Analyste de Boston

Analyste de Boston
Contributor since: 2009
Shouldn't this be called an ILLIQUIDITY-bias strategy? (Your name gets it backwards.)
"...returns {increase} as you move from large- to small-cap companies."
Did Fama & French control for survivorship bias? As followers of certain Chinese Pink Sheets would note, the devil's in the details: looking at 'winners only' does not accurately reflect most investors' reality. Not at all!
I like small caps, but they require a great deal more attention & risk-tolerance.
Market's been a roller coaster, in fact, and heading south since this prognostication. DOWN -6% since 10/29/11.
And however they attempt to paint the numbers - the latest news (Congress, Europe, the ME) certainly isn't getting rosier.
I'll bite: I believe the ECB cannot bail out Italy, and it's been reported "the central bank has no plans to make its purchase program unlimited." It's very doubtful the IMF will either. But nevermind, with Spain, Ireland and Portugal (and probably a few others) in queue, the Euro woes spell disaster sooner or later.
Who wants to hold stock through a Lehman X10 Crisis, seriously? "Stick To The Portfolio Plan You Had Before Things Got Ugly" sounds like the old Wall Street prescription for Buy-n-Fold. Retail investors need to realize the 90s aren't returning. Lehman-scale deflationary waves will destroy asset wealth in the years to come, as before, but in ever greater magnitude. In this, the new era of ugly, you MUST think/get defensive BEFORE the #$%& hits the fan, or you will be absorbing -15%, -25%, -45% losses repeatedly.
So go ahead and hit the snooze button one more time. But bailouts and helicopter drops of money are NOT something you can 'count' on forever, even though it's likely to get us through this week.
Get a new plan, hopefully one that includes leaving the market after the next PIIG crisis and before the dominoes start falling. Because (you know) nothing's been fixed and this isn't going away without most of your life-savings in the market. Investors without an exit strategy will pay dearly, for sure!
Asset allocators might want to check Bob Greer's (PIMCO) study by Ibbotson (2003). Optimized, w/ commodity and eqty portions equally weighted, Gold becomes ~5-10% of a prudently diversified 60/40 portfolio.
Considering Gold (the asset class) an overlap between 'Cash' and 'Commodities,' a reasonable allocation for some older, HNW, ultraconservative investors with income-streams might be as high as 25%!
Less than 1% of retail investors have any Gold at all. I did the math over a year ago - now Casey Research "borrow" my talking-point!
Attribution to the Analyste, please.
The article is poorly titled; otherwise, this is a fine article and food-for-thought. (I personally believe "Gold is a terrible investment" and recommend older, conservative, HNW investors hold no more than ~25% of this valuable and worthy REAL asset. Gold: NOT an "investment"!)
One point that has interested me is #2: High Premiums. What is or isn't a "high premium"? Various opinions possible, but I suppose HISTORICAL rates are the best metric: (in USD$) in the 19th C. 90% Gold coins usually had ~10% premiums over currency (Paper) - but much higher at times and throughout the 20th C. Finding retail rates is difficult - that's NEVER what's quoted as "historical POG."
Maybe you didn't know this, but US Gold Coin premiums are probably as LOW as they've ever been in the last 100 years: look at eBay auctions from the Summer of 2011. +3%?!!! That's cheap, on a relative basis - US Gold Coin trading at or very near bullion prices is an extraordinary event.
Also: Platinum was trading at a 1% RETAIL premium in the Summer 2010. That is the lowest premium in history, folks.
In a sense, PMs have never been cheaper (retail) - the story we all missed debating imaginary Bubbles or while SELLING Gold for 40 cents on the Dollar to Cash4Gold scammers?
Watch the premiums: the premiums WILL rise.
Look at that small fee carefully. Wouldn't your safety-deposit box be cheaper?
Vuke is right: first whiff of a REAL panic and "your" coins held by the big bad wolf - I mean, 'custodian mutual fund' - will simply disappear...
A cheaper way to buy Au is APMEX.
"Lets have a look at the evidence if you have it."
GoogleBooks has Price-Currents (Cours d'Or ; Gold Kours; etc.) in Paper Fiatscos but not much earlier than the 19th C.
