably bullish on gold, i still have 1/2 postion that i need to close but untill i see any bullish development i think will continue to hold that trade

see you at $650

As long as gold is below $870-900 i feel its a fade to lower prices

The commericials are adding to their short postions this past week so you could well be right about large holders with outstanding short positions but they have severe deep pockets and are likely to hold those positions open for a while

However you may get a decent move higher in gold in the next day or So along with oil as it appears that equities may mount a rally soon if not today tommorrow (possible obama or Opex Expiry move) so gold stocks may take gold higher along with the HUI, it seems the market is in tandem with Gold and oil as they have both dropped since the prior top and we are at a pivotal area on the SPX

I'll see you at $650 as well nouf After golds $40 loss yesterday I expected a dead cat bounce to at least $835 today but gold only managed a 80 cent dead cat bounce to $821.80. You can pretty much stick a fork in gold for a while as it is done Once gold breaks down below $810 it will be a freefall to the $770's where the next resistance level is, then the $730's and finally $682 will get taken out and gold will base in the $625-$650 area. Sorry flying the HUI chart says it all

[Khun Jean]

It is funny to see that you think gold has gone down. I see it as the dollar got stronger. That is not the same, only in isolation it is true.

Look at gold in other currencies and you will see what i mean.

If i rewrite your comment from my point of view it would sound like this:

After the dollar rose $40 against gold yesterday I expected the dollar hitting a ceiling at $835 today but the dollar only managed a rise to $821.80. You can pretty sure the dollar is rising to the sky. Once the dollar rises to $810 it will be a bulls market all the way to $770's where the next resistance level is, then the $730's and finally $682 will get taken out and the dollar will base in the $625-$650 area.

Doesn't sound feasible does it. Any reason why the dollar will get stronger and stronger while Bernanke is printing them with no end in sight, and backed by nothing but a promise.

[flying]

Sorry flying the HUI chart says it all

Funny you should put it that way

For me it is all HUI actually. Because no matter what some paper trade price says it is not the reality of physical gold for me. Like I said before I am not a trader.

Edited January 13, 2009 by flying

[flying]

It is funny to see that you think gold has gone down. I see it as the dollar got stronger. That is not the same, only in isolation it is true.

Look at gold in other currencies and you will see what i mean.

If i rewrite your comment from my point of view it would sound like this:

After the dollar rose $40 against gold yesterday I expected the dollar hitting a ceiling at $835 today but the dollar only managed a rise to $821.80. You can pretty sure the dollar is rising to the sky. Once the dollar rises to $810 it will be a bulls market all the way to $770's where the next resistance level is, then the $730's and finally $682 will get taken out and the dollar will base in the $625-$650 area.

Doesn't sound feasible does it. Any reason why the dollar will get stronger and stronger while Bernanke is printing them with no end in sight, and backed by nothing but a promise.

Sometimes you do have to wonder dont you?

[Naam]

Sometimes you do have to wonder dont you?

what is there to wonder? every Bill, Buck, Hank and Joe (even Bubba from Little Rock, Arkansas ) is aware of the inverse relation gold/dollar, crude/dollar and a lot of other commodities which are priced in dollars.

[flying]

Sometimes you do have to wonder dont you?

what is there to wonder? every Bill, Buck, Hank and Joe (even Bubba from Little Rock, Arkansas ) is aware of the inverse relation gold/dollar, crude/dollar and a lot of other commodities which are priced in dollars.

Yes but it still is a wonder to see it going back 7 years or so.

Also I believe that line in Martin Armstrongs latest page that said

Gold has decoupled from oil as it should and has been rising on an ounce-to-barrel ratio

[Naam]

Sometimes you do have to wonder dont you?

what is there to wonder? every Bill, Buck, Hank and Joe (even Bubba from Little Rock, Arkansas ) is aware of the inverse relation gold/dollar, crude/dollar and a lot of other commodities which are priced in dollars.

