Why Gold will be flat or GO DOWN!!!! 4/27/13

MrOrganic

Mr.Organic 4/27/13


Why Gold will stay flat or go DOWN!!!!!

1. Gold does not produce anything.

2. Gold does not make the states any money!

3. Gold does not make the Government any money!

4. The higher ups (buffet, etc) have even put there stamp of disapproval

on this "Barbaric Relic" , There words not mine.

5. Gold is a hindrance to states & government, new laws, new regulations,
new policing....In there minds attracts criminals.

6. Gold is difficult to track, monitor, tax, etc in there minds.

7. Increase's the individual's PRIVATE wealth & sovereignty. A big NO-NO
for our socialist GOV.

Then where will the wealthy put there $$$ when the "punch bowl fueled"

fraudmarket of wallstreet starts Dying????

REAL ESTATE!

1. Produces Jobs! from illegal gardners to Big Corp!
2. Stimulates economy
3. higher taxes, property, state, sales, etc
4. Overseas investment (huge factor) Mortgage brokers do not have to
follow "money laundering" laws/Procedures as do other industries!!!

Think about that for a second!!!

5. Low rates, set the stage, high dow jones made them flush with cash!
They smacked Gold down, So where are they gonna go???

6. My final tip that had me write this? A letter from Bank of America
(one of the biggest crooks) saying card holders can now earn 5x points on
qualifying home improvement purchases with your Bank america blah blah
blah Card.

5x points on Qualifying hardware, interior furnishing & Garden supply
store through june 30, 2013

Now ask your self why out of all the things they could offer?
Education, Office furnishings, Auto, FARMING OR GARDENING equipment!!

Why "home improvement"???? The banks/Wall st./whitehouse are 1. Most
or all of obama's close people are ex- Goldman sachs or Wall st!!!

Keep in Hard assets just ones with numismatic value, currency, watches,
Art, etc

Once a Month I will post this.

In 6 months I will review

derryb

My CC is offering extra cashback on restaurant purchases. Guess that means I should invest in restaurants.

My experience in the advertising world is that promotions (and increases in advertising expenses) are because of a reduction in sales and a declining market share.

streeter

Their
There
They're

yellowkid

Awful stuff, that gold

gsa1fan

I got a 10% discount coupon from eBay think I'll buy a 1 ounce AGE tonight

C0INB0Y

Owned Gold has no Counterparty.

Owned Real Estate has no Counterparty BUT is Taxed every year.

That's enough for me.

yellowkid

One of the problems with raw land is you better hope it's the right piece, and as mentioned taxes. We have a goodly amount and except for the fact that we bought it years ago, I would sell it.

roadrunner

1. Gold does not produce anything.

But mining gold does produce things - much of the world's gold comes via combined copper-gold metal projects. Is copper worthless to a modern economy?
Gold is also the only real debt extinguisher in the world which is why CB's vault 31,000 tonnes of it. While that's technically not a production feature, it's a huge
advantage to those that have it. $7 TRILL in gold hoarded by central banks produces a lot of potential debt extinguishing.

2. Gold does not make the states any money!

The states for the most part don't make any money anyways unless you happen to be a North Dakota. If states managed their money more like gold, they
all wouldn't be insolvent and beholding to the govt for handouts. Gold transaction are probably <1/10 of 1% of all state transactions. Look for another smoking gun
besides gold.

3. Gold does not make the Government any money!

The us govt made plenty of money on gold's rise from $255 to $1923.....approx $440 BILL dollars over 10 yrs. Now if only they sold it all to China before
it went down! If they don't have the 262 MILL ounces then I would agree it didn't make any money for the govt. The amount of US gold sold over decades to
help manage its price, has made TRILLIONs of dollars for big banks and the US govt via currency, bond, and stock movements....much of it leading to tax revenues.
They've made a veritable fortune (for someone) over their leases, swaps, and sales of gold. The revenues from gold sales via coin dealers, jewelers, pawn shops, and
bullion dealer income taxes makes the govt $Billions per year.

