Gold tops $1,400/ounce per my prediction.

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LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Give me an alternative investors can use to curb against inflation given that every currency in the world is being wrecked.

Gold is a currency of fear because for the first time in a long time, there is a real reason to be fearful.

Have you ever performed a regression analysis on gold and inflation and comparing it to stocks or land versus inflation?

Me thinks not.
 

BansheeX

Senior member
Sep 10, 2007
348
0
0
You can't go to Walmart and make a purchase in gold. Or Home Depot. Or Stop & Shop. Or Mobil. Or Sears. Ain't a payment option at Newegg. Or Amazon. Or Dell. Paypal doesn't take it. Power company doesn't list it as an option. Same with Comcast. Or my heating oil company.[/url]

(Amazing how all of these "Buy Gold Now!" places are selling gold... for dollars.)

You are completely missing the point. There are two things you can do with dollars: trade them or save them. Just because physical gold can not be readily traded for goods at a major department store doesn't mean it can't ever be better to have your savings in gold rather than dollars. It has TROUNCED interest bearing deposits the past 10 years and can be readily sold for dollars when needed.

People fail to realize that EVERYTHING is a gamble, even dollars in the bank. It's not like we're going to wake up tomorrow to hear 20% interest rates and a balanced budget amendment cutting swaths of government programs across the board. Going forward, I can think of no safer bet than gold. Even so, I cannot proclaim to have been there since the beginning. I bought in 2008 when gold was $800. Ten years ago, it was $300.
 
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DominionSeraph

Diamond Member
Jul 22, 2009
8,386
31
91
You are completely missing the point.

His point was rather simple and clear:

You will not find one well minded or educated person on this Earth who wouldn't trade for gold.

A: I will not find one well minded person on Earth who will not trade for gold.
B: I will not find one educated person on Earth who will not trade for gold.

So,

C: All well minded people on Earth will trade for gold.
D. All educated people on Earth will trade for gold.

This means that,

E. Any person who will not trade for gold is neither well minded nor educated.

It does not, however, mean,

F. Any person who will trade for gold is necessarily well minded and/or educated.


Anyway, I just pointed out that pretty much nobody on the planet trades for gold anymore. If he wants to say that it's the other six and a half billion people who are in the wrong... well, that'll be good for a laugh given how markets work.
 

JMapleton

Diamond Member
Nov 19, 2008
4,179
2
81
Have you ever performed a regression analysis on gold and inflation and comparing it to stocks or land versus inflation?

Me thinks not.

You're missing the point, again. Gold is not comparable and it is not an investment, it's a storage for wealth. I do not and have never advocated gold as an investment, especially for the long term.

Land can be taxed and confiscated easily. Stocks can be taxed and confiscated easily. Gold in a 200lb safe in a secret room below my house cannot.

Gold is protection against politicians. It's protection against the government. It's protection against a piece of paper some people call "money." It's protection against corruption.

I think gold best utilized for anyone with a significant amount of wealth, they can store 5-10 percent of their wealth in physical gold and hide it where it cannot be found or taxed in case of emergency.
 

Tequila

Senior member
Oct 24, 1999
882
11
76
Ok, so we figured out gold is not a good investment so what does that leave?

How does gold sitting in safe help you in anyway? In case of what emergency? When it comes to political instability I'll just reiterate what's already been said here.

Guns > twinkies > beef jerky > gold.

EDIT: replace Guns with "Guns and lots of ammo"
 

JMapleton

Diamond Member
Nov 19, 2008
4,179
2
81
Ok, so we figured out gold is not a good investment so what does that leave?

How does gold sitting in safe help you in anyway? In case of what emergency? When it comes to political instability I'll just reiterate what's already been said here.

Guns > twinkies > beef jerky > gold.

I'm not talking when the lights go out in some nuclear WWIII scenario. I'm talking collapse of the US Dollar or even collapse of the economy (depression). Guns I think are a good investment to protect what you have but you cannot "store wealth" in guns.