None of those Paper fiatscos - except the Pound Sterling (perhaps) are still circulating. That's evidence of Paper's Failure, obviously! There weren't newspapers (or paper) circulating before 400-500 years ago, and the data isn't consistently available. Literally: the Paper did not survive (and little data remains.)
That said, I place where I've summered was minting Gold ~500 BC : that's ~2600 years ago. If one can dig it up - and that happens - it's called archeological evidence. Gold is Money, still!
And yes: you can also buy it here: it HAS intrinsic value.
"Many Elliott Wave analysts have incorrectly called tops in Gold multiple times over for the last 10 years."
That's right - the Elliot Wavers are wrong. And discredited. That's old news; you're joining them soon enough.
"I would seriously consider anything approaching the $1,915 level to be a potential target for a top at this time."
THE top? No - you're wrong again. Unless we're plunging into deflation within 12-18 months - a distinct possibility, but nothing to do with your "Elliot Wave" hocus-pocus - we will have surpassed $1,900 and/or Gold will be selling at much, much higher retail. Why? Because POG has become a function of USD$ debasement, not significant speculation (yet). Flight from the Dollar has not yet begun here, in the largest global investing market: when that rush starts, Gold will move multiples higher fairly quickly. (I don't foresee that until after 2014-6; Americans still "don't get it"! And they are slow learners.)
Currently, Gold is less than 0.2% of US households' assets. As an asset class, it's not yet included in most portfolios. And retail Americans have been net sellers for decades! Just wait until the paradigm shifts & they START buying! Gold won't "peak" until the asset class exposure is back near an historic mean, years later. When Gold is 8-12% of US portfolios, the Bubble STARTS - but trillion$ must MOVE first. When ~$4 Tln leaves stocks & bonds for Gold, where does that put POG? And THEREAFTER, as Gold surges towards ~20% of holdings, the Investor Death Spike arrives. Reasonable & unbiased observers will note the Peak is probably a decade away, since PMs typically witness decades-long Bull Markets and this one only started about ten years ago.
A clue? Watch the premiums, REAL prices: Gold is currently @$1,828 from a better online retailer. Cheap! $1,500./oz (or anything less) is a Buyer's DREAM price, in debased USD$ currency. The CBs and Wall Street will struggle to maintain the false notions of Paper value even as Gold becomes NOWHERE available at their make-believe prices (in this, the fake "free market.") Why does the US Mint charge a ~35% premium, now? When the dam breaks, even that will look cheap!
The alternative, clutching an obviously failing asset class - US Paper Dollars - or sitting 100% in Paper is sheer lunacy... hundreds of FAILED Paper fiatscos across races, cultures, continents & centuries have taught that lesson. Didn't get the memo? Not got Gold, yet? Still clinging to the American Exceptionalist delusion? That Wall Street will care about you?! LOL Dream on.
fwiw, I recommended Gold to clients back in 2002/2003, and bullion in 2009. Best unorthodox call(s) I ever made, too! Proof is in the numbers, chief.
>26% of the world's invested assets were in gold. Today it is 1%.<
Not to quibble, my friend, but:
As I look at ICI and WGC #s, Gold is LESS THAN 0.2% of US Household investable wealth. Americans are 99.9% in Paper: guesstimating it's practically all US Stocks (>80% US?) US Bonds (>80% US Treas?) and US Cash (>98% USD MMs?) ... you see there are no hedges, there is no real diversification: it's all 'eggs in one basket.'
Hope and pray for the best - and fervently recite several decades of Wall Street lies to try to keep it all together, LOL Blind and bereft of reason, "it can't happen here!" bleat the dupes. That, to my thinking, virtually guarantees it WILL: the Perfect Storm is soon upon us. I suppose it started in 2000 and won't end until after 2020.
We can talk about the end of the Gold Bull AFTER sovereign defaults and a new, strict monetary regime appears. First, eliminate the pensions, and wipe out the fictitious Paper Wealth of the US Middle Class. Then, Gold is again ~20% of global assets. This will be a very painful reality for all, unfortunately - but must happen, BECAUSE NOTHING HAS BEEN FIXED. So it goes.
