I just ask this question, and its free for everyone to answer....what will we make and who will we sell it to?
Gee, how did we ever survive before Nixon opened the China trade window? What would we do if someone closed that window? Maybe we'll do like before and sell what we make to 300+ million Americans!
2025 isn't 1965. America has priced itself out of the manufacturing business.
Blanket statements like this are not true. Labor costs and regulatory compliance are the main cost savings for overseas manufacturing, but not all manufacturing requires a lot of labor, most of it is (or can be) highly automated and thus doing it in the US does not cost that much more on a per unit basis. And don't forget there are other offsets, such as shipping and lead times, quality control, and loss of IP. It will or would be a lot easier for the US to sell goods to other country if they didn't tariff our exports, but I bet, for example, Europe might buy a few more American cars if they were priced equivalently to the European models.
We are a country of excess, we have everything we need. Other than replacement, demand for goods is negligible.
I must not understand what you're saying. Why do we import so much then?
That's why we are a service economy- We even import labor to mow our lawns.
The US, like most countries, has work visas for every level of labor such as engineering and doctors, not just landscaping. What's your point? Foreign labor is brought in to compete with domestic labor and keep costs down, not because it isn't available.
Foreign countries will not want our automobiles. We will not build plastic or rubber factories here.
Why would other countries not buy our cars if they did not have tariff surcharges on them? I do believe that's why the tariffs are there to begin with - so foreign markets do not have to compete with US cars. right?
If the economics make sense, the plastic and rubber factories will be back. Any company would prefer to eliminate the logistics nightmare of a vulnerable foreign supply chain if the economics make sense.
Sure, we can build iPhones--if we can find the labor since half of America has a 6th grade or lower reading comprehension level-- and (maybe) sell them to Americans at 50% more, but other countries won't pay that price.
Sounds like the perfect employee to perform assembly work. But regardless, do you really think labor is a large part of the cost of an iPhone? I'm pretty sure most of it is automated. Apple CEO Tim Cook has said that the reason they make the iphone in China (Taiwan) is not labor costs, where workers are paid $10-27/hr. I seriously doubt the having Americans assemble the phones would lead to more than $50 in increased cost on a $1000 item. What's it worth to know that the next time international tempers flare that we can still get new phones? Let's not forget that higher costs don't come without extra value.
It would be great to have skilled, high paying manufacturing jobs here but the final product cost would be prohibitive to the rest of the world. Business cannot grow if it is limited to its own community. The rest of the world will trade among itself and American will fail.
The world is tired of buying US paper. Tariffs imposed by other markets have lead to the US being only able to sell to "its own community" but his may be about to change.
So how would that AFFECT gold price in the USA?
A stronger US dollar would mean lower US dollar gold prices and products that are expensive for other countries to buy, but a weak US dollar makes US good more affordable. That's why policy changes have to be viewed in context.
The DXY has broken support and is headed to ~88, which probably means higher gold prices still coming.
With your permission we can move this discussion to the current economy thread so as to not derail your thread further.
@ProofCollection said:
To each his own, but if you are a stacker, extreme values are a great time to switch from one metal to another. You >can do quite well doing that.
Who says that the "extreme values" are in fact that....based on historical ratios ?
So far, these "values" have persisted for DECADES and it appears that the current prices are the New Normal, not the prices in the past.
Even if they do revert back to historical means, it could be years or decades. The DJIA used to swing between 3% (sell) and 6% (buy) dividend yields to indicate whether you should buy or sell stocks..... but hasn't done that in 40+ years.
@ProofCollection said:
To each his own, but if you are a stacker, extreme values are a great time to switch from one metal to another. You >can do quite well doing that.
Who says that the "extreme values" are in fact that....based on historical ratios ?
So far, these "values" have persisted for DECADES and it appears that the current prices are the New Normal, not the prices in the past.
Even if they do revert back to historical means, it could be years or decades. The DJIA used to swing between 3% (sell) and 6% (buy) dividend yields to indicate whether you should buy or sell stocks..... but hasn't done that in 40+ years.
I never said that. It's never easy to identify when you are in the middle of it, but certainly at these two historical points one could have guessed the ratio was at an inflection point. Certainly if Silver gets down below 30:1 it's time to start thinking about making the move. It's a little harder on the other side because the sky is the limit.
@ProofCollection said:
Platinum is another interesting case. Who knows how much further it can go but trading gold for Platinum is >probably not a bad deal here at 3.6:1.