Yes but it still is a wonder to see it going back 7 years or so. Also I believe that line in Martin Armstrongs latest page that said

Gold has decoupled from oil as it should and has been rising on an ounce-to-barrel ratio

would you care to explain in what way the dollar/gold ratio is related to the $-index and oil graphs you posted? besides, what "wonder" going back 7 years are you referring to?

[flying]

Yes but it still is a wonder to see it going back 7 years or so. Also I believe that line in Martin Armstrongs latest page that said

Gold has decoupled from oil as it should and has been rising on an ounce-to-barrel ratio

would you care to explain in what way the dollar/gold ratio is related to the $-index and oil graphs you posted? besides, what "wonder" going back 7 years are you referring to?

I didnt post any oil graphs?

I meant it makes you wonder when you look back & see for 7 years the dollar index declining

Edited January 14, 2009 by flying

[Naam]

excerpt from Martin Armstrongs "teachings" on which i refuse to comment

The Middle East is universally believed to be the source of future problems.

Looking at the 224 year cycle of political change provides an eye-opener to say the least. It was the year 1095 that the Byzantine Emperor Alexius Comnenus asked Pope Urban II for help infighting the Turks. If we look at the 224 year cycle between the West and the Muslim World we see the dates 1095, 1319, 1543, 1767 and 1991. Iraq invaded Kuwait in August 1990 and the West invaded Iraq in February 1991. The invasion stopped short of Baghdad leaving Saddam Hussein in power only because he may be the lessor of two evils - keeping the religious extremists under his control. Often overlooked is the conflict between the two prime divisions in Islam the Sunni, who followed Abu Bakr as the successor to Muhammad (570-6432AD) and the Shites, who followed the son-in-law and first cousin. While the Sunni constitute about 85% of Islam, it is the Shites that largely believe that there should be no separation between church and state. Thus, the Shites would overthrow the monarchy of Saudi Arabia if they could and would rejoice had Hussein been removed from power. This would have allowed Iran to expand its power taking Iraq which is believed to be about 40% <deleted>. This would then put Saudi Arabia at risk not to mention Syria

and Turkey. In other words, if Iran could expand its religious control over the states in the Middle East, it would most likely result in a civil war similar to that of England between the Protestants and the Catholics. It is disturbing that the West invaded precisely on the 224 year cycle target of 1991."

Its all in the cycles, it appears that nothing can be done to stop the cycles from manifesting their effects. As Martin has stated before the whole Universe is cyclical, galaxies, stars, planets are all subject to cyclical laws (our Sun he wrote has a 300 year cycle which causes its output to vary by 15% and the Sun could not even shine if it did not have cycles) it is therefore logical that humans and their societies are also subject to these cyclical energies - 'as above so below'.

[Naam]

Yes but it still is a wonder to see it going back 7 years or so. Also I believe that line in Martin Armstrongs latest page that said

Gold has decoupled from oil as it should and has been rising on an ounce-to-barrel ratio

would you care to explain in what way the dollar/gold ratio is related to the $-index and oil graphs you posted? besides, what "wonder" going back 7 years are you referring to?

I didnt post any oil graphs?

I meant it makes you wonder when you look back & see for 7 years the dollar index declining

no need to take Armstrong's 224 years cycle. just look at a longer period (starting in 1970) and you see the dollar index waxing and waning like the moon. and each waxing and waning was the result of fundamentals. the last waning of the index has a fundamental reason too, namely a village in Texas is waiting to get its village idiot back in a week or so

[flying]

the last waning of the index has a fundamental reason too, namely a village in Texas is waiting to get its village idiot back in a week or so

That has me laughing to so hard I had to explain it to my panraya

[Nouf]

The inverse relation to commodities is an obvious, and what ever commodity you purchase untill they drop the US$ standard it is very important to still monitor the DX, you saw that last year in the commodoties pop, as traders were just following "hot" money

Same again in Treasuries this past 2 months, its just "hot money" looking for any gain as the whole game is rigged its just one big ponzi scheme.

