Platinum continues to dominate gold

Weiss

Well, dominate may be too strong a term.

But it's been above gold now for a few weeks.

My gut tells me it's temporary--that gold will eclipse Pt again soon and for a long time.

But economic indicators seem to be pointing to higher industrial demand.

What do you think?

derryb

I think when the restless labor in S. Africa, where most of it is mined, settles down, so will the price.

Overdate

Platinum just slid under gold again - $1596 vs. $1598.

jmski52

My gut tells me it's temporary--that gold will eclipse Pt again soon and for a long time.

But economic indicators seem to be pointing to higher industrial demand.

What do you think?

I think that platinum has more industrial uses than gold, and that the industrial economy sucks worse than the government is letting on. I also think that investment demand for gold is strong and will continue to be strong.

It's still a toss-up, but if manufacturing ever recovers, watch out for platinum!

derryb

platinum fans need to monitor new auto sales (catalytic converters) and S. Africa labor movement (mining).

jmski52

Oh, I forgot to factor in the 10:1 scarcity ratio of platinum to gold, to which derryb alludes in mentioning S. African mining. Not only is the labor situation dire, but recovery is more difficult by the day, due to deeper mines and declining deposit concentrations.

derryb

The bulk of Platinum is mined in S. Africa.

I'm sticking with silver for best intermediate and long term gains. Short term is gonna continue to be a roller coaster.

Steve27

Platinum is 50 times more scarce than gold, so I consider it to be normal for Platinum to be higher than gold.

fivecents

Gold is now higher than Platinum. I agree Platinum is undervalued compared to gold.imho

derryb

let's not forget the other white meat, i mean metal:

Palladium Continues to Shine

OPA

<< <i>Gold is now higher than Platinum. I agree Platinum is undervalued compared to gold.imho >>



Didn't last long.

calleocho

Platinum is 50 times more scarce than gold, so I consider it to be normal for Platinum to be higher than gold.

Are you sure of this?

I am sure that there is more gold mined throught history than platinum...but is platinum actually rarer than gold?

Pokermandude

<< <i>I am sure that there is more gold mined throught history than platinum...but is platinum actually rarer than gold? >>



By a longshot. Especially if you're talking in terms of "reserves".

derryb

Platinum reserves are evidently below the minimum needed to make it a universally recognized store of value, as is the case with gold. At times "too rare" can be a bad thing.

cohodk

<< <i>let's not forget the other white meat, i mean metal:

Palladium Continues to Shine >>



$400's within 12 months.

derryb

<< <i>

<< <i>let's not forget the other white meat, i mean metal:

Palladium Continues to Shine >>



$400's within 12 months. >>


Deflation vs. Inflation - the real forum tug of war.

jmski52

It's now a "dead heat" with Gold at $1,593.80 vs. Platinum at $1,593.00.

Baley

And my money invested in PMs has been "dead money" for 2 years now, and counting

Darwin

...Well, if many moles of iridium were put into a particle accelerator, and crashed forward into a proton, for a huge waste of money(in the billions at least) we could "create" more platinum. It is possible to "change" one element into another artificially-this is how elements 93 and up were discovered/designed. Or, if gold undergoes radiometric decay...might it lose a proton-and turn into platinum?

DrBuster

<< <i>And my money invested in PMs has been "dead money" for 2 years now, and counting >>



So, just to bust your chops, you have 1 dca for the past 2 years, 1 buy for your entire egg on point, that prevents you from benefiting these quarter swings in any way whatsoever.

Baley

I'm saying almost all of my precious metals were bought 1999-2003, and they did really well for several years, but have not made any progress in the past 2 years. I keep hearing that they will make some progress someday, perhaps soon, but they have not made any progress in two years and it seems equally likely now that they will go down from here, not up, maybe down 10% 0r 20% more.

If I knew that would happen, obviously, I'd sell all my metals and then rebuy them and either also buy more or take a nice tropical vacation.

And if I was as confident that metals would rise as some on here are saying, then I'd put new money to work there, but right now metals appear fairly priced and static.

If there was some kind of temporary crisis and metals rose 10 or 20% from here, I'd consider it a gift and sell most of my bullion, favoring rare coins with the rest of my hard money money

mainly I'm bored with metals for many moons now and so are many many others, maybe posting this looking for a reason to buy some because I do like them, just seem to have enough already because it just gains and loses the same few percent over and over

jmski52

Baley, you sound as if you really don't think that metals are a store of value, or can/should be used as such.

Let's say you have a 1 oz Gold AGE that is now worth $2,000 that you bought in 2003 for $1,000. You sell it for $2,000 and rack up $1,000 in cap gains for a net tax bill of $350.

Now gold loses 20% and you re-buy the 1 ozer @ $1,600 and you still have $50 left over. Nice job.

But what if gold gains 20% from here and goes to $2,400. You have $2,000 with which to buy 0.8333 oz of gold back. Not good.

Weighing the risk/reward ratio, I see your selling the 1 ozer for a potential gain of $50 vs. a potential loss of your current position as being equivalent to a loss of $400.

The ratio of risk to reward seems to be 8:1 against churning your position. Am I wrong?

Corrected

CaptHenway

So why the divergence in the past few days since the Cyprus crisis broke?

bronco2078

I don't see much platinum locally and last week my local guy offered me a 1/4 ounce proof without packaging for $420 and I passed it up.


2 days later I stopped in to ask about it and it was gone

roadrunner

<< <i>So why the divergence in the past few days since the Cyprus crisis broke? >>




Safe haven trade (risk-off) is dollar - TBonds - gold.

