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What's up with gold?
frostbyte
Posts: 170
I replied in the huge gold/silver trends thread, but figured that may not be the place for detailed discussion on what I want to know.
How does one take advantage of rising and falling gold prices? or do you? Obviously you say buy low sell high, but I'm looking for more details. Would ebay's prices actually change that regularly or where to buy?
Why is it dropping so much? Will it likely drop more? Is it time to buy? Who wants to teach me the ways? It was at $690 just a little while ago, now it's $50 less an ounce. I thought gold was more of a safe buy that just stayed constant or slight gains.
How does one take advantage of rising and falling gold prices? or do you? Obviously you say buy low sell high, but I'm looking for more details. Would ebay's prices actually change that regularly or where to buy?
Why is it dropping so much? Will it likely drop more? Is it time to buy? Who wants to teach me the ways? It was at $690 just a little while ago, now it's $50 less an ounce. I thought gold was more of a safe buy that just stayed constant or slight gains.
Beginner that wants to learn.
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Comments
For the little guy/gal, average collector, timing is a losers game. Maybe 5% or 10% will be successful at timing the market, the rest will either break even, lose a little, or lose big time. Probably 20% to 30% of small timers lose big time when trying to time the markets.
I always write that the average collector is best off buying (or selling) in small increments, getting an average price over time. Long term I think gold is headed much higher. In the next year, to three years, I don't see much upside for those trading physical gold. The transaction costs and shipping will eat up most of the profits, even if a person is near perfect in timing. Virtually no one has perfect in timing, though a lot of Internet pundits will claim it, usually after the fact, not in real time.
In other words, if you expect the US dollar to drop over the next few years and don't want to gamble in other currencies, you may want to buy some gold.
Also, I remember reading somewhere that historically the stock market index has outperformed gold.
It's been in a secular bull market since 2003. This is another correction. I think the bull market has 3-5 years left.
Honestly no one can answer that question.
To me gold/Silver is a safe haven. I do not put all my eggs into that basket. 5%.
Mutual funds etc. are probably better long term.
Timing the market unless you are an expert is foolish, so think long term. Hope this helps. jws
Great time to add to my Gold Type Sets
Don't be standing in that line with all the other goofuses to buy gold when it breaks $700. Always buy metal when it is quiet and cheap)...when no one is chasing it. Buy a little dip here, buy a little dip there, pretty soon you have a little pile. Rathole your purchases till the yellow metal goes on one of its peridoic tears, let some of it go back into the great continuum and call your self a genius. They come, you go...they go, you come. Life is good.
Knowledge is the enemy of fear
You can't go wrong holding precious metals (gold, Silver, Platinum).
At least another 5 years to go in this metals Bull market. (rocky road though sometimes!!....not for the faint of heart).
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
<< <i>Buy the dips........100% Fantastic advice!! >>
Agreed. But there's also the usual caution about trying to catch a falling dagger, so I'd not go "all in" at this level. I'd start moving a little bit in at a time and follow it on the way down if it keeps up. But I'd not put the whole thing into gold now.
Woah, about 2x the normal volume today, 7.1 mil shares @ $64.26/share...Hey, it's only a half a billion buks in one day. I wonder what the volume will be when this stuff lights up?
<< <i>If you want to trade gold frequently then buy and ETF such as GLD. Open a brokerage account with a discount broker. Trade the physical metal will cost you a fortune. Have fun. >>
That's probably what I was looking for. I'll research this more. I hope it follows gold prices but without the huge shipping, ebay and paypal fees to sell it. Thanks. You had some good info I'm trying to understand on the other thread too. Good information. Thanks
I'll wait until gold drop to $580 to make a move.
I use common, low-tech money management strategies for all investments. Without a strategy, nothing else matters. Secondly I use common, low-tech trading tools to identify prices that are likely not 50:50 from a success:fail standpoint.
Ebay is entirely unsuitable for what I do as an investor. I'm not saying Ebay is bad, because I do use it when I want a 1/10th oz coin for the collection. It would just be ludicrous for me to activate my strategies through any marketplace like Ebay.
<< <i>Buy the dips........100% Fantastic advice!!
You can't go wrong holding precious metals (gold, Silver, Platinum).
At least another 5 years to go in this metals Bull market. (rocky road though sometimes!!....not for the faint of heart). >>
The same advice was given in 1982.
