Did this article answer that question?
Did this article answer that question?
I don’t play at that level, but I have often wondered how many people who are involved in the buying and selling of gold actually have their hands on the metal involved.
Not too many if this story is any indication.
So what do you get when you buy gold? A fancy piece of paper that says you have gold reserved in your name somewhere in a vault in other state or country?
Riiiiiight!
Not exactly rocket science to think that trading in paper like that, given the perilous state of the economy the world over, is a very dumb idea.
This can’t be right, G Gordon Liddy and Glen Beck are still pushing hard.
Call me a skeptic, but if I did own gold I would like to have the genuine article in a safe place. And that is the problem...where would that be!
I am most concerned by copper and the base metals. This shows a big component is pessimism over the economy for the short term. Gold amd silver will not bounse back easily from this one.
A real QE3 is around the corner. Then, Gold will take off.
You remember when we started talking about this. I think Gold was at about 450. Let any real-estate weasel in the world come in on this.
On the bright side, if it keeps this up, we won’t have to worry about confiscation! ;)
You are not allowed to pull the curtain, the great wizard will see you when he feels it necessary.
Gold is still in a bull market. If you study the price and volume action of gold from a technical analysis standpoint, this short term correction was very predictable.
The speculators have been flushed out and gold will resume it’s rise. Nothing goes straight up.
It’s a blip. Gold is still na excellent hedge aginst inflation. Long term, it is not going down.
There are lots and lots and lots of “late-to-the-party” holders of both silver and gold. There will be panic selling for a while here. That is a reality.
Undoubtedly, silver will pause at even numbers of dollars, but that would appear to be only temporary. If silver goes back to where it started going parabolic, which is where frenzies often go to, we could be talking about $15.
Low twenties = very easy.
Especially since hurricane Isabel sent that surge up the Chesapeake Bay, overwhelming my house & docks, and leaving all my gold somewhere out in the middle of the Chesapeake Bay....along with all my long guns, hand guns, and ammo.
I am still buying gold because nothing has changed. Nothing...
Not altogether certain these are a factor at the present time. True, they are un-backed and thus doomed to fail, but a dropping price actually helps strengthen them. Remember, nobody is actually taking any physical bullion out of the funds.
Huge factor at the present time! Main culprits are the hedge funds. Investors want money out, margin calls are ringing, Au and Ag are the only things they can sell and still book a profit.
Mixed. Investors can always liquidate some or all of their margin stocks (or the broker/dealer will do it for them). About the last thing most want to do is bail out of the one asset bound to rebound, especially in an instant (e.g. think Middle East).
On the other hand, the increased margin requirements at the Comex is indeed a factor, although much less of one since they have boosted them about a dozen times in the last few months. See Market Manipulation below.
Actually, gold is money, despite the Bernack's idiotic statement to the contrary. PM's are difficult to move (bulky, heavy, expensive to transport, etc.) and can be sold and then repurchased at a different location, but most of these transfers are made without disrupting the market.
This is a factor, but is probably overrated.
Technical analysis is most helpful when fundamentals are unchanging. This is not the case at the present time.
Without a doubt, many of the algorithms used by the hedge funds are firing off right now, but this will probably not be much of an issue for very long.
Inflation is rampant and virtually every developed country is monetizing vast amounts of sovereign debt. Deflation is not a problem at this time.
Commodities are falling because economic production is dropping - thus demand is, or will soon be, down substantially. However, this is not the case for PM's. Gold has limited industrial applications and silver's uses, while significant, are generally inelastic (e.g. medicine and antibacterial), or booming (e.g. smart phones and DVDs).
Banks and governments manipulate the hell out of PM's using numerous techniques, especially naked shorts. It's called the preservation of wealth effect. People panic when they see their currency trashed with respect to PM's. At the present time, the big banks are hung out to the tune of tens of billions in terms of paper losses and they are coming up on year end. Unfortunately, the price is dropping without knocking many leaves off of the gold tree (or in other words, the effect is temporary because they still have to come up with the bullion somewhere). Moreover, it looks like they are about to lose control of the market. Gresham's law anyone?
There is one of the largest runs in history going on at the present time as money is fleeing the European Community in advance of its collapse and the collapse of the Euro. For this reason, the Fed is printing a ton of money and "loaning" it to the ECB for the short term (until after the EOY banker boy bonuses). This is boosting the demand for dollars through the roof, and the price of gold is inversely proportional to the price of gold.
Rumor has it that several eastern European banks (e.g. in Poland and the Baltic Countries) are being forced to sell gold in order raise dollars. Maybe.
The Fed are masters at subterfuge. Bernack has denied QE3. However, they are printing money for liquidity (see above), are about to bail out the IMF (again), and are propping up European banks. They are indeed "twisting" some of their short term debt into longer maturities, but while this addresses the problem of paybacks, it no way addresses the problem they have with ongoing deficits of $100 billion per month and rising. The current "solution" of reverse repos applied to GSE trash with big banks acting as middlemen is ... by any other name ... printing money to boost bank reserves and fund deficits ... which by any other name is quantitative easing. And people are stupid enough to believe the Fed line ... for a while yet.
$1610 gold price right now
$1915 was the peak interday gold price a few weeks ago probably September 6th
SILVER
$28.47 right now
SILVER
Peaked near $50 a few months ago
Most “buyers” for the past 500 pts. or more are herd followers who got hyped “in”. They're getting out now in droves, but more to come soon as they are the ones who ALWAYS bail when anything upsets them - same ones that sell their stock funds/etfs near the bottom.
Sorry, gold is not going to the moon, it's tanking and will tank faster if there is any rally in stocks. All you have to know is that it was being power-sold and promoted all over the place to know there are MANY owners who are not “believers”. They go in because “they had to” or they'd miss “the next great thing” just like they piled on tech stocks at the end of the 90’s. Another classic bubble and burst.
A Freeper asked me what I think of this decline. My reply:
I think this is a great time to keep buying regularly. I
I think the fundamentals are there for a future rise. Gold’s steady 10-year rise (15% per year) would put it at about $1400 today, which I’m prepared for.
I’m intrigued by the notion that the Euros are panicking into the dollar, which is thus in a bubble of temporary strength, which makes commodities drop.