does anyone else here think that gold will go way down...

...when the economy stabilizes?

 

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Personally yes but question is, when does the economy stabilize?

 

Think? Not really. Hope? Every day.

 

I wouldn't count on it happening any time soon. Physical metal is tough to get right now. Silver is really tough to touch anywhere near spot.

 

Considering that gold has risen 'on average' around 15% per year for the last twenty years... it is always a good investment... even if it goes down rapidly... it always climbs back. Best wishes, Mike

 

Yeah, key question is when can it stabilize?

Only chance I see in the near future is maybe a huge stimulus package, artificially inflating things for a while and giving people a temporary, false sense of security (which I guess is the intention??). At which point you may see the markets start climbing and maybe people will dump their precious metals to get back in.

On the other hand, with the kind of money they're printing these days (trillions per year instead of billions), it might take a whole lot more dollars to buy anything before too long. Unless they can invent some new fantasy way to get rid of inflation which isn't going to happen.

I think the markets are being artificially suppressed right now. As much as I'd love to see it happen, I don't see it happening. I don't know what factors would be strong enough to cause a major drop. Things might not be stabilizing for a long time.

 

Suppression of the Gold would certainly be a smart idea by the Treasury and the normal gang of suspects, and I believe it is being done. Money is just a play thing for them and a billion or so of paper can do a lot of suppression of gold shares also.

If gold started going up $5-10 a day, it would cause a panic, people would take their money accounts out of the TARP banks, those banks would need more funds, stocks go down, more people panic, they want hard assets, gold goes up, go to step one.

Wouldn't it be great if all of us had a printing press!

I have a big bet in that gold will go up. My question is when will stabilization cause it to go back down so I can sell.

Jim

 

That sounds about right except that even with stabilization, the price might never go down much below the low of last year ever again in the lifetime of any CoinTalk member.

 

Only one thing about gold prices can be confidently guaranteed - They will sometimes go up, sometimes go down, and sometimes remain stable!

 

Here's a simple rule that I have found to be pretty accurate.

Anything that goes up in value at a rate that's multiples of inflation WILL crash. Spikes/bubbles/etc are never sustainable.

Look at coins, they spiked and crashed in 1965, 1980, 1989 and they have again recently spiked and seem to be in the beginnings of a crash now.

Collector cars have done this

Stamps have done this

Baseball cards

Real Estate

Silver

Gold will do the same thing. I think that, in today's money, gold should settle in the $5-600 range per ounce.

Historically, in today's money, oil should be in the $35-40/bbl range. Where has it settled? Adjusted for inflation we've historically paid a bit under $2 in today's money for Gasoline. Where has Gasoline stabilized?

$950 an ounce is not sustainable long term IMO.

 

That is why I laid off on my gold buying, esp coins for my gold type set.

 

It is the on av thing that got me thinking. gold was below $450 for 6 of the last 10 years.

 

One thing to keep in mind is that your sample might not be representative. If you had lived in Mexico, Zimbabwe, Turkey, Germany, Iceland or any of the other nations that have experienced currency collapses, you might feel differently about it. Also, by your definition, the rise in gold from $32 to $100+ was unsustainable and we can expect gold to return to $50 per ounce and silver to $1.50 any day now. There are countless examples where metals took a one way trip up and never returned to their former base price because the currency lost value. You just need to expand your search to a wider range of times and places.

But I agree that $950 is not sustainable in the long term -- it will prove to be too low.

 

I think the answer to your gold question is yes.

However, the second clause (copied above) is the key question -- when.

The other half of that question -- where the US dollar will be versus other currencies -- is also key as this affects the price of gold as much as anything.

 

I personally believe the price of gold is artificially low currently. If the U.S. mint had to hault production of all of it's bullion coins last year, there is demand to sustain $900+/ ounce for a while yet. I was patiently waiting for it to dip under $600, but realized that was not going to happen for a few years now. I think we all realized the economy was going to take a dive, just not this severe. Until it starts showing signs of recovery, I believe gold will remain high.

 

The fact is that if you look at gold as a raw commodity... it rises overall. I have a cigarette case which I bought for £100 when it was worth £450 scrap.... it is now worth around 700+scrap after 18 months of owning it.... not sure how this works with coins as I don't invest in golds coins... but gold itself is a good investment whatever. Best wishes, Mike.

 

I am waiting patiently for gold to go back down to $300/$400 range. Then invest or add gold coins. Pipe dream? Maybe, but I can hope. :thumb:

 

Here is an interesting chart that goes back further.A lot of ups and downs.

 

gold seems a bit overpriced but panic is in. As soon as panic recedes, and all we have is hope and change and plan, hehe. what we will have is people calm in the wake of a recession. Disinflation is in, and voila, a catalyst for gold to crash over next year or so.

What will happen in the future though, is higher inflation that is caused by the printing of trillions of dollars in cash. and thus it will proppell commodoties higher..the question is will it shoot up from $750 (our estimate), or $550.

 

Hello wake up bunch of ignorants - if you factored in inflation, we still have NOT hit the price record of what happened in 1980. Use this calculator before you start talking absolute nonsense: http://data.bls.gov/cgi-bin/cpicalc.pl

OR if you still have trouble understanding, how about an inflated adjusted gold price chart:

http://goldprice.org/inflation-adjusted-gold-price.html

Case closed. Has it risen by a magical figure of 15% annually? No it hasn't and it does a VERY poor job. If you are a bank and stashed huge amount of gold in your bank, you are likely to be LOSING money because you are spending an absurd amount of money in security alone, much less maintenance on the vault etc.

The thing is, the USD cannot be allowed to fall for bloody obvious reason - it's the dominant global currency and once that trust is gone, what do you suggest people to pay with? Back to the gold and silver days? That's totally absurd. A pack of candies - 1/250th oz of gold or 1/10th oz of silver please. Right, unreal.

I'm probably more shocked that people are not having faith in their own currency. This is NOT Zimbabwean dollars.