If (or when) gold bubble bursts....

I don't mind conspiracy theories because most of the things that happen are planned in some way by someone. I worry more about those "coincidence theorists" that believe everything happens completely at random.:bigeyes: If everything is random, economic and investment analysis is pointless, as is the analysis of coin prices.

I don't believe your theories either, although you probably have a 50% chance of being generally correct. Economics [including inflation] is more complex than you suggest.

 

Log in or Sign up to hide this ad.

Yes, I've studied up quite a bit on the federal reserve this past year. I've found a lot of other people have too, both that I have met online and in person. Which is great. In the age of the internet, I'm hoping the light bulb will come on for more people.

Cloudsweeper is right. There's usually much more to a story if you are willing to dig. Most people aren't willing. Some are just lazy. Some don't know that they need to dig and some just plain don't want to know.

I can believe that there are people pulling the strings that do control very important aspects that stear our society. I don't doubt it a bit. I don't believe they want what we have right now. An example of something (housing market, credit crisis) that got away from them that they lost control of.

Economy in the tank, unemployment up and a generally unhappy society. Even if unemployment is only 8.5%, I think it drags down everyone who is employed and makes the whole atmosphere pretty gloomy for everyone. People want to feel needed and important. I'm sure there are bosses telling people every day that if somebody doesn't like something, they'll find someone else. People feel expendable.

In general, I don't think the powers that be want unrest and a bad economy. At this point in time at least. This makes people restless, irritated, and more aware.
It's much easier to control things (people) when times are good, when everyone's fat, happy, lethargic and care free about everything. Then nobody's looking to point fingers or shed light into the shadows where these criminals reside. Then all people care about is sports and what their favorite hollywood celebs are doing.

What's interesting is that the only possible fix to our credit system is to make more credit available. This is a debt based system that relies on a perpetual growth of debt forever. Not actual GDP growth. Simply debt growth. And some people have to lose because not everyone will be able to win. It reminds me of a ponzi scheme almost. It's like who can get in early enough? Who can take advantage of people or a situation the most, and long enough, to make a living, retire and get out before the house of cards comes crashing down?
There's enough crooks between the govt. and private sector that I'm sure there's enough CYA going on and throwing blame like hot potatoes that they don't enjoy what we're going through either.

I don't know that we're really talking conspiracy theories here. Look at all of the things that are common knowledge. I think a lot of stuff is almost " hidden in plain sight" because not enough people care. Take spp.gov for example. Most will say, there's no conspiracy! See, they even have a website. But it's not promoted and up until a few years ago, the whole thing was a big secret. Until they finally had to come clean. That's a big issue but not much media attention.

There was illegal gun confiscation from law abiding citizens during Katrina while criminals romed the streets. Watched video of it for myself. That happened. Common theme though. Nobody cares!

The bildeberg group was a conspiracy theory for years. Until everybody started getting video cameras and taping the people coming and going. The news wasn't allowed to cover it at all. Now it's somewhat common knowledge but not many people care.


To get back on topic though, I'm buying this year like there's no tomorrow. Regardless of what precious metals do. I hope they go down. But I'm not counting on it. I've got my eye on some coins I want to find and I don't know how many more years it will be before they're not even remotely affordable. Not just gold.

Example: Coins that might have been worth a day's pay in the 50's may cost a week's or a month's pay now. That's a steep curve to chase, IMO. I lost 14 years of non-collecting. I've got a lot of catching up to do and it always seems like we're waiting for the next shoe to drop that will send the markets into chaos one way or the other. How much stuff now, might be really cheap compared to what future generations are faced with?

The way things are going, this generation could be the last hurah as far as the number of people who can remotely afford a lot of the nicer stuff out there. Something big is coming down the pike for our currency. I'm counting on it and I dont believe it will help you buy more PMs.