The gold buy is really down to the Inflation vs deflation debate and once we have an outcome then you buy and sell gold based on the outcome og that

i personally think its a very weak argument to base any purchasers of any commodity or investment on fundemantals when you are not looking at the present picture, unless you have a boat load of money and are of a millionaire/billionaire status and can afford to take pot shop gambles on Gold as some sort of wealth diversification, then it really does need warranting that you need to get your thesis right when you are making purchases and not be drawn into the:

"The US$ is going to the toilet route"

Now i am sure the consequences of what Bernanke are going to causing the US some serious problems down the road all them IOU`s will come back to haunt them.

You are making a gamble like anything, so are making a decision based upoon what you think "should" happen,

I ask all the holders of gold - what happens if your thesis is delayed by 10 years???? and gold goes down to $400??? (the inflation argument)

what you going to do then in the mean time????? still sit on the yellow metal?? or are you going to keep buying lowere to avergae down your loss??? if you buy here???

Its pretty much in your interest that the US$ goes to the toilet, but have you thought about the debt still outstanding that is still in $`s we have come of the back of a 15 year boom in credit and i just cant think that it can be resolved in just 18 months

So the arguments of a Infationary boom around the corner imo is weak thesis, as that`s what Gold buying is based on, is it not????

After all you still have to buy things back in $`s as every commodity is priced $`s

The case for owning gold is the demise of the US as i see it, when is thats going to happen???? 1 year, 5 years, 20 years????

Gold has rallied nicely since the start of the greenspan bubble, but on the back of the DX, and more so since the FED slashed rates.

So i will ask any gold holder-

Where or what is your thesis for seeing gold higher and what is going to be the catalyst for higher prices??

if your answer is the printing of money, i think you need to take a real valid look at that argument because i dont still that evidence yet

If its the demise of the US$ again i dont see that argument playing out yet (this correction on the DX could rally back to 100 and gold maybe down to $600 by then) and it also may take alot longer than people are expecting as all that "credit debt" needs to be paid down

Unless of course the US governemt just hands out free money

If its the fall of the US, how long are you waiting for this to happen???

Anyone think the US goes to the toilet in the next month??? 3 months 1 year, 3 years????

i would like to know on the basis of all the gold purchases, and do you really belive in your theis of the US is going to the toilet?????

or the De-coupling route that the world decides to shed the US consumer????

[flying]

Anyone think the US goes to the toilet in the next month??? 3 months 1 year, 3 years????

i would like to know on the basis of all the gold purchases, and do you really belive in your theis of the US is going to the toilet?????

or the De-coupling route that the world decides to shed the US consumer????

Personally I think we have already been tossed in the toilet

But that aside why does everyone need a reason not to have all of their eggs in one basket?

What makes anyone think that if the sh8t hit the fan there would then be the option of going & getting an alternate currency?

When the banks closed their doors during the run on the banks were folks then allowed to go to another window & withdraw currency & change it to something else?

Dont get me wrong I see what your saying & I am not in $$$ bracket perhaps that your even speaking to. But I do not see a problem with having currency & money.

[Naam]

I ask all the holders of gold - what happens if your thesis is delayed by 10 years???? and gold goes down to $400??? (the inflation argument)

the answer of most goldbugs will be the same as was their answer for the last three decades, namely

"this time it's different! the end is near. the day of reckoning is looming around the corner. your fiat money will be completely worthless. the crisis will wipe out the value of all your other belongings, your wife will divorce you and then open a bar in Soi 6 with the proceeds of selling your daughters into slavery..."