If catalytics goes bye-bye as ICE melts away....the WMG go back to $500 each by 2035.
@jmski52 said:
I see the mother of all blowoffs coming in the future. Problem is, there's no way to know from what level it will >occur.
In other words, you don't see the mother of any blowoffs.
Without timing, the prediction is useless.
While technically true, there are topping indicators that one can use to indicate when you're near a top. Trying to time a pattern reversal (top or bottom) is a fool's errand, but ideally you'll have been a long term holder and you take profits. So while you wouldn't necessarily want to take all of your gold and put it in platinum right now, 10% now and maybe another 10% in a few months and so on and so on might make sense, if you believe the ratio will return to where it's been. If you look at the fundamentals of platinum being more rare than gold and primarily sourced from volatile and unreliable locations, it's probably one of the better bets you can make. At some point people will look at $4k or $5k gold (or higher and say 'what else could I be buying instead? I see a ~$1700 target for platinum (not sure on timing), but that imputes $5k gold if ratio stays where it's at or much higher if the ratio continues to deteriorate. Consider also that the DXY has lost roughly 15% and Plat and Palladium have yet to make any kind of a move.
2011 when silver ran up fast is the closest thing I can liken this to. This run has been going on for many months though. I'm not a technical guy but wow. USD down, demand up and what else?
I'm beginning to think we'll never see $3,000 again.
In other words, you don't see the mother of any blowoffs.
Yes, I do. And the reason that it's hard to predict is because we've reached uncharted territory in a record short amount of time. Volatility is the result of uncertainty. That also doesn't mean that the fundamentals have reached full fruition. A blowoff in this kind of rising market is only temporary any way. It means that the fits and starts are unpredictable, and to me that equates to a high probability of a major blowoff, after which - the dust settles for awhile.
Without timing, the prediction is useless.
I've seen how you hedge your predictions, so don't give me that know-it-all malarky.
I don't count my chickens before they are hatched. I tend to agree with ProofCollection, that gold hasn't reached the mania phase yet, and if the banking surveys are somewhat accurate, it will take central banks another 2 years to reach the optimum level of 30% reserves in gold. That leaves a lot of time for the market to reach a high level of exuberance.
Human nature being what it is, a lot can happen in the meantime, notwithstanding the debt financing problems worldwide and geopolitics to mention a couple of big ones.. The blowoff could happen at $3,500. It could happen at $5,500. It could happen at much higher levels. Nobody really knows, period.
Q: Are You Printing Money? Bernanke: Not Literally
@ProofCollection said:
If you look at the fundamentals of platinum being more rare than gold and primarily sourced from volatile and >unreliable locations, it's probably one of the better bets you can make. At some point people will look at $4k or $5k >gold (or higher and say 'what else could I be buying instead? I see a ~$1700 target for platinum (not sure on timing), >but that imputes $5k gold if ratio stays where it's at or much higher if the ratio continues to deteriorate. Consider >also that the DXY has lost roughly 15% and Plat and Palladium have yet to make any kind of a move.
The problem is that the previous big moves in the WMG's was tied to ICE auto demand. That is falling. Gold is up almost 50% in the last year while the WMGs are flattish.
I think there's a fundamental revaluation going on. At a minimum they need until 2030 to "burn off" the excesses of the bubble moves they each made going back to the 1990's, IMO.
@VanHalen said:
2011 when silver ran up fast is the closest thing I can liken this to. This run has been going on for many months though. I'm not a technical guy but wow. USD down, demand up and what else?
I'm beginning to think we'll never see $3,000 again.
I think we could see $2800 again as the charts always fine a reason to re-test previous resistance levels. Always. Could be Deutch bank finally going bust, or volcanoes in Italy, or potentially a positive market announcement/development.
@ProofCollection said:
If you look at the fundamentals of platinum being more rare than gold and primarily sourced from volatile and >unreliable locations, it's probably one of the better bets you can make. At some point people will look at $4k or $5k >gold (or higher and say 'what else could I be buying instead? I see a ~$1700 target for platinum (not sure on timing), >but that imputes $5k gold if ratio stays where it's at or much higher if the ratio continues to deteriorate. Consider >also that the DXY has lost roughly 15% and Plat and Palladium have yet to make any kind of a move.
The problem is that the previous big moves in the WMG's was tied to ICE auto demand. That is falling. Gold is up almost 50% in the last year while the WMGs are flattish.
