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Are PM bulls worried/concerned/afraid that higher interest rates will squash demand for PMs?

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  • cohodkcohodk Posts: 19,122 ✭✭✭✭✭

    @jmski52 said:
    The yield curve inversion is the most it's ever been. There's nothing on the horizon to indicate that rates won't keep going much higher.

    Nothing except the inverted yield curve itself.

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • cohodkcohodk Posts: 19,122 ✭✭✭✭✭

    @jmski52 said:
    I don't care of PM stackers stack other stuff. This is a PM forum and I'm asking if PM stackers would be begin to stack yield instead of stacking PMs.

    There's a reason that rates are higher, and it's not a good one. I'll stay with something real, thank-you very much.

    There's no, absolutely no good reason to "churn the account" chasing yield.

    In what way would one selling gold to buy a guaranteed 5% for 2 years be considered churning?

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • derrybderryb Posts: 36,821 ✭✭✭✭✭
    edited July 6, 2023 12:21PM

    @cohodk said:

    @jmski52 said:
    I don't care of PM stackers stack other stuff. This is a PM forum and I'm asking if PM stackers would be begin to stack yield instead of stacking PMs.

    There's a reason that rates are higher, and it's not a good one. I'll stay with something real, thank-you very much.

    There's no, absolutely no good reason to "churn the account" chasing yield.

    In what way would one selling gold to buy a guaranteed 5% for 2 years be considered churning?

    I'd call it bad churning. For one, rates will offer a higher return in the near future. Two, gold will match such returns if not do better. Gold is liquid, a 2 year lock in is a done deal for 2 years. The only way this churn would possibly be beneficial is if rates come down from 5%. Not gonna happen in the intermediate and long term.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    NFP on deck later today....inflation numbers next week.

    Will set tone for next month or two.

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @cohodk said:

    @GoldFinger1969 said:

    That said, short- term fluctuations in nominal and real rates aside, gold is going much higher by 2030 and 2035. At least a double, maybe $5,000.

    So 6% a year? And it won't be a liner return so you never know when the big payday will come. One can get 6% on solid corporate paper and be able to plan around the cash flow.

    I don't consider gold a substitute for tangible financial assets that provide interest and/or dividends. My gold is almost all coins, so I have an aesthetic art-like connection to them beyong whether I make money off the investment/speculation.

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @jmski52 said:
    There's no, absolutely no good reason to "churn the account" chasing yield. The yield curve inversion is the most it's ever been. There's nothing on the horizon to indicate that rates won't keep going much higher.

    YC inversion higher in the past, 1979-81 comes to mind. Keep an eye on PAR GSE MBS as it heads for +200 bp, could indicate systemic issues coming for banks and/or financial system. Might lead to opportunity for MREIT common or pfds, but only nibbling on the latter right now.

  • GoldminersGoldminers Posts: 3,987 ✭✭✭✭✭

    @GoldFinger1969 said:
    NFP on deck later today....inflation numbers next week.

    Will set tone for next month or two.

    The CPI inflation will be lower next week because comparing against a large 1.4% monthly gain last year. Then next month the average inflation number will go back up comparing against a 0% gain month last year.

  • cohodkcohodk Posts: 19,122 ✭✭✭✭✭

    @derryb said:

    @cohodk said:

    @jmski52 said:
    I don't care of PM stackers stack other stuff. This is a PM forum and I'm asking if PM stackers would be begin to stack yield instead of stacking PMs.

    There's a reason that rates are higher, and it's not a good one. I'll stay with something real, thank-you very much.

    There's no, absolutely no good reason to "churn the account" chasing yield.

    In what way would one selling gold to buy a guaranteed 5% for 2 years be considered churning?

    I'd call it bad churning. For one, rates will offer a higher return in the near future. Two, gold will match such returns if not do better. Gold is liquid, a 2 year lock in is a done deal for 2 years. The only way this churn would possibly be beneficial is if rates come down from 5%. Not gonna happen in the intermediate and long term.

    That's not churning. Churning is flipping silver trinkets for other silver trinkets. You know, not buy and hold.;)

    The rest of you comment shows lack of knowledge and assumption.

    1. No one is "locked in" or done deal for 2 years.
    2. Gold is less liquid than bonds.
    3. There is no guarantee that gold will match or exceed bond returns.
    4. It's evident you are not aware of returns on 5 to 10 fixed income.
    5. Fixed income investments can be hedged to generate addition income.
    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • jmski52jmski52 Posts: 22,849 ✭✭✭✭✭
    edited July 8, 2023 8:17AM

    Churning has zero to do with silver trinkets.