As the long, slow, and fairly steady (managed) decline of the USD$ regime continues - so Gold shall rise. This is the ever-repeating history in every fiat paper currency before, is it not? Count the hundreds! Reality cannot be denied ...much longer.
"You did NOT answer my question!!!"
Question is flawed, Questioner is biased. Next! My response was to SHOW how you're wrong - your premise that Gold always falls in deflation is simply wrong: look at history. (The rest of your Wrongness is more complicated, however. Too much to explain why, here. I'm not a free therapist either, LOL.)
",,,let me know how YOU would know if we hit a multi-year top and potentially conclude this multi-year run in the metals,,,"
I'm looking at a PM price record you don't have, going back to 1800. I'm seeing an Event in 1825, an Event in 1865, another in 1920, and in 1980 (plus a few lesser and apparently uncorrelated (but similar and probably related events.) So why don't you tell me which of those you know something about - can you identify and explain any such event besides 1980? Because - if you cannot - your "understanding" of 1980 is not just suspect... but rather, probably wrong. Why?
Hint #1: PMs typically form multi-DECADE highs & lows, not "multiyear tops." If you cannot correctly register the increment - it's back to the drawing-board!
Hint #2: Over that time-frame, PMs typically witness a SERIES of multiyear tops w/ sharp retracements prior to a parabolic Investor Death Spike Event in a cornered market coincident with a Global Credit Crisis and/or radical currency revaluation.
If "around the corner" means "by 2022" - I'll agree with that. Until then, the nominal Paper Value (in USD$) will rise and fall towards that inevitable denouement (in your treasured but nevertheless false Paper)... call it 'the True Price Revelation.' You really want that tomorrow? Careful what you wish for!
"Is there some objective perspective or methodology you can apply that will allow you to identify if you are incorrect in your analysis, rather than simply holding a falling asset for the next 4-5 years if the deflationists are correct?"
I wonder why Paper Bugs always falsely claim "Gold goes down with deflation." History (deflation in the 19th, 20th C.) proves that's not the case. Gold & Silver (Money) don't deflate in Paper Crises - on the contrary, their value goes UP!
Looking at the retail price of non-monetary Platinum in the USA, 1840-1900, it's not clear Pt was a "falling asset" in periods of falling prices either. It rose and fell with speculation & supply, however: that's not properly called "deflation."
Furthermore, retail investors are not industrial producers - prices might not fall, for the Little Guy: Supply in mkt disequilibrium could simply evaporate. The PM might be nowhere available at the 'so-called Spot Price' set by the the govt : this is our Soviet future, folks!
Meanwhile, Gold is UP 5% since this "on the verge of collapse" article appeared. LOL, some people are simply WRONG, too!
Gold Seasonality typically ranges -8% > -15%. This move down was faster, but it's still well within Seasonal norms.
Earlier in the Summer, I also predicted a strong likelihood we'd see this kind of retrace with the warning it might be more like 1973 or 1975. Look at those years, "free gold" in the secular Gold Bull of 1966-80, and understand what PRECEDENT means. This author sounds ignorant, uninformed - I'd bet he's never owned Gold either.
Investors who think Gold behaves (charts) like Equities are clueless. Paper-bugs screaming "Crash, Gold, Crash!" won't move the market, either.
Mid-summer, I stuck my neck out and called for a -15% Seasonal Decline (that's well within historical norms, you should know) by November. That call ruffled a few feathers - some goldbugs are in denial that Gold can EVER drop now. (I see their point: and they're WRONG.) But look at 1973 & 1975: Gold in a secular Bull Market CAN drop -25% from April - November, History shows...
Gold has now dropped -15% from its 2011 Peak @ USD$1,895. It may drop further still .... BUT I sense another round of QE (maybe from the French & German Banksters this time) is imminent. If that happens - and the markets get just ~50% juiced like 2009 - we'll quickly retest & probably surpass $2k (within ~six months.) Call that your 'best case scenario' for Stocks & Gold...
If not, and SPY & GLD continue falling in tandem for another two weeks, I'll bluntly suggest that Deflation Round# 2 is soon upon us. Major European bank failures would be the scariest Halloween nightmare - and beget a bleak Christmas indeed.
