Gold getting KILLED!!!!

[flintlock]

Re: Gold getting k i l l e d !!!!!!!!!

Mega was saying the same thing when it was at $900. "When will it ever go up?!!!"

[LargoWinch]

Re: Gold getting k i l l e d !!!!!!!!!

Mega was saying the same thing when it was at $900. "When will it ever go up?!!!"

We should start a "short Mega's gold calls ETF"... and make it 3X.

[Polish_Silver]

Harpers is Flogging Gold !

Gold gets flogged by the July 2011 Harpers, in Thomas Frank's "Gold Faithful".
Frank's argument is that gold is riding a bubble of paranoia. He does not mention:
1) Negative real rates
2) central banks of India, China, Russia are gold buyers
3) The value of gold assets as a percentage of total wealth is still historically low.

I hope they print my rejoinder:

Dear Harpers,

I loved reading Thomas Frank’s “Gold Faithful.”

However, I differ with him on several points.

If “politicians aren’t all the same everywhere”, then gold bugs
may not be either. I studied physics and work at electronics.
I do not believe that modern civilization is a fraud. However, I do believe
that central banks are both corrupt and inept. That is reason enough to own gold,
and central banks hoard the metal for exactly this reason.
I also agree with Keynes that low interest rates cause gold prices to rise (Gibson’s Paradox) .


Does Mr. Frank save for retirement by putting cash into a savings account?
Perhaps he would rather speculate in stocks, buy Greek bonds, or collect social security checks
from a government already $14 trillion in debt?

[Ellen Z]

Re: Harpers is Flogging Gold !

Gold gets flogged by the July 2011 Harpers, in Thomas Frank's "Gold Faithful".

I also agree with Keynes that low interest rates cause gold prices to rise (Gibson’s Paradox) .

[/FONT]

Many thanks for the links!

[pwcmba]

Re: Harpers is Flogging Gold !

Down $80 from the high. Does CME raise margin rates tonight or tomorrow? Will anyone care?

[metalman]

Re: Harpers is Flogging Gold !

Down $80 from the high. Does CME raise margin rates tonight or tomorrow? Will anyone care?

pissing on a forest fire.

[pwcmba]

Re: Harpers is Flogging Gold !

As Mega said back in June -
"Gold getting k i l l e d !!!!!!!!!

KILLED,DEAD,FINISHED...F*CKED
Oh for the love of God........When we we see any SUN LIGHT !!!!!

Where is $2,000 gold........when, when.....
I should have bought CDO's !"

[thriftyandboringinohio]

Re: Harpers is Flogging Gold !

$1,642 an oz right now. 3 weeks ago it was $1,920.
This might qualify as a "healthy correction".

[lektrode]

Re: Harpers is Flogging Gold !

even the turd is agitated today: http://www.tfmetalsreport.com/blog/2486/wow
the jpm conspiracy theory continues to rage...
he cant understand the selloff in AG, he thinks 'sharp rebound' both AG & AU next week
seen any updates from EJ?
all i can say is: i'm gittin the ole 'is now the moment to buy' nervous again...
metalman?

[charliebrown]

Re: Harpers is Flogging Gold !

i bought today ... PHYS.

hat tip to EJ today. I traded a big chunk of my paper silver for paper gold in august around silver 42.
Thank you for your persistance in warning. I moved from 8% to 5% on your first warning, then from 5 to 3. I may by silver again, but it is going to have to be less than 60 to 1 on the silver to gold ratio. Which as of today puts silver around 27.

[lektrode]

Re: Harpers is Flogging Gold !

hmmm: http://seekingalpha.com/symbol/phys?...general&s=phys ?

i guess the question is: are the hedgies done selling (for this year)? (assuming this is the right question)
does this one correlate well to the gold price?
and does anybody see this as the dip/bottom that EJ was thinking about earlier?

http://seekingalpha.com/article/2955...-and-gold-down

http://seekingalpha.com/article/2955...inancial-crash

Today 5d 1m 3m 1y 5y 10y
	52wk high:	16.86
	52wk low:	11.32
	EPS:	2.36
	PE:	N/A
	Div Rate:	N/A
	Yield:	N/A
	Market Cap:	2.06 B
	Volume:	6.97 M

Today 5d 1m 3m 1y 5y 10y
	52wk high:	16.86
	52wk low:	11.32
	EPS:	2.36
	PE:	N/A
	Div Rate:	N/A
	Yield:	N/A
	Market Cap:	2.06 B
	Volume:	6.97 M

[DaveGillie]

Re: Gold getting KILLED!!!!

....They have a value of euro2,800 ($3,900) and were produced by the United Future World Currency, a group pushing the idea of a global currency.


http://www.google.com/hostednews/ap/...A2jBQD99A8J080

well ,well an eurodollar coin for $3,900, not bad

Somenone should WARN these UFWC people to stay out of the USA!!! Liberty Dollar norfed provoked quite an attack from the FEDS over "pretending" silver was "currency".

