What is th edeal with GOLD???

[davidstvz]

Re: What is th edeal with GOLD???

Too bad I didn't have the good fortune to discover iTulip last month instead of two years ago! However, in the end I don't want to be lucky I want to be right. EJ's newspaper is good medicine. This is 1976 not 1980.

[gvozden]

Re: What is th edeal with GOLD???

this is nothing but normal shakeup like any other thing in the market everybody wanted to be long gold and market is simply shaking to see who is still sting on the tree

One thing that I do not understand is why did EJ changed his call for gold correction in mid 2012 he called for technical correction in gold (bottom price range was 1200 to 1050 or something like that) then all of a sudden in January he changed his opinion. (In my humble opinion for all wrong reasons) I never understood the article from January (especially dollar and gold call). I kind of asked question I believe it was November of 2012 about money flow but never got the answer.

Gold correction can go on a bit more and I am looking for EJ article from 2012 for guidelines on how deep it can go.

"EJ 2012-06-19

CI: Not time to thinkabout moving out of gold?
EJ: Not hardly. An acute liquidity crisis emanating from Europe later this year may produce a deflationary down draft not unlike what we saw in 2008 that pushes gold down temporarily. But this will produce another unwanted flight into the US dollar, unwanted by the US because a depreciating dollar is a key element of deflation management. The US cannot afford for the dollar to rally for long, and so it will not. As a net foreign debtor, the US can manage the dollar downby delivering the right level of expectations of future depreciation that becomes self-fulfilling by producing the change in capital inflows necessary toproduce it."


I think that this is the key
this part is still in play by me (as EJ noted few times things take much longer to unfold then we anticipate)

[Forrest]

Re: What is th edeal with GOLD???

True enough, good sir! Although I would add that us peons are controlled by money or the lack thereof. First you have the money, then you get the stoicism.

Actually, you don't. I'm not rich...I'm not even well off. I don't even make the average wage per year in the US, and living in SoCal is not cheap!

When my Dad's probate closes, I will be comfortably average if I handle it right. But what if the world blows up before then? What if the nice little inheritance I MIGHT have never gets to me? After all, even with everyone seeking yield, it isn't easy getting out of income earning real estate units in a very nice area in downtown LA. Even people who have a lot of cash...like the French guy who was in escrow with us...suddenly couldn't afford the price last week, and he needs to get his money out of France before they confiscate it.

Regardless, I still have my little bit. Two thirds of it was bought in 2006. Another third in December 2012. I don't want the money back, because the gold I do have is what stands between me and poverty if the world goes to hell...that and my stashed foods, and my beginning of a tiny farm. I feel blessed, not cursed, that I have some gold, regardless of the price paid for it in monopoly money. None of my friends have more than able bodies and their wedding bands!

I know how this will end...even if it takes a long, long time to get there. If I had my druthers, I would go back to when I could work for a living, so that it didn't matter what money I had, and I didn't hobble around to water the plants I'm growing for food. If you have a strong able body and mind, be thankful if all you have is a handful of silver, because life is going to keep going for quite some time, and you can begin again.

It truly is a matter of attitude, which requires stomping on your fears and regrets. We only have today, and this moment guaranteed to us. None of us will get it right, and you have no idea what anyone except yourself went through to get what they have. Yup, EJ looks pretty right now, but I have no idea what he paid for what he has. I don't have any knowledge of what he does have other than his life experience of business and economics.

I only know what I have paid for what I have, and for all I have missed, and messed up. And whatever your situation, it is yours to deal with. It is a very scary time to live only if you focus on everything that might go wrong. Please, think instead of what you have, and who you have, and be ready to simply begin again. It is, after all, what we all do everyday.

[goadam1]

Re: What is th edeal with GOLD???

Fair enough. But you sit on the perch of a well done trade. From where I sit... Meh.

[verdo]

Re: What is th edeal with GOLD???

EJ, I say this with the utmost respect for you and your work:

Those who found iTulip in only the last few years could have used a little heads up on this piece of advice:

Maybe I missed it. There's a lot of information on this forum so it's quite likely that I did, despite trying to be diligent in reading the archives instead of asking the same basic questions over and over. I tried, I really did. After finding iTulip and digging in as much as I could understand I put 25% of my net worth into BullionVault in 2011. I too thought the concept of 'expensive insurance' was reasonable and I still do.

That said, it's been a gut-wrenching few months to watch this and EJ, as much as I respect your viewpoints and tireless research, I feel like you're basically saying that if you found the itulip thesis in the last few years and made some decisions in line with it, then that's a real shame.