But if you're worth a million, you cannot store 10 percent of your net worth in guns. What are you going to have, a 1,000 guns?

Grow some sense.
 

Tequila

Senior member
Oct 24, 1999
882
11
76
I'm not talking when the lights go out in some nuclear WWIII scenario. I'm talking collapse of the US Dollar or even collapse of the economy (depression). Guns I think are a good investment to protect what you have but you cannot "store wealth" in guns.

But if you're worth a million, you cannot store 10 percent of your net worth in guns. What are you going to have, a 1,000 guns?

Grow some sense.

What good is that gold if the economy collapses? The next depression if it happens won't be pretty and I'm guessing there is a good chance things would get chaotic, violent with riots and small wars breaking out. Let's say it gets so bad and the currency is worthless and we turn into a barter society. The people that thrive are those who have guns and food and the knowledge to grow their own food and build housing. Gold won't mean crap in that situation. Let's say I'm really good at skinning animals but lousy at growing crops. You'd be the last person on this earth I would barter my furs with. I don't need your gold, you can stare at it all day in your 200lb safe for all I care. Now if you had some porn in that safe I might trade my furs for that..
 
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Zebo

Elite Member
Jul 29, 2001
39,398
19
81
Legally, can I open up a business and only accept gold and silver, or pink-colored toys, as payment?

No. The feddie funny money police will jail you. You are robbing them of thier scam.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
I'm not talking when the lights go out in some nuclear WWIII scenario. I'm talking collapse of the US Dollar or even collapse of the economy (depression). Guns I think are a good investment to protect what you have but you cannot "store wealth" in guns.

But if you're worth a million, you cannot store 10 percent of your net worth in guns. What are you going to have, a 1,000 guns?

Grow some sense.

This is the problem I have with gold nuts (and you in particular since you're supposedly the elephant bumper). These doomsday scenarios are utterly ridiculous and without merit.

Say, for example, there is a dollar collapse. So what? Does that mean that the currency fails no matter what? Does that mean the economy fails and we resort to nothing but gold or that type of trade? Gold gets you nothing as another currency can take hold pretty easily and quickly. It would take an utter economic and social collapse for gold to be worth anything more than a shiny metal.

And as far as not being confiscatable or taxable, it can be confiscated and taxed just as easily as land or stocks. It is tracked somehow and can (and has) been confiscated in the past.

I'm going to laugh when gold goes crashing down again.
 

Zebo

Elite Member
Jul 29, 2001
39,398
19
81
Ok, so we figured out gold is not a good investment so what does that leave?

How does gold sitting in safe help you in anyway? In case of what emergency? When it comes to political instability I'll just reiterate what's already been said here.

Guns > twinkies > beef jerky > gold.

EDIT: replace Guns with "Guns and lots of ammo"

Need cash flow. Fuck gold silver stock or anything else that does not give cash flow.

ATM cash can be converted to whatever you want.

I do about $2200 a day in my store after labor and cogs that's about $600. I can buy 1 oz every 2 day off sales...get it?
 

Tequila

Senior member
Oct 24, 1999
882
11
76
Need cash flow. Fuck gold silver stock or anything else that does not give cash flow.

ATM cash can be converted to whatever you want.

I do about $2200 a day in my store after labor and cogs that's about $600. I can buy 1 oz every 2 day off sales...get it?

I get plenty of cash flow from my stock divvies. Not $2200 a day though. Nice!
 
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BansheeX

Senior member
Sep 10, 2007
348
0
0
What good is that gold if the economy collapses? The next depression if it happens won't be pretty and I'm guessing there is a good chance things would get chaotic, violent with riots and small wars breaking out. Let's say it gets so bad and the currency is worthless and we turn into a barter society. The people that thrive are those who have guns and food and the knowledge to grow their own food and build housing. Gold won't mean crap in that situation. Let's say I'm really good at skinning animals but lousy at growing crops. You'd be the last person on this earth I would barter my furs with. I don't need your gold, you can stare at it all day in your 200lb safe for all I care. Now if you had some porn in that safe I might trade my furs for that..