Please recall how - in 'the Lehman Moment' (worst phase of the 2008 Crash) Gold dropped with Equities - as much, not less! That suggests a -35% > -45% downside this go-round, I'd guess.
Now looking at Kitco, Gold today dipped below USD$1,610. From Peak Close (9/5-9/6) @ POG USD$1,895. that's a -15% Decline.
I was not wrong on that call.
Will we see a FULL -25% Major Seasonal Decline, something closer to 1973 or 1975? I suppose we may. Again, those bigger drops occurred during a secular GOLD BULL MARKET - years before (and far below) levels signalling the Investor Death Spike Event of 1980.
Is it different this time? Well, the economic cycle and commodity pricing - if not all asset values! - have now become distorted by almost 10 years of "QE" (to label NINJA loans/checks-to-taxpayers what it WAS, anti-deflationary QE back in 2003!) The Greenspan& Bernanke cabal may have gone to far now - with chaotic price mayhem erupting in the near future. The supercycles may escalate and collapse even faster, thanks to technological "improvements" LOL
Gold & stocks falling hard in tandem signals DEFLATION : the destruction of Paper asset valuations, the imminent erosion of Paper savings, the destruction of business operations ... the only Dollar World we've known for 40-60 years. Hard landing, anyone?
In the Great Unwind (2000-2021/2), I previously supposed Stage 2, the penultimate leg-down, would run 2014-16; 2011/2 is advancing the timetable. Sure hope they've got a Plan B ready to deploy sooner - if Gold goes to the moon within 5 years, that only means the other shoe is dropping sooner. Sayonara, Paper-Bugs!
otoh, if massive QE is deployed imminently, the current Gold Dip Buy Target is here & now (soon gone?) - remember how quickly Gold snapped back in November 2008, on the announcement of 'the Rescue Package' for Billionaire Banksters?
Mid-Summer, I called a -15% downside to Gold and wrote (above) "I suppose POG continues drifting down thorough September/October" ..... SO it drifted down, fell sharply, and drifts down some more.
GLD is now down -13.4% and hit -15% intraday around 9/28.
Does anyone doubt POG -15% from that August Peak, by Nov. 1 or within the next 7 trading sessions? C'mon!
>Debt-fueled unsustainable excesses, globalization, financial deregulation/integration and other factors led to our demise.<
No, you're putting the cart before the horse. There's no Commodity Bubble, just a shift starting, away from the Paper Bubble in US Treasuries. This is just the beginning. A decades-old unsustainable deficit currency scheme led to "our demise" (a totally normal, anticipated conclusion, if you study history.) The Print-Extend-&-Pre... Myth of the last few decades is what's totally unsustainable. Quite literally, there's no "there" there... so it MUST fail.
>Deflating the unsustainable boom will, in turn, deflate the commodity price bubble and clear out the front-running, momentum speculators and hoarders (like China).<
Hahahaha! What's a USD$1,000. Treasury Note worth, if no one but the traders of the Fed offshore ops want to "buy" it? For how long can that "hoarding" (gimmick account) continue?
No, the Chinese are shifting their national savings into real assets in places like Africa and So.America, with all that worth-less USD$ Paper they accumulated for two decades. (When they cannot any longer, they will experience Buyer's Regret for those fictional Trillion$ in Paper, not the property they've acquired.)
Stuff is not the problem; Paper is the problem. In the short run, increasing instability in the fictitious Paper valuation game will wreck havoc on our UNDERSTANDING what anything's "really" worth, that's all. Add zeros to whatever - that's how Paper goes, every time.
Again: it's not a "Commodity Bubble" it's a Paper Bubble. WebVan stock was not worse than many US companies' today, so we've not seen the worst yet either. When the Fed can no longer prop Paper prices and print directly into the market - via POMO and the machinations of the President's Working Group - then, and only then, will we see what anything's really worth.
Price Discovery is years from now, you're right about that (I think.)
Matthew, I've been reading you for years - and I greatly appreciate your insights into the Commodity markets.
That said, I noticed in 2008 that when Gold & Stocks start declining in tandem it meant DEFLATION and huge losses ahead. I noticed something similar happening last month, for the first time in almost three years. It's not so consistent, but still alarming.