No one has a crystal ball, but for those of us who may have lost a big chunk of net worth in the last few months "I guess you were too late, relax" isn't particularly helpful I don't think. Just my two cents.

As goadam1 said, we can pretend this doesn't suck, but for a lot of people who did it for the right "expensive insurance" reasons (not the BS reasons), we're hurting. Obviously no one expects you to know the future, but at least acknowledging what's happened would be kind.

It's going to be nice looking back on this thread a few years from now and chuckling at how worried people were when gold was selling for the best discount we would ever see again. I'm new here as well, but I think i read the signals a lot differently than you did rdc. Based on what I was reading here, and observing in real life, I was led to make these posts, among others some months ago

Frank I'm personally not sure what the pin to this bubble will be specifically, but what I have been expecting is another 2008-style deflationary head-fake where the US dollar shoots up as it often does in these scenarios, and gold corrects. Stocks aren't down hard enough though, which makes me feel like we haven't see the bottom yet. You just don't want to get scared at this time and treat it as a gift. In 2008, gold had a huge correction, but it still managed to end the year higher. This shows that when gold corrects, you better act on it fast

That, and my view of there being a strong likelihood of a severe market correction this year in the U.S. (which will cause a crash in the major indexes worldwide) and another short term "flight to quality" as some would put it. I don't consider US dollars quality, but if everyone else does, then that's where the market will probably run to. I'm not selling any gold mind you, but I'm selling out of other investments so I can buy them back when they're cheaper. Even gold may take a little dip, which I would welcome because I got into this bull run a tad late in the game, so another 2008-style correction in gold would be a nice opportunity. EJ says that there's a good chance of a "mini-ka" happening, where deflationists will come out of the woodwork for a short while. I'm kind of banking on EJ being right on that, on top of the mess going on in Europe and Japan.

I honestly never saw any indication from itulip that gold was on the verge of rocketing to the moon. If i felt that was the sentiment on here, I would have been backing up the truck some months ago. There were a lot of indications that gold had to correct, and Eric himself had been hinting to this short deflationary wave we're in now. He just doesn't scream about it from the hilltops because he's said several times that he isn't a trader, and he doesn't buy and sell gold to dodge these downdrafts. The only thing that hasn't happened quite yet is a severe market correction, which i never expected to see anyways until the later half of this year to early next year. I'm just confused as to how you and I read completely different signals coming out of itulip.

[Forrest]

Re: What is th edeal with GOLD???

Fair enough. But you sit on the perch of a well done trade. From where I sit... Meh.

I sit on a perch of a SMALL well done trade...but I do sympathize. Losing what you thought you had always hurts bad..but you do have the gold, right? Those are PAPER losses you are moaning over...and the trade is not finished.

[Forrest]

Re: What is th edeal with GOLD???

It's going to be nice looking back on this thread a few years from now and chuckling at how worried people were when gold was selling for the best discount we would ever see again. I'm new here as well, but I think i read the signals a lot differently than you did rdc. Based on what I was reading here, and observing in real life, I was led to make these posts, among others



Originally Posted by verdo
Frank I'm personally not sure what the pin to this bubble will be specifically, but what I have been expecting is another 2008-style deflationary head-fake where the US dollar shoots up as it often does in these scenarios, and gold corrects. Stocks aren't down hard enough though, which makes me feel like we haven't see the bottom yet. You just don't want to get scared at this time and treat it as a gift. In 2008, gold had a huge correction, but it still managed to end the year higher. This shows that when gold corrects, you better act on it fast




Originally Posted by verdo
That, and my view of there being a strong likelihood of a severe market correction this year in the U.S. (which will cause a crash in the major indexes worldwide) and another short term "flight to quality" as some would put it. I don't consider US dollars quality, but if everyone else does, then that's where the market will probably run to. I'm not selling any gold mind you, but I'm selling out of other investments so I can buy them back when they're cheaper. Even gold may take a little dip, which I would welcome because I got into this bull run a tad late in the game, so another 2008-style correction in gold would be a nice opportunity. EJ says that there's a good chance of a "mini-ka" happening, where deflationists will come out of the woodwork for a short while. I'm kind of banking on EJ being right on that, on top of the mess going on in Europe and Japan.





I honestly never saw any indication from itulip that gold was on the verge of rocketing to the moon. If i felt that was the sentiment on here, I would have been backing up the truck some months ago. There were a lot of indications that gold had to correct, and Eric himself had been hinting to this short deflationary wave we're in now. He just doesn't scream about it from the hilltops because he's said several times that he isn't a trader, and he doesn't buy and sell gold to dodge these downdrafts. The only thing that hasn't happened quite yet is a severe market correction, which i never expected to see anyways until the later half of this year to early next year. I'm just confused as to how you and I read completely different signals coming out of itulip.