Your post-apocalyptic anarchy is not in the cards for America. A downfall so thorough that people are reduced to bartering with each other and living in communes? Nobody saves to enhance future consumption, everyone produces only so much as they consume? We have some stubbornly crazy people on this board, no wonder I left for months on end.
 

Craig234

Lifer
May 1, 2006
38,548
350
126
You're missing the point, again. Gold is not comparable and it is not an investment, it's a storage for wealth. I do not and have never advocated gold as an investment, especially for the long term.

Land can be taxed and confiscated easily. Stocks can be taxed and confiscated easily. Gold in a 200lb safe in a secret room below my house cannot.

Gold is protection against politicians. It's protection against the government. It's protection against a piece of paper some people call "money." It's protection against corruption.

I think gold best utilized for anyone with a significant amount of wealth, they can store 5-10 percent of their wealth in physical gold and hide it where it cannot be found or taxed in case of emergency.

Putting aside the issue of taxation on homes, many people made a similar argument on land - they're not making any more of it (they are still mining a bit of gold).

And yet any 'storage place for wealth' not based on its 'intrinsic' (or 'use') value (which again Land has more than gold), us subject to the wealth of the buyers.

So if the *buyers* are suddenly impoverished by societal disaster - they aren't going to have a lot of wealth, in whatever form, for paying a lot for gold, either.

Similarly, home prices took a big hit when the population who might trade wealth for those homes lost a lot of their wealth.

I should mention that it's not just about 'wealth' in society - it's also about changes to who has that wealth. Depending on that, things that the middle class buys might go up in price the more wealth the middle class and vice versa, while things the top 0.01% buy might go up in value the more wealth they have, and vice versa.

This is a reason why the 'rich getting richer' isn't in a vacuum that doesn't affect others - 'who cares if they have 100 sports cars instead of 50, you're jealous' - but rather affects opportunity as access to investing and owning what produces wealth is harder and harder to 'break into' the higher the concentration of wealth, creating a cycle of plutocracy, which is why I mention the 'Latin American' model of 15 families owning 95%+ of business, land, the media, and so on as an illustration of where it can lead.

We have a healthier and more productive nation with a 'middle' distribution of wealth, with plenty of opportunity and the rich not as extremely rich - and with a healthy democracy.

When competing interests want to keep the system fair to protect their interests - a diversified economy and distributed wealth - you get better laws than when there's an 'owner class' so powerful as to set the rules for its own benefit against the public interest.

I went well beyond the topic of gold, but the point is that its value isn't all that reliable in a time of social economic upheavel IMO.

I think the 'Mad Max' scenarios are not going to happen so much as we should be concerned about the threat of plutocracy, and opposing the move to plutocracy.

You can guarantee yourself protection a lot better by limiting the concentration of wealth than by owning gold.

Gold might have its short term purposes, against one currency's devaluation, or even investment the last decade, but it's limited IMO.

It's too bad there's so much more interest in the economic theory of gold's role, than in the wholesale destruction of the middle class.
 
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Craig234

Lifer
May 1, 2006
38,548
350
126
This is the problem I have with gold nuts (and you in particular since you're supposedly the elephant bumper). These doomsday scenarios are utterly ridiculous and without merit.

Say, for example, there is a dollar collapse. So what? Does that mean that the currency fails no matter what? Does that mean the economy fails and we resort to nothing but gold or that type of trade? Gold gets you nothing as another currency can take hold pretty easily and quickly. It would take an utter economic and social collapse for gold to be worth anything more than a shiny metal.

And as far as not being confiscatable or taxable, it can be confiscated and taxed just as easily as land or stocks. It is tracked somehow and can (and has) been confiscated in the past.

I'm going to laugh when gold goes crashing down again.

I've made the point in the past that I view stocks' value as not based directly on anything the company does, but rather on the the investors' behavior for that company.

A company can come out with great new products and have their stock go down if investors want to pay less for it, and vice versa.