I don't need to tell you what another deflationary wave will do to commodity trades. Lately, we've been in another perilous 'in-the-pool, outta-the-pool' period that looks & smells familiar, eerie & unpleasant... Take care!
Sorry I didn't read this more carefully, too.
"I have 50% of my portfolio in my top 3 positions... As you can see, 3 out of my top 4 holdings are listed on the pink sheets or ADR."
WHOA NELLY. Buffett would never invest this way, and this is certainly not "old school investing." I think your strategy is more akin to gambling, and you will lose alot more in the next 9 months on these investments. Even an aggressive young investor should probably have no more than 15% his/her assets in wildly speculative gambles.
Does someone know how often (the statistical likelihood) Pink Sheets go to zero in recessionary environments? Coming up!
Sorry, another point here.
>By the end of Q3, my portfolio was -30.5% compared to the benchmark of -8.3%.<
Speculating on Pink Sheets (perhaps reasonably, perhaps not) you shouldn't benchmark to the S&P500. No sophisticated investor sees these as equivalent investments - that comparison itself is a red flag.
btw, John Paulson's Advantage Plus Fund is DOWN nearly -50% ... so your very aggressive strategy might not be so bad. (Again, unless that "YTD return" includes contributions too!)
In the moment when every Paper Fiatsco fails, Gold (& Silver) 'go to the moon' in that Paper, YES.
Longer term, I'm not so sure. I suppose Commodity Prices really just track or hold value approximately (and not in every month/year) based on production demand and free-trade level. There are clearly instances when speculation distorts price, but those are almost always very short-lived (<2 year) events, or coincident with war-demand (of longer duration.) We haven't seen shortages, yet.
The real question is what consequences shall arise, later, from the artificial support granted to STOCK prices (2008-2011) by the ongoing Fed & CB's interventions. I believe this will continue for several years - but Boomers/401kers will be left holding the bag. The Day of Reckoning will be both unavoidable & brutal, after the churn and burn of two or three bank holidays (c.2014-20).
Remember: Paper (Stock & Bond spec) ALWAYS returns - but often, after much longer periods of debasement and poor performance. I'm not convinced American GenXers will buy that crappy US stock in their retired parents' portfolios at these still inflated prices - just like I never believed the myth of ever-rising home prices c.2005. That paradigm has already failed!
Might it reappear in Brazil, China, Russia circa 2021 however? Perhaps it will. And so Commodities will again be shunned - wash, rinse, repeat. No asset class reigns forever.
"incredibly high commodity prices" measured in what, Bernanke/Greenspan Dollars, with an intrinsic value of .... ????
Zero. ALL Paper is worth, effectively, zero. Its a promissory fiction: in other words, your entire argument, indeed: your entire perspective, mindset & Reality, are anchored or chained to a fundamentally unsustainable fantasy: that Paper doesn't fail.
But it does. Every Paper Fiatsco goes to its intrinsic value eventually. Zero! And what is a barrel of Oil worth, when your fictional "paper money" is no longer accepted?
And so we are facing the second stage of the Dollar's Long Terminal Illness - another Decline, much like 1967-83, and perhaps lasting as long (2000-2014?) We're only 4 years into the worst of it, with municipal & state debt obligations just ahead of corp. pension failures, and the repudiation of Medicare/Medicaid... Tomorrow? No, after the next 2-3 rounds of bank bailouts. Don't assume the stocks you tout will have any value in 2020!
This stage of The Great Unwind started with the Dot.Bomb and the Deflation that Greenspan identified c. 2002 (you were asleep), which led directly to 'govt checks to taxpayers' (hahahaha!) and trillion$ in NINJA loans to any mouthbreather who asked, plus bankrupting neverending wars (2 or 3 is it, so far? How many more to come, as Uncle Sam's ME satraps all start fleeing to Switzerland?) and of course, the FreddieFannieGoldman Showers and those Paper bonuses you (the Stupid Little Taxpayer) paid for... no wait, that YOUR CHILDREN paid for, with THEIR future?? Not all the good jobs are gone - but the decent, livable wage jobs are: shipped overseas in the Clinton Years (NAFTA and globalization are here to stay) as the Paper Ponzi worked its one-time magic - once, and only once. Larry Summer & Rick Rubin got theirs - how about you, schlub? You think the 90s are returning: that the e-z money game will surely continue or begin anew - that Helicopter Ben's PRINTING solves the problem, or counts for Reality somehow, forever? That he can hit the magic "Rest" button and the mountain of bad debt won't result in the end of our economy as we know it? "Pssst! Wanna buy a bridge to Brooklyn?"
