On the upside, FedEx is looking to hire 250 pilots. That number is not confirmed, just a guess around "campus." But it will be the first pilot hiring in 5 or so years. At face value it would seem that FedEx is looking at some growth (international...domestic is tapped out.) However, add into the mix retirements, Age 60 rule, contract negotiations, aircraft shuffling and 250 isn't all that much but at least it's in the right direction.
<< <i>Once these states (starting with Michigan and California) that are so over burdened with medicare and union pensions start going bankrupt then the smelly stuff will hit the fan. >>
I thought the passage of the recent health care bill was supposed to lower our costs? Just got my first statement for 2011 and my premium increased 23%. While I was expecting a 5-10% increase, this one floored me. Neither me or my wife crossed any major age barrier this year. On top of that we have a $10,000 deductable with the only paid-for benefit being an annual physical. At the current rate of increase, the annual payment will be $36,000/yr by the time I am medicare eligible, assuming that stays at age 65. Do the price reductions from the health care bill kick in next year? Or do CPI "substitutional" effects take hold here which means I should seek out more cost effective veterinarian care instead?
Shameless article. Talks about a bubble, talks about how even if the dollar is in the tank, just look at the other guys and that the bad news that could happen is already in the current price. Then in the last two paragraphs it tells you to buy options on SPDR for $3 just in case gold does hit its $2,300 peak. Oh well, thought the bugs might enjoy news from the other side.
Edited to add: Don't forget to read the comments after the article.
<< <i> I should seek out more cost effective veterinarian care instead?
roadrunner >>
Well, Veterinarians in general probably have more integrity than many MD's and they may also be smarter since they have to change gears from one physiology to another so they might become the saviors of the American health care system as government may draft veterinarians to lend a helping hand.
This will really be a boon to another failed state in the midwest
Illinois Lawmakers Propose 75 Percent Income Tax Hike
January 6, 2011 10:38 PM
SPRINGFIELD, Ill. (CBS) – Gov. Pat Quinn and the leaders of both houses of the Illinois General Assembly have agreed on raising the state income tax.
If the bill passes, the plan would raise the personal income tax rate from the current 3 percent to 5.25 percent. That’s a 75 percent increase. In real dollars, that would mean if you currently owe $1,000 in taxes, next year you would owe $1,750.
<< <i>This will really be a boon to another failed state in the midwest
Illinois Lawmakers Propose 75 Percent Income Tax Hike
January 6, 2011 10:38 PM
SPRINGFIELD, Ill. (CBS) – Gov. Pat Quinn and the leaders of both houses of the Illinois General Assembly have agreed on raising the state income tax.
If the bill passes, the plan would raise the personal income tax rate from the current 3 percent to 5.25 percent. That’s a 75 percent increase. In real dollars, that would mean if you currently owe $1,000 in taxes, next year you would owe $1,750.
Wish we could build a fence at the border ( of Florida ) >>
Indiana's govenor, Mitch Daniels, is inviting Illinoinians with open arms. This would be a major boon for Indiana which still runs balanced budgets though barely and not con- sistently.
Being in NW Indiana though which has been getting overrun with people from Illinois for two decades now it would be harder to see the advantages. In Indianapolis the in- flux isn't so great but here they overrun the schools and two of them on the same road constitutes a traffic jam. We're getting close to needing vastly more infrastructure to handle the influx and around here bridges are only good for a couple years even if they don't fall down under construction. They won't even plow till the snow stops.
Illinois needs to fix its own problems and a massive flight away won't help. They need to go after the fat and the waste first and then go after pay and pensions. Maybe if they could stop the massive vote fraud in Chicago they would find out what the political will of the people really is.
IL would do well to look up the last “temporary tax increase” that Massachusetts imposed about 20 years ago. It’s still up there! I’d tell the last person living in Illinois to “turn off the lights,” but, hey, the electric company will have already cut off the juice by then for non-payment. Soon I think this will happen in ALL STATES!. they wont be satisfied until everyone is homeless! Then they will start a homeless tax!
Many successful BST transactions ajia (x2,Meltdown),cajun,Swampboy,SeaEagleCoins,InYHWHWeTrust, bstat1020,Spooly,timrutnat,oilstates200, vpr, guitarwes, mariner67, and Mikes coins
Precious metal prices are rising because of worries about inflation and Europe's debt crisis.
Gold and silver prices have surged over the last year as investors sought protection against inflation and volatility in currency markets. Concerns about Europe's financial system flared again Monday when Portugal's borrowing rates spiked.
"Europe's got people worried again," said George Gero, senior vice president for RBC Wealth Management in New York.
The yield on Portugal's 10-year bonds soared as high as 7.18 percent Monday. The higher yield means investors were demanding more compensation for taking on the risk of lending money to Portugal, a sign that their confidence in the government was waning. The yield fell back to 6.94 percent on speculation that the European Central Bank was buying Portuguese bonds. Yields fall when bond prices rise. Text
Many successful BST transactions ajia (x2,Meltdown),cajun,Swampboy,SeaEagleCoins,InYHWHWeTrust, bstat1020,Spooly,timrutnat,oilstates200, vpr, guitarwes, mariner67, and Mikes coins
<< <i>Shameless article. Talks about a bubble, talks about how even if the dollar is in the tank, just look at the other guys and that the bad news that could happen is already in the current price. Then in the last two paragraphs it tells you to buy options on SPDR for $3 just in case gold does hit its $2,300 peak. Oh well, thought the bugs might enjoy news from the other side.
Edited to add: Don't forget to read the comments after the article.
Hi, I'm new here, (I'm from the currency forum) and I just read the article about the bubble you posted. I have heard Dave Ramsey say the same thing, and it has me concerned. But, about 4 years ago, when gold was at $650 / OZ., Dave Ramsey convinced me gold was too volitile and not a good investment, so I sold a few ounces..at $650 only to see it rise ever since. I have great respect for Dave, but he does not like gold at all. Now, I'm not heavily invested in gold, because I'm not financially well off to start with...the economy has all but destroyed my business and means of livelihood. I have been collecting currency for a few years, and lost my ass when I had to sell off most of my collection. But what I got for my paper, I bought gold, at around 1150 an ounce. What I did was, I got 4- slabbed NGC MS62 $20 gold coins (Saints and Libs), with the theory that, if gold falls, I'll still have the numismatic value. The rest of the gold I got was just bullion Eagles. The bullion, I've bought and sold, bought and sold, every time I think it has peaked, but I'm always wrong. I know no one has a crystal ball, but I hear...and read...so many different opinions...I'm confused. I dont even know what certain terms mean, like being "bullish" or "bearish". Maybe someone can answer my questions? Thanks
<< <i>Shameless article. Talks about a bubble, talks about how even if the dollar is in the tank, just look at the other guys and that the bad news that could happen is already in the current price. Then in the last two paragraphs it tells you to buy options on SPDR for $3 just in case gold does hit its $2,300 peak. Oh well, thought the bugs might enjoy news from the other side.
Edited to add: Don't forget to read the comments after the article.