Knowledge is the enemy of fear
Interest rates are going higher all around the world, makes holding gold more expensive and less desireable
Maybe in the short term noise but not quite true for the longer term (several years). The 1974-1980 gold market flew with the highest
interest rates seen for decades. What did that end at? 12% rates with 20% inflation? We have now moved from 1/2% to 6% rates and gold tripled. If rates go to double digits you will see gold much higher. Short term interest moves in any direction seem to be called "bad" for gold. If interest rates go down, you'll see an analyist call that "gold negative." These guys want it both ways. And the public buys this. Everything reported in the news appears to be gold negative and stocks positive (too many jobs or too few jobs, etc). You can't have the analysis both ways.....unless we're talking precious metals......those hated barbarous relics of the past.
Upward long term interest rates move ARE gold positive:
-rising rates means less business activity and weakening markets
-eventually the stock market and corporations show less profits-
-less profits means less tax money for Uncle Sam which leads to
exponential drops in revenues.
-Shortfall in foreign investment money can only be offset by raising
rates further.
-the effect snowballs, rates rise further, economic activity continues
to drop. The trend continues on.
-People look to alternative investments to protect their money.
-Things don't change until rates peak and then start to lower.
Gold may become less "desireable," but only if much higher prices make it too pricey for most to purchase. Prices will still go up.
roadrunner
////////////////////////////////////////////////////////
Yup. Not worth the work.
The ETFs are perfect for jumping in and out.
GLD and IAU for gold. SLV for silver.
If you want to play with oil, USO works great
for daytrading.
You will have to pay some taxes on your gains,
and your losses may not be fully deductible on
the event year's tax return.
-eventually the stock market and corporations show less profits-
-less profits means less tax money for Uncle Sam which leads to
exponential drops in revenues.
-Shortfall in foreign investment money can only be offset by raising
rates further.
-the effect snowballs, rates rise further, economic activity continues
to drop. The trend continues on.
-People look to alternative investments to protect their money.
-Things don't change until rates peak and then start to lower.
Interest rates and limits on precious metals trading killed off the last big precious metals spike, about 27 years ago. Quite alot depends upon perceptions and how the government spins the facts. One fact that nobody can spin is how much gold or silver you are holding. If the dollar crashes, it is worth the price of paper. If gold crashes, it is still worth the price of gold. It's a very subtle thing, but it may someday become significant.
I like to recall that a silver dime still buys about what it could buy in 1964, but a clad dime will only buy 10% of what one would buy in 1965. That's called monetary deflation, and it is occuring today at a faster rate than it has for quite awhile. The difference between now and 1980 is that all of the reporting indices have been changed, and the true rate of inflation is quite obscured by government bs.
As inflation goes up, wages rise and tax revenues increase due to our staggered tax rates which tax higher earnings more. For the dogs in Washington DC, it's a win-win. For most of us regular working stiffs, it's not quite so good.
So what'sup with gold? Looks like a selloff, based on fear. Don't worry, the greed part of the equation will return. Longterm, I wouldn't be holding dollars - maybe some, but not alot.
I knew it would happen.
<< <i>It always amazes me how many gold/silver experts there are on this topic on these boards......not!!! Gold price fodder is so amusing!! Everyone has an opinion, most of them are flawed. Party on self proclaimed experts!! You are legends in your own minds. Just my flawed opinion of course!
It is amazing. There are maybe three or four posters whose opinions I take at face value. There might be about twenty or so I see as contrary indicators (wrong way Corrigans). There are another twenty or so that seem to always have the same opinion (bull or bear) no matter what the market is doing. For this last group of perma-bulls or perma-bears it is easy enough to skip their posts, they basically post the same information (or misinformation) every time.
I always write that the average collector has zero business trying to time the metals markets. Most that try will lose, some will lose big time. A few can do it, and those that can don't need to ask for advice, nor post their signals for the public to read
/edit typos
Why are these types of posts right after mine? I never proclaimed myself an expert! But, maybe I am a legend in my own mind - ok, I'll give that one to ya!
There are another twenty or so that seem to always have the same opinion (bull or bear) no matter what the market is doing. For this last group of perma-bulls or perma-bears it is easy enough to skip their posts, they basically post the same information (or misinformation) every time.
I always write that the average collector has zero business trying to time the metals markets. Most that try will lose, some will lose big time. A few can do it, and those that can don't need to ask for advice, nor post their signals for the public to read .
