Thesis change time? Gold approaching $760

[jtabeb]

Re: Thesis change time? Gold approaching $760

I guess we see who has "Brass balls"..........its not too bad for me as i paid for it using £...........which is down 20% ish.
Mike

You didn't think that this was going to be easy, that they would just give up, did you?

It ain't about guts, guts and no brains gets you dead.

It IS about brains and conviction, I'll take my chances with these.

P.S. (they = "THEM")

[Joy]

Re: Thesis change time? Gold approaching $760

Hi Andreuccio,

Yes, my comment was directed towards the general discussion.

My sense is that the physical market is dwarfed by the paper market in Gold. Where as I might order a couple Gold eagels to hedge my inflation risk, the hedge funds might be selling hundreds of 100oz Gold contracts to establish a trend trade on the deflation meme.

So be it.

I am real money and can take a draw down. Can they?

[ASH]

Re: Thesis change time? Gold approaching $760

I have historically ALWAYS been right on the general sequence of events (thus far) but my timing has also almost always been early.

...

Thus my impulse to buy gold at present is not a positive indicator ;)

It's more of a positive indicator than if you were in the deflation camp.

On the other hand, your record makes your assessment of "how bad it will get" disheartening.

For my part, I don't have any original thoughts on the economy; all of my "predictions" result from reading the analyses of others and determining who makes better arguments. My trade in second-hand predictions has been pretty good to date... at least about the general sequence of events. However, I have the same problem with timing. The reason the second-hand arguments sound good to me is that they are usually rooted in long-term macroeconomic fundamentals -- the sort of rational argument that appeals to a scientist. The problem is that macroeconomics is like thermodynamics -- it can tell you what the end state is going to be, but not how fast we get there. I haven't found an economic discipline that can give me kinetics for financial matters yet (the timing), although EJ seems to have something like that, in addition to his very good long-term predictions. However, the "science" in EJ's timing predictions are inside a black box, and there is a component of the dark arts in them, too. Thus, on matters of timing, I am more of a religious cultist, whereas on long-term macro I can pretend to be a scientist.

[j4f2h0]

Re: Thesis change time? Gold approaching $760

The majority of people that are freaking about the price crash are the ones who have to look at a gains/loss sheet whenever they check there portfolio. Obviously this is devastating from a numerical standpoint, and the numbers make u forget why u did what u did in the beginning! Was anyone in the physical metals with the intention to sell short term:confused:? i am extremely forward looking, and only trying to accumulate as much as i can on a per ounce basis, not gain/loss!

[ocelotl]

Re: Thesis change time? Gold approaching $760

The majority of people that are freaking about the price crash are the ones who have to look at a gains/loss sheet whenever they check there portfolio. Obviously this is devastating from a numerical standpoint, and the numbers make u forget why u did what u did in the beginning! Was anyone in the physical metals with the intention to sell short term:confused:? i am extremely forward looking, and only trying to accumulate as much as i can on a per ounce basis, not gain/loss!

On my particular case, specially in the last month, when somebody has guessed that I'm into physical PM's, they ask me why I'm keeping them in this moment. My answer always is: "I'm thinking of them not for selling tomorrow, but in at least 5 years" That, given historical economics of Mexico (we always fear more inflation that what there is at the moment, and have done since late 70's), settles the question.

[jtabeb]

Re: Thesis change time? Gold approaching $760

On my particular case, specially in the last month, when somebody has guessed that I'm into physical PM's, they ask me why I'm keeping them in this moment. My answer always is: "I'm thinking of them not for selling tomorrow, but in at least 5 years" That, given historical economics of Mexico (we always fear more inflation that what there is at the moment, and have done since late 70's), settles the question.

On a completely unrelated note: how did property values fare in Mexico when the currency would tank. I don't have experience on this and would appreciate yours.

V/R

JT

[GRG55]

Re: Thesis change time? Gold approaching $760

Hmmm... apparently I've learned at least something in my two years here. Because I was wondering last night if what's happening is that the CBs were trying to bring the dollar down, but failing.

Specifically I was wondering what if "markets were remaining irrational longer than... " and people were simply refusing to give up on the dollar as a refuge in a crisis despite the wishes of Treasury and the Fed.