Hi, I'm new here, (I'm from the currency forum) and I just read the article about the bubble you posted. I have heard Dave Ramsey say the same thing, and it has me concerned. But, about 4 years ago, when gold was at $650 / OZ., Dave Ramsey convinced me gold was too volitile and not a good investment, so I sold a few ounces..at $650 only to see it rise ever since. I have great respect for Dave, but he does not like gold at all. Now, I'm not heavily invested in gold, because I'm not financially well off to start with...the economy has all but destroyed my business and means of livelihood. I have been collecting currency for a few years, and lost my ass when I had to sell off most of my collection. But what I got for my paper, I bought gold, at around 1150 an ounce. What I did was, I got 4- slabbed NGC MS62 $20 gold coins (Saints and Libs), with the theory that, if gold falls, I'll still have the numismatic value. The rest of the gold I got was just bullion Eagles. The bullion, I've bought and sold, bought and sold, every time I think it has peaked, but I'm always wrong. I know no one has a crystal ball, but I hear...and read...so many different opinions...I'm confused. I dont even know what certain terms mean, like being "bullish" or "bearish". Maybe someone can answer my questions? Thanks >>
Wish I could give you some definitive answers... but it remains a guessing game. We place our bets as we see fit and hope they work out. IMO though it looks like a no brainer though for gold and silver, at least for a portion of ones portfolio.
You are in the right forum... stick around and keep reading hear and you will be up to speed in no time!
Haha! You're right! No questions as such...but what does the term "bullish" mean? And, I'd like some opinions here about this "bubble" thing....seems to have merit, folks a lot smarter than me hold to this idea of the bubble about to burst soon, but then, I read so many others who predict PMs will continue to rise...
Hi, I'm new here, (I'm from the currency forum) and I just read the article about the bubble you posted. I have heard Dave Ramsey say the same thing, and it has me concerned. But, about 4 years ago, when gold was at $650 / OZ., Dave Ramsey convinced me gold was too volitile and not a good investment, so I sold a few ounces..at $650 only to see it rise ever since. I have great respect for Dave, but he does not like gold at all. Now, I'm not heavily invested in gold, because I'm not financially well off to start with...the economy has all but destroyed my business and means of livelihood. I have been collecting currency for a few years, and lost my ass when I had to sell off most of my collection. But what I got for my paper, I bought gold, at around 1150 an ounce. What I did was, I got 4- slabbed NGC MS62 $20 gold coins (Saints and Libs), with the theory that, if gold falls, I'll still have the numismatic value. The rest of the gold I got was just bullion Eagles. The bullion, I've bought and sold, bought and sold, every time I think it has peaked, but I'm always wrong. I know no one has a crystal ball, but I hear...and read...so many different opinions...I'm confused. I dont even know what certain terms mean, like being "bullish" or "bearish". Maybe someone can answer my questions? Thanks
Well, there are 110 fairly well known gold "bug" analysts who think gold is headed to $2500+. I guess it's possible they will all be proven wrong, all 110 of them. But these are the same guys that were calling for $1,000+ gold 4-8 years ago. When real interest rates are once again positive, the QE's are gone, $600 TRILL in otc derivatives is resolved, and cities, states and nations no longer have crushing debt issues....then gold's time will be over. Probably every asset class in the world is going through bubble stages but the source of the expansion always points back to fiat and debt.
Dave Ramsey was paraded around here back in 2004 by former member Dollardude. Ramsey was predicting new highs for stocks by 2006 and poor results for gold. At least Ramsey wasn't that far off on his stock prediction but was miles off on gold. I wonder if he saw the decline from October 2007 coming and got his clients out of stocks for the remainder of 2008. Something tells me that answer to that question was no. Ramsey should well know that "gold's volatility" comes directly from volatility in fiat currencies. When fiat currencies are no longer abused and hopefully backed by something other than promises, then gold's volatility will disappear as well. Gold simply mirrors the extreme volatility in fiat. Fiat is the fuel while gold is simply the flames showing the outcome.
<< <i>Well, there are 110 fairly well known gold "bug" analysts who think gold is headed to $2500+. I guess it's possible they will all be proven wrong, all 110 of them. But these are the same guys that were calling for $1,000+ gold 4-8 years ago. When real interest rates are once again positive, the QE's are gone, $600 TRILL in otc derivatives is resolved, and cities, states and nations no longer have crushing debt issues....then gold's time will be over. >>
When you talk about this kind of thing you have to provide a timeframe. I'm 100% confident that given enough time, gold will be $2500. It may be 20 years from now, but eventually I'll be right...
The vast majority of those $2500+ gold calls are within the next 1-6 years as the commodities boom matures (ie fiat bust matures). There might be a couple who are looking out beyond 2016, but not many. Martin Armstrong is one of the ones thinking that the cycle peaks around 2015-2017. I'm familiar with between 1/3 to 1/2 of those guys and that's my take on reading them over the past 5 years.
That's how the dollar has held up against gold over the past 9 yrs. Note that the Dollar index chart looks much more prettier/bullish that this one. But this one is more realistic showing an 87% loss of value against gold. If one was looking at the USDX chart they would see "only" a 33% drop in the index over the past 9 years (ie how much our fiat has dropped against other competing fiat currencies).
Think Bull in a china shop, tearing everything to shreds. Bullish means that people are charging forward with their investment in one product or another. The opposite of Bear, as in sleeping bear in hybernation. Bear means that nothing is moving, no body is buying anything. The Wall Street icon is a bear and a bull fighting. The yin and yang of investments. Folk that are bullish on gold are optimistic that it will rise in price. Edited to add that a bull thrusts it's horns up when charging and a bear claws it's prey down so bull is up and bear is down...
"...I'd like some opinions here about this "bubble" thing"
A bubble means that a product has been priced well beyond its value. Example of the housing bubble is that homes were selling for much more than they should have out of speculation of even higher prices in the future. The bubble was that they were priced well beyond their real value. Bubble alludes to the idea of the soap bubble bursting and then you are left with nothing. The idea of a gold bubble is that it has been priced beyond its real value and at some point the price will fall.
Realize that there are a number of forces in play when you consider gold as an investment. In the media particularly, you have the bull camp and the bear camp. The bulls have been running the gold show for a number of years, pulling money away from paper assets like the stock market, mutual funds, 401K's, and other paper investments and this is not good for the paper products people. Most stock market individual investors lost a fair amount of their investments a couple of years ago, on the order of 40% of their investments, and since have retreated into more secure investments like gold, silver, land, and other vehicles. Once the market began collapsing, the nasty underbelly of programmed trading, derivitives, fractional ownerships, all the new gimmicks that are in play with the paper markets became exposed and folk took what little money they had left even to the point of cashing out the 401's and IRA's to buy more predictable investments.
