Next Level: GOLD $1,350.00

One day does not make a market.

Although PM's are down today, the fundamentals that have sent prices up over the last decade are still in place, namely uncertainty about the future of the global economy, deficit spending by the U.S and other large economies (viz. UK & Japan) and the possible rise of inflation.

I am not so interested in graphs and predictor data, I'm more interested in how people actually behave. At this point, I think there's enough fear in the market to warrant holding on to my positions, both derivative and physical.

 

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I disagree, Scott Brown's election yesterday hints at ending Obama's free spending.

He is going to have to cut the deficit and swing center if he wants to be re-elected.

This will make the dollar stronger. It will make gold fall.

 

Hey, copper looks great around the house. I've got some big blocks I bought last January. Bought them at a great price when people didn't seem to be interested in it, then just did some decorating around the house with them. They draw everyone's attention whenever they walk into the house, plus I've more than doubled my investment.

 

A significant deficit was in place before President Obama was elected. It has, of course increased since then. Without the stimulus program, the economic situation would be far worse then it is presently.

The election of one senator in Massachusetts will not have a significant effect on a deficit that was created during the Bush and the Obama administrations.
The fixed expenses of social security, Medicare and Medicaid remain in place regardless of what party wins election.

The uncertainty of paring the national deficit down will remain for years since it will not be known for some time whether it can be done without significant negative consequences for the dollar.

The PM ride promises to be bumpy at times, but will likely be on the plus side in 2010.

 

Prove it. Most of the money was stolen given away as bonuses and when asked where it went "We" were told to "stick it" more or less by the banks.

 

Currently:

Gold @ $1,105.60/oz. Low $1,102.20/oz. - High $1,105.70/oz.

Silver @ $17.74/oz. Low $17.61/oz. - High $17.74/oz.

 

And the mighty Dollar begins to show signs of life!

Let's hear it for a 1980-style collapse in PM prices!

 

Damn you greenback!! Damn you!!!

 

Well, as the DOW and gold free fall....there's 2 ways to look at it....


Shake it off and make it a buying opportunity, or sell and get out, abandon ship!!

 

I can't get the Tom Petty song out of my head...you know...

"And I'm free.....free fallin' ....."


http://www.youtube.com/watch?v=5gqT6En2O78

 

Currently:

Gold @ $1,098.70/oz. Low $1,087/oz. - High $1,110.30/oz.

Silver @ $17.50/oz. Low $17.31/oz. - High $17.95/oz.

 

It's funny when the price of gold drops a little then the Republicans onboard try to find clever ways to explain the drop. Where's your leader, Rush? Scott Brown, really?? :rolling:

 

Sip kool-aid...

Pour another glass. Sip kool-aid...

Sip kool-aid...

Sip kool-aid...

 

This is heresy to a gold bug.

 

Most of the money stolen? Given away as bonuses? A gross generalization at best..you won't find this conclusion in any reputable analysis. Earmarks by politicians for their districts, yes..money that could have put to better use, agreed..wholesale pilfering..no and no.

While it is true that when the government spends, it is not as careful or efficient as say most well-run businesses, it is also true that in the Autumn of 2008, credit markets were freezing up worldwide and quick action needed to be taken. Bernanke, a student of history had studied the depression and his conclusion was that the Great Depression was exacerbated by the lack of stimulus. The U.S. was not the only Central Bank that came to this conclusion..every other Central Bank of any size in most of the developed nations did exactly the same thing; they threw money at the problem.

Please note that the economic crisis was in many ways the result of fast and loose capitalism run amuck with overleveraged assets, unrealistic loan practices and more than a few people hooked on greed. While it made good press to spotlight the biggest scoundrels and fat cats, there were also a lot of joe six-packs who joined the fray scheming to get to Treasure Island the easy way.

Granted, the actions of the Federal Reserve and Congress were not in any way perfect..but in retrospect I prefer the defective "quick and dirty" stimulus to none at all. The clean-up will take years, if not decades to accomplish, if that is we have the political will to do it.

In the meantime, I'll take that glass of Kool-Aid. It's a bit watered down..but better than dying of thirst.

 

I think the major point is that almost none of the funds were used for stimulus. They were given to financial institutions to replace the reserves lost through speculation. Almost none of it was "spent." Some of it was laundered through AIG to payoff Goldman [and others] 100 cents on the dollar while other creditors took major haircuts on the same investments. Now it turns out that most of the institutions that took the money never really needed it. And the Fed seems to have instructed some of them to lie to the SEC about where the funds went. The debt incurred to pull this off will be a major drag on the economy for decades to come. In the upside down world that has been created, the losses resulted in executives getting record bonuses, shareholders hanging on to their capital, and citizens paying off defaulted contracts so the bondholders get paid. Nobody lost except the citizens.

 

Can't disagree about any of this, except that at least part of the crisis was created by "citizens" of all stripes, in high and not so high places.

As for bonuses, the argument is that there is a small pool of talent that deserves extraordinary pay, otherwise they will migrate to competitors. While bankers receive the brunt of the villainizing (every good story needs a villain, eh?), the same sort of thing goes on in other professions. Coaches get paid big money to jump to other schools, elite athletes take advantage of the "market" to land big contracts. Somehow, the public is more accepting of this type of largesse, perhaps because sports at least offer entertainment, something a banker will never be accused or capable of doing.

With respect to AIG, it was reported in the Financial Times this week that the Feds investment in AIG contracts has so far netted about a 15 billion dollar profit. So, at least in this case taxpayers will probably get more than they paid in.

Speaking of waste, let's not forget the absurd wars we continue to wage in Iraq and Afghanistan. If were talking about return on investment, we've dropped over a trillion without any meaningful return. Leaving the battlefield isn't necessarily a bad idea. We left Vietnam years ago and at the time it was thought by doing so, it would regress into a communist blackhole. To the contrary, it's becoming a vibrant economy. My favorite shirt is made in Vietnam. While Vietnam's not a democracy by any means, it's not North Korea either.

The best analogy I've heard regarding the initial "stimulus", "bailout" "crisis management" or whatever you choose to call it involves a village. This village has a high dam above it that is ready to break. Action must be taken quickly. The villagers realize that when if the village is saved, not only will the law-abiding villagers be spared, but also the thieves, rapists and dregs of society. After the damn is secured, then other measures can be taken. Call it fine tuning. That's our next job.

We're a democracy. We elect people to do a job. If they don't we vote them out. If their performance is sub-par and we continue to re-elect them, we only have ourselves to blame. The recent election in Massachusetts tells me this system is working. We are a large country of many racial, ethnic and economic groups. Of course it will be difficult to arrive at decisions that will please everyone. But that is our challenge and I am cautiously optimistic we will be able to find solutions. There will be missteps and I agree, there were plenty of them in the initial "stimulus" effort.

 

platinum is still several hundred dollars overpriced. sell platinum and buy gold. last year the gold at one point is higher than platinum.

 

I would just add a few points:

1. The difference between coaches and athletes and bankers is that the coaches and athletes don't ask for public funding when they lose a game.

2. The "profit" earned from AIG masks the fact that transaction just reinforced the moral hazard for irresponsibility.

3. I completely agree that the wars need to end immediately.

4. Using your dam analogy, in our case the funding would not go to repairing the dam. It would go to reimbursing the financial institutions who lost money on their "dam soundness swaps."

5. We are supposed to be a constitutional republic, not a democracy.

Thanks for the reply.:thumb:

 

Thanks as well for starting the dialogue..I'll have to get up to speed on the constitutional republic concept...