Van Posted March 16, 2012 Report Share Posted March 16, 2012 Sometimes links from postimage stop working for some reason. http://postimage.org/image/tl8xxmgnb/ Link to comment Share on other sites More sharing options...
drbubb Posted March 16, 2012 Report Share Posted March 16, 2012 Looking back... On Sept.26, 2011, there was a GAP near present trading levels The GAP in GBS.L is from $158.55 down to almost $156 Link to comment Share on other sites More sharing options...
malvern hills Posted March 16, 2012 Report Share Posted March 16, 2012 Sometimes links from postimage stop working for some reason. http://postimage.org/image/tl8xxmgnb/ Great chart Van. Does it work with silver? Link to comment Share on other sites More sharing options...
sine270 Posted March 16, 2012 Report Share Posted March 16, 2012 Just to put in a good word for PM ETF's, I dumped 80k worth of GBS and PHAG a couple of days ago. Held them for 5 or 6 years. Had no problems at all (except now the Capital Gains). Paper? Maybe or maybe not but it worked despite what everyone was saying about the dangers of ETF's. Will be buying again soon in a joint account to get twice the CGT but thats for another thread. Point being that non leveraged ETF's are a highly effective way (or at least have been) to buy and hold or trade gold and silver. Dealing costs next to nothing and no hassle. Link to comment Share on other sites More sharing options...
drbubb Posted March 16, 2012 Report Share Posted March 16, 2012 Thank you for saying that. As everyone knows, there MAY be a problem with ETF's or Paper gold someday. But thus far they have provided a low cost and effective trading vehicle. So we can say: + there MAY be a problem with ETF's or Paper gold someday + there MAY be a dramatic collapse in Gold prices someday Both of these are risks that one may choose to take or not take. Thus far, the bigger risk has been from the downwards move in Gold, so Paper trading effectively has been better than someone Buying gold above $1800, or $1900 and just hoping for the best. I do hope that we are seeing the beginnings of more Balance discussions here. Link to comment Share on other sites More sharing options...
sine270 Posted March 16, 2012 Report Share Posted March 16, 2012 As everyone knows, there MAY be a problem with ETF's or Paper gold someday. But thus far they have provided a low cost and effective trading vehicle. So we can say: + there MAY be a problem with ETF's or Paper gold someday + there MAY be a dramatic collapse in Gold prices someday Both of these are risks that one may choose to take or not take. Thus far, the bigger risk has been from the downwards move in Gold As a buy and holder of real and paper gold I have always agreed with this. The risks you have mentioned have perhaps started out small and have increasedd over the years. I have always considered the biggest risk to be downwards moves in gold/silver. I wanted the liquidity of the ETF's but they were always going to be the first to go. I will have to buy again withing 30 days for CGT purposes but I am now getting out of paper gold as quickly as my CGT allowances will allow me. After that I may follow with my GM holdings and the coins will be the last to go if ever. There is no real reason for my actions now except I need the money and maybe there is a limit to how long one should continue to push ones luck. In effect, I will now be averaging out and it will take a few years to be all out except coins. The way I see it is that just by avoiding CGT I can afford to lose out in not selling at the best times price wise. Also it helps if I have my hand forced to a certain extent because I am not great in judging markets. On the way up I often had a set buy every month and I'd quite like to have the same on the way down. It'll probably work better than me panic selling at all the wrong times and having to pay cgt. Link to comment Share on other sites More sharing options...
romans holiday Posted March 16, 2012 Report Share Posted March 16, 2012 Thank you for saying that. As everyone knows, there MAY be a problem with ETF's or Paper gold someday. But thus far they have provided a low cost and effective trading vehicle. So we can say: + there MAY be a problem with ETF's or Paper gold someday + there MAY be a dramatic collapse in Gold prices someday Both of these are risks that one may choose to take or not take. Thus far, the bigger risk has been from the downwards move in Gold, so Paper trading effectively has been better than someone Buying gold above $1800, or $1900 and just hoping for the best. I do hope that we are seeing the beginnings of more Balance discussions here. Balanced? Who bought gold above $1800, or $1900? Near all who discuss gold [as opposed to hedgies that jump on bandwagons] bought before the spike above the trend and are still showing a paper profit. Is it that difficult to discuss the Long Term theme/ trend, which you've agreed should be the focus of this thread? Link to comment Share on other sites More sharing options...