[flying]

I ask all the holders of gold - what happens if your thesis is delayed by 10 years???? and gold goes down to $400??? (the inflation argument)

the answer of most goldbugs will be the same as was their answer for the last three decades

I am no bug but the argument I hear most is...............Great time to load up if the prices should drop.....If you can find it locally

[Naam]

I ask all the holders of gold - what happens if your thesis is delayed by 10 years???? and gold goes down to $400??? (the inflation argument)

the answer of most goldbugs will be the same as was their answer for the last three decades

I am no bug but the argument I hear most is...............Great time to load up if the prices should drop.....If you can find it locally

do a little research from WHICH sources you hear this argument and you will find out that they are the same who preached that gospel years ago. the only differerence is that they shout much louder because they can point to a certain validity of their argument taking only the last 5-7 years into consideration. the 2½ decades before are conveniently never mentioned.

and the gold bugs who starved to death because their gold never yielded even the equivalent of the inflation rates are in their graves and conveniently quiet too

[Naam]

a picture tells more than a thousand words. look at gold from 1975 to 2002, i.e. 27 years (more or less) nada, nothing, zilch, rien, niente, nichts, muffat, mai mee yield!

[flying]

a picture tells more than a thousand words. look at gold from 1975 to 2002, i.e. 27 years (more or less) nada, nothing, zilch, rien, niente, nichts, muffat, mai mee yield!

Sure & that is the truth for that time.

But is today in the same situation as those days?

Is the economical/financial climate unchanged?

I thought you did not like tech analysis?

PS: again as I have said many times I am not after yield in this gold.

I am after safe haven for a percentage of my liquidity

Edited January 14, 2009 by flying

[flying]

Gold's most notable investment attribute is that it remains ,in the words of financial historian Peter Bernstein..." The ultimate certainty and escape from risk"

When all else fail Gold does not.

Also I find it interesting that

Gold has become one of the most under owned of all financial assets in recent times. And yet ironically, along with silver, gold has been the only unquestioned store of value for much of recorded history. Every Single Paper Currency Bar None has devalued against gold and for centuries it was regarded as the foundation of the global financial system Something hard to conceive today.

Edited January 14, 2009 by flying

[Naam]

a picture tells more than a thousand words. look at gold from 1975 to 2002, i.e. 27 years (more or less) nada, nothing, zilch, rien, niente, nichts, muffat, mai mee yield!

Sure & that is the truth for that time.

But is today in the same situation as those days?

Is the economical/financial climate unchanged?

I thought you did not like tech analysis?

PS: again as I have said many times I am not after yield in this gold.

I am after safe haven for a percentage of my liquidity

i can't answer your questions Flying. fact is nobody can. besides, i look at several dozens of graphs several dozen times each and every day. looking at them is not technical analysis but looking at naked undeniable facts and history. but i refrain to extrapolate and project history into the future as the technical analysts do. if TA would really work it would be one of the most guarded secrets by those who are experts. all of them would sit on their private islands in the caribbean, protected by a dozen body guards carrying the most sophisticated weaponry, looking at their custom built 300' yachts and wonder what the captain and his Michelin star decorated chef have catered for the next cruise around the island and whether the butler has made arrangements for a dozen girls. oh... before i forget... perhaps they would also waste a few minutes thinking whether it's time to buy a new Learjet as the old one needs oil change, new tires and brake pads.

[Naam]

Gold's most notable investment attribute is that it remains ,in the words of financial historian Peter Bernstein..." The ultimate certainty and escape from risk"

When all else fail Gold does not.

Also I find it interesting that

Gold has become one of the most under owned of all financial assets in recent times. And yet ironically, along with silver, gold has been the only unquestioned store of value for much of recorded history. Every Single Paper Currency Bar None has devalued against gold and for centuries it was regarded as the foundation of the global financial system Something hard to conceive today.

a baseless and hair raising statement as it does not take into consideration that one could and still can make fortunes by investing paper currency and convert this fortune into any other property which one likes. this discussion gets quite boring Flying by you citing, respectively copying and pasting lopsided statements from third parties instead airing your very own thoughts.

[flying]

Gold's most notable investment attribute is that it remains ,in the words of financial historian Peter Bernstein..." The ultimate certainty and escape from risk"

When all else fail Gold does not.

Also I find it interesting that

Gold has become one of the most under owned of all financial assets in recent times. And yet ironically, along with silver, gold has been the only unquestioned store of value for much of recorded history. Every Single Paper Currency Bar None has devalued against gold and for centuries it was regarded as the foundation of the global financial system Something hard to conceive today.

a baseless and hair raising statement as it does not take into consideration that one could and still can make fortunes by investing paper currency and convert this fortune into any other property which one likes. this discussion gets quite boring Flying by you citing, respectively copying and pasting lopsided statements from third parties instead airing your very own thoughts.