I'm not sure that's relevant. Here's the past and predicted platinum supply deficit from the world platinum council. Where's the platinum going to come from?
From Marketwatch. With “no viable alternative,” the dollar will “likely remain the reserve asset of choice — just at a much cheaper price. All roads currently lead to a weaker dollar, especially if the increasing hostile global negotiation climate forces the Fed to become the marginal buyer of U.S. debt once again — which certainly can’t be ruled out,” This could lead to $4,000 gold if the Fed has a new boss and objectives. Still the BRICS and naysayers still use the weakened dollar for trade.
Rock bottom premiums are a result of high prices, just as in 2011.
Premiums will rise as physical metal becomes harder to source (for multiple reasons). Higher prices simply reflect the decline in purchasing power of all of the fiat currencies and their associated bonds & other forms of debt.
Q: Are You Printing Money? Bernanke: Not Literally
@jmski52 said:
Rock bottom premiums are a result of high prices, just as in 2011._
Premiums will rise as physical metal becomes harder to source (for multiple reasons). Higher prices simply reflect >the decline in purchasing power of all of the fiat currencies and their associated bonds & other forms of debt.
@jmski52 said:
I see the mother of all blowoffs coming in the future. Problem is, there's no way to know from what level it will occur.
The fun part is that the mania hasn't even started. There's zero mania as evidenced by rock bottom premiums.
Rock bottom premiums are a result of high prices, just as in 2011.
Not really. Gold is divisible. People don't have to buy full ounces. It's more a lack of retail demand. Just as in previous manias, premiums explode for consumer sizes while industrial sized bars are plentiful. Today we have the opposite.
edited to add: Record ETF gold inflows suggest that gold is not "too expensive."
Gold - Is it different this time? We don't think so. Gold is 27% above its 200 DMA, a level only exceeded a few times (0.5% of the time) in the last 30 years and all of those saw swift pullbacks eventually touching their 200 DMAs. We have been offsides on this call of late, but continue to think it's in a blowoff phase here.
Gold - Is it different this time? We don't think so. Gold is 27% above its 200 DMA, a level only exceeded a few times (0.5% of the time) in the last 30 years and all of those saw swift pullbacks eventually touching their 200 DMAs. We have been offsides on this call of late, but continue to think it's in a blowoff phase here.
I don't know about "different this time" as chart behavior is pretty reliable; however, we have to recognize that a restructuring of the world financial system is taking place so it's more possible than ever for it to be "different this time." When it's all done things aren't going to work they way they used to. In some ways worse, some ways better, but definitely different.
I think it's clear that a goal for the US is a weaker dollar because I believe it's an essential component of achieving stated goals. And a weaker dollar does mean higher gold and commodity prices.
".... We estimate that large Asian central bank buyers are likely to continue their rapid gold purchases for another 3-6 years to reach our estimated range of potential gold reserve targets.Our base case forecast assumes speculative positioning normalizes from current elevated levels (85th percentile), while the top end of our price range reflects persistently stretched positioning amid heightened uncertainty. Medium-term price risks remain skewed to the upside, and we illustrate how, in tail-risk scenarios, gold can exceed $4,200/toz by end-2025."
".... We estimate China’s gold reserves by anchoring to the last major update in June 2015, when authorities disclosed a cumulative puchase of 604 tonnes over prior years, putting their gold reserves at 1720 tonnes. We then estimated monthly additions since June 2015 based on our nowcast of China central bank purchases. The first round of sanctions on Russia in 2014 led to a gold reserve buildup as the Central Bank of Russia anticipated scenarios similar to those in Libya and Iran, with a member of the board of governors noting that gold cannot be ‘arrested or frozen’.
We think the build up is likely to be gradual. As the then deputy governor of the PBOC acknowledged already in 2013, the gold market is too small to absorb a large-scale buildup without significant price disruptions ."
@jmski52 said: Rock bottom premiums are a result of high prices, just as in 2011.
Premiums will rise as physical metal becomes harder to source (for multiple reasons).
Actually, the higher the price the easier the sourcing.
I believe economic theory says that in an efficient market the price will change such as to maintain availability so sourcing should always have the same ease. Higher prices will draw out supply (encouraging selling) while lower prices will suppress selling (discouraging selling). Prices are changed to get the desired increase or decrease in supply. With PMs there seem to be two markets (bulk market and the retail market) that seem to operate somewhat independently.
Comments
With your permission we can move this discussion to the current economy thread so as to not derail your thread further.