There is a very strong push by many entities with a vested interest to get individual investor money back into the market and to accomplish this there is a constant media drumming of how bad gold, land, commodities, currencies, are and how they are all in a bubble and they are all doomed because the only real way to invest money is in the stock market. Most folks think of the old mantra "Fool me once, shame on you, fool me twice, it's my fault." and will have nothing to do with buy and hold investments in the stock market. So, now we have the "Gold is in a bubble" crowd. They want your money in their paper products and out of gold. No body makes money off of you if you have your money in gold so they have to keep you away from gold and get your money into their paper or they can't make a living off of you. They are certainly not looking out for your interests with their advice...they are looking out for their interests.
Just my opinion, and that's what you asked for. Don't look for investment advice in this thread, you won't find it. What you will find is plenty of well studied opinions and some wild assed guesses. Do your own due dilligence and if you are really interested, do some reading, follow some of the links posted here and have an opinion of your own that is based on fact and perception.
Yes, I was only asking for opinions. One more question, what doess "fiat" mean? I am totally clueless on financial terminology.... Thanks for the replies
Common type of currency issued by official order, and whose value is based on the issuing authority's guarantee to pay the stated (face) amount on demand, and not on any intrinsic worth or extrinsic backing. All national currencies in circulation, issued and managed by the respective central banks, are fiat currencies.
The bullion, I've bought and sold, bought and sold, every time I think it has peaked, but I'm always wrong. I know no one has a crystal ball, but I hear...and read...so many different opinions...I'm confused. I dont even know what certain terms mean, like being "bullish" or "bearish". Maybe someone can answer my questions? Thanks
Every one of the responses to your posts has been dead-on, by exactly the guys who can give you a good understanding. In many instances, when someone indicates that they are "bullish" or "bearish" it may very well mean that they have something to sell you. If you learn the basics for investing and start by making your own decisions then you are ahead of 90% of the people. Right or wrong, if you can take responsibility for your own mistakes and your own successes, then you will learn faster.
The economic environment has been altered from what it used to be, and it may never go back. Most of the people in this forum have an interest in precious metals because precious metals have been proven and continue to be proven as a way to keep from losing what you have earned. It is said that gold is a "store of wealth", which is a very accurate concept that describes what gold does. It can be a trading vehicle like any other financial asset, but it's main attraction is that it is resistant to bad governmental policy, i.e. - money creation and overspending by government.
My advice - use precious metals not as a trading vehicle, but as a piggy bank, or like you would have once used a Savings & Loan account. If you someday have most of your financial obligations "under control", then it's always a challenge to do some trading for fun & profit. Don't buy gold unless you can hold it for at least 1 year. Chances are, you might want to keep accumulating it anyway instead of selling it in a year.
I recommend thinking of your holdings in terms of ounces, instead of dollars. The dollar price for gold doesn't matter, unless there is a cataclysmic change of some sort. Until then, the dollar is the problem - not gold. Remember that. There will undoubtedly come a day when the price of gold goes down, in dollars, yen, francs, marks, or yuans. The difference is that gold will still be gold long after those fiat paper currencies have devalued all the way to 0.00000000000000000001. That is what happens EVERY time. Good Luck!
Q: Are You Printing Money? Bernanke: Not Literally
The reason some investors use the term bubble for metals prices is because they've seen this pattern before:
a large, long term rise in value, outpacing other investments
the belief that the current, asympotal trend line can be extended indefinitely
the widespread idea that "this time it's different" fundamentally, so that the asset can't decline
the concept that every drop in price or "correction" is a "buying opportunity"
angry opposition to anyone suggesting caution at these prices or suggesting that a decline is possible
Again and again we have seen it, recently in dot-com stocks and real estate, but in prior generations, in tech stocks, in real estate, in beanie babies, in metals, in auto stocks, in telephone stocks, in photography stocks, in real estate, in railroad stocks, in metals, in shipping stocks, in tulip bulbs..
Now when the unions finally cave to lower wages, jobs will come back to America. We have only ourselves to blame for sending jobs overseas. Oh, The Age of Austerity.
The FED wants inflation, while it might make sense that we could be in for an extented deflationary trend, we should not underestimate the power of goverment.
8000 dollars for buying a house, 4000 for buying a new car, extended unemployment benefits, 0% fed rates, more tax cuts even in the face of crushing deficits, saving bankrupt car companies and insolvent banks is not economicaly sound.
two rounds of quantative easing ...and perhaps more to follow ( election time will come soon enough)
I think Cohock might be right in a pure economics setting, however Washington will keep messing around with free markets and one day they might simply go too far, think that they can control it, twist it to their needs and finally they will start beliving that they are impervious to market forces and then they will really mess things up.
History teaches us that human arrogance towards free market forces always ends up the loser.
"Women should be obscene and not heard. " Groucho Marx
<< <i>The reason some investors use the term bubble for metals prices is because they've seen this pattern before:
a large, long term rise in value, outpacing other investments
the belief that the current, asympotal trend line can be extended indefinitely
the widespread idea that "this time it's different" fundamentally, so that the asset can't decline
the concept that every drop in price or "correction" is a "buying opportunity"
angry opposition to anyone suggesting caution at these prices or suggesting that a decline is possible
Again and again we have seen it, recently in dot-com stocks and real estate, but in prior generations, in tech stocks, in real estate, in beanie babies, in metals, in auto stocks, in telephone stocks, in photography stocks, in real estate, in railroad stocks, in metals, in shipping stocks, in tulip bulbs.. >>
This time people have been warning that this time it's different since silver was at $4 per ounce. This time it is different. This time there's less silver in the world than there has been in hundreds of years and never before has it been of critical importance in the mafacture of so very many different products which the modern world needs to function. This time it's different because there are vast forces allayed against high- er prices rather than forces trying to increase the price. This time it's different because there are huge numbers of people who are buying on dips and have been doing so since the price was far lower. This time it's different because most of the big analysts have been advising against buying silver. This time it's not a small consortium or a couple invest- ors trying to manipulate the market to go higher it's millions accumulating small amounts while the cabal is issuing paper at breakneck pace. This time it's different because most of the silver in the world is paper instead of metal.
This time it's different because the demand exceeds the supply and the metal is disappearing all over the world. It's different because there are no warehouses full of metal anywhere on the planet to bring supply and de- mand into some sort of balance. It's different becaue even sharply higher prices are not increasing supply very much or significantly reducing demand It's different this time because many people are becoming more leery of the value of currencies.
This isn't to say the real value of silver must become recognized at this point in history. Anyone who has loved silver for a long time knows that patience is necessary. But it is different this time because the value of money has been allowed to exceed its true value while cartels have had their foot on the throat of silver producers and owners.
This time it's different because when the cabal fails the price will shoot higher rather than collapsing.
This time it's different because the math is indisputable. It's either inflate or cut benefits. And that's not even counting the issue of unfunded liabilities.
Something is going to give, and the one thing that isn't different is that the politicians will still attempt to feather their own nests in the process.
Q: Are You Printing Money? Bernanke: Not Literally
Baley, I think you're a genius. Inflation is non-existant, I agree. Let me know when you are selling metals, and which ones, and I will match it (sell also). Thanks!
<< <i>The wages have to come down. When they do then the prices of goods will also decline. >>
Sorry, the wage:cost of goods relationship is not so simple.