Well that is your opinion.

That 1st statement was not mine but I agree 100% with it so why not quote it?

Also your opposite of Peter Bernstein & I for that matter

He said it was a great escape from risk....You on the other hand say it is a no reward situation.

Well..............perhaps... but is it boring only because I do not agree with you?

The topic is Gold up in 08 where to in 09

I have given you my thoughts many times,

Here it is again...............

I am not a goldbug looking to get rich in Gold.

I have 20% of my liquid assets in PM's now that I hold for lack of a safer idea at this time. I feel safer to have some money as well as currency.

I showed you in another thread how little any collapse would really affect me.

If a better idea should arise I have 80% liquidity available to me.

I think I know where you stand on gold you dont like it as an investment...

( I am not fond of it in that light either & never said I was)

I *think* you know where I stand on PM's

I repeat I am not looking to get rich from Gold so all of *your* copying & pasting of charts etc. does nothing for my situation. Instead you can perhaps show me mucho concrete reasons for unlimited hope in the USD?

Edited January 15, 2009 by flying

[Naam]

I repeat I am not looking to get rich from Gold so all of *your* copying & pasting of charts etc. does nothing for my situation. Instead you can perhaps show me mucho concrete reasons for unlimited hope in the USD?

i can't because wishful thinking is not my strength and i leave the mucho razón(es) for our optimist on duty VegasVic to list.

having said so, i am convinced that the Dollar will for years to come still play a major albeit -compared to the past- diminished role in global finance and world trade. therefore i deem it mandatory that an investor, who wants to diversify and spread risks, should hold a certain amount of dollar denominated assets and besides that assets in other currencies. to which extent? that's depends on the individual perspective and expectations. the afore said (diversification) applies of course to you and other american, british, down under and european friends too, especially to those who live in a country without a currency peg.

i am well aware my words will hit deaf ears because from what i learned in this forum most people are not willing to think in any other than their "home" currency and the much favoured handcuffs of YUCK ... 401Ks, IRAs, Qrops, mutual funds and similar obsceneties

[flying]

i can't because wishful thinking is not my strength and i leave the mucho razón(es) for our optimist on duty VegasVic to list.

i am well aware my words will hit deaf ears because from what i learned in this forum most people are not willing to think in any other than their "home" currency and the much favoured handcuffs of YUCK ... 401Ks, IRAs, Qrops, mutual funds and similar obsceneties

Im sure V V 's ears are burning

I am actually interested in in other currencies

I was also waiting for 09 to cash in a small IRA I had sitting.

That will give me a year to deal with the penalties

[gregb]

You are making a gamble like anything, so are making a decision based upoon what you think "should" happen,

I ask all the holders of gold - what happens if your thesis is delayed by 10 years???? and gold goes down to $400??? (the inflation argument)

what you going to do then in the mean time????? still sit on the yellow metal?? or are you going to keep buying lowere to avergae down your loss??? if you buy here???

Correct. Like all investing, gold is a bet. If any of us had a working crystal ball we wouldn't have to worry. To answer your question, if gold keeps going down, I'll keep buying. The fundamentals of most currencies are such that gold as a currency is a hedge no sane person can afford to ignore.

I'd turn your question around. What will YOU do if hyperinflation hits in the next few years and you don't have enough gold? Do you have another insurance plan that is free of counter party risk?

The case for owning gold is the demise of the US as i see it, when is thats going to happen???? 1 year, 5 years, 20 years????

The case for all fiat currencies like the USD is inextricably linked to peak oil and energy depletion. If you don't understand or accept that the current global economy is built on oil, economic growth requires continually increasing oil production, oil production has reached a maximum and is now in decline, and that energy decline necessarily means economic decline, it will be hard for you to realize why the concept of the US dollar surviving for the next 20 years is an exceedingly low probability event. Your experience in the last 30 years is not going to help you much in the next 30. It will be a different era.

