gold

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dharma's picture
dharma
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gold

the metal down, the xau/hui up! hmmmmmmmmm

xau/hui daily divergences

doing some buying.

nibble   nibble   nibble

nice to see you machine

dharma

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dharma
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Re: gold

looks like an impulsive move off the lows. meaning the short term trend has changed back to up . impulses never travel alone. so i am looking for a pullback and then another impulse.

 

i found this interesting on another note

China Becomes Oil ETF’s No. 4 Holder, Buys SPDR Gold

Feb. 9 (Bloomberg) -- China Investment Corp., the nation’s sovereign wealth fund, invested for the first time in the U.S. Oil Fund, an exchange-traded crude-futures fund, joining Morgan Stanley & Co. and Goldman Sachs Group among the top holders.

China Investment became the fourth-largest holder in the Oil Fund by buying 2 million shares, equal to 3.48 percent of the outstanding units, with a value of $78.6 million, according to a Securities and Exchange Commission 13-F filing posted on Feb. 5. It also took a 1.45 million share stake, or 0.4 percent of the total, in the SPDR Gold Trust worth $155.6 million.
http://www.bloomberg.com/apps/news?pid=206...id=aZtsKyX2S6Ls
do as they do, not as they say. rsi daily divergences in crude

dharma

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Re: gold

Problem with paper commodities is there are no commodities behind the paper.  The gold funds seem to be fractional reserves with the fraction of gold getting lower and lower.  That said, I do believe China may be providing a hard floor for gold  near 1050. Two (I'm not implying coordinated) large shorts pushing gold down 20 dollars in minutes last week bounced hard at 1050.

I am not an investment professional, obviously.

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Re: gold
docmims wrote:

Problem with paper commodities is there are no commodities behind the paper. 

I see the choice of tracking paper as a possible start of financial wars. The big banks now have a trading party that has a better ear on inside information, as China is a major purchaser of the commodities themselves.

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Re: gold

this is about protecting oneself. gold has a history of being money.  the wheat will be separated from the chaff, it takes time.  w/all the sovereign debt, its only a matter of time before debasement takes place.  they have debased everything through derivatives. its not a question if gold goes higher , but when

dharma

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Re: gold
dharma wrote:

this is about protecting oneself. gold has a history of being money.  the wheat will be separated from the chaff, it takes time.  w/all the sovereign debt, its only a matter of time before debasement takes place.  they have debased everything through derivatives. its not a question if gold goes higher , but when

dharma

That is true.  you miss my point.  You need to have gold in your physical possesion.  You can make money in the paper gold market, but when it comes crunch time, they can not deliver the gold.  The paper markets are themselves derivatives in which you can make paper money  on fluctuations in gold price (I do it).  Do not view them as protection against a crash, because your counter party will be in default.

Short term I am bearish, because I think the dollar is getting stronger, but 1050 seems to be a strong floor at which the Chinese are buying

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Re: gold

sir w/all do respect, you missed my point, owning physical is a given, the etfs and so are not what they say they are. having traded gold in the bull from 76-1980 i am a fairly experienced @this.  and i do own a fair amount of miners. 

i am looking for a bottom and run from either the 1st of march or the 10th of march

dharma

china, india, vietnam are all supporters of gold. and so are other eartern countries its in their culture

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The Evolutionary Ape
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Re: gold
dharma wrote:

this is about protecting oneself. gold has a history of being money.  the wheat will be separated from the chaff, it takes time.  w/all the sovereign debt, its only a matter of time before debasement takes place.  they have debased everything through derivatives. its not a question if gold goes higher , but when

dharma

I've always struggled to understand this and perhaps I can be educated on the value of gold.  You can't eat it.  You can't drink it.  You can't live in it (unless you can build a gold brick house which seems beyond asinine). And you can't wear it unless you are of course a rapper in which case I stand corrected.  I doubt gold has much value in Haiti right now.  It seems to me you'd want the skills and resources to grow food, obtain clean water, build shelter and create clothing far before gold.  Personally if shtf I don't want gold.  I want to eat, drink, have clothes on my back, and a roof over my head, and depending on where I live, the last two are not required. 