Knowledge is the enemy of fear
$3,400
futures hit 3434.7
Who says that the "extreme values" are in fact that....based on historical ratios ?
So far, these "values" have persisted for DECADES and it appears that the current prices are the New Normal, not the prices in the past.
Even if they do revert back to historical means, it could be years or decades. The DJIA used to swing between 3% (sell) and 6% (buy) dividend yields to indicate whether you should buy or sell stocks..... but hasn't done that in 40+ years.
I never said that. It's never easy to identify when you are in the middle of it, but certainly at these two historical points one could have guessed the ratio was at an inflection point. Certainly if Silver gets down below 30:1 it's time to start thinking about making the move. It's a little harder on the other side because the sky is the limit.
http://ProofCollection.Net
Platinum is another interesting case. Who knows how much further it can go but trading gold for Platinum is probably not a bad deal here at 3.6:1.
http://ProofCollection.Net
I see the mother of all blowoffs coming in the future. Problem is, there's no way to know from what level it will occur.
I knew it would happen.
The fun part is that the mania hasn't even started. There's zero mania as evidenced by rock bottom premiums.
http://ProofCollection.Net
The fun part is that the mania hasn't even started. There's zero mania as evidenced by rock bottom premiums.
You should update the thread title. $3,300 is so yesterday.
I knew it would happen.
I'm not allowed to for another week, it's part of my punishment.
http://ProofCollection.Net
Blowoffs? What is a blowoff?
If catalytics goes bye-bye as ICE melts away....the WMG go back to $500 each by 2035.
and, if someone... anyone in jail breaks the rules while in jail, there will be no erasing the tracks
In other words, you don't see the mother of any blowoffs.
Without timing, the prediction is useless.
we're all ... rich?
i need farmland. going to be the cheap way to feed the family and a piece of land with future demand
While technically true, there are topping indicators that one can use to indicate when you're near a top. Trying to time a pattern reversal (top or bottom) is a fool's errand, but ideally you'll have been a long term holder and you take profits. So while you wouldn't necessarily want to take all of your gold and put it in platinum right now, 10% now and maybe another 10% in a few months and so on and so on might make sense, if you believe the ratio will return to where it's been. If you look at the fundamentals of platinum being more rare than gold and primarily sourced from volatile and unreliable locations, it's probably one of the better bets you can make. At some point people will look at $4k or $5k gold (or higher and say 'what else could I be buying instead? I see a ~$1700 target for platinum (not sure on timing), but that imputes $5k gold if ratio stays where it's at or much higher if the ratio continues to deteriorate. Consider also that the DXY has lost roughly 15% and Plat and Palladium have yet to make any kind of a move.
http://ProofCollection.Net
$3475 has been passed
kitco hit 3475
$3500 on APMEX.
http://ProofCollection.Net
daily chart YTD
the blue line is open interest
just for you derryb: we're at 350,000 contracts of open interest
note open interest was more earlier in the previous contract month
i'm not posting a lot. things are changing that fast
2011 when silver ran up fast is the closest thing I can liken this to. This run has been going on for many months though. I'm not a technical guy but wow. USD down, demand up and what else?
I'm beginning to think we'll never see $3,000 again.
In other words, you don't see the mother of any blowoffs.
Yes, I do. And the reason that it's hard to predict is because we've reached uncharted territory in a record short amount of time. Volatility is the result of uncertainty. That also doesn't mean that the fundamentals have reached full fruition. A blowoff in this kind of rising market is only temporary any way. It means that the fits and starts are unpredictable, and to me that equates to a high probability of a major blowoff, after which - the dust settles for awhile.
Without timing, the prediction is useless.
I've seen how you hedge your predictions, so don't give me that know-it-all malarky.
I don't count my chickens before they are hatched. I tend to agree with ProofCollection, that gold hasn't reached the mania phase yet, and if the banking surveys are somewhat accurate, it will take central banks another 2 years to reach the optimum level of 30% reserves in gold. That leaves a lot of time for the market to reach a high level of exuberance.
Human nature being what it is, a lot can happen in the meantime, notwithstanding the debt financing problems worldwide and geopolitics to mention a couple of big ones.. The blowoff could happen at $3,500. It could happen at $5,500. It could happen at much higher levels. Nobody really knows, period.
I knew it would happen.
The problem is that the previous big moves in the WMG's was tied to ICE auto demand. That is falling. Gold is up almost 50% in the last year while the WMGs are flattish.