Gold as a currency, has the very desirable attribute of not requiring oil or energy for value in the same way the GDP of a current industrial economy does. In fact, as oil is depleted, gold becomes more valuable. Thus, the smart bet now is on gold, and will continue to be on gold. The only real question is the timing. But unlike a coin toss, the days are not independent. Each day results in further use of non replenishable assets, and thus each day makes it more and more likely that the collapse of industrial economies will happen tomorrow. (And by the way, the militaries of the world are all based on oil. As oil becomes scarce, it will be more and more difficult to keep them operating. That is how they will eventually fall.)

i would like to know on the basis of all the gold purchases, and do you really belive in your theis of the US is going to the toilet?????

or the De-coupling route that the world decides to shed the US consumer????

Pretty much the former. All civilizations eventually die. It happened to the Egyptians, it happened to the Greeks, it happened to the Myans, it happened to the Romans, etc. Nobody who is honest with themselves should discount the fact that it will also happen to the current industrial civilization. Again, only timing is really open for debate. The fact is, collapse happens so slowly you won't be able to notice it in a single lifetime no matter how hard you look, but it is also undeniable that fiat currencies decline in value during the collapse of an empire.

You can choose to dismiss this with any snarl word you may be able to dream up, but a smart man hedges his bets. I didn't believe peak oil when I first heard about it despite an extremely advanced education at a world class university where it was taught. But after spending several years researching it, I can tell you there is no solution to the problem that is politically acceptable. And this necessarily means energy decline. And that means economic decline. And that means a smart man ignores the short term oscillations in gold and bets on the fundamentals.

If gold looks cheap to me today, I buy it. If it looks cheaper tomorrow, I buy it again. I will keep buying as long as nobody comes up with a viable substitute for oil. And I have years of study under my belt to guage the concept of "viable". It's not something that can be explained or taught in an internet forum, but it is an adventure I highly recommend everyone investigate and do so with an open mind. I didn't believe it at first. It sounded too ridiculous. But keep an open mind and it'll be hard to deny the reality of it after several years. It took centuries to build our oil based infrastructure. It will take centuries to build anything else. In the meantime, there is going to be alot of pain for everyone. Owning gold will likely help mitigate that.

[Nouf]

Thank you for comments, i agree partially with some of what you have written, i agree on the oil trade the world still does need oil and its very much needed only the market will decide the actual price not you or I

market forces will decide fair value

however where i dis-agree on the purchase of gold and commodities is where we stand in the cycle, i believe the Inflationists (hyper-inflationists) are wrong at this present time.

I have mentioned this previous in other threads that i believe we are entering a Deflationary environment so i dont see a purpose or hedge yet as i am a holder of cash and no asetts, and untill i see evidence of inflation i believe owning gold and any assetts presently is the wrong move

What the Fed and treasury have done for the US$ is not good, and i am sure that will cause problems in the future, but when, is the problem?? and the timing of this

As we enter this protracted decline and i expect it to carry on for a while yet, asetts will likely get cheaper against cash, as forced liquidation takes hold, so i see no point in buying anything, when i think i will get far cheaper in the future

I think many have got their thesis wrong and the gold buyers i think have to (of course i may be proved wrong) Gold buyers are in the Hyper-inflation camp

Well someone needs to show me evidence of Hyper-inflation, or inflation, and with that we still have a shortage of US$`s as there is a great deal of outstanding debt to be paid down we have just popped the biggest financial ponzi scheme in history

As i stated previously unless the US writes of the consumer debt, only then i see Hyper-inflation and a purpose for owning gold or having a hedge against inflation against any fiat currency (i will wait for any evidence of the demise of the US$ 1st)

I agree the fiat system is flawed, but where i stand cash presently is King, untill inflation takes place, i want proof 1st of inflation

Its the Hyper-inflation thesis and the reason for owning gold where many are getting mixed up between deflation vs inflation.