I've heard the arguement that gold has historically been a form of currency, but why?  The dollar has been the currency of the world, and I'm sure there are many people wondering how wise that has been.  Perhaps it will be the currency after a collapse, but I cannot for the life of me understand the logic behind the worth of gold no more than my ex-girlfriend's obsession over diamonds...but that's a whole other story.

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Re: gold
The Evolutionary Ape wrote:

I've always struggled to understand this and perhaps I can be educated on the value of gold.  You can't eat it.  You can't drink it.  You can't live in it (unless you can build a gold brick house which seems beyond asinine). And you can't wear it unless you are of course a rapper in which case I stand corrected.  I doubt gold has much value in Haiti right now.  It seems to me you'd want the skills and resources to grow food, obtain clean water, build shelter and create clothing far before gold.  Personally if shtf I don't want gold.  I want to eat, drink, have clothes on my back, and a roof over my head, and depending on where I live, the last two are not required. 

We don't really know what the future will look like.  A cataclysmic collapse or something close to it is certainly possible, and if that's the case then gold may have lower or no value.  But is that the most probable future?  It's all guesswork at this point, but my hunch is that it's much more probable that the future decline will be less dramatic and more drawn out than that.  Now in a slow collapse or decline I think food, shelter, means of security, and other necessities are still better overall investments than gold, but nonetheless gold would still hold value, perhaps even increase in value substantially (in terms of what it can buy not just how many dollars you can get for it) if currency crises become commonplace and a bubble for physical gold develops.  I don't have any expectations of getting rich from a gold bubble though; I'm mostly concerned with preserving some of the savings I have.  Seeing as money was widely used in societies far less complex and far more turbulent than ours, I think it's realistic that money will still be used in our societies in anything less than a total or near-total cataclysmic collapse.

Quote:

I've heard the arguement that gold has historically been a form of currency, but why?  The dollar has been the currency of the world, and I'm sure there are many people wondering how wise that has been.  Perhaps it will be the currency after a collapse, but I cannot for the life of me understand the logic behind the worth of gold no more than my ex-girlfriend's obsession over diamonds...but that's a whole other story.

You're right, there isn't any particular reason or logic behind gold having the value it does, other than the fact long ago some people thought it looked pretty.  Gold being favored as a currency just caught on in some parts of the world, and the way history played out it just happened to be seen as money by most dominant civilizations.  We're creatures of habit by nature, and such long-held notions and habits don't usually change quickly or easily.  Powerful financial entities and nations have during the past several decades been trying to convince the world that gold as currency is an obsolete and outdated concept, yet even for all their influence and after all that time their efforts haven't changed that popular notion much.  So given that and the likelihood of multiple currency crises, I'm making the bet that it will continue to be valued as money at least for much of my lifetime.  Questioning the 'why' of it is somewhat pointless when dealing with irrational creatures; it's often easier just to ask which irrational behaviors and habits are likely to be consistent and bet on that. Laughing

- Nickbert

 

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Re: gold

I'll trade food for gold. we'll have plenty, just look us up.

 

husband,father,farmer,optometrist                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     robie                                                                       

 

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Re: gold
nickbert wrote:

I don't have any expectations of getting rich from a gold bubble though; I'm mostly concerned with preserving some of the savings I have.  Seeing as money was widely used in societies far less complex and far more turbulent than ours, I think it's realistic that money will still be used in our societies in anything less than a total or near-total cataclysmic collapse.

...

So given that and the likelihood of multiple currency crises, I'm making the bet that it will continue to be valued as money at least for much of my lifetime.  Questioning the 'why' of it is somewhat pointless when dealing with irrational creatures; it's often easier just to ask which irrational behaviors and habits are likely to be consistent and bet on that. Laughing

Well said, Nickbert.  