The biggest flaw in your statement is ignoring the impact of a weakening currency and other economic forces which cause inflation (increases in expenses, reduction in purchasing power) but have ZERO to do with wages in this country.
Oil and energy prices are a HUGE factor in the price we pay for everything we buy. If the USD continues to weaken against other currencies, oil and other commodities will continue to increase in price. Even if the US buys less because wages are lower, these are international markets and the price of oil has little to do with wages. So if energy prices continue to climb (in USD) and all else stays the same with stagnant wages, prices are going UP, not down or flat. The same argument can be made for the raw materials and other commodities. Oil is currently at $91 because of the USD, not because of world demand or consumption.
The US imports an extremely large portion of all consumer products. If the USD goes down versus most other currencies (as it has all year), particularly the Chinese yuan, will prices for US consumers go up or down? Again the prices will INCREASE, and it has nothing to do with wages. Prices on imported goods are not going any lower simply because Americans are making the same or less in wages and can't afford to buy as much.
A TV set costs what it does not because of how much Americans make, but because of the costs to acquire the raw materials to make it, the labor and machines to put it together, and energy to transport it, and the retailer who sells it, the costs to market it, and what a competing set is sold for. Even if no one can suddenly afford a $1000 TV doesn't mean that the price of a $1000 TV will drop to some lower price. Market forces will cause the mfr to stop or reduce production, and if a mfr can no longer stay in business, then factories will close, rather than discount product below mfr cost or work for free.
Then there are taxes, which are destined to increase everywhere and for everyone in the US. If corporate taxes increse, they get passed onto the consumer which results in higher prices, but not necessarily higher wages. And you could argue that an individual tax increase is the same as either earning less or paying more for everything. Again we have prices/expenses going up, purchasing power going down with no increase in wages.
While there may be valid correlations such as you've described, inflation does not require increasing wages (or vice versa). In fact, you could argue that inflation could cause increasing wages. Who is going to work for $7/hr if it takes 1 hour to buy a loaf of bread? Most would rather logically take government aid then work for peanuts. Absent slave labor (i.e., illegal immigrants), business owners are forced to pay more for labor which gets passed on to the consumer in prices.
The residents of ZMB are probably making more today (in $ZMB) than they were a few years ago, but I think if you looked at the numbers their overall purchasing power has probably declined.
Unemployment persistently high? Wages coming down? Prices coming down? Production well below capacity? Inventories high? Consumer spending cautious? Remind us again, someone, what's inflationary about any of that?
Trillions of liquidity is still being pumped into the system. It's not going to wages. But it is going to commodity items where investors are buying in order to try and hold on to their wealth. Real wages topped off in 1973. That didn't stop inflation from hitting commodities in the later 1970's as the dollar faultered. The price inflation today in these assets is not a recent invention. It took years of currency abuse to ignite current prices. And if not for the huge pull back in summer/fall of 2008 it would have been more apparent to people that commodity prices were consistently rising from 2002-2010. The currency abuse of the 80's and 90's is what gave birth to that rise. Consumers, production, spending, etc have little to do with currency confidence as ProofCollection has shown.
Baley, I think you're a genius. Inflation is non-existant, I agree. Let me know when you are selling metals, and which ones, and I will match it (sell also). Thanks!
thanks for the high regards, PreTurb! I haven't sold my metals position yet, not even your icon
but I'll be sure to let you know
btw, did i say inflation was non-existant? prices for some things are up, others are down, just like they should be in a Market
roadrunner, how does the amount of liquidity (money?) being Pumped into the Economy compare to the amount of wealth (money) Destroyed in the real estate credit bubble pop?
roadrunner, how does the amount of liquidity (money?) being Pumped into the Economy compare to the amount of wealth (money) Destroyed in the real estate credit bubble pop?
It doesn't matter how much paper wealth has been wiped out in inflated real estate, otc derivatives, etc over the past few years. What matters is where the new money or liquidity has been going. And it certainly hasn't been going into paying wages, hiring new workers, or fighting over distressed real estate. Most of the money has been given to the big banks. And they've taken the money and used it to speculate in stocks, bonds, currencies, and commodities. The same number of people still inhabit the earth and they all need to breathe and eat. And many need to help better secure their financial futures if they have enough liquid assets to do so. In the end, it only matters that this huge amount of new liquidity is being pumped into specific sectors selected by the big banks and investment funds. If real estate is continuing to contract why should that effect fresh money being pumped into relatively tiny PM and commodity markets?
Speak of the devil....my earlier post about the "gold bubble" article (link - Don't buy gold...it's in a bubble!) and Dave Ramsey....
Just listened to Tuesdays Dave Ramsey show, and he read that entire article on his show, then, very emphatically advised people absolutely not to buy gold. Wow. He did make a pretty good argument.......but still, I'm convinced just to hold what I've got for now. I do look for knowledgeable opinions but I know its still a personal decision.
<< <i>roadrunner, how does the amount of liquidity (money?) being Pumped into the Economy compare to the amount of wealth (money) Destroyed in the real estate credit bubble pop? >>
No money was destroyed. The people who sold real estate at the inflated prices still have those dollars or spent them into the economy and they still exist.
USDA releases Jan supply/demand report, bullish for corn, wheat and soybeans and ag stocks -Update-
The USDA released another bullish report with more cuts in inventory levels and more unfavorable/untimely weather events occuring in key growing regions. U.S. corn inventory levels fell 10.5% to 785 million bushels, soybean inventory fell 15.2% to 140 million and wheat inventory levels fell 4.7% to 818 million bu.
Global corn inventory levels declined 2.3% to 127 million metric tons and overall global production expectations were cut by 4.7 million metric tons. The U.S and Argentina were the key drivers to lower global production. In the U.S., corn for ethanol usage rose 100 mln bushels, helping cut U.S. ending inventory levels not seen since the 1995/96 crop season.
Just listened to Tuesdays Dave Ramsey show, and he read that entire article on his show, then, very emphatically advised people absolutely not to buy gold. Wow. He did make a pretty good argument
I'd be interested to know what Dave Ramsey's argument for emphatically advising people not to buy gold. He must have some reason, and if you can't post what that reason was, then it doesn't make for a very interesting debate.
Q: Are You Printing Money? Bernanke: Not Literally
Now when the unions finally cave to lower wages, jobs will come back to America. We have only ourselves to blame for sending jobs overseas. Oh, The Age of Austerity. >>
i was reading that one, too. besides unemployment figures not including those who have given up looking you also have the $150k guy who spoons froth at Starbucks now. He's employed, but at minimum wage. His purchasing power...kaput, in relative terms to where he was before. this a'int over by any stretch of the idea.
No money was destroyed. The people who sold real estate at the inflated prices still have those dollars or spent them into the economy and they still exist.
True enough. The money/credit/debt changed hands. There are still trillions of MBS's sitting out there waiting to see who was the winner and who was the loser. For now, both sides of the transaction are marking those to show both sides as the winner. If everyone's house tomorrow was revalued down by 50% that wouldn't change the demand for food and other important commodities. Mortgage payments on those homes would still be the same. The only real effect is that homeowners don't feel as rich and would probably pull in their spending. But US homeowners aren't the driving force behind world commodity demand.