If deflation takes hold the US$ will get stronger and the rush to pay debt in dollars is still happening (its the strongest currency presently out there the evidence is the run for 30yr T bills) and the DX strength

The bond market, will tell me if the Hyper-inflation thesis kicks in (of course if i see evidence of inflation i will be hedging)

Gold does appear to hold some strength, and yes i would agree it is perceived to be of some value and shows that as its held up well,

But case in point i still dont think its a buy here yet untill any evidence of inflation or hyper-inflation.

I think gold is a poor buy here(because of the deflation aspect in the cycle)

The public has mistaken the timing of the US$ and its near term strength as we enter deflation its this reason, timing and being aware of the overall situation we are presently in, we could be a deflationary period for longer than you think and Gold goes no where

as i also stated previously in this thread untill gold settles above $900 i am not bullish on gold at all. (however i would be very tempted at $600ish) where i bought last time and sold it 6 months ago

the point you make on buying gold on the dips and as its goes down, well i leave you with the saying of.

Never try to catch a falling knife.

If you have forced sellers as deflation takes hold all asett classes will get destroyed, look at gold in the Autumn period, it went down with the meltdown of the stock market, like all asetts will in a deflation it got destroyed to $680

Of course you are free to choose what/when you purchase, but i think many need to be aware of the short term strength in the US$ as we are un-winding this credit cycle and i think the case for hedging for inflation is further away than many think, be it with the purchase of oil,gold or tea leaves

What happens if gold see`s $600??? are many just going to keep averging down

By the time any such inflation takes hold your wealth is wasted by deflation,

It seems to me the basis of owning gold still seems to be of the scare factor of the demise of the US$ fiat system, well i think owning gold will be the least of US the consumer problems as Anarchy takes hold and a Mad Max environment or any Zimbabwe Hyper-inflation

I think guns and tinned food would be far more useful

Edited January 16, 2009 by Nouf

[flying]

I think gold is a poor buy here(because of the deflation aspect in the cycle)

The public has mistaken the timing of the US$ and its near term strength as we enter deflation its this reason, timing and being aware of the overall situation we are presently in, we could be a deflationary period for longer than you think and Gold goes no where

as i also stated previously in this thread untill gold settles above $900 i am not bullish on gold at all. (however i would be very tempted at $600ish) where i bought last time and sold it 6 months ago

the point you make on buying gold on the dips and as its goes down, well i leave you with the saying of.

Never try to catch a falling knife.

I think by your own description it is you that is trying to catch the falling knife.

Others are buying here & there & where they can.

What makes you think that when your price is *right* there will be physical gold for you to buy?

When you speak of cycles do you mean your a cyclist? Because if you are I read a very good cyclist comments & am pretty amazed at how accurate he has been.

He wrote them back in early 06

Also I 100% agree with your last comment

I think guns and tinned food would be far more useful

But not that they will be far more useful but they will be needed by many at some point.

[flying]

Flying, I think that gold may have seen its high for 2009 already, but given the severe recession in the worldwide jewelry market and the deflationary trend that is griping the worlds economies for the foreseeable future, I do think that gold has very possibly seen its high for the year already biggrin.gif

Oh boy..........You sure you want to make that prediction 7 days into the 1st of 12 months of 09?

I'll see you at $650 as well nouf After golds $40 loss yesterday I expected a dead cat bounce to at least $835 today but gold only managed a 80 cent dead cat bounce to $821.80. You can pretty much stick a fork in gold for a while as it is done Once gold breaks down below $810 it will be a freefall to the $770's where the next resistance level is, then the $730's and finally $682 will get taken out and gold will base in the $625-$650 area. Sorry flying the HUI chart says it all

Sorry Dude your HUI was soooooooo wrong BWAHAHAHAAH

Edited January 16, 2009 by flying

[Nouf]

I think gold is a poor buy here(because of the deflation aspect in the cycle)

The public has mistaken the timing of the US$ and its near term strength as we enter deflation its this reason, timing and being aware of the overall situation we are presently in, we could be a deflationary period for longer than you think and Gold goes no where

as i also stated previously in this thread untill gold settles above $900 i am not bullish on gold at all. (however i would be very tempted at $600ish) where i bought last time and sold it 6 months ago

the point you make on buying gold on the dips and as its goes down, well i leave you with the saying of.