    Churning is buying/selling/buying/selling/buying ad infinitum on the advice of your friendly “financial advisor” who incidentally is the only one in the equation who is guaranteed a positive return on each transaction that occurs using clients’ money. But of course, you know that very well.

    A locked-in 5% return for 2 years is fine in a stable environment, but I don’t consider the can-kicking debt-based economy in which the debt load is going exponential to be all that stable. Do you?

    You may say that you aren’t locked into a two year instrument, but that simply means that you have to keep churning the account in order to get out from under it if interest rates go against your position. Churn, churn, churn. Not for me. Good for the broker though.

    If you have to hedge a bond, why buy it in the first place? Where’s the conviction that you have made such a great decision in buying the bonds? Pffft.

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • bidaskbidask Posts: 14,017 ✭✭✭✭✭

    @jmski52 said:
    I don't care of PM stackers stack other stuff. This is a PM forum and I'm asking if PM stackers would be begin to stack yield instead of stacking PMs.

    There's a reason that rates are higher, and it's not a good one. I'll stay with something real, thank-you very much.

    There's no, absolutely no good reason to "churn the account" chasing yield. The yield curve inversion is the most it's ever been. There's nothing on the horizon to indicate that rates won't keep going much higher.

    If yields keep going much higher that is not good for PM's imo

    I manage money. I earn money. I save money .
    I give away money. I collect money.
    I don’t love money . I do love the Lord God.




  • cohodkcohodk Posts: 19,122 ✭✭✭✭✭

    @jmski52 said:
    Churning has zero to do with silver trinkets.

    Churning is buying/selling/buying/selling/buying ad infinitum ....

    Isn't this what some do when they talk of attempting to profit on price volatility? We hear that on this forum continually in regards to silver trinkets, err, $1 denominated US silver.

    BTW---even you hedge.

    But I wouldn't expect you to understand how to increase return and at the same time reduce risk as knowing how is the definition of conviction.

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • TwoSides2aCoinTwoSides2aCoin Posts: 44,291 ✭✭✭✭✭

    Bulls charge.
    Churning is with the cow's cream, not the bull's.

  • jmski52jmski52 Posts: 22,849 ✭✭✭✭✭

    But I wouldn't expect you to understand how to increase return and at the same time reduce risk as knowing how is the definition of conviction.

    Getting bound up in paper leverage isn't conviction.

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • cohodkcohodk Posts: 19,122 ✭✭✭✭✭
    edited July 12, 2023 3:52AM

    @jmski52 said:
    But I wouldn't expect you to understand how to increase return and at the same time reduce risk as knowing how is the definition of conviction.

    Getting bound up in paper leverage isn't conviction.

    But holding something for going on 2 decades with no return is? One should be convicted.

    Like I said, you don't understand and are unwilling to understand.

    Separately, anyone see the latest PM sentiment indicators?

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • jmski52jmski52 Posts: 22,849 ✭✭✭✭✭

    But holding something for going on 2 decades with no return is? One should be convicted.

    You're beginning to sound like Trudeau. However, I can reliably testify that dollar cost averaging into precious metals over almost 2 decades has served me very well. No Return? BS, my spreadsheet says otherwise.

    I can document every single transaction I've made since 1987, and the great majority of my line items show some very nice unrealized gains that I can sell anytime and offset the tax consequences by picking out the very few losers and selling them to balance the tax liability of the net proceeds.

    Like I said, you don't understand and are unwilling to understand.

    I understand that handing my money over to a broker or to the banking system is inherent with all kinds of risks that I can avoid by doing my own diligence, not to mention the transaction fees, management fees, and frontrunning practiced by JPM or GS & Company.

    What's not to understand?

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • derrybderryb Posts: 36,821 ✭✭✭✭✭

    CPI says inflation at lowest in two years. But, there is always a later revision.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • bidaskbidask Posts: 14,017 ✭✭✭✭✭

    I had to sell some AAPL today for my kid’s junior year in college

    I bought shares in February 2013 at 15.97.

    I manage money. I earn money. I save money .
    I give away money. I collect money.
    I don’t love money . I do love the Lord God.




  • TwoSides2aCoinTwoSides2aCoin Posts: 44,291 ✭✭✭✭✭

    @bidask said:
    I had to sell some AAPL today for my kid’s junior year in college

    I bought shares in February 2013 at 15.97.