I referred to humanity's irrationality/puzzling nature in another post today.  As long as we can predict the ways in which our fellow humans will be irrational, then we can plan around those predictions.  I'm guessing (a) the collapse won't be total/cataclysmic, and that some medium of exchange will be needed for commerce.  Hence, precious metals.  (And if I have enough time, other likely in-demand barter goods:  pints & half-pints of liquor, et al., or [just thought of this the other day, not sure if it's a good investment] decks of playing cards?)

Viva -- Sager

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Re: gold
The Evolutionary Ape wrote:
dharma wrote:

this is about protecting oneself. gold has a history of being money.  the wheat will be separated from the chaff, it takes time.  w/all the sovereign debt, its only a matter of time before debasement takes place.  they have debased everything through derivatives. its not a question if gold goes higher , but when

dharma

I've always struggled to understand this and perhaps I can be educated on the value of gold.  You can't eat it.  You can't drink it.  ...I've heard the arguement that gold has historically been a form of currency, but why? 

Gold has been used as money in Western civilization for over 6,000 years. It is available in nature as gold and not chemically combined and so easily recognized. It is a soft metal that is easily worked, does not discolour or tarnish so it makes pretty jewelry. It is also rare. These features made it useful as a store of value for making transactions.

Other metals could have been used but copper and tin were far more useful for making bronze, used in shields and swords whereas gold was too soft for such use. Even today there is really no use for gold other than jewelry and as a conventional store of wealth.

 

 

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Re: gold

It is a soft metal that is easily worked, does not discolour or tarnish so it makes pretty jewelry. It is also rare. These features made it useful as a store of value for making transactions.

We both agree that it's rare, then why would it work for making transactions?  If there isn't enough of it for all the people to use it, then some people obviously counldn't use it for transactions and would be left out in the cold.  Scarcity of gold is exactly why the people started trying to invent ways to increase the money supply because there never has been enough gold for it to work as a good general medium of exchange.

 

What do you value the gold in?

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Re: gold
Thomas Hedin wrote:

It is a soft metal that is easily worked, does not discolour or tarnish so it makes pretty jewelry. It is also rare. These features made it useful as a store of value for making transactions.

We both agree that it's rare, then why would it work for making transactions?  If there isn't enough of it for all the people to use it, then some people obviously counldn't use it for transactions and would be left out in the cold.  Scarcity of gold is exactly why the people started trying to invent ways to increase the money supply because there never has been enough gold for it to work as a good general medium of exchange.

 What do you value the gold in?

I suggested that rarity, recognition, prettiness and lack of usefulness (for making weapons) all allowed gold to become a transactional substance, in ancient times, in response to the question  "why gold?".

You point out that its rarity is a problem. This was not apparent in ancient times when only Pharoahs, Kings and nobles had gold but became a problem when gold was needed by the merchants of the Middle Ages.

"What do you value the gold in?" As far as I can tell gold has no intrinsic value.

 

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Re: gold
Thomas Hedin wrote:

It is a soft metal that is easily worked, does not discolour or tarnish so it makes pretty jewelry. It is also rare. These features made it useful as a store of value for making transactions.

We both agree that it's rare, then why would it work for making transactions?  If there isn't enough of it for all the people to use it, then some people obviously counldn't use it for transactions and would be left out in the cold.  Scarcity of gold is exactly why the people started trying to invent ways to increase the money supply because there never has been enough gold for it to work as a good general medium of exchange.

That is why silver was used for medium value exchanges and copper for low value.

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Re: gold

but if rarity is what made it good for making transactions then why would gold need to be propped up by other things, such as silver, copper, bank notes, ect......?????

Either that or the fact remains that there simply isn't enough gold to make it work as a general meduim of exchange.

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Re: gold
The Evolutionary Ape wrote:

I've always struggled to understand this and perhaps I can be educated on the value of gold.  You can't eat it.  You can't drink it.  You can't live in it (unless you can build a gold brick house which seems beyond asinine). And you can't wear it unless you are of course a rapper in which case I stand corrected.  I doubt gold has much value in Haiti right now.  It seems to me you'd want the skills and resources to grow food, obtain clean water, build shelter and create clothing far before gold.  Personally if shtf I don't want gold.  I want to eat, drink, have clothes on my back, and a roof over my head, and depending on where I live, the last two are not required. 

