Discussion in 'Bullion Investing' started by Yankee, Jun 16, 2009.
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I have a great deal of certainty that both Martin Armstrong and Alf Fields are going to be proven 100% correct in their predictions that gold finds or has found its low in this month to be followed by a dynamic move to the upside. This move will not be modest by any means, but rather the most vigorous move we have experienced so far in this Gold bull market. Attend to completing whatever you wish to do in the next few coming days. Watch your simple trend lines very carefully this time because sales at $1000 will be wrong. The glib saying of "Sell in May and go away" will separate you from terrific gains this time around.
The least I can take away from this is that he feels $1000 is coming before summer is out. We could get a low of $890-$918 within the week and spend a number of weeks chopping slowly upwards for a stronger move in July. I'm watching the charts and still no positive confirmation of a definitive pog bottom yet even though a number of the indicators are in bottom territory. If the dollar moves up strongly and flattens the stock market, I don't see how gold miners can avoid correcting as well.
I think it's a good long term move for them and wish the U.S. would do something similar.
The paper gold market is huge--probably more than $2 billion dollars a day--but most of that is money going round in circles. The market for actual physical gold is surprisingly illiquid, as the chairman of Goldcorp found when he tried to buy just over 1 tonne of physical a few years back:
I don't doubt the senator's primary concern--that China fears US inflation and is diversifying its reserves--but I don't think his headline statistic holds up.
the germans are sarting to sell gold at vending point'r at areport's and their rolling them out no shorted of gold in germaney
To have 10% of its assets in gold, China would have to buy the equivalent of two years of the total world production of gold. Doing this would drive the price of gold up, but it would depress the value of the dollar holdings that China has. In other words, they would be depreciating the value of their total holdings by converting too many dollars too fast. In the stock market, this is called "bidding against yourself".
It's more likely that China will convert and re-allocate dollar holdings slowly into other currencies and commodities (including gold) to soften the effect on the value of the dollar-denominated holdings they own.
I know the gold bugs on the forum are looking for the big & fast spike upwards in the price of gold, but be aware that any big move has negative implications for most of the central banks and they will do their best to avoid these sudden jolts.
I think the price of gold & silver will continue to rise, but slowly and in an orderly way that will not cause alarms to go off.
I think in 25 years, the government of China will be more like the government of the U.S. Not because they bought it, but because the country will become more democratic as Chinese citizens prosper.
Silver outpaced gold going up....it's now outpacing gold going down...
actually, the Russian Finance Minister made a strong statement this week in support of the dollar which along with Japan's expressing "100% confidence" in U.S. Treasurys pushed the U.S. dollar higher and precious metals lower.
However, a week does not a market make. Most traders think this decline in the metals is short-lived and as the dollar starts declining again..gold & silver will push up again. I doubt however that you will see a quick spike to the upside absent a "black swan" event such as a natural disaster, new war or other unpredictable factor that would cause the necessary turmoil for a big move to the upside...
Let me know when they do it..........
The Chinese aren't talking...it's just other speculators talking about what they think the Chinese will do.
For the gold bugs on this forum who are looking for the quick buck, they hope, they pray that the Chinese will buy a mondo quantity of gold and push the price up.
Hope is not a very good investment strategy. There is no real reason for the Chinese to substantially increase their gold holdings. Other than a store of value, gold has little usefulness.
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