A bull market in amateur gold commentary

[LargoWinch]

Re: A bull market in amateur gold commentary

Do you have a link to the current Taylor rule recommendations? I could only find one from Jan 2009, but we are essentially in the same economic territory now. At that time, the Taylor was recommending negative interest rates (-6%). I would imagine that the recommendation would not have changed much.
http://krugman.blogs.nytimes.com/200...ound-blogging/

[ATTACH=CONFIG]3590[/ATTACH]

ViC78, I read recently (can't remember where) that the Taylor rule is now indicating around +3.5%.

I would like to point out however, that the Taylor rule as per your graph never turned negative since the light gray line is not actual but it is a "GS forecast beyond 2008Q4". Having said that, if the Taylor rule indeed showed a negative rate a some point, than I retract my previous statement as I do believe that in no event interest rates should dip below "0%".

Perhaps a better statement would be that the i-rates should follow John Williams' SGS (1990) [or member bart's equivalent data], which is now just over 4%.

[karim0028]

Re: A bull market in amateur gold commentary

Ah but karim0028, there are few more "hopefully invested" in PM than me (ok Jtabeb maybe).

I sincerely hope Gold does not hit $5,000+/oz and wish CBs would raise rates immediately to at least the level prescribed under the Taylor Rule as they are causing untold damage. Though luck I guess.

We are but a few in a herd of many....

[Spartacus]

Re: A bull market in amateur gold commentary

In the last 2 Rickards interviews on Eric King's site, James Rickards thinks the US FED is trying / will try to get inflation going by lowering the US$ against other currencies

When this fails to work, or fails to ignite inflation, the US FED's last resort will be to lower the US$ 's value relative to Gold (raise the POG)

You have to remember that gosverments do not like the price of gold increasing: it highlights the weakness of their fiat and failed policies. As such, a massive bubble similar to the NASDAQ/housing is unlikely as it will go against the gosverments will (I am not saying it is impossible here, but certainly more difficult to achieve).

[metalman]

Re: A bull market in amateur gold commentary

In the last 2 Rickards interviews on Eric King's site, James Rickards thinks the US FED is trying / will try to get inflation going by lowering the US$ against other currencies

When this fails to work, or fails to ignite inflation, the US FED's last resort will be to lower the US$ 's value relative to Gold (raise the POG)

old news is old.

ej predicted the fed inflation with dollar depreciation before it happened... remember? when the deflation hysteria was flying in march 2009... even here at itulip... where we know deflation can be stopped 'the foolproof way'? by currency depreciation.

from queen of hearts...

This has the important consequence that the current exchange rate immediately reveals whether any policy to escape from a liquidity trap has succeeded in creating expectations of a substantial increase in the future price level. If it has, this appears as a substantial current depreciation of the currency. Consequently, if the currency does not depreciate substantially, the policy has failed.

- Journal of Economic Perspectives Escaping from a Liquidity Trap and Deflation:
The Foolproof Way and Others, Lars E.O. Svensson, January 2003

rickards reading old itulip?

[Polish_Silver]

Re: A bull market in amateur gold commentary

The link from Itulip.com does not go to the right thread. It goes to some argument about deflation.