Oddly, I never saw the info about a mini-ka, but it is what I saw happening, (mini ka, long wait, then BOOM!) and wondering how long (hopefully marvelously long) a bit of deflation might hang around so I could get my 'maybe' future wealth decently into a good chunk of gold. I could use a good 6 months to clear the probate, and would prefer a little bit longer, a year even, preferably if everyone feels that the markets are settled, the gold bugs were all wrong, and QE Eternal continues on. There should be enough extra oil in North America to give us that much time to recoup, and get our money together, and buy while the price is near the production cost.

Now that everyone is beginning to talk about the deflationary times of the Great Depression, and the dustbowl we may face due to drought (there really are a lot of gloomy people out there scare-mongering for the government), I simply want to know how gold prices fared in the 30's before Roosevelt commandeered it all. Was there deflation? Or did it not matter when we were still on the gold standard?

What does deflation do to gold when the real value of oil stays high, and food prices continue to rise steadily? And will the deflation, short as it may be, moderate food prices, or just be a big drag on the economy?

If the dollar is high due to a flight to quality while Europe and China find out what the real damage is, and we produce enough oil to unofficially backstop the dollar as well, are we facing lower prices in gold?

[vt]

Re: What is th edeal with GOLD???

One needs not be a trader if the long term investment is focused on.

Bonds from 2000 to 6 weeks ago beat stocks by a wide margin with and without risk accounted for. EJ also told us to get out of bonds early this year.

Gold is comfortably higher than the 2001 entry point of $250, and one shouldn't have more than 15% gold anyway.

Stocks are 20% less than the 2000 peak on an inflation adjusted basis.

And lest we forget: a perfect call to sell silver at $50 in April, 2011

As far as making money the best may be ahead over the next few years. The key is to understand the reason why the dislocating events that occur do so in the way they do; you may then be able to take advantage of them.

Above all search for other sources of information on investment advice to complement EJ's work. Remember, no one bats 1000. You can pay 10 times or more for worse advice then you receive here.

[goadam1]

Re: What is th edeal with GOLD???

I sit on a perch of a SMALL well done trade...but I do sympathize. Losing what you thought you had always hurts bad..but you do have the gold, right? Those are PAPER losses you are moaning over...and the trade is not finished.

Im more annoyed I underweighted equities. Gold suffered a serious drop. It was way too high in relation to oil. I don't think oil is shooting up anytime soon. I think an aging china and new domestic drilling has to be accepted as a new paradigm (for now). I'm fine holding and even adding some gold to the portfolio. But some luster is lost and I feel that I poorly timed diversifying out of cash because of some of the ideas here.

[Forrest]

Re: What is th edeal with GOLD???

Im more annoyed I underweighted equities. Gold suffered a serious drop. It was way too high in relation to oil. I don't think oil is shooting up anytime soon. I think an aging china and new domestic drilling has to be accepted as a new paradigm (for now). I'm fine holding and even adding some gold to the portfolio. But some luster is lost and I feel that I poorly timed diversifying out of cash because of some of the ideas here.

That I can understand...I am terrified of putting money into a concern I know nothing about, and since my background is Real Estate, Mortgages, and the long term Bond Market on which mortgages are based, (all fear based plays) even in a shaky market I'd prefer to make small equity loans on debt free houses at a high interest rate than play that world-wide casino!
And yet, I have tried to understand that market...I know it sounds funny, but I have no tolerance for that kind of risk...as if Gold and Real Estate Loans in California were not risky!!!

And yet, because I understand these old fashioned plays, I feel oddly safe in them. Gold really only is a safe savings place when there is no other savings worth having...plus a little silver coin for possible trading in difficult times. For me, the best I can do is make my plays with real estate loans, and when the gold play has subsided due to a more stable world financial system, lower my gold holding to 10%, and put the return from the sale of gold into energy, food, medical and security stocks of worldwide corporations with dividends. I'm not insane enough to put all my money into a single play...even real estate loans are done in small multiples, you know, through small REIT's.

Having been in cash must be very hard, looking back on the insane stock market rise, and wondering if, or perhaps knowing that you would have made a killing...just remember that in fact, you did not know, and the stock market could have eaten all your capital with one (more) stupid move regarding the Cypress debacle by the government, or Japan forcing their money out even faster.

