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The bounce in precious metals takes a breather, with gold (GLD) off 1.6% and silver (SLV) off...

The bounce in precious metals takes a breather, with gold (GLD) off 1.6% and silver (SLV) off 1.2%. It's more tough news for John Paulson after his gold fund reportedly lost 27% in April, bringing the YTD loss to about 47%. Add David Einhorn to those taking a hit: "We were somewhat surprised by the swift decline," he said on the GLRE earnings call (transcript), especially given the BOJ's joining in "the global monetary printing race." Einhorn sees nothing to change his long-term bullish stance.
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Comments (9)
  • CassandraSees
    , contributor
    Comments (407) | Send Message
     
    Gold did not lose 27% to 47% of its value - - So, should I feel sorry for a fund that speculated/gambled in options/futures, paper gold shares, derivatives, etc. and lost their shirt when the manipulators called in their bets on their crooked game?
    7 May 2013, 11:51 AM Reply Like
  • kgroeppe
    , contributor
    Comments (13) | Send Message
     
    I read that the government "loaned" much of our gold to the big banks
    who sold it. Is this really true? Sounds like Nixon selling gold to try to control the price of gold, and we know how that worked.
    Nobody wants to really think about what will happen when the dollar collapses, but that is really serious business, and will be with us for centuries. But people tend to deny the possibility of any events which are too painful to consider. That doesn't mean that people like me are wrong; it just means that people are too indolent to act in the face of real danger, or they may actually want it to happen.
    7 May 2013, 12:24 PM Reply Like
  • Skeptical Investor
    , contributor
    Comments (505) | Send Message
     
    They only lost their shirt if they were over-leveraged and forced to sell. Gold is a sure thing long term, but requires a disciplined investment approach. In the long run we are all dead, but it's better to die rich than busted by a surprise hyperinflation.
    7 May 2013, 12:32 PM Reply Like
  • css1971
    , contributor
    Comments (870) | Send Message
     
    Gold isn't an investment. You won't make much money on gold or silver. Gold is a savings plan which you (given time) will get out broadly only what you put in. Though the numbers may be much larger.

     

    The way I think about it... In 1971, children's piggy banks stopped working. Had you noticed that kids don't save in piggy banks any more? That's because American President Richard Nixon and the world banking fraternity came along and robbed them all. They robbed the piggy banks of millions of children all over the world.

     

    Gold and silver simply make piggy banks work again.
    7 May 2013, 03:11 PM Reply Like
  • dragos2901
    , contributor
    Comments (74) | Send Message
     
    Inflation is every central banker's Playboy dream, but the question remains: after 5 years so far and trillions spent on resurrecting inflation all to no avail, what's it going to take? If 1 trillion a year won't suffice, will 2 trillion be enough? Will 10, 20, 100 trillion do the trick? The truth is, who knows. For sure central bankers don't. They are just playing their magic trick, waiting for the inflation to come in one day. Right now I am playing th OBVIOUS and shorting the yellow metal.
    7 May 2013, 01:19 PM Reply Like
  • css1971
    , contributor
    Comments (870) | Send Message
     
    Well, we don't know, but historically what they are renowned for doing is pushing and pushing and pushing till the dam breaks. Then you get all the inflation you could ever need.

     

    Oh and you're on the heavy side of the boat.
    7 May 2013, 03:00 PM Reply Like
  • sethmcs
    , contributor
    Comments (3461) | Send Message
     
    What's it take to get inflation going? Shortages. The thing that's changed quite a bit is gold is a securitized commodity. Meaning the supply of paper gold can be a lot bigger than physical overwhelming demand.
    7 May 2013, 03:43 PM Reply Like
  • Jason Burack
    , contributor
    Comments (1824) | Send Message
     
    The paper price is in complete divergence from supply/demand for actual metal. Only traders, speculators and miners should worry about the paper price unless you bought mining shares or royalty/streaming shares. If you bought actual metal for insurance and wealth preservation, you should not care what the paper price says. If the paper price goes much lower, a large % of miners are going bankrupt. Demand for metal is still rising. This will setup a supply shock in 3-5 years in my opinion. Paper price says collapse and bear market but disappearance of metal from COMEX warehouses, rising premiums on coins and bars and 8-10 weeks to get delivery of metal says shortage is coming. Miners are about to start turning off supply to survive. Has anyone ever seen a market where demand for actual commodity is rising and the technicals look this bad? This is NOT a free market!
    7 May 2013, 03:54 PM Reply Like
  • Skeptical Investor
    , contributor
    Comments (505) | Send Message
     
    Central banks create money, either cash or electronic entry equivalents by purchasing longer dated securities in the marketplace at the prevailing price. The cash created is a hot potato that seeks some source of return above that of cash, which is zero. As more and more cash is produced, the desperate search for returns creates asset bubbles, which are elements of an increasingly unstable environment. Every such increasing instability ends catastrophically as the asset inflation eventually generates widely recognized inflation expectations that cannot be ignored further by the central bank. But at that point the central bank is incapable of significantly reducing the level of cash that has been created, since the value of the securities in their portfolio crashes and even a total liquidation (which would further reduce the prices) would retire only a small fraction of the originally created cash. Hello Zimbabwe, goodbye dollar, thank goodness for hard assets.
    8 May 2013, 12:53 AM Reply Like
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