    I had to pay my own tuition. But my silver position has increased by $6k in the last two days.

  • TwoSides2aCoinTwoSides2aCoin Posts: 44,291 ✭✭✭✭✭

    @TwoSides2aCoin said:

    @bidask said:
    I had to sell some AAPL today for my kid’s junior year in college

    I bought shares in February 2013 at 15.97.

    I had to pay my own tuition. But my silver position has increased by $6k in the last two days.

    In addition to tales; an associate bought one Bitcoin in 2013 for $150. He dumped it in 2022 and traded for $52,000. worth of silver and gold.
    Time is the key component.

  • bidaskbidask Posts: 14,017 ✭✭✭✭✭

    @TwoSides2aCoin said:

    @bidask said:
    I had to sell some AAPL today for my kid’s junior year in college

    I bought shares in February 2013 at 15.97.

    I had to pay my own tuition. But my silver position has increased by $6k in the last two days.

    Wonderful😊

    I manage money. I earn money. I save money .
    I give away money. I collect money.
    I don’t love money . I do love the Lord God.




  • HigashiyamaHigashiyama Posts: 2,192 ✭✭✭✭✭

    @TwoSides2aCoin said “Time is the key component.”

    Yes, although most people who think they can market time either (a) are very lucky or (b) don’t keep very good records.

    Higashiyama
  • blitzdudeblitzdude Posts: 5,894 ✭✭✭✭✭

    @TwoSides2aCoin said:

    @bidask said:
    I had to sell some AAPL today for my kid’s junior year in college

    I bought shares in February 2013 at 15.97.

    I had to pay my own tuition. But my silver position has increased by $6k in the last two days.

    I had to pay my own tuition too, well sorta..... Uncle Sam took care of the bill once I contributed $1200 and served 5 years in the Corps. Your Gutter position is probably down around 50% in past last decade (non-inflation adjusted). SMPR!

    The whole worlds off its rocker, buy Gold™.

  • bidaskbidask Posts: 14,017 ✭✭✭✭✭

    @Higashiyama said:
    @TwoSides2aCoin said “Time is the key component.”

    Yes, although most people who think they can market time either (a) are very lucky or (b) don’t keep very good records.

    Are not very lucky

    I manage money. I earn money. I save money .
    I give away money. I collect money.
    I don’t love money . I do love the Lord God.




  • TwoSides2aCoinTwoSides2aCoin Posts: 44,291 ✭✭✭✭✭
    edited July 27, 2023 8:57PM

    @bidask said:

    @Higashiyama said:
    @TwoSides2aCoin said “Time is the key component.”

    Yes, although most people who think they can market time either (a) are very lucky or (b) don’t keep very good records.

    Are not very lucky

    >
    In the business of coins and collectibles, the focus and strategy are somewhat different. Though bullion has become a bigger part of the picture in a few stretches of that endeavor over the past 14 years, I'm mostly just having fun with coins.

    Still I go long on the metals. Steel, copper, aluminum too. My other trades require that stuff , as well.

  • TwoSides2aCoinTwoSides2aCoin Posts: 44,291 ✭✭✭✭✭

    And aside from that, Dave, I bought a coin shop 14 years ago. Silver was $10. Today it's $24.
    Goes up , goes down. Goes up , stays down. Goes up , goes up , goes down , stays up. Go figure. Go long.

  • VasantiVasanti Posts: 455 ✭✭✭✭
    edited July 28, 2023 9:19AM

    It’s definitely in the downslope, but nobody can predict the future.

  • percybpercyb Posts: 3,324 ✭✭✭✭

    @jmski52 said:
    Churning has zero to do with silver trinkets.

    Churning is buying/selling/buying/selling/buying ad infinitum on the advice of your friendly “financial advisor” who incidentally is the only one in the equation who is guaranteed a positive return on each transaction that occurs using clients’ money. But of course, you know that very well.

    A locked-in 5% return for 2 years is fine in a stable environment, but I don’t consider the can-kicking debt-based economy in which the debt load is going exponential to be all that stable. Do you?

    You may say that you aren’t locked into a two year instrument, but that simply means that you have to keep churning the account in order to get out from under it if interest rates go against your position. Churn, churn, churn. Not for me. Good for the broker though.

    If you have to hedge a bond, why buy it in the first place? Where’s the conviction that you have made such a great decision in buying the bonds? Pffft.