I'm sure Ramsey's current argument is every bit as good as the one he used back when gold was $375. Here's what Dollardude, one of Ramsey's forum disciples had to say about it back in Dec 2003. And no doubt most of this thinking is based on Ramsey's inputs. I wonder if Ramsey got his disciples out of the stock market in 2007 or let them crash and burn with everyone else in 2008??
Silver? Everyone knows my opinion on precious metals (they stink), so I would dump it all now at this price, but PLEASE don't flame me. I know I am in the minority in this forum. I was fortunate to get to go to Europe in 2000, and it cost me next to nothing (a little over $2K for 2 1/2 weeks) because the dollar was so strong. Now it is so weak. I think it will come back. When the euro came out, it was meant to be about equivalent to US$1, so it has a long road to recovery. ....yup, those PM's have sure stunk up the joint during the past 7 yrs.
<< <i>Just listened to Tuesdays Dave Ramsey show, and he read that entire article on his show, then, very emphatically advised people absolutely not to buy gold. Wow. He did make a pretty good argument
I'd be interested to know what Dave Ramsey's argument for emphatically advising people not to buy gold. He must have some reason, and if you can't post what that reason was, then it doesn't make for a very interesting debate. >>
I'd be glad to detail his advice, but I cant remember all his reasoning....I do remember he said gold's overall track record over a long period of time was not good. He says it has no intrinsic value, and the demand is driven only by peoples economic fears, etc. . Again, I listened to him on this about 4 years ago ,and sold off some of my gold when it was $650 an ounce...and it has been going up ever since. After that, I didnt even listen to Ramsey for a coupla years. Fortunately, I began buying back in before it hit $800 and I've kinda been buying a little at a time...and I have decided to hold on.
Comments
In China, Car Buyers in a Backup
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
Is a Bond Crisis Inevitable? by Patrick J. Buchanan
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>
<< <i>Once these states (starting with Michigan and California) that are so over burdened with medicare and union pensions start going bankrupt then the smelly stuff will hit the fan. >>
It will be called QE3. >>
Proof, my sigline says what's coming next.
Pension fund confiscation...ut oh
<< <i>In China, Car Buyers in a Backup >>
hitting the brakes...more a move to curb
similar article explanation for the year end surge in Beijing
roadrunner
Since no one's mentioned it (here) yet...
National Debt Tops $14 Trillion
Will this push gold up, or down? (rhetorical)
Edited to add: Don't forget to read the comments after the article.
Don't buy gold...it's in a bubble!
<< <i> I should seek out more cost effective veterinarian care instead?
roadrunner >>
Well, Veterinarians in general probably have more integrity than many MD's and they may also be smarter since they have to change gears from one physiology to another so they might become the saviors of the American health care system as government may draft veterinarians to lend a helping hand.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
Illinois Lawmakers Propose 75 Percent Income Tax Hike
January 6, 2011 10:38 PM
SPRINGFIELD, Ill. (CBS) – Gov. Pat Quinn and the leaders of both houses of the Illinois General Assembly have agreed on raising the state income tax.
If the bill passes, the plan would raise the personal income tax rate from the current 3 percent to 5.25 percent. That’s a 75 percent increase. In real dollars, that would mean if you currently owe $1,000 in taxes, next year you would owe $1,750.
Illinois Raising State Income Tax 75%
Wish we could build a fence at the border ( of Florida )
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>This will really be a boon to another failed state in the midwest
Illinois Lawmakers Propose 75 Percent Income Tax Hike
January 6, 2011 10:38 PM
SPRINGFIELD, Ill. (CBS) – Gov. Pat Quinn and the leaders of both houses of the Illinois General Assembly have agreed on raising the state income tax.
If the bill passes, the plan would raise the personal income tax rate from the current 3 percent to 5.25 percent. That’s a 75 percent increase. In real dollars, that would mean if you currently owe $1,000 in taxes, next year you would owe $1,750.
Illinois Raising State Income Tax 75%
Wish we could build a fence at the border ( of Florida ) >>
Indiana's govenor, Mitch Daniels, is inviting Illinoinians with open arms. This would be
a major boon for Indiana which still runs balanced budgets though barely and not con-
sistently.
Being in NW Indiana though which has been getting overrun with people from Illinois
for two decades now it would be harder to see the advantages. In Indianapolis the in-
flux isn't so great but here they overrun the schools and two of them on the same road
constitutes a traffic jam. We're getting close to needing vastly more infrastructure to
handle the influx and around here bridges are only good for a couple years even if they
don't fall down under construction. They won't even plow till the snow stops.
Illinois needs to fix its own problems and a massive flight away won't help. They need
to go after the fat and the waste first and then go after pay and pensions. Maybe if
they could stop the massive vote fraud in Chicago they would find out what the political
will of the people really is.
(x2,Meltdown),cajun,Swampboy,SeaEagleCoins,InYHWHWeTrust, bstat1020,Spooly,timrutnat,oilstates200, vpr, guitarwes,
mariner67, and Mikes coins
Gold and silver prices have surged over the last year as investors sought protection against inflation and volatility in currency markets. Concerns about Europe's financial system flared again Monday when Portugal's borrowing rates spiked.
"Europe's got people worried again," said George Gero, senior vice president for RBC Wealth Management in New York.
The yield on Portugal's 10-year bonds soared as high as 7.18 percent Monday. The higher yield means investors were demanding more compensation for taking on the risk of lending money to Portugal, a sign that their confidence in the government was waning. The yield fell back to 6.94 percent on speculation that the European Central Bank was buying Portuguese bonds. Yields fall when bond prices rise.
Text
(x2,Meltdown),cajun,Swampboy,SeaEagleCoins,InYHWHWeTrust, bstat1020,Spooly,timrutnat,oilstates200, vpr, guitarwes,
mariner67, and Mikes coins
<< <i>Shameless article. Talks about a bubble, talks about how even if the dollar is in the tank, just look at the other guys and that the bad news that could happen is already in the current price. Then in the last two paragraphs it tells you to buy options on SPDR for $3 just in case gold does hit its $2,300 peak. Oh well, thought the bugs might enjoy news from the other side.
Edited to add: Don't forget to read the comments after the article.