4. The higher ups (buffet, etc) have even put there stamp of disapproval

Buffet owned 130 MILL ounces of silver from 1996-2006, a hoard only surpassed by the Hunt Brothers. Had Buffet held this silver untll 2011 he could have
made about $5 BILL. Warren is one of the biggest metal bulls that ever lived. Do we think his spots changed in 2006? We can only judge him on what he did, not
what he says. He bought a crap load of silver....enough said

5. Gold is a hindrance to states & government, new laws, new regulations,
new policing....In there minds attracts criminals.

It was not a hindrance to states or govt's when the constitution was created. In fact it was a huge benefit the was the primary building block of the nation's
amazing 19th and early 20th century growth. Immigrants flocked here for the gold standard and the freedom it represented. It's certainly a hindrance to modern
govt's who are now used to living with non-functioning gold standards (ie fiat money) since approx 1914. You can't buy votes very easily under a gold standard

6. Gold is difficult to track, monitor, tax, etc in there minds.

It certainly is. Just like it was in 1787. But cash money under the table is just as difficult to track. Why not get rid of all paper currency and shift to all electronic
transactions? That's already in progress....answered my own question.

Nothing is going to work as long as the govt decides who gets the handouts while the FED/big banks decide what the interest rates are going to be. Forget about focusing on
gold. We need to get rid of entitlements to buy votes that are paid for by future debt via fiat money. Real estate isn't any better because of distorted rates and interference
by the govt and big banks in those markets (Fannie, Freddie, mortgage backed securities, interest rate rigging, etc.). The price of gold is just an alarm bell that tells everyone
when the system is out of whack. Same for CPI, interest rates, libor, etc. If the various system alarms can't sound because of manipulation...the ship continues towards the
iceberg at full speed. That additional time just gives the looters more time to empty the vaults.

vpr

I agree that gold is just a metal, and for the most part useless. And so is paper money. It's people's confidence in the product that makes it valuable. And at some point, that confidence in paper will be lost in most of the world. Gold on the other hand can't be printed and if history is any guide, gold will ultimately gain a lot of value. Unless you think your timing is perfect, why would you want to go against a trend that has been in place for a decade or so, and the long held belief that gold is a hedge against inflation?

In the medium term however, i think gold will go down. Again, this is the medium term trend. I'm a seller at current prices and a buyer in the long term. At some point gold will lose most of its value and I hope I can time it somewhat right. If we get to the highs in gold and silver again, I will not be selling. I'll be buying more. And if we continue to drop, I will also buy more. For now, I'm just saving up my paper money and staying on the sidelines.

vpr

And I'm sure at some point, the government will tax precious metals at a ridiculous rate, again blaming "speculators" for the problems created by them. At that point, there will be a huge difference in prices between paper gold and physical gold.

roadrunner

Gold is not really a hedge against inflation. It didn't do any of that from 1983-2000. It's just that at times it often goes up during inflationary periods. What gold
really does is to act as a check/balance against the loss of faith in govt's and their currencies/debts. During deflationary periods gold has often done it's best work.
That is, deflationary business conditions that ultimately have been followed by massive monetary printing to get the nation out of that hole. Most hyper-inflations of the
20th century were preceeded by strongly deflationary conditions as economies ground to a halt.

Reasons #1 to #7 in the OP's post didn't seem to work very well in keeping gold prices down from 1967-1980 and now again from 2000-2013. Sheesh, if everyone just
realized in 1971 that gold didn't produce anything, we'd have never seen it rally once we came off the international gold standard. If only Paul Volcker had dumped out leaflets by
airplane over all of the nations cities.

cohodk

If you had written this 2 years ago you would have received the same responses.

secondrepublic

spot on, RR

the long-term trend will be up, even if the short and medium term are unclear. let me tell a short story. one of my cousins is married to a guy in the Chicago area who demolishes old/abandoned homes. one time was working on a demolition project and found an old wallet behind a stove. the wallet had two $100 dollar bills, both dated 1934, in worn condition. I helped him look up the price values -- not worth much more than face value. maybe $150 each, tops. now imagine for a minute that whoever put those aside, had instead socked away ten $20 gold pieces... or $200 in face value silver... back in 1934. forget even the numismatic value, just look at the bullion value. instead of $300 worth of paper (market value for those two FRNs), instead you would have had at least $15,000 value in gold... or thousands of dollars worth of silver. now, what do you think the situation will look like 10, 20, 30, 40 years from now? my guess is more of the same. long-term deterioration of the value of the dollar, which today is worth 1/75th what is was worth when gold still circulated.