This is an opinion thread. On one hand, you suggest skipping posts by permabulls or permabears. Then you turn right around and bash market timers and newbies who ask for advice. What opinion do you have, Red Tiger - other than the presumption that everyone posting here isn't as adept at winning in the markets as you are?
Come'on, be constructive - I dare you.
I knew it would happen.
What matters is the 5-10 trend chart in gold. It shows where we've been and what is reasonably likely future course. It really doesn't matter where it's been the 20 years prior to this (the only fact anti-gold bugs seem to know), but where the trend is headed. If this were a stock chart, the Cramers of the world would be screaming "double booyah." When this chart finally breaks down, then you can start calling gold dead. Until then, go track the S&P.
10 year chart
Another interesting set of trend charts is on this link. The Dow/Gold
ratio has trended consistently since gold was freed in 1971. While no sure thing, I'll put my faith in this chart rather than the current Dow or S&P. Posting history doesn't make one an expert. Nor do all those that have 401K's at work proclaim themselves to be stock experts. They usually go with the flow/trends and hope for the best. Guess they should be tarred and feathered for not being experts but having the nerve to invest in something they don't fully understand. I see posts by JPKinla, Deadhorse and others about what their stakes are in the PM's, coins, etc. Then there are others
who always have the same tired opinions that never ever discuss their strategies or any hint of what they hold. Always being right, you'd wonder why they waste time posting here rather than counting the $$ millions they have earned always being right in their timing the markets. They've never bought a bad coin, never made a bad trade, and always whoop-a$$ed the market......booyah!
Gold comparison historicals
Bull or Bear? That's the irony of it. We've been in a gold bull for 5 years and a stock market secular bear for several years. Opposing cycles within these markets are just part of the norm.
roadrunner
But, I prefer precious metals for the reasons stated in my previous post, see above. It's a simple choice for me. Each to his own.
I also think that when someone asks for opinions in an opinion thread, you ought to give your opinion instead of bashing everyone's post and not even giving an opinion.
Oh, did I mention Plats?
I knew it would happen.
See how easy it is! I just out debated you! With a little more time,
you'll come up to speed.
roadrunner
I knew it would happen.
<< <i>This is an opinion thread. On one hand, you suggest skipping posts by permabulls or permabears. Then you turn right around and bash market timers and newbies who ask for advice. What opinion do you have, Red Tiger - other than the presumption that everyone posting here isn't as adept at winning in the markets as you are? >>
I do not pose as an expert. Nor do I play one on TV
My opinion, which I gave in my first response to the thread and in numerous other threads on the subject, is that gold is in a trading range, a pennant formation. A few days back I wrote that I saw upside potential to $700 max, with downside to $600, so risk was greater than reward. Now that gold is down, it is about neutral in here. In my mind, the most likely scenario is a trading range for another full year or more. Only scalpers with small transaction costs can make money on these smallish moves. Those trading physical gold coins don't have a decent short term play at this time. That's my opinion.
Readers know that I have been and continue to be long term bullish on gold. I have posted my long range target of $2000 an ounce on several threads. Maybe that puts me in the perma-bull camp and my posts should be ignored too
Again, the average collector has zero business trying to time the metals markets. It is not a place for newbies and novices. For adults that can do their own research, form their own opinions, it is fine. For the novices, I have always written the same tired unexciting advice: buy steadily in small increments when getting in, do the same when getting out. That is, if a person shares the same long term bullish view that I do. Many do not. Many make fun of such lofty price targets. That is ok. I've been wrong before. I'll be wrong again.
/edit to add: for the average collector a 3% allocation to gold is plenty. If they are really gung ho another 3% in gold equities or mutual funds. More than that, I see as too much for the average person. Others are welcome to other opinions.
Sounds like what I say to my retirees regarding stock funds.
Sounds like what realtors say to their prospective purchasers.
(Safe prediction)
for the average collector a 3% allocation to gold is plenty.
Easy for you to say. What gold can I buy with only $37.88?
I have read estimates of a price retreat to the low $500.00's. However, inflation doesn't seem to be under control just yet. I just read tonight an article about England's bout with its worst inflation in a decade. Despite inflation, other central banks are selling off inventory and buying assets (bonds) that pay interest. Spain sold some 35 tonnes if I remember correctly. Some countries are buying and some selling. Some individuals are buying while others are selling. All told, it is a mad mad mad world.
