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Gold Has Become The Best Investment


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This was a most interesting thread on the old board.

 

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Bearwithme

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Gold has just become the best investment.??.

? on: November 29, 2002, 06:46:03 pm ?

 

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First of all I need to say that at this moment I own no physical gold or mining stocks.

 

That will change next week when I invest in mining and perhaps some gold options.. is it me, or does the reckless abandon that our government plans to display in fighting deflation going to do one thing to gold. That is to simply weaken the viability of fiat currency, thus making gold much, much more attractive as an investment.

 

I would enjoy hearing what fellow stoolevillians have to say about this!

 

 

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Re:Gold has just become the best investment.??.

? Reply #1 on: November 29, 2002, 07:28:20 pm ?

 

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Bearwithme, The inflate or die crowd seem to think they can do everything short of repeal the law of gravity through monetary policy. It's their utter self confidence and the confidence of the multitudes behind the recent rally that leaves me as critical as ever. It doesn't SEEM to be playing out like the Aesop fable it will probably prove to be. The grasshoppers WILL get creamed in the end. Right now they're creating moral hazards, appealing to the worst in human nature, forestalling the inevitable. But more than that they are rowing against the Elliot wave. It's not going to work.

 

Gold may prove to be a good idea, but I wonder. It may be that what is coming will hurt everyone, that there isn't a sure strategy to get around it. It's like a reckoning of some sort.

 

 

 

 

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Re:Gold has just become the best investment.??.

? Reply #2 on: November 29, 2002, 07:31:13 pm ?

 

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I've been long the miners and CEF since March or so. Started buying coins last month. The action in gold has been puzzling the past few weeks. Neither up nor down. The short position on most miners is up drastically- I haven't seen the COT reports on the metal recently. Your point about inflation seems so obvious that I'm puzzled by the lack of positive thrust in gold this month.

 

 

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I've known since college that at the time of the Franco-Prussian war in 1872, the smart money (French) bought on the German artilliery and sold on the French cavalry bugles. But I could not have imagined that it takes the intestinal fortitude of a maggot to go long with all the systemic rot festering around us. - Stutz (10/24/02)

 

 

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Re:Gold has just become the best investment.??.

? Reply #3 on: November 29, 2002, 07:43:33 pm ?

 

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Wind changes directions so fast.

 

Just a few years ago, quite a few commentators "concluded" that China currency RMB "better" devalue X%; Last week, I read some where said RMB is overvalued.

 

well, it is remotely possible, what if China backs its currency with gold?

 

Gold, China and the US Dollar

 

Clive Maund, Kaufbeuren, Germany, 12 November 2002

 

An excerpt:

 

Can you imagine what will happen to the US dollar if at the same time China backs its currency with gold?!

 

 

 

 

Hypertiger

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Hyperinflation kills...

 

Re:Gold has just become the best investment.??.

? Reply #4 on: November 29, 2002, 09:08:54 pm ?

 

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They have "borrowed gold" to satisfy the demand for physical...

 

Options and futures for the most part are settled with cash so it is an easy operation to back gold with paper. there is more paper then gold to back it up. As long as people will accept paper instead of gold then the price can be manipulated...

 

But they will run out of Gold eventually or the ability to fool people into taking paper IOU's.

 

When Gold "cracks" it will be astounding.

 

Why manipulate GOLD? If gold shoots up the World banking system would collapse overnight. It is a deadly serious game they are playing...

 

In the run up to Y2K the mint was running 24/7 to prevent the price from cracking.

 

 

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Market crash = irrational exuberance x money2 -You'll never catch me, SUCKERS!

 

 

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Bearwithme

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Re:Gold has just become the best investment.??.

? Reply #5 on: November 29, 2002, 11:07:23 pm ?

 

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Quote from Hypertiger:

As long as people will accept paper instead of gold then the price can be manipulated...

 

Hypertiger: Is it true that the old Olivia Newton John song "Let's get physical" is actually about physical possession of gold vs. paper ownership. She obviously has a deep passion for issues related to currency and economics.. her song was way ahead of its time.

 

Imagine if we all took her advice and demanded physical.. that would be interesting don'tcha think??

 

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Goldmember

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Re:Gold has just become the best investment.??.

? Reply #6 on: November 29, 2002, 11:22:06 pm ?

 

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"In the run up to Y2K the mint was running 24/7 to prevent the price from cracking" -Hypertiger

 

Would be nice to have an insider at the U.S. mint or the Royal Canadian Mint and have a first hand report on Maple Leaf production and employment overtime hours, and have a running chart on any production changes.

