Gold and the Market

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biggdog1

biggdog1

Member
I just checked the U.S. Mint website for coin collecting and noticed that ALL the GOLD coins minted for this year are already sold out. I have been buying gold proof coins for a while and this is one of the earliest sell dates to mind. Gold will more than likely pass $700 per ounce this month and could be well on it's way to a $1000 before the end of the year. What is this telling me? The dollar is going to get weaker through the end of the year and that the I-Fund could well earn 30-40% by year's end. I wish I had Bambi's water dish full of it and I would be one happy puppy !!!
 
Mike said:
I like going off topic... :p
Here's an explanation on what impacts the gold price: http://www.cupel.com/gold_price.html

Here are charts on the price of gold:
http://www.usagold.com/gold-price.html

Looks like a 5 yr bull market to me... given the inflation data combined with the fact that inflation keeps creeping up after the Fed finishes with rate-hikes, I think there's still several months to go at the minimum, and probably a year to a year and a half at the long end. It all hinges on how aggressive the Fed is going to be and how quickly they can clamp down on inflationary pressures. They've been ineffective thus far, and there's no reason to believe that will change anytime soon.

Tom, I share your concern with a gold bull and a stock bull coexisting... however, it has happened in the past. Gold went up about 10% in 2003 while the stock market took off. Interestingly, after the ugly inflation data when the PPI was released, gold sold off and bonds rallied. More proof that once you think this stuff is easy to figure out... it isn't. ;)
Click to expand...

Mike,

It just goes to show you how much speculation is in the price of gold right now. Oil as well, for that matter.

Tom
 
Speculation is the cornerstone of every market. Even long-term investors are speculating to some degree. It all boils down to what you *think* will happen during the time you are in the market. If you think a company is going to tank, you short its stock. If you think its profits / earnings will outperform the estimates, you go long. The same thing applies to the overall market and the economy. Economy going in the toilet? Short the indices or go to bonds. Economic boom coming? Go long with everything you have.

Whether your horizon is one year, one month, a decade... it's all guesswork.

As for today - gold, oil, and the market all rose strongly. Interesting.
 
And since nobody ever listens to me, I'm sure nobody here profited from it either. :D

Case in point: I didn't listen to myself for awhile and waited 'til the middle of trading on Friday to take a position in GLD - the stupid ETF was almost perfectly flat after that. :p
 
Gold's up another $27 so far today. Now you're just showing off Mike :)

...Ouch for inflation concerns.
 
tsptalk said:
Gold's up another $27 so far today. Now you're just showing off Mike :)
Click to expand...
I think it'll run up close to its old high again. The fundamentals are there. We have a pervasive fear of conflict with Iran over their nuclear program, and just for kicks, the North Koreans threatened nuclear retaliation if we attack them pre-emptively. Then there's the Israeli-Palestinian situation spiraling out of control. If these weren't enough, I believe that inflation data going forward will continue to be at least as bad as what we've seen thus far (note: I don't think that it's really "bad", but the Fed does, and that's all that matters in this discussion, since investors care about the Fed policy).

Why will inflation continue to be a problem? Simple. The government's own calculations all but guarantee it. Excluding home prices while including rent? That should tell you what you need to know - we saw none of the inflationary run-up that should've run parallel to the overheating real estate market of the past five years. We are going to see it now - with mortgage interest rates climbing back toward historical norms, fewer people will buy houses and more will opt to rent instead. That will drive rental prices up which will show up in the inflation data. There's also continued high commodity and energy prices. Yes, commodities sold off awhile ago, but they're climbing back up. These things will work their way into the overall price level.

Since the market looks ahead about 6 months, I figure gold's run will end right around the last Fed rate hike, since inflation seems to lag the Fed by a few months (so when they're done hiking, inflation will also be "done" a few months later - and gold's usefulness as a hedge will be at an end - unless we go to war with Iran, but that's another issue).

This could all be just a bunch of hooey and mindless speculation, but I don't think that it is. FWIW, a high jobs number Friday sends gold into the stratosphere.
 
GLD opened at $58 on 6/29/06.
GLD closed at $63.81 yesterday.

+10% in less than two weeks.
 
Eh, gold.

A look at the ETF fund in commodities -- i shares -- show the weighting of gold to be fairly low. Oil, one the other hand, has a very large weighting, about 75%.

Recently another analyst on msn.com --Junak is his name, I believe -- has changed his investment strategy by with a very bullish stand on gold. It is a big shift for him. Along with his recommendations is a record of his past performance, and supposedly he has greatly outperformed the indices.

There is another analyst on msn.com who is also bearish, but his name escapes me.


The analyst I respect most is Bob Brinker, and as of now he is not bearish.

For those worried about investment returns, even now one of the better choices is simply to make extra payments on the mortgage. The interest paid on the loan is front-loaded to the extreme. And figuring the interest due compared to the principle is a real eye opener -- you won't get that kind of return anywhere ... anywhere within the law that is.
 
Gold Hits Record $900 an Ounce
NEW YORK - Gold futures briefly rose above $900 an ounce Friday for the first time as high oil prices, a weak dollar and fears of a U.S. recession led uneasy investors to keep buying the precious metal. An ounce of gold for February delivery on the New York Mercantile Exchange jumped $6.50 to $900.10 in morning trading, an all-time high and a psychologically important milestone. Gold later slipped to $898.70 an ounce on profit-taking but remained in record territory.
http://www.newsday.com/business/nationworld/wire/sns-ap-gold-at-900,0,1270731.story
 
Looks like the world is slowly becoming more and more bullish towards gold. The Gold Bugs really can't complain because they've been waiting for this day their entire lives. Here's my question- Will they get caught up in the euphoria or will they cash in their profits?

I think they're going to get washed away in the bullishness.

No way, absolutely no way I'd be a buyer of gold at these levels, especially physical gold. And to those who own physical gold- I always thought I'd sell my baseball cards for a profit, but when you have something you can look at and hold, it makes it much more difficult to unload. Don't fall in love.

Gold isn't going to $5,000 either, not in this lifetime. Alleged Pied Pipers of Armageddon have an agenda, meaning, they probably bought starting at the 300-400 level and want you to buy it at these levels.
 
The gold bandwagon got washed away in bullishness, but the strong hands will step up in the gold market as soon as a few more stops get blown. Don't be surprised when additional nations announce gold purchases in the near future.

Buying at 1200 and watching a market go to 1000 is how 'Long Term Investors' are born.
 
Simondale88,

The stock market is actually fairly stable at the moment - view a chart of the VIX and watch the trend lines. Bullitt is right about gold. I bought 15 ounces back in 1980 at that peak - but I never plan to sell my coins. I like to handle them too much and boy are they beauties.
 
... as a taxpayer I would be pissed off if the Fed didn't unload a lot of gold to India at the last high. That was a prime opportunity to reallocate Fed resources and get cash back into the US markets. You know they did, they invented that play. :)
 
You would have known by now. Besides, nobody knows how much Gold the US has. For all we know, Fort Knox could be empty.
 
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