I view gold similarly - as a product whose value is based on its investors' behavior.

There's one type of 'central' gold investor for some reasons, like governments, that are always owners. But the huge fluctuations seem to me the 'crazy buyers'.

When they are fewer and/or less wealth, gold is down. When they are more and wealthier and hyped on gold - whipped into a frenzy - it goes up.

I have underestimated the gold demand, by overestimating its buyers' rationalty not to get sucked into the bubble - and I've missed out on huge returns as a result.

I'd think even you have to admit, as much a debunker of the gold bubble as you are, that the bubble has been pretty remarkable - and you could have made a lot (for bad reasons).

But the gold bugs debate its 'value in a fantasized disaster', while I think the value is more 'how long will the gold nuts keep burning their money to fuel this fire'.

It's hard to see how it can go on much more.

But I was wrong before.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
I've made the point in the past that I view stocks' value as not based directly on anything the company does, but rather on the the investors' behavior for that company.

A company can come out with great new products and have their stock go down if investors want to pay less for it, and vice versa.

I view gold similarly - as a product whose value is based on its investors' behavior.

There's one type of 'central' gold investor for some reasons, like governments, that are always owners. But the huge fluctuations seem to me the 'crazy buyers'.

When they are fewer and/or less wealth, gold is down. When they are more and wealthier and hyped on gold - whipped into a frenzy - it goes up.

I have underestimated the gold demand, by overestimating its buyers' rationalty not to get sucked into the bubble - and I've missed out on huge returns as a result.

I'd think even you have to admit, as much a debunker of the gold bubble as you are, that the bubble has been pretty remarkable - and you could have made a lot (for bad reasons).

But the gold bugs debate its 'value in a fantasized disaster', while I think the value is more 'how long will the gold nuts keep burning their money to fuel this fire'.

It's hard to see how it can go on much more.

But I was wrong before.

The market can stay irrational far longer than I (or most people) can stay solvent betting against it.

The rationale for protection through gold just doesn't hold up. Rampant inflation won't happen until consumption goes up enough to take up the slack in the economy. That means that millions of people will need to have jobs, quickly. So quickly that the Fed will not be able to unwind its positions and the velocity of money increases beyond what they can handle. This is an asinine assumption as there is nothing that will snap us out of this, leading to a V shaped recovery.

The devaluation of the dollar is of little concern unless long-term, or even middle term, wages cannot keep up with the reduction in PPP. Considering that PPP is maintaining a relatively steady pace, it's not an issue.

The commodity increase is likely due to a combination of poor crops and speculation of an instant turn-around, all of which is bullshit, and not because of monetary inflation.

As such, even long-term inflation can be hedged against by using common consumer good producing companies that can price inflation in. The J&J's of the world have a far better correlation to inflation than gold does. Anybody with an elementary degree of statistical knowledge can find this out.

This is why I find it hard to take JM seriously.
 

alkemyst

No Lifer
Feb 13, 2001
83,769
19
81
It's funny when those talk about post-apocalypse and how gold would be less valuable than that last bag of Fritos.

That may be true short term...however; most of the world's economies have shown gold their superstar.

Once things get back to normal it's going to be those with the shiny trinkets that end up recontrolling the world.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
It's funny when those talk about post-apocalypse and how gold would be less valuable than that last bag of Fritos.

That may be true short term...however; most of the world's economies have shown gold their superstar.

Once things get back to normal it's going to be those with the shiny trinkets that end up recontrolling the world.

LOL. This is what I love about gold crackpots. They suddenly think that their gold will be what matters between life and death in the *probability* of an apocalypse in their lifetimes. Let's do a little statistical analysis here.

1. In order for your gold to be worth anything, there needs to be an apocalypse. Let's peg that at 20% in the next 100 years. That's almost absolutely on the high side, but I'll make it a nice big number for illustrative purposes.

2. In order for your gold to be worth anything, you need to survive the apocalypse. Let's peg that one at 10% for the general population in the US (most live in cities or are not self-sufficient), but since you're smarter than the average bear (you are, aren't you?), I'll give you a 50% greater chance (quite a confidence interval for our nice chap above...), or 15%.