 

I would assume that production staff at the mints must LOVE working with the gold and silver coins as opposed to mass quantities of steel slugs. I certainly know that if I were a mint employee I would feel a huge sense of satisfaction and happiness to work with gold and silver. True artisans who probably whistle on the way to work. Royal Canadian Mint

 

 

 

? Last Edit: Today at 12:27:18am by Goldmember ?

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Re:Gold has just become the best investment.??.

? Reply #7 on: Today at 12:15:23am ?

 

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Try this option play:

 

JUN 04 450 Call - $470 each

 

Buy 10 of 'em at $4700.

 

When (not IF) Gold goes to $1000 your talkin:

 

(530 * 10 * 100) - 4700 = 530,000 - 4,700 = 525,300

 

in PROFIT !!!

 

If you don't think that the house 'a cards isn't goin to collapse by then (ala Enron) then this TRADE IS NOT FOR YOU).

 

And after all all you're riskin is $4700 --- pocket change for most people.

 

It's like buyin a lottery ticket except for a Gold Bull it's based on your beliefs.

 

 

 

 

 

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Re:Gold has just become the best investment.??.

? Reply #8 on: Today at 05:45:49am ?

 

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I won't move this article to where it belongs due to the growing schizophrenia here in Stoolville, board-wise but I would like to add that I would like to see Gold move forward (and away from the US$). One way to start to do this is to cease pricing gold in archaic measures like Troy ounces and adopt the proper SI units (or at least cgs) ie kilos or grams. One step on the road to modernisation and away from American hegemony. Of course the next step is to make the Comex irrelephant.

 

 

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Re:Gold has just become the best investment.??.

? Reply #9 on: Today at 08:05:30am ?

 

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Gold stocks have been a in a long sideways down phase in the 2-3 year cycle. Based on this cycle, I concluded a couple months ago that the miners would go sideways in a broad range well into next year. This is the pattern they have been following so far. They'll break out to the upside next year, but it could be as late as the second half. There's clearly been accumulation on the pullbacks. Strong hands are loading up. Give it time.

 

I will post this weekend's analysis on Stool's Gold on the new message board some time this weekend.

 

Doc does a daily analysis of the HUI in the AM edition of the Anals, posted weekdays at 7:30 AM NY time.

 

 

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Get immediate access to your very own Anals! 3 Months - $19.29. Cheap!

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Guest Guest_yobob1

Why is this board having a hard time recognizing me requiring multiple log-ins? Is this a CIA conspiracy or what?? :blink:

 

Anyway, to me a lot of you are missing the role of physical gold in your portfolio. IMO the reason to own physical gold is to protect a portion of your wealth's purchasing power. Yes you might make some gains in any given currency at various points in time, but in the long run I think you'll find that gold has preserved your wealth more than enhanced it. In the case of a deflationary scenario, in conjunction with an increased safe haven status of gold, you might find it possible to purchase other "things" at reduced prices with a "currency" that has increased in relative value: i.e. the best possible case for gold.

 

On the other hand if the madmen at the levers actually manage to induce price inflation, gold should at least keep pace with the devaluation of fiat.

 

Miners still present some risk to me at this point. I still contend that in a hard down equity crash, the risk remains that at least some of the miners get sold hard as people scramble to monetize paper out of fear.

We have yet to see real fear in this market. I don't think one should ignore at least the possiblility for the "baby with the bath water syndrome".

 

You might want to save a few gambling chips for averaging down if you currently hold "good" miners. The same applies to the physical. I personally don't think they are done screwing with the POG (or the POag) yet. As such I continue to take opportunities as theya re presented, though lately that means in silver and not gold. I'm looking for a price nearer to $300 before adding.

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I still haven't quite figured out how these PM's work. I'm currently holding a few: GG, DROOY, HGMCY, AEM. Sometimes they go UP if the price of gold goes up, sometimes they go down if the price of gold goes up. And visa versa. Some rise when the market goes up, some fall. I can't really get a feeling for the patterns. What I HAVE learned is that if I use a stop, I will be stopped out, the price will go right back up to where it was, and I feel like a jackass- it's happened more than once. So... for now, no more stops. Then again, if they go down and don't come back up again, I'm screwed. Regardless, I'm holding for the long term and if I lose my money, it won't be the first time. The only other alternative is physical gold that I pay a hefty commission for, can't put in a safety deposit box (as per Merciless) and will likely have my cleaning lady retiring in Cabo San Lucas. I'm open for enlightenment.

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Guest AssMaster

There is always CEF (Central Fund of Canada), which holds physical gold but has a hefty (15%) premium to the price of gold. Perhaps the premium could be thought of as cheap insurance or altenratively really high management fees.

 

Or just buy some FSAGX, or one of the other higher rated gold funds which should balance out the vagaries of individual gold stocks.