drbubb Posted March 17, 2012 Report Share Posted March 17, 2012 Balanced? Who bought gold above $1800, or $1900? Near all who discuss gold [as opposed to hedgies that jump on bandwagons] bought before the spike above the trend and are still showing a paper profit. Is it that difficult to discuss the Long Term theme/ trend, which you've agreed should be the focus of this thread? Somebody bought it there - plenty of volume went through. Maybe no one on GEI did, we were making many warnings here. And certainly few here would admit it. Actually, I dont think I ever paid more than $160 for GLD, but I did sell some PHYS and replace it with MNT, and am now slightly underwater on that trade. Link to comment Share on other sites More sharing options...
Mabon Posted March 17, 2012 Report Share Posted March 17, 2012 Somebody bought it there - plenty of volume went through. Maybe no one on GEI did, we were making many warnings here. And certainly few here would admit it. Actually, I dont think I ever paid more than $160 for GLD, but I did sell some PHYS and replace it with MNT, and am now slightly underwater on that trade. A couple of folks who I previously worked with. And who had previously derided Gold (despite being relatively 'sophisticated' investors)...bought at around 1800 (equiv sterling sum) (sept 2011) an ounce and are now tamping! They said that I'd said to buy some Gold. My reply was 'yes I said to buy it years ago when it was 600 quid an ounce not over 1000!.' (Some People Tsk Tsk) Link to comment Share on other sites More sharing options...
drbubb Posted March 17, 2012 Report Share Posted March 17, 2012 A couple of folks who I previously worked with. And who had previously derided Gold (despite being relatively 'sophisticated' investors)...bought at around 1800 (equiv sterling sum) (sept 2011) an ounce and are now tamping! They said that I'd said to buy some Gold. My reply was 'yes I said to buy it years ago when it was 600 quid an ounce not over 1000!.' (Some People Tsk Tsk) Haha That's what often happens. People resist for years, and then they get sucked in to buy during the mania that creates a parabloc move up. We are seeing such a parabolic move right now in Apple shares Link to comment Share on other sites More sharing options...
Errol Posted March 17, 2012 Report Share Posted March 17, 2012 A couple of folks who I previously worked with. And who had previously derided Gold (despite being relatively 'sophisticated' investors)...bought at around 1800 (equiv sterling sum) (sept 2011) an ounce and are now tamping! They said that I'd said to buy some Gold. My reply was 'yes I said to buy it years ago when it was 600 quid an ounce not over 1000!.' (Some People Tsk Tsk) If they are worried they purchased it for the wrong reason (i.e. to make a quick buck). Link to comment Share on other sites More sharing options...
drbubb Posted March 17, 2012 Report Share Posted March 17, 2012 If they are worried they purchased it for the wrong reason (i.e. to make a quick buck). They would have achieved more if they had aimed to lose a quick buck. Haha As Larry P. has said, when you start calculating your potential profits on future moves, it is time to sell. Link to comment Share on other sites More sharing options...
Errol Posted March 17, 2012 Report Share Posted March 17, 2012 They would have achieved more if they had aimed to lose a quick buck. Haha Irrelevant. An ounce of gold is an ounce of gold. They still have what they paid for. They haven't lost (or made) anything. Link to comment Share on other sites More sharing options...
drbubb Posted March 17, 2012 Report Share Posted March 17, 2012 Irrelevant. An ounce of gold is an ounce of gold. They still have what they paid for. They haven't lost (or made) anything. The purist formula - stated in three short sentences. How terribly silly it is ! The purchasing power is down 10-20% since they invested at $1800-1900, so of course they are worse off. Don't be blinded by some ridiculous "religiosity" ! Link to comment Share on other sites More sharing options...
Errol Posted March 17, 2012 Report Share Posted March 17, 2012 The only thing that will matter is how many ounces you have. Think in terms of ounces. Link to comment Share on other sites More sharing options...