TEA,

You're probably never going to favor gold.  It's just not in your nature ... and that's fine.  I have a brother-in-law that thinks like you and I've given up changing his mind.  But no sensible person is going to rely 100% on gold and not have considered how to have water, food, shelter, clothing, and a modicum of skills for survival. 

Let's say you have a SHTF scenario. 

You have an unexpected fire in your house.  Oops, there goes your stored food.  How are you going to obtain more?  Everything you have is burned ... except for that gold still holding its value in the smoldering ruins that you can exchange for food from others who were not burned out.

You have your crops in the field.  Oops, a herd of deer came in overnight and cleaned you out.   Oops, you have an infestation of blight, bugs, or whatever and your crop is ruined.  But you still have gold to purchase food.

You have your nice little homestead.  Oops, nuclear disaster, massive chemical spill from derailed train, tornado, Mt. St. Helens blowing volcanic ash over everything, river flooding, etc., etc. forces you to evacuate the area.  Do you scoop up your contaminated or soggy top soil and take it with you or do you take gold?

You're Vietnamese (or Weimar Republic German or modern Argentinian or ?).  You have to flee the country from the communists or other political unrest.  Do you lug bags of food, bottles of water, and containers of top soil with you or do you use your gold to buy your way out of the country and get a new start in a new land?

You have your bumper crop of food.  But your don't have an immediate buyer.  It sits there rotting until the buyer can get there and oops, suddenly, he's no longer interested because your food has gone bad.  But your gold is sitting there unchanged.

Or it's the middle of winter and suddenly, unexpectedly, TSHTF (EMP weapon detonated over America).  Do you run out and start digging through the snow to plant your crop?  Nope, you have to wait for spring even though you have soil and seeds.  You're no better off than the person who is foolishly holding only gold.

If you want to deny 5,000 years of history of gold being used in this role, that's OK but even though you may say "This time it's different", it doesn't make it so and it virtually never is different.

Hope this helps.

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Re: gold

folks, history is a guide. gold has been money and in the usa it was money until 1971 when nixon closed the gold window.  also history has shown when given the lack of restraint, ie currency being fiat, then they will devalue the currency by printing.  the dollar has been devalued since 1971 in a big way.  so, give all the arguments of not being eatable etc. facts are facts. yes you cant eat gold, but as money you can buy food. in germany in the hyperinflation , the wealthy moved to the countryside and traded farmers gold/jewelry for food.

what i do know having been involved in trading markets for the last 30+years is @the top everyone will recognize golds utility and everyone will want to own it. you can mark that down. it is human nature. nothing is new. study markets and human behaviour and you hve the keys. @the top everyone wants whatever it is jdsu, cmgi, tulip bulbs , you name. its how bull markets end.

dharma

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Re: gold

Consider the simple rules of supply and demand.  The supply of gold continues to be highly restricted and the demand for gold is as high as any time in history.

The growing middle classes in China and India alone will add tens of millions of gobal citizens to the demand side of the equation.  And since that middle class has access to the internet and commercial markets, they will also have the ability to acquire gold, either directly or through providing new capital to funds such as ETF's.

The same goes for oil and other energy commodities, although I prefer the prospects for oil to increase in price when compared to coal or natural gas.

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Re: gold

Thought some of you might like to hear from James Dimes. Some good info in his new book, although at 88 dollars, I think I'll pass. Jon

http://www.financialsense.com/Experts/2010/Dines.html

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Re: where to buy gold in the usa

can someone give me a reputable gold dealer in the us?  how about tulving, rosalind capital, aurum, gold dealer.com?   how do  you know that you received actual gold?  what assurance do you have?  i would appreciate any advice.  

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Re: where to buy gold in the usa

If you are in easy driving distance of Wilmington DE, you can buy and pick up here

http://www.fidelitrade.com/

Not far off I-95.  Probably can order long distance, but I don't know, haven't tried it.