Fact check your premises, based entirely on Wall Street's chicanery & fraud, and you'll see that your conclusions are waaaaaay off the mark. The idea that REAL commodities will be given away for 2009 Bernanke Dollars x 10 is ludicrous. US stocks aren't "coming back" : au contraire! The world will blame US for this catastrophe, and rightly so. This House of Paper Cards has no foundation so "our" Paper - yes, Paper (Fiatscos) - must return to its intrinsic value. For the Dollar, Price Discovery will be the Reality you've long denied.
I fear the USA in the 21st Century will resemble the 19th in more ways than any of us will want to know. Blame those who peddle the lie of the last half of the 20th! The lesson of the Continental will taught to those who think "the last thirty years" will look like the next... and so, a half century of more of Paper promises must end in Paper tears.
"Commodity prices are too high" in Monopoly Money too, chief.
I don't believe MStar's data was incorrect. Zacks now (10/11) shows the trailing 15 Year TOTAL return is 5.73%.
MERFX is a fine fund, but generates nowhere near +8% real return. More concerning, the patterned DECLINE in long-term returns > ~3% annualized (BEFORE taxes) suggests the real returns are heading towards zero.
Trend looks pretty obvious: the salad days of the late 80s & 90s are long gone and not soon repeating. If we're heading into another recession, it's far more likely these long term real returns will turn negative by 2014. (Fake CPI + real loss of purchasing power, after higher taxes = negative.) I'd love to hear the argument otherwise!
New investors 'First BUY' Target: ~USD$ 25.
Value BUY Target at ~USD$ 16. - 20.
Also, WATCH THE PREMIUMS: on your computer screen, POS might come down, but no dealers will Sell at that sweetheart rate. Particularly if/when these 'shortage rumors' prove true.
The DISCONNECT between 'low official prices' (nowhere available) and 25% > 50% higher retail (what you'll have to pay) is another ugly form of PRICE DISCOVERY... just like the 'make-believe markets' of the old Soviet Union!
Its all part & parcel of the creeping Paper Lie.
I believe in diversification, keeps you on top of your game. Since the portfolio benefit threshold benefit disappears below 3%, you obviously don't need any MORE than 33 asset class choice-stocks.
Obviously, some asset classes are major and others minor; that forces choices. The optimal for manageability is somewhere between 12-24. Here, I'm counting 'Swiss Franc' separate from Dollar-Bullish UUP, as different & perhaps complementary choices. You might have 4 Intl Eqty choices, etc. and these sub-asset classes start adding up.
< 20 STOCKS is not diversified.
<6 asset classes is not also diversified, unless you're using the broadest ETFs (like Vanguard's, or SPY for 'all US Eqty exposure.')
These are the choices we make - what to include, what to ignore? For example, those duped by Wall Street shills skipped Gold and have been proven WRONG, WRONG, WRONG for ten years and counting. It's gotten so bad, Barron's has to run articles attacking those who got it right!
Why keep following the discredited, bigoted Paper-Bugs? At what point do you recognize your mistake, reassess & finally do it the right way? Many never will. Discount Paper-Bias (permeating the MSM and commercial websites) to find the safer middle-ground. "Got Gold?"
Why stop there? Why not spell it all out: describe this trend and its most likely outcome ... since NOTHING HAS BEEN FIXED NOR CHANGED.
In 2008 we did NOT have Price Discovery. Instead, we had a Treasury-Fed orchestrated bailout of Wall Street: the truth DEFERRED, DELAYED, DENIED. They can do that again - perhaps twice, three times even? - but there WILL come the day when they haven't the resources to stem the tide of final redemptions nor the power to hide the essential bankruptcy of the Paper Lie. What happens when millions of Americans wake up to the fact that their pensions (just like the Soviet citizens' !) were a deceitful ploy or accounting fiction?