GRANDAM

But,,,but,,,but,,,but,,,,,

Jim Sinclair promised me that gold is going to $3,500+ real soon.

I guess everyone has an opinion,,,,, wish I knew who is right

GrandAm

s4ny

When credit card companies offer 5X points it is a loss leader for their business.
The get less than 2% from the merchant but they hope to boost the cardholder's
balance and get the 25+% interest going on the larger balance that results from the
increased spending.

Gold is gold. It has been around since the dawn of history. Buffett may not like it
(I don't know, but didn't Buffett have a lot of silver at one time?)

Gold has been a better store of value than any currency in the last 100 years.

People want gold and the world population is growing in both size and wealth, so
gold will rise over time. With big moves up and down.

jmski52

If you had written this 2 years ago you would have received the same responses.

But things are so much better now. The debt load is better. Government spending is finally under control. The economy has recovered. Unemployment is low. High-paying manufacturing jobs have all come back (and the quality of manufactured goods is soooo much better now). The real estate market is hot (especially if you listen to "real estate today" on the Saturday morning radio), Social Security and retirements are fully-funded, the banks are overflowing with excess reserves and are lending to business, health care costs are falling, systemic fraud has been eliminated, welfare fraud has become a thing of the past: food stamps and disability are no longer being abused, and we finally have a government that is looking out for our interests.

And best of all, QE is expanding! What could possibly go wrong? All of this hand-wringing by gold bugs is useless. There's plenty of money, for everybody!

Or, maybe not.

cohodk

<< <i>If you had written this 2 years ago you would have received the same responses.

But things are so much better now. The debt load is better. Government spending is finally under control. The economy has recovered. Unemployment is low. High-paying manufacturing jobs have all come back (and the quality of manufactured goods is soooo much better now). The real estate market is hot (especially if you listen to "real estate today" on the Saturday morning radio), Social Security and retirements are fully-funded, the banks are overflowing with excess reserves and are lending to business, health care costs are falling, systemic fraud has been eliminated, welfare fraud has become a thing of the past: food stamps and disability are no longer being abused, and we finally have a government that is looking out for our interests.

And best of all, QE is expanding! What could possibly go wrong? All of this hand-wringing by gold bugs is useless. There's plenty of money, for everybody!

Or, maybe not. >>



You just proved the point I've been trying to express the last few years.

jmski52

You didn't notice my tongue-in-cheek? The only problem, cohodk is that sooner or later they will run out of other people's money.

ricko

I will stick with gold and silver..... I know that it will - for my lifetime - be a store of value and maintain liquidity. Cheers, RickO

roadrunner

<< <i>If you had written this 2 years ago you would have received the same responses. >>




Because as jmski52 has so clearly stated, the fundamentals behind gold's rise are 100% unchanged. Did gold's fundamentals change from 1974-1976 when
its price was smashed -48% (from $197 to $103). Everyone declared the gold bull dead. Yet whatever fundamentals remained, pushed gold up 8X from
August 1976 to Jan 1980....when the fundamentals really did change by $800 gold. One of those fundy's being interest rates well into double digits. Currently, gold's fundamentals
are better than they have ever been during the past 12 years. Instead of too big to fail banks, we've turned them into too big to jail. We've only made things worse with respect to
the world's sovereign debts and fiscal deficits. Fiat currencies are in a race to the bottom. I suspect in 2 yrs from now the orig post will get the same response as well.

And yes, that Buffet guy did own a crap load of silver approx 7 years ago. No contradiction there. Alan Greenspan was a professed gold bug in the 1960's. One of the things he said
back then was gold is the only thing that fulfills all the requirements of money . . He couldn't say that stuff once he joined the USTreasury/club FED. Once you receive your own
key to the banker's executive washroom your publically spoken words may have to contradict your personal beliefs (ie "doing God's work," etc.)