 

Time

Time is one thing those would take advantage have. What they do in politics and lobbying is their job.
What we do is go to work everyday and try to keep our jobs.
It will take an effort to remove the people who have done the damage. It might be a complete overhall is necessary to downsize the government and remove the crooks.
Ideas are being tried that some say are dart board tactics, but they do not even get that sofisticated.
We could all have a nice collection if simple accounting was used, and we did not keep people in any type of public office more than 8 years. The longer they stay in power the more the osmosis of politics corrupts.
Picked up a couple of older gold sets today from an old friend , 1993 & 1994 proof sets.
I have helped him off and on to dipose of a car collection.

 

I'm just saying that once this financial crisis settles down and things start to normalize, I think gold and silver will drop noticeably.

 

"Never assume malice where incompetence adequately explains the situation." Napoleon

Are there powerful groups pushing for their self interest. Yes, bankers, lawyers, pharmaceuticals, teachers, cops, even coin collectors. Is anyone truly in charge. Nope. Each group tries to influence there own little area, but there are varying interest within the group itself. Who created the Fed? The bankers. Who owns the Fed? The 200 (and declining) member banks. How much a share? 3% of your deposits. How can I become a member bank? Open up branches coast to coast, all national banks must be a member, or have a really large state bank and submit an application. Can I sell my share to some monarch? No, shares can not be sold and must be held, it implies ownership. Can I have Bernakie's job? Only if appointed by the president and ratified by congress. Also, you have to be a regional Governor first, also appointed. Will I be audited? Annually by GAO.
Of course I did get this off a government web site.

Back on topic. I think gold will remain stable at it's current level with the economy in stall. I don't think hyperinflation is an issue since the bankers are using all that cash to fill potholes in their spreadsheets. If we somehow stumble into another get rich quick scheme and the economy goes charging off in that direction, I think someone at the Fed will remember where the shredders are. My only concern is China and the trade debt. Right now China has been spending their greenbacks on increasing their gold reserve (600 tons in 2006 to over 1000 tons today). Buying mining companies and oil fields. We are buying up basket cases. If they pull out of US treasuries, the dollar will look awfully weak and gold will look awfully good.

 

The thought for the day :thumb:

 

When did this start?

We can not keep playing the same game. We have enemies who now have nuclear capabilities. Any one on those can cause any positive government report to be shredder material in a minute. There is evolution, great inventive events, but quatum leaps are for computer games.
Wall street bought main street America starting a few decades back. Now it is pay back time for several billion dollars of contributions to election funds ,and lobbist funds to be paid back. Who gets the spanking , not wall street.
The government keeps the people in a constant state of flux. They do not have an idea of where to start or finish.
The banks are paramount to fund an economy. They are using vast amounts of money and trying to fill the voids that the liar loans left and other complicated paper trasactions that are leveraged to the blue sky.
Cash and precious metals might be your best friend for quit a while.
It is about time for silver to be moving.

 

here are my 2 cents

smart money flows into gold

real smart money flows into silver

enjoy

 

One thing everyone is ignoring is the unexpected world crisis. Another 9/11, war in the east, a nuke gets detonated somewhere, or some crisis I can't imagine. It always happens, and gold always jumps. The only way gold remains stable is if the world, and our economy remain stable, and that won't happen.

 

Sorry guys, I think that we are in for a period of peace and prosperity. The Clinton years all over again.

 

Probably right about that.

What's difficult is figuring out the timeframe.

I read a lot of macro-economic articles since I work for an investment firm.

For the economy to recover and grow, it will take an annual inflation rate of 3-4%. This is a higher rate than our government would like to see, but they would rather risk a higher inflation rate then having the economy in a deep recession for a prolonged period of time. In theory, this should be good for precious metal prices since with inflation we would expect to see a depreciating dollar. It may not necessarily happen that way though, if with a recovering economy and increased confidence enough people decide to use their money to either spend it on consumer goods or invest in in more traditional asset classes (viz. stocks & bonds). In that scenario, gold may not move much at all.

One interesting thing about gold is that it wouldn't take a lot of increased demand to move the price up substantially. It's in limited supply and getting more means digging it out of the ground.

