PMs and HYPERinflation (or not)

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LindaBobzien's picture
LindaBobzien
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Joined: Dec 12 2008
Posts: 34
PMs and HYPERinflation (or not)

This snip from the following article: http://www.financialsense.com/fsu/editorials/stathis/2009/0313.html

"Why do I even mention the topic of hyperinflation? Because I’ve
received countless emails from average Joe’s who’ve been brainwashed by
others claiming hyperinflation is coming. As a consequence, they’ve
asked me whether they should take all of their savings and buy gold or
invest in foreign currencies. This is a dangerous move for
non-professional investors. Trading your dollars for gold and foreign
currencies is a sucker’s move for the average Joe because America isn’t
going to see Zimbabwe-type devaluation. Therefore, without
true hyperinflation, currency trading/hedging should only be a strategy
for experienced investors who know WHEN TO ENTER AND WHEN TO EXIT.
Otherwise, you’ll get blasted."

We are long on PM's and we are just "Joe".  Thought on this?

Even without HYPERinflation one would think PMs would be the place to go, but Mike Stathis is implying otherwise here. 

Are PMs as volitile as that?  My gut still tells me to have the PMs in the "bodega".  But selling my paper gold at some top would be good.  Paper is paper after all.

~lb

 

 

 

 

rci2145's picture
rci2145
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Joined: Jan 3 2009
Posts: 24
Re: PMs and HYPERinflation (or not)

I think he is right for the most part.  We are not Zimbabwe.  Hyperinflation will not happen in the U.S. anytime soon.  Gold is a nice place to put some of your money but a lot of average Joes are expecting to get rich from investing in a lot of gold.  That strategy is likely to burn a lot of people.

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strabes
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Joined: Feb 7 2009
Posts: 1032
Re: PMs and HYPERinflation (or not)

Note he's encouraging prudence against taking "all of their savings" and buying gold.  I think that's quite prudent because doing that is a fool's game.  If you have enough savings to have a base level of PMs for insurance against collapse, that's smart.  But don't double down on PMs or go "all in" for investment/speculation purposes unless you're aware of some of the technicals used by traders...waves, trends, etc.  That needs to be the basis of trying to make money on metals, rather than relying on marketing from mints and gold dealers to retail coin buyers.  For metals, it's also good to stay on top of inflation expectations.  And for that, again, don't rely on marketing, politics, opinions...just look at the bond market (the yield curve, the spread on TIPS, Fed publications) and the U Mich survey.  There currently isn't much inflation expectation, despite how irresponsible our government is acting.

Yes selling paper "at some top" is a good idea...mid-Feb was a good top...I sold all GLD and SLV, while I held onto my physical metals.  According to wave technicians at EWI, PMs are going quite low for a while before taking a new ride higher. Another wave technician says they aren't going that low and will shoot higher soon.  Tough to know what to do.  Personally, I'm betting on EWI's forecast because I see no inflation expectation yet.

 

SamLinder's picture
SamLinder
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Joined: Jul 10 2008
Posts: 1499
Re: PMs and HYPERinflation (or not)
strabes wrote:

Note he's encouraging prudence against taking "all of their savings" and buying gold.  I think that's quite prudent because doing that is a fool's game.  If you have enough savings to have a base level of PMs for insurance against collapse, that's smart.  But don't double down on PMs or go "all in" for investment/speculation purposes unless you're aware of some of the technicals used by traders...waves, trends, etc.  That needs to be the basis of trying to make money on metals, rather than relying on marketing from mints and gold dealers to retail coin buyers.  For metals, it's also good to stay on top of inflation expectations.  And for that, again, don't rely on marketing, politics, opinions...just look at the bond market (the yield curve, the spread on TIPS, Fed publications) and the U Mich survey.  There currently isn't much inflation expectation, despite how irresponsible our government is acting.

Yes selling paper "at some top" is a good idea...mid-Feb was a good top...I sold all GLD and SLV, while I held onto my physical metals.  According to wave technicians at EWI, PMs are going quite low for a while before taking a new ride higher. Another wave technician says they aren't going that low and will shoot higher soon.  Tough to know what to do.  Personally, I'm betting on EWI's forecast because I see no inflation expectation yet.

 

Strabes,

Your knowledge in this area is much appreciated by us "Joe's" who are hanging out here trying to preserve what little wealth we have. I've been sitting on the fence about buying a small stash of gold but haven't made any moves yet. I almost feel paralyzed by indecision. Since you appear to follow some aspects that clue you as to whether inflation is imminent or not, perhaps you would be kind enough to kick out a bulletin for the rest of us when you see inflation beginning to rear its ugly head. Thanks.

SamLinder's picture
SamLinder
Status: Diamond Member (Offline)
Joined: Jul 10 2008
Posts: 1499
Re: PMs and HYPERinflation (or not)
LindaBobzien wrote:

<snip>

We are long on PM's and we are just "Joe".  Thought on this?

Even without HYPERinflation one would think PMs would be the place to go, but Mike Stathis is implying otherwise here. 

Are PMs as volitile as that?  My gut still tells me to have the PMs in the "bodega".  But selling my paper gold at some top would be good.  Paper is paper after all.

~lb

 

Linda,

Couple of questions:

1. What do you mean when you say you are "long" precious metals?

2. What does "...have the PMs in the "bodega" mean? Are you saying "bodega" means "stash" or "under the mattress"?

Thanks.

that1guy's picture
that1guy
Status: Gold Member (Offline)
Joined: Jan 11 2009
Posts: 333
Re: PMs and HYPERinflation (or not)
strabes wrote:

Note he's encouraging prudence against taking "all of their savings" and buying gold.  I think that's quite prudent because doing that is a fool's game.  If you have enough savings to have a base level of PMs for insurance against collapse, that's smart.  But don't double down on PMs or go "all in" for investment/speculation purposes unless you're aware of some of the technicals used by traders...waves, trends, etc.  That needs to be the basis of trying to make money on metals, rather than relying on marketing from mints and gold dealers to retail coin buyers.  For metals, it's also good to stay on top of inflation expectations.  And for that, again, don't rely on marketing, politics, opinions...just look at the bond market (the yield curve, the spread on TIPS, Fed publications) and the U Mich survey.  There currently isn't much inflation expectation, despite how irresponsible our government is acting.

Seconded......... go team!!  hahaha I like picking your brain strabes, hope you don't mind it .....Tongue out 

mike

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