Gold's work of balancing out the debt load is far from done. Sometime in the next 1-5 years it will once again be at all time highs north of $2,000/oz.

cohodk

And all of those supposed fundamentals did not prevent people from losing 30 to 50 percent of their money. That's been my contention all along.

cohodk

once again be at all time highs north of $2,000/oz. 

I agree. And some people owning gold will realize returns greater than the stock market while others will realize returns less than US Treasuries. For some gold will have proven its mettle while for others it will represent lost opportunity.

cohodk

<< <i>You didn't notice my tongue-in-cheek? The only problem, cohodk is that sooner or later they will run out of other people's money. >>



The only problem is that eventually we will all die.

roadrunner

<< <i>And all of those supposed fundamentals did not prevent people from losing 30 to 50 percent of their money. That's been my contention all along. >>




Your contention is correct. But it doesn't change the fact that gold went up 8X in 40 months back in the 1970's after most everyone said the fundamentals (and price) were dead.

No one forced anyone to buy gold at $1700-$1900/oz. Nor is anyone forcing people to buy stocks up here near Dow 15,000. But, somehow, a 30% loss in the stock market is
more palatable to people, a badge of honor if you will.

For someone to have lost 30% of their money in gold, they would have had to buy above $1900, and then sell out at the panicky bottom 2 weeks ago at precisely the window that gold hit
under $1330. That would have been a 30% loss. Is there even such a person in the entire world that did this with such impeccably bad timing? And this assumes they did it in paper
gold only since the premiums in physical gold have risen during the past weeks. One would think that if someone made the mistake of buying gold at $1900, they'd have been scared
out at $1700, or $1600, or even $1525. And if that didn't scare them out, then maybe the recent drop under $1500 or $1400 did. If they held on the whole way, they are down 24%.
Same argument for silver. Find me someone who paid $49/oz and then got scared 2 weeks ago and sold out at $23 or lower for a 50% loss. For every person that did such a silly thing,
there are probably multiple people who bought silver in the single digits and sold it in the $40's. Financial or tangible asset markets would never rise if some people didn't pay "too much"
when buying. Maybe we need a new program like "Obamasure" to enable all investors to purchase at a fair price with minimal downside. St. Thomas Aquinas would love it.

jdimmick

Bought 5 oz of gold today at current price that buyer paid over 1800 oz for last year. Finally broke and sold, he held out as long as he could.

Right at the 49.00 silver peak, had a guy in the military come in and spend 20k buying silver , two weeks later, came back and sold it all for a $12 per oz loss, got scared, (this was that first big drop a few years back)

DoubleEagle59

<< <i>Bought 5 oz of gold today at current price that buyer paid over 1800 oz for last year. Finally broke and sold, he held out as long as he could.

Right at the 49.00 silver peak, had a guy in the military come in and spend 20k buying silver , two weeks later, came back and sold it all for a $12 per oz loss, got scared, (this was that first big drop a few years back) >>



Those are perfect examples of two people who should never buy PM's.....ever!!

jmski52

Nor is anyone forcing people to buy stocks up here near Dow 15,000. But, somehow, a 30% loss in the stock market is more palatable to people, a badge of honor if you will.

Yep, I do believe that there is a plan, and the plan is to drive people into the stock market. Whether or not that will protect people's longterm investments and retirement funds is anybody's guess.

My opinion is that when a selloff happens, the fund managers will be forced to liquidate and with HFT trading programs doing most of the trading now, a massive liquidity crunch and wealth destruction on an unprecedented scale could very well take place. And not being on the "inside", I do believe that most small timers won't have a chance to get out without getting hit hard.

The only way out of that is more QE, and just about everyone who manages money in the world already knows it. When that stops working, it's Katie bar the door.

cohodk

I kind of agree with you jmski. Not that invest ores or being herded into stocks but that there is potential for another economic relapse. Pms would decline as well though. The only asset to hold would be dollar bills.

cohodk

OK roadrunner, so let's say 22-44% decline. Even though when people talk about a drop in stocks they use the very top and very bottom when few people actually bought or sold at those levels. In just trying to be consistent.