Don't buy gold...it's in a bubble! >>
----------------------------------------------------------------------------------
Hi, I'm new here, (I'm from the currency forum) and I just read the article about the bubble you posted. I have heard Dave Ramsey say the same thing, and it has me concerned. But, about 4 years ago, when gold was at $650 / OZ., Dave Ramsey convinced me gold was too volitile and not a good investment, so I sold a few ounces..at $650 only to see it rise ever since. I have great respect for Dave, but he does not like gold at all. Now, I'm not heavily invested in gold, because I'm not financially well off to start with...the economy has all but destroyed my business and means of livelihood. I have been collecting currency for a few years, and lost my ass when I had to sell off most of my collection. But what I got for my paper, I bought gold, at around 1150 an ounce. What I did was, I got 4- slabbed NGC MS62 $20 gold coins (Saints and Libs), with the theory that, if gold falls, I'll still have the numismatic value. The rest of the gold I got was just bullion Eagles. The bullion, I've bought and sold, bought and sold, every time I think it has peaked, but I'm always wrong. I know no one has a crystal ball, but I hear...and read...so many different opinions...I'm confused. I dont even know what certain terms mean, like being "bullish" or "bearish". Maybe someone can answer my questions? Thanks
<< <i>
<< <i>Shameless article. Talks about a bubble, talks about how even if the dollar is in the tank, just look at the other guys and that the bad news that could happen is already in the current price. Then in the last two paragraphs it tells you to buy options on SPDR for $3 just in case gold does hit its $2,300 peak. Oh well, thought the bugs might enjoy news from the other side.
Edited to add: Don't forget to read the comments after the article.
Don't buy gold...it's in a bubble! >>
----------------------------------------------------------------------------------
Hi, I'm new here, (I'm from the currency forum) and I just read the article about the bubble you posted. I have heard Dave Ramsey say the same thing, and it has me concerned. But, about 4 years ago, when gold was at $650 / OZ., Dave Ramsey convinced me gold was too volitile and not a good investment, so I sold a few ounces..at $650 only to see it rise ever since. I have great respect for Dave, but he does not like gold at all. Now, I'm not heavily invested in gold, because I'm not financially well off to start with...the economy has all but destroyed my business and means of livelihood. I have been collecting currency for a few years, and lost my ass when I had to sell off most of my collection. But what I got for my paper, I bought gold, at around 1150 an ounce. What I did was, I got 4- slabbed NGC MS62 $20 gold coins (Saints and Libs), with the theory that, if gold falls, I'll still have the numismatic value. The rest of the gold I got was just bullion Eagles. The bullion, I've bought and sold, bought and sold, every time I think it has peaked, but I'm always wrong. I know no one has a crystal ball, but I hear...and read...so many different opinions...I'm confused. I dont even know what certain terms mean, like being "bullish" or "bearish". Maybe someone can answer my questions? Thanks >>
Wish I could give you some definitive answers... but it remains a guessing game. We place our bets as we see fit and hope they work out. IMO though it looks like a no brainer though for gold and silver, at least for a portion of ones portfolio.
You are in the right forum... stick around and keep reading hear and you will be up to speed in no time!
Sorry, Beatles fan but I don't see a question in your post. Did you have one?
Well, there are 110 fairly well known gold "bug" analysts who think gold is headed to $2500+. I guess it's possible they will all be proven wrong, all 110 of them. But these are the same guys that were calling for $1,000+ gold 4-8 years ago. When real interest rates are once again positive, the QE's are gone, $600 TRILL in otc derivatives is resolved, and cities, states and nations no longer have crushing debt issues....then gold's time will be over. Probably every asset class in the world is going through bubble stages but the source of the expansion always points back to fiat and debt.
What 110 gold analysts have predicted
Dave Ramsey was paraded around here back in 2004 by former member Dollardude. Ramsey was predicting new highs for stocks by 2006 and poor results for gold. At least Ramsey wasn't that far off on his stock prediction but was miles off on gold. I wonder if he saw the decline from October 2007 coming and got his clients out of stocks for the remainder of 2008. Something tells me that answer to that question was no. Ramsey should well know that "gold's volatility" comes directly from volatility in fiat currencies. When fiat currencies are no longer abused and hopefully backed by something other than promises, then gold's volatility will disappear as well. Gold simply mirrors the extreme volatility in fiat. Fiat is the fuel while gold is simply the flames showing the outcome.
roadrunner
<< <i>Well, there are 110 fairly well known gold "bug" analysts who think gold is headed to $2500+. I guess it's possible they will all be proven wrong, all 110 of them. But these are the same guys that were calling for $1,000+ gold 4-8 years ago. When real interest rates are once again positive, the QE's are gone, $600 TRILL in otc derivatives is resolved, and cities, states and nations no longer have crushing debt issues....then gold's time will be over. >>
When you talk about this kind of thing you have to provide a timeframe. I'm 100% confident that given enough time, gold will be $2500. It may be 20 years from now, but eventually I'll be right...
US Fiat vs gold - long term chart (click chart to expand)
That's how the dollar has held up against gold over the past 9 yrs. Note that the Dollar index chart looks much more prettier/bullish that this one. But this one is more realistic showing an 87% loss of value against gold. If one was looking at the USDX chart they would see "only" a 33% drop in the index over the past 9 years (ie how much our fiat has dropped against other competing fiat currencies).
roadrunner
Think Bull in a china shop, tearing everything to shreds. Bullish means that people are charging forward with their investment in one product or another. The opposite of Bear, as in sleeping bear in hybernation. Bear means that nothing is moving, no body is buying anything. The Wall Street icon is a bear and a bull fighting. The yin and yang of investments. Folk that are bullish on gold are optimistic that it will rise in price. Edited to add that a bull thrusts it's horns up when charging and a bear claws it's prey down so bull is up and bear is down...
"...I'd like some opinions here about this "bubble" thing"
A bubble means that a product has been priced well beyond its value. Example of the housing bubble is that homes were selling for much more than they should have out of speculation of even higher prices in the future. The bubble was that they were priced well beyond their real value. Bubble alludes to the idea of the soap bubble bursting and then you are left with nothing. The idea of a gold bubble is that it has been priced beyond its real value and at some point the price will fall.
Realize that there are a number of forces in play when you consider gold as an investment. In the media particularly, you have the bull camp and the bear camp. The bulls have been running the gold show for a number of years, pulling money away from paper assets like the stock market, mutual funds, 401K's, and other paper investments and this is not good for the paper products people. Most stock market individual investors lost a fair amount of their investments a couple of years ago, on the order of 40% of their investments, and since have retreated into more secure investments like gold, silver, land, and other vehicles. Once the market began collapsing, the nasty underbelly of programmed trading, derivitives, fractional ownerships, all the new gimmicks that are in play with the paper markets became exposed and folk took what little money they had left even to the point of cashing out the 401's and IRA's to buy more predictable investments.
There is a very strong push by many entities with a vested interest to get individual investor money back into the market and to accomplish this there is a constant media drumming of how bad gold, land, commodities, currencies, are and how they are all in a bubble and they are all doomed because the only real way to invest money is in the stock market. Most folks think of the old mantra "Fool me once, shame on you, fool me twice, it's my fault." and will have nothing to do with buy and hold investments in the stock market. So, now we have the "Gold is in a bubble" crowd. They want your money in their paper products and out of gold. No body makes money off of you if you have your money in gold so they have to keep you away from gold and get your money into their paper or they can't make a living off of you. They are certainly not looking out for your interests with their advice...they are looking out for their interests.
Just my opinion, and that's what you asked for. Don't look for investment advice in this thread, you won't find it. What you will find is plenty of well studied opinions and some wild assed guesses. Do your own due dilligence and if you are really interested, do some reading, follow some of the links posted here and have an opinion of your own that is based on fact and perception.
