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The stronger dollar has precious metals resuming their decline in force (or is the decline in...

The stronger dollar has precious metals resuming their decline in force (or is the decline in precious metals strengthening the dollar), with gold (GLD) off 2.3% and silver (SLV) off 2.2%. Crude oil (USO) pulls back a bit from its recent big rally, -0.9% to $95.53.
Comments (106)
  • Excellent! With 85 billion new "strong" dollars being printed every month, we should all be rich soon!
    10 May 2013, 07:44 AM Reply Like
  • This alone is inflationary. The run up in equities is simply being fueled by the Fed. This can't go on forever...or maybe it can?
    10 May 2013, 07:57 AM Reply Like
  • Flem-

     

    Its the ultimate buying opportunity, since we have followed the path of Japan, its only a matter of time before we announce ANYTHING to devalue our currency & thus crash the dollar & gold shoots.
    10 May 2013, 08:05 AM Reply Like
  • Wrong.
    10 May 2013, 08:29 AM Reply Like
  • I am waiting for someone (who knows a lot more than me),to write about the different types of inflation. Money inflation vs. Price inflation ..We are experiencing both ,but price inflation has been concealed in many ways IMHO. You know the carton of Ice Cream is NO longer a 1/2 gallon etc.
    As for Money inflation well that's a bigger kettle of fish ,but is the main reason why we need precious metals in order to protect our wealth from an immoral government that is spending money like a drunken sailor in order to win the next election. Wait ,the drunken sailor analogy is not right,they quit spending once they are out of money. :)
    10 May 2013, 03:33 PM Reply Like
  • "The rumored Hilsenrath "tapering" story - originally expected to come out late Thursday - instead came out after yesterday's market close. It's mostly a summary of what's already known - that Fed officials plan to reduce asset purchases in steps, the timing of which is still being debated. The article leans heavily on Richard Fisher and Charles Plosser, two well-known hawks (and non-voters on the FOMC this year) who would have already tightened if it was up to them. A number of Fed speakers - including Bernanke - are set to speak next week."

     

    Oh this will be an interesting week for the markets. Stopping QE'S will doom the top of this market for sure. Now is this a rumor or the truth?
    11 May 2013, 09:09 PM Reply Like
  • "Libor may be replaced by a new system next year. FT says discussions are centered around a dual-track system wherein a survey-based approach (the old model) would operate concurrently with a transaction-based index (the new model). Presumably, such a setup would retain the stability of the traditional model, while incorporating an element of objectivity"

     

    First they change the formula for GDP, now this?? Boy they are really going to extremes to be able to manipulate every figure they can aren't they? What a joke!!!...
    12 May 2013, 08:28 PM Reply Like
  • I am willing to bet the winnings in my Yen trade so far that the Japanese central bank is up to its old trick. But don't fight the trend, buy some put options. I am long physical, but I relish every opportunity to short the paper version.
    10 May 2013, 08:07 AM Reply Like
  • There seems to be a contradiction in logic. Commodities continue to decline with consensus of a deflationary environment. Yet, somehow, housing - another commodity - is anticipated to improve. Why will housing improve in a deflationary environment?
    10 May 2013, 08:20 AM Reply Like
  • It won't.
    10 May 2013, 09:07 AM Reply Like
  • Housing improving is a sign that we are moving away from deflation, in my opinion. Housing is the common man commodity. The common man controls the price based on supply and demand more than gold, silver, oil, etc. People are starting to spend more, we are going to start increasing our GDP, paying off our debt and eventually be able to raise interest rates to fight off inflation.

     

    It's going to be beautiful! Join the ride.
    10 May 2013, 09:11 AM Reply Like
  • We are not in a deflationary environment rather the rate of inflation is slowing. So we still have some inflation just less. But when gold was on that massive run we didn't have a lot of inflation either? In fact, we haven't had a lot of inflation since the early 80's. But we've had lots of different asset classes get hot and pop. So none of this has anything much to do about inflation.
    10 May 2013, 09:34 AM Reply Like
  • The_Batman,

     

    Raising debt led to fear of default/inflation let to raising gold prices.
    10 May 2013, 09:36 AM Reply Like
  • People really think they own their home until they raise taxes way too high, or want to build a road right through your living room. Another falsehood.
    10 May 2013, 11:16 AM Reply Like
  • 95, can you explain to me why banks don't mark to market? Just curious your thoughts. My guess is you think this is a non-event, that the FASB simply allows banks to do what they want when they need to, in helping the economy improve via Fed policy. Do you think this is ok because the result so far has been staving off deflation and collapse of some banks?
    10 May 2013, 11:57 AM Reply Like
  • Doug,

     

    I think you are asking leading questions. That's what I think.