Silver is another story. It's cheap relative to gold. It has more industrial uses but is not as attractive as gold as a store of value. If you buy a large quantity of a precious metal, you have to factor in storage costs. Simply put, storage costs for silver are higher because the same dollar amount will take up more room.

I have used gold for the past 5 years as insurance against "tail risks".
Tail risk is an unlikely outcome such as an earthquake, war, pandemic or market crash. So I don't invest in it to make money. I use it to protect against events that I can't predict that would cause the rest of my portfolio to decrease in value.

During those calamitous events, gold prices will generally rise. Like anything else, I would prefer to buy this insurance at a lower cost (when gold prices are lower). I learned about this strategy from people who have decades of success in all kinds of markets. They generally allocate about 5-10% of their total portfolio to precious metals, either in physical form or through investment vehicles such as stocks or mutual funds.

Bottom line, since any smart investor realizes the limits of his ability to predict the future, diversification is key and precious metals should be part of the mix.

 

Good post^^

 

Thank you..

It is an odd and uncomfortable period for many people now because of all of the uncertainty of our economy.

What I find gratifying about the threads at cointalk is the mutual respect that forum members have for each other even when they disagree.

I feel very strongly that if there were more even-headed discussions by more folks on a larger scale, many large problems would be more easily solved.

 

Excellent post Morgan 1878! :thumb:

As an insurance policy, it's something you want to have, but never have to use. So I figured, I might as well get a few of the pretty ones along the way. Buying bullion is what brought me back to coin collecting.

Thank you.

 

Boss: too tired to respond in detail to all the posts, but agree with most of this except that the powers that be don't want to tank the economy. Has anyone asked themselves why a Harvard Law professor, and the whole of congress pushed through this 12 TRILLION (that is the correct and unreported in the media, true figure) bailout, none of which went to help the average person of whom 70% of the economic activity is based on? That is, consumer spending accounts for 70% or so of all US economic activity. As this plan has not worked, because it makes no sense, and can't work because it fundamentally misunderstands economics and human nature. If you give a huge bank billions of dollars in a preciptically falling economy are they goning to secure their positions or send that money out HOPING they get it back with interest? None of this money goes to tax breaks for small business owners (whom generate some 90%+ of the new jobs in the US). Why would such apparently smart people keep throwing money to the wind (borrowed and hot of the press printed money)????? The individuals (Senate, Congress, Pres, etc) want us so desperate we will accept anything they throw at us as a solution.
A bigger theme that no one wants to believe is that the richest and most powerful people in the world often believe in a greatly reduced population figure (from Ted Turner, to Bill Gates, to Hiliary Clinton, and many others). They are happy the economy is tanking- they get richer by buying up assests at huge discounts and people die from food shortages, diseases due to lack of health care or delayed care under socialized medicine,. None of the stuff I have read so far on this post that sound conspiracy have been demonstrated to be untrue.

PS The GAO audits of the Fed by the way are farse, and yes this came from the gov website. Anyone can do research on this and see. Look at Ron Paul's new proposal to audit the Fed.

Even one should Google: World Unification, Global government, etc.. I think gold and silver can only go up, accordingly

 

Joke ?

One would hope you are joking, or smoking some way powerful weed. If it is neither then take care of Pakistan, Afganistan, North Korea , Iran, Drug cartels , gangs, and Washington D.C. . Tell me when your done Mr. President.

 

It worked for FDR, why not BO? You don't think they're working for us? Economics is a social science, which means its a pseudo science. They're real good at offering conflicting explainations for what happened after the fact. Did any economists predict the housing bubble, or any bubble before it happened?

What they're doing is stealing all our money. The root problem is democracy. It doesn't work. Plato knew it over 2000 years ago.

If Hussein cared about American jobs, why doesn't he end H1 visas?

 

another PRWE statement thats got nothing to do with coins

 

Another philosophical student of The Republic. :high5: I knew there was something I liked about you.

 

You sound like my financial advisor. Although I do understand why he constantly has to complicate investing.