Thanks for the replies
Source: Business Dictionary
fiat currency
Definition
Common type of currency issued by official order, and whose value is based on the issuing authority's guarantee to pay the stated (face) amount on demand, and not on any intrinsic worth or extrinsic backing. All national currencies in circulation, issued and managed by the respective central banks, are fiat currencies.
Every one of the responses to your posts has been dead-on, by exactly the guys who can give you a good understanding. In many instances, when someone indicates that they are "bullish" or "bearish" it may very well mean that they have something to sell you. If you learn the basics for investing and start by making your own decisions then you are ahead of 90% of the people. Right or wrong, if you can take responsibility for your own mistakes and your own successes, then you will learn faster.
The economic environment has been altered from what it used to be, and it may never go back. Most of the people in this forum have an interest in precious metals because precious metals have been proven and continue to be proven as a way to keep from losing what you have earned. It is said that gold is a "store of wealth", which is a very accurate concept that describes what gold does. It can be a trading vehicle like any other financial asset, but it's main attraction is that it is resistant to bad governmental policy, i.e. - money creation and overspending by government.
My advice - use precious metals not as a trading vehicle, but as a piggy bank, or like you would have once used a Savings & Loan account. If you someday have most of your financial obligations "under control", then it's always a challenge to do some trading for fun & profit. Don't buy gold unless you can hold it for at least 1 year. Chances are, you might want to keep accumulating it anyway instead of selling it in a year.
I recommend thinking of your holdings in terms of ounces, instead of dollars. The dollar price for gold doesn't matter, unless there is a cataclysmic change of some sort. Until then, the dollar is the problem - not gold. Remember that. There will undoubtedly come a day when the price of gold goes down, in dollars, yen, francs, marks, or yuans. The difference is that gold will still be gold long after those fiat paper currencies have devalued all the way to 0.00000000000000000001. That is what happens EVERY time. Good Luck!
I knew it would happen.
a large, long term rise in value, outpacing other investments
the belief that the current, asympotal trend line can be extended indefinitely
the widespread idea that "this time it's different" fundamentally, so that the asset can't decline
the concept that every drop in price or "correction" is a "buying opportunity"
angry opposition to anyone suggesting caution at these prices or suggesting that a decline is possible
Again and again we have seen it, recently in dot-com stocks and real estate, but in prior generations, in tech stocks, in real estate, in beanie babies, in metals, in auto stocks, in telephone stocks, in photography stocks, in real estate, in railroad stocks, in metals, in shipping stocks, in tulip bulbs..
Liberty: Parent of Science & Industry
Now when the unions finally cave to lower wages, jobs will come back to America. We have only ourselves to blame for sending jobs overseas. Oh, The Age of Austerity.
Knowledge is the enemy of fear
If by this you mean Wall street & Washington DC crowd I agree.
The wages have to come down. When they do then the prices of goods will also decline.
Remind us again, someone, what's inflationary about any of that?
Liberty: Parent of Science & Industry
8000 dollars for buying a house, 4000 for buying a new car, extended unemployment benefits, 0% fed rates, more tax cuts even in the face of crushing deficits, saving bankrupt car companies and insolvent banks is not economicaly sound.
two rounds of quantative easing ...and perhaps more to follow ( election time will come soon enough)
I think Cohock might be right in a pure economics setting, however Washington will keep messing around with free markets and one day they might simply go too far, think that they can control it, twist it to their needs and finally they will start beliving that they are impervious to market forces and then they will really mess things up.
History teaches us that human arrogance towards free market forces always ends up the loser.
Groucho Marx
<< <i>The reason some investors use the term bubble for metals prices is because they've seen this pattern before:
a large, long term rise in value, outpacing other investments
the belief that the current, asympotal trend line can be extended indefinitely
the widespread idea that "this time it's different" fundamentally, so that the asset can't decline
the concept that every drop in price or "correction" is a "buying opportunity"
angry opposition to anyone suggesting caution at these prices or suggesting that a decline is possible
Again and again we have seen it, recently in dot-com stocks and real estate, but in prior generations, in tech stocks, in real estate, in beanie babies, in metals, in auto stocks, in telephone stocks, in photography stocks, in real estate, in railroad stocks, in metals, in shipping stocks, in tulip bulbs.. >>
This time people have been warning that this time it's different since
silver was at $4 per ounce. This time it is different. This time there's
less silver in the world than there has been in hundreds of years and
never before has it been of critical importance in the mafacture of so
very many different products which the modern world needs to function.
This time it's different because there are vast forces allayed against high-
er prices rather than forces trying to increase the price. This time it's
different because there are huge numbers of people who are buying on
dips and have been doing so since the price was far lower. This time it's
different because most of the big analysts have been advising against
buying silver. This time it's not a small consortium or a couple invest-
ors trying to manipulate the market to go higher it's millions accumulating
small amounts while the cabal is issuing paper at breakneck pace. This
time it's different because most of the silver in the world is paper instead
of metal.
This time it's different because the demand exceeds the supply and the
metal is disappearing all over the world. It's different because there are no
warehouses full of metal anywhere on the planet to bring supply and de-
mand into some sort of balance. It's different becaue even sharply higher
prices are not increasing supply very much or significantly reducing demand
It's different this time because many people are becoming more leery of
the value of currencies.
This isn't to say the real value of silver must become recognized at this
point in history. Anyone who has loved silver for a long time knows that
patience is necessary. But it is different this time because the value of
money has been allowed to exceed its true value while cartels have had
their foot on the throat of silver producers and owners.
This time it's different because when the cabal fails the price will shoot higher
rather than collapsing.
I don't recall who said that here. Please refresh my memory.
I knew it would happen.
Something is going to give, and the one thing that isn't different is that the politicians will still attempt to feather their own nests in the process.
I knew it would happen.
<< <i>The wages have to come down. When they do then the prices of goods will also decline. >>
Sorry, the wage:cost of goods relationship is not so simple.
The biggest flaw in your statement is ignoring the impact of a weakening currency and other economic forces which cause inflation (increases in expenses, reduction in purchasing power) but have ZERO to do with wages in this country.
Oil and energy prices are a HUGE factor in the price we pay for everything we buy. If the USD continues to weaken against other currencies, oil and other commodities will continue to increase in price. Even if the US buys less because wages are lower, these are international markets and the price of oil has little to do with wages. So if energy prices continue to climb (in USD) and all else stays the same with stagnant wages, prices are going UP, not down or flat. The same argument can be made for the raw materials and other commodities. Oil is currently at $91 because of the USD, not because of world demand or consumption.
The US imports an extremely large portion of all consumer products. If the USD goes down versus most other currencies (as it has all year), particularly the Chinese yuan, will prices for US consumers go up or down? Again the prices will INCREASE, and it has nothing to do with wages. Prices on imported goods are not going any lower simply because Americans are making the same or less in wages and can't afford to buy as much.
