Where will gold go from here?

Discussion in 'Bullion Investing' started by Dynoking, Jan 27, 2020.

  1. GoldFinger1969

    GoldFinger1969 Well-Known Member

    Let me tell you all of a conversation I had recently, which should warm the hearts of some of you Gold Bugs.

    Friend of mine is a fairly successful Wall Street trader, now manages $$$ for himself and F&F. Was never a big hitter or got 6 or 7-figure bonuses, but saved his $$$ and invested wisely. Early-60's.

    Not super-rich but very comfortable....has about $10 MM net worth, so he lives off his dividends/interest of a few hundred thousand a year. Again, he wouldn't consider himself "rich" as he has to work to afford his nice suburban lifestyle and he has high expenses (4 kids in college or about to go, healthcare premiums of $30K a year, property taxes north of $20K, etc.).

    I went to a local coin show with him a few years ago, but he's never been big into gold (no dividends or interest which is his big thing to live off of).
    Tried to get him to go to other shows but always busy with family stuff.

    Anyway.....he was on my email blast detailing all the fun I had at FUN....mentioned what a great time I had....talked a bit about what I bought, what I saw, CT friends I met, etc.

    He responds back...."Hey, get me a list in a few months of dealers or coin shows I can buy gold coins in size."

    So I responded, "Sure, not a problem, plenty of places or shows...what are you talking about, 10 or 20 coins ?"

    He comes back with: "No, I am thinking more like 200 or 300 coins !!"

    WTH !!!!??? :wideyed::wideyed::wideyed::wideyed::wideyed::wideyed:

    So this is 1 guy who never bought more than token amounts of gold and now is talking about putting 5-10% into gold coins of his hard-earned, serious portfolio.

    Multiple that by tens of thousands of people, maybe millions, some with lots more $$$ and even lots of others with less (but in greater numbers).....it could be like a stadium full of people trying to enter the stadium all through 1 door.:D
     
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  3. -jeffB

    -jeffB Greshams LEO Supporter

    Thing is, one guy's history of getting rich (and, yeah, for most of us $10MM constitutes "rich") as a Wall Street trader doesn't automatically make his financial/political predictions wise. At any point in history, there are always some people convinced that The Sky Is Falling Any Day Now, and that NOW is the TIME to ACT.

    When gold spiked to $1900, people were waiting for it to hit $5000. When it "dipped" back to $1600, there were people backing up the trucks, or at least saying they were. Some of them were smart and previously successful, I'm sure.

    There were also plenty of people who were quite certain one Great Confiscation or another was right around the corner, with a big uptick in theat belief oh, say, approximately 11 years ago. Somehow I missed it, if it happened.

    I may be cynical, but I don't see anything coming down the political pike that would pose a serious threat to the business of maintaining fortunes. There's certainly talk of threats, but that talk seems somehow never to materialize once elections pass, regardless of "which side" wins...
     
    GoldFinger1969 likes this.
  4. GoldFinger1969

    GoldFinger1969 Well-Known Member

    No, he himself isn't predicting the price of gold. But for the first time in his professional career he is looking at protecting his financial assets with disaster insurance.

    That was my point, I personally think predictions are worthless. However, in this case, the prediction is predicated on an outlier event happening which is NOT currently discounted in the financial or gold markets.

    Sure, but again, those were CYCLICAL moves. What my investment friend and others like him are talking about -- IF they act -- is a SECULAR move.

    We're talking about protecing your assets from political/financial confiscation.

    Except now it's not based on nonsense, it's based on explicit political promises.

    Probable ? Maybe not. Possible ? Increasingly likely.

    What was once unheard of is now becoming mainstream.

    That was what my friend is fearing and what is possibly going to hit in coming months.

    I hope you are right -- you might be right.

    You PROBABLY are right.

    But the outlier events are no longer a hike of a few points in marginal taxes or FICA limits being raised. It's now a 6% wealth tax.

    Do the math on a 6% wealth tax after a few years. :eek::wideyed::woot::yack:
     
  5. GoldFinger1969

    GoldFinger1969 Well-Known Member

    As an aside, the leader of a mainstream German political party (who's not mainstream, not sure how he moved up the ranks) recently called for the expropriation of the assets of BMW by the state.:wideyed:

    I can assure you that in Germany -- home to Weimar hyperinflation (still dominates Bundesbank and German financial thinking) and a certain guy with a mustache in the 1930's and 1940's -- lots of Germans, including business owners, took note.
     
  6. imrich

    imrich Supporter! Supporter

    "WE" hope you're correct in your prognostication, as a VERY PROMINENT political entity has advocated invested wealth confiscation for years before current deficients existed.
     
    GoldFinger1969 likes this.
  7. GoldFinger1969

    GoldFinger1969 Well-Known Member

    My point is this, Jeff: if gold is going to make a HUGE move up, it's not going to be because of supply and demand, Central Bank buying, India and Chinese coin collectors, or American numismatists.

    It will be because of an unseen, outlier event just like the 20-fold rise in the 1970's was a byproduct of inflation tripling and oil prices going up 10-fold and the monetary system coming apart.

    I'm not saying it's happening. I'm saying now....it's something that mainstream observers now think has become much more likely. Like maybe from a fraction of 1% to 1%. Or from 1% to 3% -- pick a number.

    The trend is not your friend in this case.:D
     
    Last edited: Jan 28, 2020
    -jeffB likes this.
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