Errol Posted March 17, 2012 Report Share Posted March 17, 2012 I don't think GF was up to anything at all. He was always one of the best/most prolific posters on this forum. Link to comment Share on other sites More sharing options...
drbubb Posted March 17, 2012 Report Share Posted March 17, 2012 The only thing that will matter is how many ounces you have. Think in terms of ounces. Why? I think in terms of purchasing power, and want to maximise that. I don't get hung up on some theoretical numerier Link to comment Share on other sites More sharing options...
sine270 Posted March 17, 2012 Report Share Posted March 17, 2012 The only thing that will matter is how many ounces you have. Think in terms of ounces. This only works if you are thinking in terms of armageddon happening any time soon. And this needs to be coins/bars. No good for GM/BV even. Otherwise you really need to be thinking in terms of how much house you can buy for your ounce of gold. This has reduced from 6 months ago. And from my recent experiences I think people need to think more about CGT. ETF's are far easier to buy and sell/ wife & breakfasting etc. Cant do any of that with coins. Devils advocate here as I have coins too. Link to comment Share on other sites More sharing options...
Errol Posted March 17, 2012 Report Share Posted March 17, 2012 This only works if you are thinking in terms of armageddon happening any time soon. I'm expecting paper money collapse. Total paper money collapse. In a matter of years. Link to comment Share on other sites More sharing options...
drbubb Posted March 17, 2012 Report Share Posted March 17, 2012 I'm expecting paper money collapse. Total paper money collapse. In a matter of years. Okay. We have different time horizons. I may be in and out of my Gold-related trades several times before then. Could hold much of a Core Gold allocation however. When the value of your Gold or other investments goes up, you might want to consider diversifying part of your wealth into Gardening-related investments: http://www.greenenergyinvestors.com/index.php?showtopic=16106 It is the most personal way of investing in Agriculture. Link to comment Share on other sites More sharing options...
drbubb Posted March 18, 2012 Report Share Posted March 18, 2012 I don't think GF was up to anything at all. He was always one of the best/most prolific posters on this forum. That is possible. I don't really know, since I have bothered to search for him anywhere else. I was given to understand (perhaps wrongly) that he was posting elsewhere. Link to comment Share on other sites More sharing options...
Errol Posted March 18, 2012 Report Share Posted March 18, 2012 He probably does post elsewhere. I post in other places as well. Hopefully he'll come back to GEI at some point. Link to comment Share on other sites More sharing options...
drbubb Posted March 18, 2012 Report Share Posted March 18, 2012 A THOUGHTFUL NOTE on Gold Prices follows. It says Gold is still a hold, and may be a good Buy, clsoer to key support at $1500: An interesting Note... WHEN TO SELL YOUR GOLD The concept of gold as an occasional part of an investment portfolio has tremendous merits- not necessarily only as a hedge against inflation (or deflation), but more because of its role as an insurance policy against monetary debasement. However, with gold having just completed an unprecedented 11 year bull run, the natural question to ask if it’s time to sell or too late to buy. Dylan Grice, global strategist at Soc Gen, wrote an interesting note outlining the reasons why gold should not be sold (yet)- to summarise: -Gold’s historical role as a medium of exchange, as well as its finite supply, makes it an invaluable hedge against monetary mischief on part of governments. -However, (as Warren Buffet recently pointed out) it pays no dividend or interest and could therefore be seen as an insurance policy with the cost being the foregone cash-flow return, with a big payout under an extreme inflationary event. -Unlike other inflation hedges, like inflation protected bonds issued by governments and subject to default or stocks which can underperform (at least during the initial period) as most bear market troughs during the 20th century have occurred during inflationary periods, gold cannot be defaulted on and will payout substantially when you need it to. -However, gold is not a “buy-and-hold” investment and, like all commodities, is essentially a speculative play which is bought to be sold at a future date. -The main reason why he holds gold is to cover against the long-term solvency of the developed world governments. Governments from ancient Rome, to Ming China, to revolutionary France and America, and to Weimar Germany have resorted to inflation in order to avoid an explicit default on their debt. -During such inflationary episodes, contracting money supply have not been politically acceptable courses of actions as they would have ushered in depression like conditions. -During the Weimar period, the Reichsbank president Rudolf von Havenstein did not pursue a policy of monetary contraction as he was terrified of the social consequences of high unemployment and falling output. -During the 