A TV set costs what it does not because of how much Americans make, but because of the costs to acquire the raw materials to make it, the labor and machines to put it together, and energy to transport it, and the retailer who sells it, the costs to market it, and what a competing set is sold for. Even if no one can suddenly afford a $1000 TV doesn't mean that the price of a $1000 TV will drop to some lower price. Market forces will cause the mfr to stop or reduce production, and if a mfr can no longer stay in business, then factories will close, rather than discount product below mfr cost or work for free.
Then there are taxes, which are destined to increase everywhere and for everyone in the US. If corporate taxes increse, they get passed onto the consumer which results in higher prices, but not necessarily higher wages. And you could argue that an individual tax increase is the same as either earning less or paying more for everything. Again we have prices/expenses going up, purchasing power going down with no increase in wages.
While there may be valid correlations such as you've described, inflation does not require increasing wages (or vice versa). In fact, you could argue that inflation could cause increasing wages. Who is going to work for $7/hr if it takes 1 hour to buy a loaf of bread? Most would rather logically take government aid then work for peanuts. Absent slave labor (i.e., illegal immigrants), business owners are forced to pay more for labor which gets passed on to the consumer in prices.
The residents of ZMB are probably making more today (in $ZMB) than they were a few years ago, but I think if you looked at the numbers their overall purchasing power has probably declined.
Remind us again, someone, what's inflationary about any of that?
Trillions of liquidity is still being pumped into the system. It's not going to wages. But it is going to commodity items where investors are buying in order to try and hold on to their wealth. Real wages topped off in 1973. That didn't stop inflation from hitting commodities in the later 1970's as the dollar faultered. The price inflation today in these assets is not a recent invention. It took years of currency abuse to ignite current prices. And if not for the huge pull back in summer/fall of 2008 it would have been more apparent to people that commodity prices were consistently rising from 2002-2010. The currency abuse of the 80's and 90's is what gave birth to that rise. Consumers, production, spending, etc have little to do with currency confidence as ProofCollection has shown.
roadrunner
thanks for the high regards, PreTurb! I haven't sold my metals position yet, not even your icon
but I'll be sure to let you know
btw, did i say inflation was non-existant? prices for some things are up, others are down, just like they should be in a Market
Liberty: Parent of Science & Industry
Liberty: Parent of Science & Industry
It doesn't matter how much paper wealth has been wiped out in inflated real estate, otc derivatives, etc over the past few years. What matters is where the new money or liquidity has been going. And it certainly hasn't been going into paying wages, hiring new workers, or fighting over distressed real estate. Most of the money has been given to the big banks. And they've taken the money and used it to speculate in stocks, bonds, currencies, and commodities. The same number of people still inhabit the earth and they all need to breathe and eat. And many need to help better secure their financial futures if they have enough liquid assets to do so. In the end, it only matters that this huge amount of new liquidity is being pumped into specific sectors selected by the big banks and investment funds. If real estate is continuing to contract why should that effect fresh money being pumped into relatively tiny PM and commodity markets?
roadrunner
Just listened to Tuesdays Dave Ramsey show, and he read that entire article on his show, then, very emphatically advised people absolutely not to buy gold. Wow. He did make a pretty good argument.......but still, I'm convinced just to hold what I've got for now. I do look for knowledgeable opinions but I know its still a personal decision.
<< <i>roadrunner, how does the amount of liquidity (money?) being Pumped into the Economy compare to the amount of wealth (money) Destroyed in the real estate credit bubble pop? >>
No money was destroyed. The people who sold real estate at the inflated prices still have those dollars or spent them into the economy and they still exist.
The USDA released another bullish report with more cuts in inventory levels and more unfavorable/untimely weather events occuring in key growing regions. U.S. corn inventory levels fell 10.5% to 785 million bushels, soybean inventory fell 15.2% to 140 million and wheat inventory levels fell 4.7% to 818 million bu.
Global corn inventory levels declined 2.3% to 127 million metric tons and overall global production expectations were cut by 4.7 million metric tons. The U.S and Argentina were the key drivers to lower global production. In the U.S., corn for ethanol usage rose 100 mln bushels, helping cut U.S. ending inventory levels not seen since the 1995/96 crop season.
Knowledge is the enemy of fear
I'd be interested to know what Dave Ramsey's argument for emphatically advising people not to buy gold. He must have some reason, and if you can't post what that reason was, then it doesn't make for a very interesting debate.
I knew it would happen.
<< <i>To an extent rarely seen in recessions since the Great Depression, wages for a swath of the labor force this time have taken a sharp and swift fall.
Now when the unions finally cave to lower wages, jobs will come back to America. We have only ourselves to blame for sending jobs overseas. Oh, The Age of Austerity. >>
i was reading that one, too. besides unemployment figures not including those who have given up looking you also have the $150k guy who spoons froth at Starbucks now. He's employed, but at minimum wage. His purchasing power...kaput, in relative terms to where he was before. this a'int over by any stretch of the idea.
True enough. The money/credit/debt changed hands. There are still trillions of MBS's sitting out there waiting to see who was the winner and who was the loser. For now, both sides of the transaction are marking those to show both sides as the winner. If everyone's house tomorrow was revalued down by 50% that wouldn't change the demand for food and other important commodities. Mortgage payments on those homes would still be the same. The only real effect is that homeowners don't feel as rich and would probably pull in their spending. But US homeowners aren't the driving force behind world commodity demand.
I'm sure Ramsey's current argument is every bit as good as the one he used back when gold was $375. Here's what Dollardude, one of Ramsey's forum disciples had to say about it back in Dec 2003. And no doubt most of this thinking is based on Ramsey's inputs. I wonder if Ramsey got his disciples out of the stock market in 2007 or let them crash and burn with everyone else in 2008??
Silver? Everyone knows my opinion on precious metals (they stink), so I would dump it all now at this price, but PLEASE don't flame me. I know I am in the minority in this forum. I was fortunate to get to go to Europe in 2000, and it cost me next to nothing (a little over $2K for 2 1/2 weeks) because the dollar was so strong. Now it is so weak. I think it will come back. When the euro came out, it was meant to be about equivalent to US$1, so it has a long road to recovery. ....yup, those PM's have sure stunk up the joint during the past 7 yrs.
roadrunner
Ill. faces 66 percent tax boost amid budget crisis
Ill. faces 66 percent tax boost amid budget crisis
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>Just listened to Tuesdays Dave Ramsey show, and he read that entire article on his show, then, very emphatically advised people absolutely not to buy gold. Wow. He did make a pretty good argument
I'd be interested to know what Dave Ramsey's argument for emphatically advising people not to buy gold. He must have some reason, and if you can't post what that reason was, then it doesn't make for a very interesting debate. >>
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I'd be glad to detail his advice, but I cant remember all his reasoning....I do remember he said gold's overall track record over a long period of time was not good. He says it has no intrinsic value, and the demand is driven only by peoples economic fears, etc. . Again, I listened to him on this about 4 years ago ,and sold off some of my gold when it was $650 an ounce...and it has been going up ever since. After that, I didnt even listen to Ramsey for a coupla years. Fortunately, I began buying back in before it hit $800 and I've kinda been buying a little at a time...and I have decided to hold on.