No connection other than as customer.  Liked the way they do business.

- Jim

 

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Re: gold

APMEX and CNI are good dealers.

 

I am sure that there are others.

 

 

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Re: where to buy gold in the usa

Kitco.com

Also, Goldmoney.com

investorzzo's picture
investorzzo
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Re: where to buy gold in the usa

Kitco.com

Also, Goldmoney.com

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ao
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Re: gold
nickbert wrote:
The Evolutionary Ape wrote:

I've always struggled to understand this and perhaps I can be educated on the value of gold.  You can't eat it.  You can't drink it.  You can't live in it (unless you can build a gold brick house which seems beyond asinine). And you can't wear it unless you are of course a rapper in which case I stand corrected.  I doubt gold has much value in Haiti right now.  It seems to me you'd want the skills and resources to grow food, obtain clean water, build shelter and create clothing far before gold.  Personally if shtf I don't want gold.  I want to eat, drink, have clothes on my back, and a roof over my head, and depending on where I live, the last two are not required. 

We don't really know what the future will look like.  A cataclysmic collapse or something close to it is certainly possible, and if that's the case then gold may have lower or no value.  But is that the most probable future?  It's all guesswork at this point, but my hunch is that it's much more probable that the future decline will be less dramatic and more drawn out than that.  Now in a slow collapse or decline I think food, shelter, means of security, and other necessities are still better overall investments than gold, but nonetheless gold would still hold value, perhaps even increase in value substantially (in terms of what it can buy not just how many dollars you can get for it) if currency crises become commonplace and a bubble for physical gold develops.  I don't have any expectations of getting rich from a gold bubble though; I'm mostly concerned with preserving some of the savings I have.  Seeing as money was widely used in societies far less complex and far more turbulent than ours, I think it's realistic that money will still be used in our societies in anything less than a total or near-total cataclysmic collapse.

Quote:

I've heard the arguement that gold has historically been a form of currency, but why?  The dollar has been the currency of the world, and I'm sure there are many people wondering how wise that has been.  Perhaps it will be the currency after a collapse, but I cannot for the life of me understand the logic behind the worth of gold no more than my ex-girlfriend's obsession over diamonds...but that's a whole other story.

You're right, there isn't any particular reason or logic behind gold having the value it does, other than the fact long ago some people thought it looked pretty.  Gold being favored as a currency just caught on in some parts of the world, and the way history played out it just happened to be seen as money by most dominant civilizations.  We're creatures of habit by nature, and such long-held notions and habits don't usually change quickly or easily.  Powerful financial entities and nations have during the past several decades been trying to convince the world that gold as currency is an obsolete and outdated concept, yet even for all their influence and after all that time their efforts haven't changed that popular notion much.  So given that and the likelihood of multiple currency crises, I'm making the bet that it will continue to be valued as money at least for much of my lifetime.  Questioning the 'why' of it is somewhat pointless when dealing with irrational creatures; it's often easier just to ask which irrational behaviors and habits are likely to be consistent and bet on that. Laughing

- Nickbert

 

Nice, Nickbert! This, I think, is a very good and useful summary of the (admittedly, perhaps unfounded) past history and likely future of gold as a store of value. It may not make sense, but it still rings true. Thanks!

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Re: gold
ccpetersmd wrote:

Nice, Nickbert! This, I think, is a very good and useful summary of the (admittedly, perhaps unfounded) past history and likely future of gold as a store of value. It may not make sense, but it still rings true. Thanks!

It is odd how it just ended up that way, isn't it?  I seem to vaguely remember from a history class some time ago that the Aztecs (or maybe Inca?) were very puzzled by the Spaniard obsession with gold.  To them it was pretty and something that had aesthetic value for ornamentation and artwork, but that was about it.  Imagine if such a civilization had become one of the most dominant throughout the world instead of the nations of Europe.  Perhaps we'd all be debating on a return to the old 'trusted' cacao bean and cotton cloth based currency instead Wink

- Nickbert

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