    Buying bonds is only part of a portfolio and at current levels, it makes sense to add them to one’s portfolio given the fact that interests rates were so low for so long. Now that one can get a good yield it’s foolish not to own some.

    "Poets are the unacknowledged legislators of the world." PBShelley
  • derrybderryb Posts: 36,821 ✭✭✭✭✭
    edited July 31, 2023 7:12AM

    JP Morgan says record gold prices in 2024

    so says the bullion bank whose traders have the most influence over spot price

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @derryb said:
    JP Morgan says record gold prices in 2024
    so says the bullion bank whose traders have the most influence over spot price

    You really think they control gold prices over big South African producers, Russia, or Central Banks ?

  • derrybderryb Posts: 36,821 ✭✭✭✭✭
    edited July 31, 2023 9:45AM

    @GoldFinger1969 said:

    @derryb said:
    JP Morgan says record gold prices in 2024
    so says the bullion bank whose traders have the most influence over spot price

    You really think they control gold prices over big South African producers, Russia, or Central Banks ?

    yes, they control spot prices and JPM is the biggest bullion bank trader. This has been well documented by numerous cases brought against bullion bank traders by the Department of Justice. Producers do not control spot prices but they do control supply. Unfortunately spot price has nothing to do with physical supply, it is based on demand for an unlimited paper supply and that is precisely why there is a difference between spot price and the price of a silver eagle. Producers are at the mercy of the spot price determined on the COMEX market. They can sell or they can sit on their product.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • derrybderryb Posts: 36,821 ✭✭✭✭✭

    The price of gold is determined by CONFIDENCE.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • SoldiSoldi Posts: 2,177 ✭✭✭✭✭

    Kitco has an interesting take on Silver this past Friday 8/11/23................Silver deficits don't exist and other silver myths.
    its a video you don't even have to read it.

  • derrybderryb Posts: 36,821 ✭✭✭✭✭

    Alasdair Macleod:

    "The error in modern thinking is not to understand that interest rates are compensation for parting with money, currency, or the right to instant access to credit. As pointed out earlier in this article, interest rates represent the market assessment of the future discounted value of a medium of exchange, to which foreigners are particularly sensitive. Since gold retains its purchasing power over time, the discounted future value only reflects time preference and counterparty risk. The discounted future value for fiat currencies includes their anticipated loss of purchasing power, which is not only more material today than it was two years ago but increasingly so. There is therefore, no connection in monetary or economic theory between the yield on gold and a fiat currency."

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • percybpercyb Posts: 3,324 ✭✭✭✭

    @derryb said:
    Alasdair Macleod:

    "The error in modern thinking is not to understand that interest rates are compensation for parting with money, currency, or the right to instant access to credit. As pointed out earlier in this article, interest rates represent the market assessment of the future discounted value of a medium of exchange, to which foreigners are particularly sensitive. Since gold retains its purchasing power over time, the discounted future value only reflects time preference and counterparty risk. The discounted future value for fiat currencies includes their anticipated loss of purchasing power, which is not only more material today than it was two years ago but increasingly so. There is therefore, no connection in monetary or economic theory between the yield on gold and a fiat currency."

    Hogwash.

    "Poets are the unacknowledged legislators of the world." PBShelley
  • roadrunnerroadrunner Posts: 28,303 ✭✭✭✭✭

    @TwoSides2aCoin said:

    In addition to tales; an associate bought one Bitcoin in 2013 for $150. He dumped it in 2022 and traded for $52,000. worth of silver and gold.
    Time is the key component.

    They couldn't have done that legally. That $51,850 net profit in Bitcoin would be taxed as a capital gain. They couldn't have traded for the same amount in silver and gold. Maybe 10-20-30% less due to taxes.

    Barbarous Relic No More, LSCC -GoldSeek--shadow stats--SafeHaven--321gold
  • TwoSides2aCoinTwoSides2aCoin Posts: 44,291 ✭✭✭✭✭

    @roadrunner said:

    @TwoSides2aCoin said:

    In addition to tales; an associate bought one Bitcoin in 2013 for $150. He dumped it in 2022 and traded for $52,000. worth of silver and gold.
    Time is the key component.

    They couldn't have done that legally. That $51,850 net profit in Bitcoin would be taxed as a capital gain. They couldn't have traded for the same amount in silver and gold. Maybe 10-20-30% less due to taxes.

    He did it legally.

    Whether or not he paid capital gains tax on his windfall was none of my business.