As for taking advice from anyone, as much as I love EJ's work, I triple check everything he says, and I do not always agree...my Dad was an economist as well, so you learn to love them even when they are not quite right about everything. With EJ, you mostly have to re-read everything you are taking as good advice from him at least twice, and then, check his work against what you want to accomplish. You may not have the same goals in mind, and that's deadly on decision making. Usually, I find myself in agreement in most of what he says, but he's looking macro and long-term, and you have to allow for that.

Try and take comfort in the gold macro play...selling out on the way up to a top, and buying into the market will be fun, and profitable. Mostly, just plan where you are putting all of the money from your gold, then forget your gold, and go on with your life as normal. I'm not saying buy more gold, (although I would, since I see the long term advantage, and do not know the stock side of the equation), just resolve to forgive yourself for being persuaded by EJ against your best interest at the time, knowing that at that point in time, none of us knew how spectacular the stock run-up was going to be. And when you get a time-machine, I'll be happy to go on your first trip...1918 might be nice...the roaring twenties onward would be a lot of fun to build an empire in.

[goldrush]

Re: What is th edeal with GOLD???

Ok, so EJ didn't prognosticate that gold would fall to $1200 in 2013. But he did sell silver on the very day silver hit its peak. When it comes to sentiment, EJ nailed the silver sentiment so thoroughly in "time at last to sell silver" that his posts on silver should be put into book form and made a best-seller. EJ, what do you see happening with silver now? Recently you said that you might start looking for entry points when it comes to precious metals - do you see more blood in the platinum group metals and silver? Some traders I know are calling for sub $10 silver in the future. The gold sentiment in the last few years wasn't as nutty as the silver sentiment but... places such as FOFOA are to gold like youtube is to silver... that blog is a cult that does not welcome to outside thought. FOFOA last year did a series of interviews with FOFOA-ers, and the title of a video called "Poopyjim debriefed by FOFOA" made me want to sell all of my gold instantly... another FOFOA-er in a video called EJ some crude choice-words presumably because EJ's PCO theory doesn't call for the stratospheric gold price that free-golders expect... but then again the die hard gold-bugs were nutty when gold was under $300. Thanks EJ.

[BK]

Re: What is th edeal with GOLD???

EJ,
Well said regarding emotions. I've come to realize that the daily price of an investment can be anything. My friend who unwisely put $60,000 in the Reserve Fund thought his Money was gone (he couldn't even imagine that Money Markets were risky when I suggested the Reserve Fund Money Market was a risky investment choice) or how about people with Money in Cyprus Banks.
The news cycle makes people feel like we the economy is out of the woods and yet the ranks of the failed Bank list grows:http://www.fdic.gov/bank/individual/.../banklist.html
Every minute of day the CNBC and Bloomberg assures Americans that Real Estate will continue to rise if/when interest rates rise in the future and we are on our road to recovery (I wish it were true).

Thanks for being a lone voice in a financial wilderness.

[goldrush]

Re: What is th edeal with GOLD???

"All of the guys who bought gold for all the wrong reasons 2008 - 2011 are getting out." Translation - gold will see 2008 prices again. Why - because I believe that the price of gold is based upon supply and demand. And most people who bought in 2008-2011 have never heard of iTulip. A gold dip doesn't concern me. What does concern me is how long gold stays at 2008 prices. Thanks EJ for this article and analysis, but what scares me is the clueless pumpers who have been wrong about PMs on youtube for the last 3 years are also brining up the 1976 pullback... maybe that will be the time of day when the broken clock is right...

[Polish_Silver]

Re: What is th edeal with GOLD???

People are selling thinking just like this.

I bet gold has been falling the last week from 1350 to 1200 because one of the large hedge funds had to liquidate their position because of 1) fund outflows or 2) being down 8 to 10% + on their Fixed Income positions.

That seems logical. Ironically, losses on bonds are causing a gold sell off. Interesting if somebody could back that up for a particular fund. But rates up is bad for gold, in general. I'm not convinced real rates are positive yet.

[kantx]

Re: What is th edeal with GOLD???

All of the guys who bought gold for all the wrong reasons 2008 - 2011 are getting out. They only every got in because the price kept going up every year while stocks were volatile. They thought gold was a safe alternative to stocks.

Now they think stocks are a safe alternative to gold.

Looks like we'll be wrapping up six months of work in the AM, barring additional technical difficulties. We will introduce a new concept, the US Dollar "Good as Gold for Oil" of GAGFO that explains the gold and oil price correlation the last time the USD was not GAGFO, the subsequent brief period when it was, the 2001 - 2011 period when it was not, and the past two years when a series of events made it appear to be but for reasons we think are transitory.

Until tomorrow:

http://seekingalpha.com/article/1526...t?source=yahoo