For now, it appears fairly clear there's been a massive transfer of REAL wealth - over the past decade - to a small number of corporations (whereby an elite few are the true beneficiaries.) It's nowheer near complete, however. So far, this trend mirrors what happened early in the Perestoika Period - the Yeltsin Period is the oligarchs' playbook. Isn't the USA looking more & more like a banana republic? As markets lurch down & up to effect, so this consolidation of wealth shall continue unabated (2012-18.) When the 'Bankruptcy Moment' appears, we will get a full blown militarist/fascist dictatorship ... probably, with the pretext of a hollow & ineffectual or simulated 'workers' revolt' (when their pensions are declared null & worthless?)
History doesn't repeat, but it usually rhymes. Look at what happened to our nemesis - why presume our paranoid, militarist regime/culture will be so different. Plus ça change...
"A man should divide his capital into three parts, and invest one-third in land, employ one-third in merchandise, and reserve one-third in ready money." Bava Metzia, fol. 42, col. 1.
Presumably, one-third in non-custodial Cash. Accessing your 'retirement savings' in a 401k can take up to 14 days. If there's a bank holiday and your funds are not available, is any custodial mutual fund "ready money" ?
US Coined Gold can be accepted as "ready money" in a time of crisis, so it is.
What does the Talmud say about putting 100% of your wealth in promissory Paper?
It's interesting to see how & why the meaning of "Buy & Hold" has changed, since it first appeared. Especially curious is how the SELLING part was dropped from the equation - and the brainwashed don't get it, either!
>Bull.—The Stock Exchange term applied to those who buy and hold stocks for a rise in price; a buyer of securities for the rise. In its most common use the word designates the speculator who buys stock which has to be carried for him in the market from "settlement" to "settlement" (q.v.); and in this sense " bulls" are mere bettors on the rise. But a man may be equally a "bull" who buys more of a stock than he can afford to pay for with his own means, and pawns it with his banker. The American equivalent of our phrase "bull of stock " is "long of stock." To be "long" in New York is to be a "bull," a holder for the rise.<
(Alexander Johnstone Wilson in A glossary of colloquial, slang and technical terms in use on the stock market, 1895)
This 19th Century example of English Stock Market slang is closer to what 'buy & hold' means today.
>Salted stock is to buy and hold stocks for a long period.<
William Hardcastle Browne, in Odd derivations of words, phrases, slang, synonyms and proverbs, 1900.)
>A major new asset class has been born, and it’s called ‘Precious Metals’ or ‘Gold’<
What a bizarre revelation. I would suggest that the author is a more like a deluded Soviet citizen than he/we would care to admit.
Actually, the extended metaphor of the brainwashed prole fits most American investors perfectly: we drank Wall Street's Kool-Aid, just like the Rooskeys believed their "Pravda" for as many decades!
Most on SeekingAlpha are still FULLY enmeshed in the Paper Lie - no wonder Keynesian morons cannot "understand" Gold ... and so few are even now waking up to that "new" asset class.
You didn't know this fact? Gold has always been money - its ALWAYS been horded by Central Banks. Bullion is real wealth, that's why the Bolsheviks and their state capitalist equivalents in the West CONFISCATED their citizens Gold.
Durrrrrrrrr..... !
>Why trot out that old "even missing out a few days can lower one’s return substantially "??? It is pointless and misleading.<
That's the point. Buy & Fold! "There's no time like now to buy," like they say in real estate.
"Price Discovery"? You mean the PAPER value of Paper Assets?
You really want to know that? Most Paper investors don't!
"To say that the Republicans are against Obama because he is black is to show true racism on your part."
I'm sorry - do 50% of Republicans still wonder if he was born outside the USA? They didn't about McCain - and he WAS.
White Man gets a pass. Again. Let's not be revisionists about this.
"when November comes when the typical bullish season begins?"
You mean play the Dead-Cat-Bounce ?
Partially hedged (and mostly in cash) sounds ace, now.