I think there's a fundamental revaluation going on. At a minimum they need until 2030 to "burn off" the excesses of the bubble moves they each made going back to the 1990's, IMO.
I think we could see $2800 again as the charts always fine a reason to re-test previous resistance levels. Always. Could be Deutch bank finally going bust, or volcanoes in Italy, or potentially a positive market announcement/development.
I'm not sure that's relevant. Here's the past and predicted platinum supply deficit from the world platinum council. Where's the platinum going to come from?
http://ProofCollection.Net
Reckless faith in the dollar's strength is reckless. Tariff proposals have demonstrated this.
Sing it with me: "God Bless the Metal of the Kings". RGDS!
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
Rock bottom premiums are a result of high prices, just as in 2011.
Knowledge is the enemy of fear
From Marketwatch. With “no viable alternative,” the dollar will “likely remain the reserve asset of choice — just at a much cheaper price. All roads currently lead to a weaker dollar, especially if the increasing hostile global negotiation climate forces the Fed to become the marginal buyer of U.S. debt once again — which certainly can’t be ruled out,” This could lead to $4,000 gold if the Fed has a new boss and objectives. Still the BRICS and naysayers still use the weakened dollar for trade.
My US Mint Commemorative Medal Set
Rock bottom premiums are a result of high prices, just as in 2011.
Premiums will rise as physical metal becomes harder to source (for multiple reasons). Higher prices simply reflect the decline in purchasing power of all of the fiat currencies and their associated bonds & other forms of debt.
I knew it would happen.
Asteroid impact, meteor strike....
I worked for DB. They suck, but they're not going bust.
Numismatic premiums are fading.
Not really. Gold is divisible. People don't have to buy full ounces. It's more a lack of retail demand. Just as in previous manias, premiums explode for consumer sizes while industrial sized bars are plentiful. Today we have the opposite.
edited to add: Record ETF gold inflows suggest that gold is not "too expensive."
http://ProofCollection.Net
Latest RBC comments:
From BTIG:
Gold - Is it different this time? We don't think so. Gold is 27% above its 200 DMA, a level only exceeded a few times (0.5% of the time) in the last 30 years and all of those saw swift pullbacks eventually touching their 200 DMAs. We have been offsides on this call of late, but continue to think it's in a blowoff phase here.
I don't know about "different this time" as chart behavior is pretty reliable; however, we have to recognize that a restructuring of the world financial system is taking place so it's more possible than ever for it to be "different this time." When it's all done things aren't going to work they way they used to. In some ways worse, some ways better, but definitely different.
I think it's clear that a goal for the US is a weaker dollar because I believe it's an essential component of achieving stated goals. And a weaker dollar does mean higher gold and commodity prices.
http://ProofCollection.Net
From GS:
".... We estimate that large Asian central bank buyers are likely to continue their rapid gold purchases for another 3-6 years to reach our estimated range of potential gold reserve targets. Our base case forecast assumes speculative positioning normalizes from current elevated levels (85th percentile), while the top end of our price range reflects persistently stretched positioning amid heightened uncertainty. Medium-term price risks remain skewed to the upside, and we illustrate how, in tail-risk scenarios, gold can exceed $4,200/toz by end-2025."
A weaker dollar is just one of several variables that influence gold. It has gone down with a falling dollar and it has gone up with a rising dollar.
Actually, the higher the price the easier the sourcing.
Knowledge is the enemy of fear
Still More from GS......
".... We estimate China’s gold reserves by anchoring to the last major update in June 2015, when authorities disclosed a cumulative puchase of 604 tonnes over prior years, putting their gold reserves at 1720 tonnes. We then estimated monthly additions since June 2015 based on our nowcast of China central bank purchases. The first round of sanctions on Russia in 2014 led to a gold reserve buildup as the Central Bank of Russia anticipated scenarios similar to those in Libya and Iran, with a member of the board of governors noting that gold cannot be ‘arrested or frozen’.
We think the build up is likely to be gradual. As the then deputy governor of the PBOC acknowledged already in 2013, the gold market is too small to absorb a large-scale buildup without significant price disruptions ."
I believe economic theory says that in an efficient market the price will change such as to maintain availability so sourcing should always have the same ease. Higher prices will draw out supply (encouraging selling) while lower prices will suppress selling (discouraging selling). Prices are changed to get the desired increase or decrease in supply. With PMs there seem to be two markets (bulk market and the retail market) that seem to operate somewhat independently.
http://ProofCollection.Net