3rd century AD, the Roman empire halted all military expansion which created a budget deficit as the cost of defending the borders continued to increase without the increases in revenue from newly conquered territories. -The Roman emperors, rather than cutting military and other sundry expenditures , chose to instead debase the currency. This resulted in the world’s first fiscally created inflationary crisis. -Governments over the years have usually resorted to “kicking-the-can” down the road rather than resort to short-term painful measures to cut spending. To reduce developed world government debt ratios to pre-crisis 2007 levels, fiscal spending cuts averaging 6% of GDP would need to be made over the next 5 to 10 years. -However, there are fortunately examples of governments eventually being forced (in response to a series of crises) to adopt measures to induce short-term pain - i.e. Margaret Thatcher’s being elected in the late 70s with a mandate for short-term pain (to reduce inflation) , which did no exist 5 years earlier. -Another example is Ireland –which is currently subject to draconian fiscal policies (to prevent an economic collapse), with output contracting by 10% from its peak, unemployment at 15% and housing prices down 60-70% from their peak. These policies would not have been possible 5 years ago. -Developed countries with central banks are a long way away from reaching the point of serious fiscal retrenchment – but the unsustainability of government finances and the increase in government debt points towards an eventual debt crisis forcing fiscal rectitude. That will be the time to sell gold. An interesting perspective on why to continue holding gold. While I do not agree wholly with some of his points (i.e. this is not the time for austerity), he does make a convincing argument on why one must hold gold as part of a diversified portfolio in the current environment– primarily as an insurance policy against government profligacy, which history unfortunately informs us is a somewhat natural tendency! As I have noted in previous newsletters, the performance of gold is highly correlated to increases in the US monetary base and the time to sell all gold will come when QE policies in the developed world come to an end (late 2013?). This is likely to be before a significant increase in inflation (2014 onwards?). There is also some serious academic work (Summers, Krugman and others) which demonstrates that the price of gold is linked to the level of real interest rates . This view has intuitive appeal– with real interest rates negative, it makes sense to hoard gold now and push its use into the future thereby raising prices now and in the near future. So the price of gold has risen because expected returns on other investments have fallen. This could explain the recent drop in gold prices, with the expected returns on other risk assets increasing (and the chances of QE receding). As the graph below (via Sy Harding) illustrates, the support level for gold prices are at around $1,500, at which point (or close to it) it should be an attractive buy as the currency debasement policy in the developed world is likely to continue for a while longer. (received by Email, from a Fund Mgr. friend) Link to comment Share on other sites More sharing options...
romans holiday Posted March 18, 2012 Report Share Posted March 18, 2012 A THOUGHTFUL NOTE on Gold Prices follows. It says Gold is still a hold, and may be a good Buy, clsoer to key support at $1500: Nothing much new in the 'explanations' or fundamentals there. Saying gold is 'a good Buy, closer to key support at $1500' is pushing it when the chart is your guide and not speculation on 'fundamentals'. 1500 might be an OK buying target for someone with already a core position in gold and then looking to get a trade in. But for someone looking to build a core position, or increase it, that target is too low.... because improbable. A glance at the chart shows that with the price at these current levels is the time to buy, or start buying, averaging in etc as a large reverse head and shoulders is shaping up. This has always been bullish for the price. I'm starting to suspect you're an egoist Dr Bubb . That is, someone who can not see something objectively, from a 'disinterested' perspective. This thread is supposed to be focused on the Long Term trend of gold as an investment and yet your posts continually, habitually, show your own short term concerns as a trader, which, let's face it, can be as often wrong as they are right [the nature of trading]. Don't you want to see your forum giving sober advice to those new to gold on how and when to buy? As you've stated, you yourself have a core in gold, so why not help rather than hinder others to build a core? Link to comment Share on other sites More sharing options...
BlackPepper Posted March 18, 2012 Report Share Posted March 18, 2012 A THOUGHTFUL NOTE on Gold Prices follows. It says Gold is still a hold, and may be a good Buy, clsoer to key support at $1500: So my question is now what do we use to measure real value? Link to comment Share on other sites More sharing options...
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