Plat - Pall - Silver need not apply. At least not yet. Notice how Palladium got its butt kicked today.

jmski52

So why the divergence in the past few days since the Cyprus crisis broke?

Gold relates to money and debt issues, platinum and silver respond more to economic data, although at some point I would expect platinum and silver to take on some monetary attributes as well.

cohodk

Notice how Palladium got its butt kicked today

I think palladium has the potential to kill people this year.

cohodk

Baley, you sound as if you really don't think that metals are a store of value, or can/should be used as such

Im not going to speak for Baley, but metals--and any other asset--are IMO only a store of value when they are a relative value. That is when they are cheap compared to other assets. In 2000 gold was a tremendous value vs stocks. Land in the shale areas was stupid cheap. But now that gold is 6x higher while stocks are about the same, this relative value is now gone. And the shale gas land is vastly overpriced---as is a lot of farmland. Surely gold can double in the next decade, but so could real estate in many areas. And there will be hundreds if not 1000s of stocks that will do the same.

I am frequently labeled as a PM hater, when the reality is that I just dont see the value. When PMs become relatively cheap---and this doesnt necessarily mean they have to go down--then I will see the value and become more bullish.

derryb

Value is not something you see, it is something you foresee. Something cheaper today than it was yesterday is only a value if it is not cheaper tomorrow. Value is nothing more than an educated guess on where prices will be at a future date. Value is something that is either realized or missed when it is too late to take advantage of a specific price.

Store of value is a matter of planning for the future value of what you are storing. There is no current, great value in $1600 gold, it is not cheap in current terms. Gold currently 6X higher than 10 years ago may very well prove to be a bargain 10 years from now. The betting is that it will prove itself later to have been a great value and to have been cheap. Those that took the bet 10 years ago surely do not regret it. $300 gold was not cheap and was not a value at that time. It has since proven itself to have been cheap and a great value when it was available for $300.



<< <i>When PMs become relatively cheap---and this doesnt necessarily mean they have to go down--then I will see the value and become more bullish. >>


As long as PMs continue to fullfill their roll (and historically they have) as a store of value they will never become relatively cheap. They will rise and fall relative to other stores of value. They will continue to find price equilibium that keeps their protection in force.

jmski52

derryb said it for me. Precious metals aren't investments, at least not for me, not at this time. I view them as a store of value and my bet is that financial markets are headed for defaults and considerable upset. It's definitely a game of probability, no doubt about that.

We simply don't get to know what's coming down the pike until it gets here. Then it's too late to react. With instantaneous markets and electronic trading, that's just the way it is now. Cyprus ought to be a clear wake-up call for anyone who has these types of concern.

renman95

<< <i>derryb said it for me. Precious metals aren't investments, at least not for me, not at this time. I view them as a store of value and my bet is that financial markets are headed for defaults and considerable upset. It's definitely a game of probability, no doubt about that.

We simply don't get to know what's coming down the pike until it gets here. Then it's too late to react. With instantaneous markets and electronic trading, that's just the way it is now. Cyprus ought to be a clear wake-up call for anyone who has these types of concern. >>



We don't get to see what's coming down the pike comrade. We are sheeple, programed to work for the elitists. We work for them cuz they know better. I don't understand why all you PM'ers are hoarding our nation's wealth. You need to share and obey. Reported.

cohodk

Value is not something you see, it is something you foresee


Im talking relative value, but for arguments sake, your premise is completely wrong. Relative value can only be assessed in the present. You can only compare the relative value of two things today. Many like to compare the 75c hamburger with the $2.00 hamburger today. This argument is invalid. Just like comparing the $150,000 house in Florida today to the same house selling for $600,000 5 years ago. You cannot say the house is cheap today just because it was valued higher 5 years ago.

Someone will probably say, "Well you are comparing the price of gold today vs 10 yrs ago.", but I am not. I am comparing the price of gold today vs equities or real estate to the value each of the 3 had in 2000. And on a relative basis, gold is much more expensive.


They will rise and fall relative to other stores of value. They will continue to find price equilibium that keeps their protection in force.

They failed miserably in this during the 80's and 90's.


Gold currently 6X higher than 10 years ago may very well prove to be a bargain 10 years from now.

Possibly. But so may equities or even your beloved Florida real estate. Like I wrote, gold doent not need to go lower to be a relative value. If the DOW goes to $30k or homes in Florida sell for $500k or if average household income goes to $100k, then gold will again be relatively cheap. Since we dont know the future, we should base investment decisions on relative value which can only be determined in the here and now. There was no relative value in silver at $45.


If one fails to see and utilize "relative value" in their investing ideas, they will almost assuredly achieve only modest (at best) long term investing returns.

Baley

I have no idea what metals will do in the next decade or two. That's why I don't buy more, nor sell it, but rather sit tight.

I do know that a huge demographic shift is happening, there is an amazing move toward health care and other elder care... the same generation that bought toys in the 50's, that bought muscle cars and cigarettes in the 60's, that bought polyester clothes and starter homes in the 70's, that bought luxury cars and second homes in the 80's, that bought more toys and computers and college tuitions in the 90's, that bought cellphones and rental properties and flippers and a wide variety of luxury goods in the 2000's, are going to be buying pharmaceuticals and medical services in the 2010s and 2020's.

jmski52

going to be buying pharmaceuticals and medical services in the 2010s and 2020's

and muscle cars....

MilesWaits

<< <i>going to be buying pharmaceuticals and medical services in the 2010s and 2020's

and muscle cars.... >>



And Bigger Mac's! Thanks to rising obesity and the related health issues, you betcha! More horsepower will be needed too......