  • FrankHFrankH Posts: 945 ✭✭✭✭✭

    The real allure of gold will be the discovery of the advantages of adjusted cost basis to anyone inheriting bullion.
    :)

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @jmski52 said:
    I understand that handing my money over to a broker or to the banking system is inherent with all kinds of risks >that I can avoid by doing my own diligence, not to mention the transaction fees, management fees, and >frontrunning practiced by JPM or GS & Company.

    Front-running is illegal and regulators are on the lookout for that all the time.

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    Rates have risen a ton at the short and long end...and gold is pretty much flat.

    Impressive...most impressive...as Darth Vader once said. :D

  • dcarrdcarr Posts: 8,468 ✭✭✭✭✭

    @GoldFinger1969 said:

    @jmski52 said:
    I understand that handing my money over to a broker or to the banking system is inherent with all kinds of risks >that I can avoid by doing my own diligence, not to mention the transaction fees, management fees, and >frontrunning practiced by JPM or GS & Company.

    Front-running is illegal and regulators are on the lookout for that all the time.

    .

    That hasn't stopped large Wall Street entities from doing it all the time.

    .

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @dcarr said:
    That hasn't stopped large Wall Street entities from doing it all the time.

    They DON'T do it...an individual here-or-there may break the rule, but there are no big profits accruing from the trading desks. In fact, the equity and bond trading desks have been net losers the last 5-10 years or so.

    If you front-run a client -- like a hedge fund -- you're going to lose your job. It's not a good tradeoff.

  • jmski52jmski52 Posts: 22,849 ✭✭✭✭✭

    Rogue traders? Yeah, right! How about rogue managements acting in concert with bought-off regulators?

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • dcarrdcarr Posts: 8,468 ✭✭✭✭✭

    Insider trading is how Congress people and Wall Street make a lot of their money.

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @jmski52 said:
    Rogue traders? Yeah, right! How about rogue managements acting in concert with bought-off regulators?

    You're just showing your lack of knowledge.

    Would you want to compare the heavily-regulated Wall Street to the precious metals hypsters and shysters out there ? How about I used the worst of the latter to smear the entire group of people who collect or deal ? :o

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @dcarr said:
    Insider trading is how Congress people and Wall Street make a lot of their money.

    You don't even know what "insider trading" is and under what conditions it is legal or illegal. You just keep throwing crap up against the wall hoping some of it sticks. :o

  • derrybderryb Posts: 36,821 ✭✭✭✭✭

    @GoldFinger1969 said:

    @jmski52 said:
    Rogue traders? Yeah, right! How about rogue managements acting in concert with bought-off regulators?

    You're just showing your lack of knowledge.

    Would you want to compare the heavily-regulated Wall Street to the precious metals hypsters and shysters out there ? How about I used the worst of the latter to smear the entire group of people who collect or deal ? :o

    Are we talking about government regulators? lol

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • dcarrdcarr Posts: 8,468 ✭✭✭✭✭

    @GoldFinger1969 said:

    @jmski52 said:
    Rogue traders? Yeah, right! How about rogue managements acting in concert with bought-off regulators?

    You're just showing your lack of knowledge.

    Would you want to compare the heavily-regulated Wall Street to the precious metals hypsters and shysters out there ? How about I used the worst of the latter to smear the entire group of people who collect or deal ? :o

    .

    You mean like Bernie Madoff ?

    .

  • dcarrdcarr Posts: 8,468 ✭✭✭✭✭

    @GoldFinger1969 said:

    @dcarr said:
    Insider trading is how Congress people and Wall Street make a lot of their money.

    You don't even know what "insider trading" is and under what conditions it is legal or illegal. You just keep throwing crap up against the wall hoping some of it sticks. :o

    Insider trading (like Martha Stewart) is illegal. But that exact same activity would be legal if performed by an elected member of Congress.

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @dcarr said:
    You mean like Bernie Madoff ?

    Proves my point...he wasn't a regulated bank or investment firm. He was on his own.

  • GoldFinger1969GoldFinger1969 Posts: 1,773 ✭✭✭✭✭

    @dcarr said:
    Insider trading (like Martha Stewart) is illegal. But that exact same activity would be legal if performed by an elected member of Congress.

    Martha Stewart lied and obstructed an investigation. The Supreme Court has ruled that "insider trading" is legal if it does NOT involve material non-public information and/or no fiduciary duty has been breached.

    Read DIRKS vs. SEC (1982). :)

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