     

    Please direct me towards your sources that fear over leveraging by banks with respect to the "actual" value of their holdings.
    10 May 2013, 12:27 PM Reply Like
  • "Housing improving is a sign that we are moving away from deflation, in my opinion. Housing is the common man commodity."

     

    I thought that was a fantastic way to phrase that! Bravo. However you are wrong on all other counts:

     

    "People are starting to spend more"
    That may be true however owning more I-whatever products to "look" more wealthy than your neighbor means nothing if you finance it with debt and at the end of the day have no real net worth aka: 85% of all Americans according to the Economic Policy Institute.

     

    "we are going to start increasing our GDP"
    Better late than never I guess considering the "recession" has been over for four years already. The 50 million on food stamps and the 90 million now completely out of the workforce might disagree with you.

     

    "paying off our debt"
    Well that statement is just to silly to comment on so we will just let that one be.

     

    "eventually be able to raise interest rates to fight off inflation"
    Sorry won't happen. The country goes from broke to completely broke.
    The gov't cannot service it's debts now without borrowing from Peter to pay Paul. The FED and gov't know we have gone where no one has ever gone before and mathematically the end game is going to be brutal for 90% of the population.
    10 May 2013, 12:28 PM Reply Like
  • 95, Google "Mark to Market" and "FASB." And as far as asking leading questions, Google "Socratic Method."
    10 May 2013, 12:32 PM Reply Like
  • TCDP,

     

    Housing prices are going up. People are at least spending more on that. More of that will only lead to more private investment. Especially as the threat of inflation stays far from sight. This will lead, as history has shown, to a higher GDP. This will lead to more money in the system so we will run a negative deficit which reduces our debt. Once employment comes back in line from these things and we start to see inflation effects the Fed will increase the interest rate.

     

    It really is that simple.

     

    The only other theory to contradict that is what you said:

     

    "Sorry won't happen. The country goes from broke to completely broke.
    The gov't cannot service it's debts now without borrowing from Peter to pay Paul. The FED and gov't know we have gone where no one has ever gone before and mathematically the end game is going to be brutal for 90% of the population. "

     

    And if you really believe that, then I am sorry for you. In my opinion, that is narcissistic and will only lead you to miss true investment opportunity. Do you really think the world, that has only progressed over time, is actually going to fail in your lifetime? And if so, why are people buying gold and not seeds?

     

    It really makes no logical sense. Nor is there history to support those claims.
    10 May 2013, 01:05 PM Reply Like
  • Doug,

     

    Socratic method allows for thoughtful questioning, not leading questioning. Good try, though.

     

    I know what mark to market is. I know what the FASB is. I want to know your sources that show that the FASB forcing banks to mark to market would show a massive coverup.

     

    I just simply don't have any evidence that those conspiracies have any merit whatsoever. That said, I am 100% for on exchange trading in all assets. Not 100% on exchange, but there should be visible quotes for anything that trades. It's the most efficient and fair market model.
    10 May 2013, 01:09 PM Reply Like
  • @95

     

    March Consumer Credit rises $7.97B vs. an expected $16B and $18.63B previously (revised from $18.2B). It's the smallest increase in 8 months, with revolving credit falling $1.71B and nonrevolving (auto, student loans) rising $9.68B. [View news story]

     

    Care to put your spin on this. People are spending more huh??
    10 May 2013, 01:13 PM Reply Like
  • Hi 9532921:

     

    Thanks for your reply. I would not feel sorry for me. Not one bit.

     

    Feel sorry for the 85% of Americans who live in their own fantasy land of make believe wealth where they equate debt and material items they cannot afford in the first place with real net worth.