 

I am looking at some small cap golds in nascent uptrends or other individual gold stocks for a buy point.

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Yobob is right it is about "saving" really... Paper, stocks, bonds, checks you name it can be produced out of thin air. Gold can not... Yet. Cash in a shoe box is good but the reality is that the world banking system which is based on inflating fractional reserves of nothing has reached it's maximum potential. It will collapse very soon and gold is the only safe store of wealth. period.

 

Because Gold is "real" money and the demand for money never decreases (only the availability) Gold's buying power for the most part is always stable over the long haul.

 

Gold is for "saving"

Paper is for "spending"

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Hyper said: "Paper, stocks, bonds, checks you name it can be produced out of thin air. Gold can not... Yet."

 

Ah, you must have the same twisted vision as me. Al, O'Neil, Citi, JPM, and the heads of the bullion banks embroiled in a massive alchemy project. Think about it. All they need to do is figure out this age old puzzler; how to produce gold from straw, and all their problems are solved. Actually, all they have to do is leak a rumor to this effect... qo has been buying physical since March01 and, trust me, I don't sleep any easier at night for it :unsure:

 

qo

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Guest Guest_beardrech

as Dok will attest , for the past month i have been trapped in some form of internet interzone having, through some exotic onomastic surgical procedure,lost my identity. The more i struggled to gain access to the board,the more Kafkaesque my situation until i now have more aliases then the leading figure on the fbi hit parade

But ,for all that,as a loyal stoolie ,coerced into becoming a lurker, i became fascinated by all the agonizing by some stoolies lamenting that all was lost ,and that the baton of truth and POWER had fallen into the hands of fed villains who were now going to race away with all of our natural fluids till kingdom come--

While its metaphysically impossible to confirm the truth or falsity of a future tense statement, its still possible to see the lineaments of the future in present behaviour.

Specifically-- When AG & Barnanke enunciated their plans for defending their Mad King Ludwigian economic behaviour i remembered Bogie ,in the Maltese Falcon riposting one of SydneyGreenstreets asssistants, who said something about bogie "pulling lead out of his liver"with "The smaller the punk(?) the flashier the patter"

And this I believe characterizes their implicitly petty gangsterISH threats against honest savers taking advantage of the presently semi-invalidated monetary heavy rackets ,heretofore controlled by the Fed.

The point ,in essence , that I'm trying to make is that the real ammunition AG & co have left is RHETORICALLY GENERATED FUD :Fear ,uncertainty and the threat of death -- and by this very same rhetoric he creates in bears a psychological hall of mirrors where we looking at our images try to outsmart and outwit and outrun what is essentially ourselves,ourselves being conned into becoming cognitively homeless,uncentered,with no self consciousness,but rather being enslaved to what WE think others are thinking ,their hope finally being that we will dervish ourselves into i a raging nsanity

beardrech

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Beardrech, your absence has been noted and mourned, and your reappearance is welcome and celebrated. The Poet Stooleate returns. Indeed, the greatest blow to our collective FURce of good and rational is not the losses many of us have sustained, but rather the multipronged attack on our confidence at best, and our sanity at worst. And, you are, as ever, entirely correct. Al Green and his bully boyz and ruffians and thugs are little more than that, and their bark packs only the bite we inflict upon ourselves. For the ocean is ineffable, its force unknowable, its vastness unfathomable. Al Green's little waves are drops within it.

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Everything tends to regress to the mean. History tends to repeat itself. At the end of the Carter Administration, an ounce of gold traded for about the same price as the entire list of Dow stocks. That was an aberration, to be sure. But no more of an aberration than what happened at the end of the Clinton years - when it took 38 ounces of gold to by the Dow. Currently, an ounce of gold will buy only 1/28th of the Dow...with probably a lot further to go before things have reached normal. Buy low, sell high. Buy gold, sell the Dow.

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Hypertiger

 

 

How about this. Gold will be useless. The final monetary system of the world will be a single currency with a World Gov't doleing out to each their worth based on their

productivity. Their productivity according to what their commanded to perform. Listening to some on this board,

the way they talk about the US and our supposed hegemony, i think they might find this most satisfying.

 

The last time I looked Japan and The European Union

in combination have a larger economy then the US.

Am I wrong?

 

God Bless America.

patriot.

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Gold;home,home de range...

 

Gold don't pay no interest,so it's dead investment,that's

what they say.

 

Well,sir,a good way to git the old dawg to pay his way

is to buy yer gold(physical only,plueeeze)and sell

close to the money options.Then,you buy cheep

"outta tha loop" options just in case he rockets outta

tha crypt.

 

Thanks to ORO from USAGOLD for that strategy.

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