However, what would be the opinion or sayings of the pm bulls if stocks dropped 40%?

roadrunner

<< <i>However, what would be the opinion or sayings of the pm bulls if stocks dropped 40%? >>



After a 4-5 year rally Dow 6600 to 15,000+ I'd say a 40% correction would be quite normal. The same zig zag corrective pattern occurred from 1966-1982.
Gold went up for 34 months (or 10 yrs) depending on your view.....and a correction stronger than the 20% seen up to 3 weeks ago was certainly possible.
Markets do correct, regardless of what they are. About the only exception has been USTBonds. But they have the support of $275 TRILL in otc interest rate contracts.

cohodk

Would the stock market Bulls be screaming conspiracy,manipulation, and my stocks are really worth 20 percent more?

Baley

there's no "stock porn Friday" where everyone shows their shiny new purchases for their collection and mentions the "premium" to the actual price because it's so nice and collectible certificate

bronco2078

Why would stocks behave the same as commodities? I think that the stock exchanges are more neutral towards the people that buy and sell than the commodities exchanges.


I never felt that the NYSE or the NASDAQ was working against me when I was buying and selling stocks.


A case could be made that the COMEX is not neutral . Changing margin requirements for example. I've never bought a stock on margin and randomly had the NYSE send me a margin call .

Why are commodities exchanges permitted to act this way? With a stock your broker might change margin requirements based on your portfolio but the exchange wouldn't just randomly double or half margins.

The COMEX and other commodities exchanges can warp the markets by their own actions. Why is this permitted? Why is 10 or 20 to 1 margin allowed in the first place?

should people be able to buy Apple stock at 15 to 1 leverage ?

roadrunner

<< <i>Would the stock market Bulls be screaming conspiracy,manipulation, and my stocks are really worth 20 percent more? >>



More realistically is that they are worth 20% less.

With the FED, PPT, and ESF all supporting the stock market for the past 4 years, I don't think anyone is going to complain. I'm not aware
of any time that those guys have supported the PMs markets and tried to push them higher. People in stocks should know by know that a
lot of their gains are from daily injections by the PPT & Co....especially following sharp moves down. Funny, didn't see the PPT jumping in on gold
on April 12th, or April 15th to recover the price.

vpr

Over the long term, it has consistently been a hedge against inflation. From 1971 to present, gold has done really well. Gold is just as useless now, as it was back in 1971. You can always pick out periods of time when that has been untrue. Gold in the early 80s was way way ahead of inflation. $35 to over $800 in a little over 10 years. Certainly, inflation was not up by that much. Hence, the long correction. Like any other investment, everything depends on a whole range of factors. When central banks around the world were unloading precious metals and when stocks were doing well, gold dropped even though there was inflation. Inflation was however, modest. Treasuries did really well from 1983-current. When that trend reverses, people will pile into precious metals. And, so will be the governments. I happen to think that this time around if governments decide to sell gold, it will not be that bearish for precious metals, because the circumstances will be different.





<< <i>Gold is not really a hedge against inflation. It didn't do any of that from 1983-2000. It's just that at times it often goes up during inflationary periods. What gold
really does is to act as a check/balance against the loss of faith in govt's and their currencies/debts. During deflationary periods gold has often done it's best work.
That is, deflationary business conditions that ultimately have been followed by massive monetary printing to get the nation out of that hole. Most hyper-inflations of the
20th century were preceeded by strongly deflationary conditions as economies ground to a halt.

Reasons #1 to #7 in the OP's post didn't seem to work very well in keeping gold prices down from 1967-1980 and now again from 2000-2013. Sheesh, if everyone just
realized in 1971 that gold didn't produce anything, we'd have never seen it rally once we came off the international gold standard. If only Paul Volcker had dumped out leaflets by
airplane over all of the nations cities. >>

cohodk

Markets do correct, regardless of what they are


The voice of reason.

cohodk

Over the long term, it has consistently been a hedge against inflation

Very true comment.........of the stock market.

Baley

Reasons #1 to #7 in the OP's post didn't seem to work very well in keeping gold prices down from 1967-1980 and now again from 2000-2013. Sheesh, if everyone just

actually, we need to say "2000-2011 now that the metal has topped and the bull market in gold is over.

The question now is: how long will the gap between bull markets be this time? 2 years now so far, but 1980-2000 was 20. Time will tell.