[unlucky]

Re: Harpers is Flogging Gold !

hmmm:
http://seekingalpha.com/article/2955...-and-gold-down

Interesting analysis under that link. The fascinating thing is that we have moved from the August regime, where gold was trading like treasuries and inversely to stocks, to another regime where gold and stocks are both plumeting - but gold continues to trade like short-term treasuries. And it's all different from 2008/09 where gold and stocks fell while treasuries of all durations rose!

If the article is right then the "twist" is forcing short-term speculators out of gold. That's great. I'm gonna wait til it stabilizes and then buy more (assuming that the opportunity lasts more than a millisecond).

[Adeptus]

Re: Gold getting KILLED!!!!

Gold & Silver mass selling was likely triggered by the stock market panic, but then has also likely been accentuated by the usual suspects..., JPM knocking 'er down in the wee hours of the morning, probably also knowing full well the CME Margin Hikes were on the horizon before it became public knowledge.

From ZH post: CME just hiked gold margins by 21%, silver by 16% and copper by 18%. Mystery solved.

[puts on the pretend-like-I-know-what-I-am-talking-about-hat] I warned of this in another thread. Let me sum it up for you folks again in the picture I posted: http://i51.tinypic.com/dq5bn9.jpg


So if these types of 'manipulations' are real (and I'm not sure they will ever be proven either way, although they are trying), IMO it takes away from EJ's fundamental justifications of such low silver targets - that look ever more likely to become the reality anyway. In short, he's right, but I'm left wondering if he's right for (in part) the wrong reasons.... which could mean, that he may very well be right this time, but eventually will be wrong if the same fundamental reasons are used - specifically that when gold recovers, silver won't go along for the ride and eventually even outperform gold (in % / year)

PS. It's options expiration next week, so I'm not entirely convinced all the selling is done yet. Also, I'm wondering just how many more days (or hours) the "G20 will all hold hands, sing kumbaya, all come to a perfect consensus and fix the global economy in October" meme will hold the markets flat. They've been meeting for 3 years and couldn't fix anything, but now they are going to resolve all the problems in a matter of weeks? Riiiiight....

Adeptus

[cobben]

Re: Harpers is Flogging Gold !

Interesting analysis under that link. The fascinating thing is that we have moved from the August regime, where gold was trading like treasuries and inversely to stocks, to another regime where gold and stocks are both plumeting - but gold continues to trade like short-term treasuries. And it's all different from 2008/09 where gold and stocks fell while treasuries of all durations rose!

If the article is right then the "twist" is forcing short-term speculators out of gold. That's great. I'm gonna wait til it stabilizes and then buy more (assuming that the opportunity lasts more than a millisecond).

"If Gold acts like a long Treasury bond, why has it plunged like a stone when the Fed announced that they were going to play the Twist?"

Perhaps it is not so simple that gold is the "longest Treasury bond"?

Here is an interesting exposition that I would like the Fed & bond people (Finster, JK, Bart . . .) to look at.

(You have to read through his whole discussion to understand what he is trying to do, I have just clipped in a few small pieces.)

What's the Duration of Gold?
http://seekingalpha.com/article/2246...d?source=yahoo

. . .

But I started this exercise wanting to look at gold’s duration, which is a little different. What I want to know is what happens to gold when inflation accelerates or decelerates. So I don’t want the annual change in prices (the first difference); what I want to look at is the change in the rate of change in prices (the second difference).

. . .

If we remove all of the points where the annual inflation rate changed by less than 0.5% (which are covered by the blue box in the chart), the R² rises to 0.26. This isn’t great, but it is at least respectable (equivalent to a correlation coefficient of about 0.5).
The slope of the line through those points is 8.3, which is to say that the expected response of the price of gold to a 1% change in CPI inflation is 8.3%.
This may seem disappointing, since most people who buy gold are doing so because they expect 20%, 30%, or larger gains. But that’s a tactical investing decision. I’m looking at a deeper question, which is the role of gold as a portfolio hedge in the long run. I expected something a little longer, since as a zero-coupon perpetual investment the Macaulay duration is effectively infinite and the modified duration for a zero coupon bond in a period of low rates can get into the 20s, but 8% isn’t bad. For hedging, I’d probably assume it is somewhat higher, maybe 10-15%. If you include 1979, the slope goes to 32, so something higher than 8% is defensible. As you can see from the chart, the relationship isn’t exactly tight.

(What I would really like to know, actually, is the response of gold to changes in inflation expectations, but we have only a short history of inflation breakevens in the U.S. and that was mostly during a period of quiescent inflation. I could do the same analysis in sterling, since a longer history exists there, and perhaps if a client is interested I will do that).

The real investing problem, of course, is not the beta of gold with respect to inflation but its alpha. The total return of gold can be thought of then as something like this:

GoldReturn = 8.3% * (change in inflation) + alpha

In other words, alpha is the “unexplained” variance in this relationship. Visually, if you draw the 8% slope line on that chart, the alpha is the difference in the actual performance compared to the “predicted” performance from the line. And it can be 20% or more on both the positive and negative sides. For my money, I would set investment guidelines on that basis rather than on the basis of the “duration” of gold, and that – combined with the long-run expectation of a zero real yield – will limit my concentration in gold. But it does seem to have some value as a hedge against inflation accelerations, and obvious diversification benefits."
. . .