3. Now, you've survived the apocalypse, good job. You've made it through something that has only a 3% chance of happening (20% * 15%). Now you need to make it long enough for gold to be an effective medium of transaction. Since society has broken down and gold has no established price, it's going to take a while to establish. Let's say 20 years (consider the dark ages lasted far longer, but I'll give you the benefit of the doubt), at another 50% chance of surviving. Good job, you've made it through when 98.5% haven't.

4. Now comes the tough part. You have to be able to keep your gold. Consider that in the 10 years and even after, warlords come into power. They become powerful enough to subjugate most other people. As we know, not everybody can be a leader and power (just like sex, drugs, money, and rock and roll) aggregates more power, only a select few can become leaders. Everybody else is a bitch. Let's say that you're a super big strong dude with a good brain, lots of guns, lots of family, and a big huge compound to survive (with transportation, gas...etc). So you're a badass, but still, only 5% become leaders (lets say the average leader has 19 followers).

Heh, now your gold matters (it isn't confiscated by somebody more powerful), but shit, you only had a .075% chance of making it this far.

5. Now you have survived the apocalypse, kept your gold, become a warlord, and have begun to make your own coinage with your baddass face on it. Now what? You're back in the dark ages and you're cool, but now society blows.

But hey, that's what people like you want, right?

See, a doof like you who thinks this way might as well just buy hurricane insurance in Iowa. I am sure some insurance broker will love to take a $5,000 premium from you for that risk.

In fact, I'll take that risk. I'll take that $5,000/6 mos. I'll invest that money in something other than gold and I'll reserve that 5,000 every 5 years into gold at a place of your choosing. I get to keep all profit from the proceeds but if by the end of the 100 years, the apocalypse doesn't happen, I get all of it, including the gold.

You willing to take that insurance policy? That's about 7.5bps of risk to me. For you, you're neutral. You're effectively in gold every 5 years, which is a reasonable timeframe for any type of massive inflation or apocalypse and you're only taking 50k of risk within that 5 years (since the rest is banked in gold).

That's effectively the risk you're taking and what you're missing for a 7.5bps risk. Pretty fucking dumb.

That doesn't even include all of the x-factors of the apocalypse that will reduce the likelihood that you're apocalypse gold even matters.

What's even funnier is that 7.5bps is probably the proportion of the population considered seriously mentally ill.
 

Tequila

Senior member
Oct 24, 1999
882
11
76
Your post-apocalyptic anarchy is not in the cards for America. A downfall so thorough that people are reduced to bartering with each other and living in communes? Nobody saves to enhance future consumption, everyone produces only so much as they consume? We have some stubbornly crazy people on this board, no wonder I left for months on end.

You mean crazy people like you, JMapleton and all you other gold freaks who are so convinced the economy is going to collapse soon? I was drawing out a theoretical situation if the "economy collapses" as JMapelton suggested.

So I ask again what good is gold an any situation?

Long-term investment: it sucks and history has proven that especially compared to stocks.

short-term investment: Well you'd have to sell it for those "lousy dollars" you seem so set against to see a gain and in that case you'd get taxed at a higher rate due to gold being a collectible.

Protection against a collapse of the economy: All hell will break loose and you know it. I think my doomsday scenario spells it out well that gold isn't going to do you shit for anything.

You gold freaks provide me with unlimited entertainment. You guys are the crazy ones, not me lol.
 

Tequila

Senior member
Oct 24, 1999
882
11
76
i don't know what you were trying to explain, but gold is worth something NOW.

Worth what? It's worth X amount of dollars. But..but those dollars are worthless to you gold bugs. So what is that gold really worth?

Oil is worth something because you can use it for gas, plastics, all sorts of useful things.
Copper too. Plumbing, electronics and alloys like brass for bullets :)

Ugh, I'm tired of arguing with you guys. Just buy all the gold you want. I don't really care anymore.