Tyler
Safehaven
Government is the great fiction through which everybody endeavors to live at the expense of everybody else. - Bastiat
<< <i>or what RedTiger said >>
No kidding. I had to go to his link the other day after I read some comments and there's a major wealth of knowledge there. This place is humbling... the more I read, the less I type.
https://acoinshop.com/ —-> https://ebay.us/m/KxolR5
<< <i>... as we slowly transition to a global economy, the dominance of the US dollar continues to diminish. Accordingly, for Americans, it is a good time to hold precious metals and premium real estate as they provide a hedge against the weakening US dollars in your bank account.
I agree, especially with the comment about real estate. I just spent almost $600,000 on a new home - almost all of it borrowed at 30-year low fixed rates. I don't see a better hedge against inflation and a better bet against the declining dollar.
In the long run drops in bonds work against gold but in the short term higher interest rates pull money from the gold market.
http://evilhoward.com/girlprison.jpg
In the long run drops in bonds work against gold but in the short term higher interest rates pull money from the gold market.
Based on Cladking's comments, gold is cooked both short and long term. I guess the only ground left in mid-term, which in my mind is
anything more than a few months to several years. No one can accurately predict gold week to week or day to day. And it's no secret that many years down the road commodities will pull back as equities take center stage. Again, look at the Dow/gold ratio as it meanders towards single digits.
roadrunner
<< <i>
In the long run drops in bonds work against gold but in the short term higher interest rates pull money from the gold market.
Based on Cladking's comments, gold is cooked both short and long term. I guess the only ground left in mid-term, which in my mind is
anything more than a few months to several years. No one can accurately predict gold week to week or day to day. And it's no secret that many years down the road commodities will pull back as equities take center stage. Again, look at the Dow/gold ratio as it meanders towards single digits.
roadrunner >>
Bonds and interest rates normally move in opposite directions. While lower bond prices
are favorable to gold, in the here and now or in day to day movements gold can decrease
even on the favorable news of lower bond prices.
This will be an important point if bonds continue lower for a long time or drop significantly.
I'm bullish gold but as I've said before and RedTiger said, it is rangebound in the short term.
Longer term it will break sharply higher whether silver does or not. Silver has far higher po-
tential but is not certain to break out in the short or intermediate term.
<< <i>What if the price of the home falls from $600,000 to $500,000 or lower? Would that have been an inflation fighter? How about $400,000? In my area, anything less than 2-3% per year annual home increases is a losing proposition...and that doesn't even take into account inflation effects. The actual home prices in my area are falling at around 5-10% per year.
>>
My macro outlook is a continued erosion of the value of our currency - which means in the long run real estate prices will keep going up. When I say
"long run," I am taking into account the fact that the mortgage is financed with 30-year fixed debt. It's inconceivable that properties even 10 years from now will be cheaper than they are today. However, I do expect prices to decline somewhat in the short term in a few areas, though not by very much. At the end of the day, it's not so much a bet in favor of real estate as it is a bet against the dollar. I am betting that those who loaned me the money at just over 6% interest for 30 years will lose out due to inflation.
PS: note that even the few places like Santa Clara and Orange county Calif still show upward median price trends is partially explained by the fact that upper end homes in exclusive neighbor hoods are still under strong demand by the rich and famous, not to mention that sellers are putting serious money into their homes to help sell them. Both those factors tend to make the home selling market look better than it is. The bifurcation seen in the coin market is also alive in the home marketplace. High end quality sells and the supply of great homes/coins shrinks. Everything else needs to be discounted or have extras tossed in to make a deal.
roadrunner
A lot of the gold bug case lately seems to be built on the theory that foreign central banks (EU and China) will dump the dollar and US Treasuries in favor of other currencies and gold. Sound like unfounded hype to me. The US is still the largest market for foreign products. The last thing the Europeans and Chinese want is to do implement a monetary policy that will price their products out of the US market and that will make it easier for US products to penetrate their markets. In fact, the US trade negotiators have been ragging on the Chinese for years about China keeping their currency artificially low against the dollar.
Have fun sitting on your piles of gold in your rented houses and preaching to your respective choirs about how gold will save you from financial Armageddon. And while you are at it, don’t forget to stock pile weapons, ammo and freeze dried food.
CG