If that's the case, what do the CBs do? Keep trying harder until there's a really big, disorderly Poom? If it's really a political choice in the end... is uncontrolled, runaway inflation (as opposed to 'major' or controlled) still better than deflation?

I can't see why the CBs would be trying to do anything, at this point, to "bring the dollar down".

Given the increasingly precarious situation of the Fed balance sheet, "Bazooka" Hank's now unlimited claims on the US taxpayer, Lehman in need of an immediate application of defibrillator paddles, numerous regional banks lined up for Last Rights, and El Erian's "dark matter" that can't be modelled [I think $#* is on to something :eek:], who knows what blows up next. It would seem useful to have a "strong dollar" at the onset of the next "surprise" credit event and Hail Mary bail out, non?

[GRG55]

Re: Thesis change time? Gold approaching $760

Hi,

This is my first post on Itulip.

Looking at price movements of Gold in the 1970s there were some wrenching pullbacks. Should it be surprising that we would get pullbacks like the one we are experiencing right now given the number of leverage accounts out there trying to ride every trend.

[ATTACH]566[/ATTACH]

Notice in 1973 Gold prices pulled back from 125 to 90 after a nice run up.

Welcome Joy. We could use a little more of that around here, especially at times like this!

Could it be that the correction we are experiencing more closely resembles the 1975/76 50% down move?

Only time will tell.

[Guest]

Re: Thesis change time? Gold approaching $760

GRG55 -

I think we are headed into the last downleg now. Gold may bottom out at either $720 or at $675. Silver? Yechh. Can easily lead gold on the down-lunge by dropping into the $8 range somewhere.

[GRG55]

Re: Thesis change time? Gold approaching $760

GRG55 -

I think we are headed into the last downleg now. Gold may bottom out at either $720 or at $675. Silver? Yechh. Can easily lead gold on the down-lunge by dropping into the $8 range somewhere.

Luke: If silver gets down to $8 I am going to make like Buffett and smile while I buy on sale.

[FRED]

Re: Thesis change time? Gold approaching $760

Welcome Joy. We could use a little more of that around here, especially at times like this!

Could it be that the correction we are experiencing more closely resembles the 1975/76 50% down move?

Only time will tell.

A couple of oldies from the iTulip archives:

[GRG55]

Re: Thesis change time? Gold approaching $760

A couple of oldies from the iTulip archives:

Interestingly [but no surprise to anyone hanging around this site] the "world"* price of crude oil was flat in nominal terms, and declining in real terms, through the mid-'70s. I am not sure if this is coincident but the two drops in CPI are concurrent with the North Sea started producing in early 1975 and the Trans Alaska pipeline came into service in mid-1977.

I should remember this, but certainly appears that the significant drop in CPI from early 1975 to mid-1976 (10% to 2.5%) could well have been one of jk's "deflation scares", which would account for the collapse in gold.

[tombat1913]

Re: Thesis change time? Gold approaching $760

I must admit to being surprised by the over convoluted approach on this site

Gold has formed an unpleasant double top and is now in a confirmed bear market.The technicians have been projecting an initial target of $650 for weeks now.

Why argue with the facts?As camus would observe(to paraphrase),explanations are for the guilty.

Wow, bold Statement. How do you expect that all of this inflation is going to occur without the price of commodities eventually rising in dollar terms?

[tombat1913]

Re: Thesis change time? Gold approaching $760

Waysouth gets it right. Prepare to see all your PM inflation proofing investments locked up and non-performing for a couple of years. Maybe even longer.

GRG55 -

I think we are headed into the last downleg now. Gold may bottom out at either $720 or at $675. Silver? Yechh. Can easily lead gold on the down-lunge by dropping into the $8 range somewhere.

You're confusing me big time! Are you saying this "last down leg" is going to just drop on down and then hang out for a "couple of years"?

[kingcopper]

Re: Thesis change time? Gold approaching $760

If the Itulip thesis is correct, I believe we are in the main event of disinflation that will lead to a "boom" in early 2009 a month or two after Obama takes over. I even believe the "boom" will happen if McCain steals a victory. I think Luke's numbers are about right and if I can buy any silver for $8, I will. ALL MARKETS ARE IN A BIG STATE OF FLUX AND ALL MARKETS ARE DEFLATING SHORT TERM.