Never try to catch a falling knife.

I think by your own description it is you that is trying to catch the falling knife.

Others are buying here & there & where they can.

What makes you think that when your price is *right* there will be physical gold for you to buy?

When you speak of cycles do you mean your a cyclist? Because if you are I read a very good cyclist comments & am pretty amazed at how accurate he has been.

He wrote them back in early 06

Also I 100% agree with your last comment

I think guns and tinned food would be far more useful

But not that they will be far more useful but they will be needed by many at some point.

Hello,

No im not looking to catch a falling knife, i suggested i will looking at the possibilty of buying gold lower if i see evidence of inflation(if deflation takes hold or the DX collapses then yes i will likely hedge) as posted in my comments, i can assure you i can purchase of gold right now, click on the goldmoney link i posted some pages back.

I think too many are on the fear factor train, and the media is hyping up the US$ destruction fiat money meltdown, i think they are way off, they are simply not understanding where we are in the credit cycle and the forced liquidations that are/is still yet to come.

Many dont understand credit cycles and wealth destruction that comes with those, they see what the Fed and Treasury is doing and immediately think of that as printing of money but its not, untill that money is actually spent by the consumer all its doing is just replacing lost debt, on the banks books, there is that much debt in the system from the potential write downs, and more is still yet to be to disclosed, its a running tap, and untill you stop the writedowns and housing gets a floor, only then can you see a possible bottom and then you see all those excess $ come into the system thats when inflation takes hold, but the Fed can also drain the slosh fund and take that money back, once and/if the economy gets back on its feet

What many gold buyers are basing their purchases on is the whole system of fiat money needs to collapse and thats requires a loss of confidence in the paper system, i dont see that evidence of that yet

can anyone show me the evidence????

Gold is easy to obtain its the coins that have been marked up at ridiculous prices that hard to buy, that the amazes me.

If the thesis of the destruction of fiat money does happen as i stated earlier, gold will be the least of your problems as you play out Mad Max scenerio, i would take my chances with guns and tinned food.

I re-interate gold needs to get back above $900 and stay above this levels failure to do so is not a good sign, with all the Fed games, and alledged printing then if gold is deemed to be of monetary value, then we should see a stampede of buying, should we not??

Again my stance is somewhat different to many as i still dont see value at these prices, untill i see signs of inflation, right now we are in deflation, we are not going into deflation we are there, as i see wealth destruction to carry on for a while longer as the purge the system of credit and force debt out in the open and for me cash presently is the stronger asett as we continue with forced liquidations

of course if circustances change a good trader will adapt, gold seems to be in a holding pattern of jockeing between $800 and $890 its needs to make a break of one of those levels or we jostle like we have done with the DX, and a period of going nowhere takes hold

However should gold break one of these levels then you should see a substanial move in that direction (of course i will adapt as and when)

I think many really need to understand where we are in the credit cycle and the present need for US$, and the need for those US$`s the need for holding Gold as a hedge against Hyper-inflation is way of the mark in my opinon

i again ask where is the evidence for inflation????

The clues are out there and very easy to read, people need to wary of being blind sided by the Guru`s and media, and not be hopping on the fear factor train, and the imminent US$ destruction, when all they have to do is go and research the evidence and come to their own conclusion about owning any asett group

They also need to be understanding debt and credit cycles

Gold maybe the currency of the future and the US$ maybe toilet paper but when will that happen 1 yr 10 yrs 20 yrs???

Being early and buying any assets at inflated prices is wrong in my book especially in an environment like we are in today

The market always decides fair value and if you are wrong you will pay for those mistakes by loosing your wealth

Good luck in your preservation of your wealth

Edited January 17, 2009 by Nouf