     

    I may sound a bit narcissistic however that does not mean I have not been fully invested for 2 decades already. Each month I watch my portfolio get injections of fresh dividends equal to the amount of almost 4 times the average American's take home pay each week (Avg American weekly gross pay= $45K per year)

     

    I am definitely not a believer in complete collapse. However you do not need that to see even more hardships expanding all over the country. Most food pantry's across the US do not even have any food left.

     

    BTW: There are countless examples throughout history of failed empires. To say there is no history to support these claims is not correct. Just because those former Empires did not have flat screen TV's, cellphones, etc. does not mean history will not repeat itself.
    10 May 2013, 01:31 PM Reply Like
  • @95

     

    So you approve of dumping 400k of gold market shorts onto the market at the same time then ?

     

    That is a fair and honest investment? Or someone trying to manipulate the market somewhat? Is it even worth your time to investigate it?
    10 May 2013, 01:43 PM Reply Like
  • 95, Socratic method "leads" the one being questioned to think the way the one asking the questions wants them to think. I like your attempt to avoid answering any questions be deflecting back to the questionnaire, and then trying to throw that person into a conspiracy camp with conjecture. I don't fall for such attempts at linguistic control. You obviously didn't Google. I thought everyone knew how to Google? (This last comment is in response to a reply you made to me in another thread).

     

    Let me Google that for you.

     

    Background:

     

    SEC OFFICE OF THE CHIEF ACCOUNTANT AND FASB STAFF CLARIFICATIONS ON FAIR VALUE ACCOUNTING
    http://bit.ly/10gpLN9

     

    AMENDMENTS TO THE IMPAIRMENT GUIDANCE OF EITF ISSUE NO. 99-20
    http://bit.ly/10LjSDE

     

    Summary of Statement No. 157
    http://bit.ly/10gpLNh

     

    Result:

     

    U.S. rulemaker eases mark-to-market's bite
    http://reut.rs/10LjQvz

     

    From the horses mouth:

     

    FASB Chairman Robert H. Herz Testifies on Mark-to-Market Accounting

     

    “While bending the rules to favor a particular outcome may seem attractive to some in the short run, in the long run, a biased accounting standard is harmful to investors, creditors and the U.S. economy,”
    http://bit.ly/10gpLNj

     

    Investopedia definition of Mark to Market as it applies to FASB.

     

    1. Problems can arise when the market-based measurement does not accurately reflect the underlying asset's true value. This can occur when a company is forced to calculate the selling price of these assets or liabilities during unfavorable or volatile times, such as a financial crisis. For example, if the liquidity is low or investors are fearful, the current selling price of a bank's assets could be much lower than the actual value. The result would be a lowered shareholders' equity.

     

    This issue was seen during the financial crisis of 2008/09 where many securities held on banks' balance sheets could not be valued efficiently as the markets had disappeared from them. In April of 2009, however, the Financial Accounting Standards Board (FASB) voted on and approved new guidelines that would allow for the valuation to be based on a price that would be received in an orderly market rather than a forced liquidation, starting in the first quarter of 2009.

     

    2. This is done most often in futures accounts to make sure that margin requirements are being met. If the current market value causes the margin account to fall below its required level, the trader will be faced with a margin call.

     

    If this accounting fraud did not occur, how could the banks have survived the financial crisis? They wouldn't have. But is that a bad thing? Would the world have ended? This isn't a conspiracy, but simple math. The fact that banks today still don't mark to market their assets simply shows they can't without fear of FDIC take over or some sort of government bailout (again). The fact the nations top banks hold more sub-investment grade derivatives today than at the height of the crisis of 2008 shows where they are today.

     

    While I agree with your Utopian scenario of an efficient and fair market, It is impossible for these banks to have visible quotes for anything that trades. There is still too much unwinding to come. Banks don't make money the old fashioned way (loans) and so they find other ways to make profits. It's a survival game for some of them. Being honest about where they still are would destroy them overnight (talking the largest banks here).

     

    Dodd Frank did little to curtail the derivatives fiasco and that is why the FASB still allows banks to do what they want in valuing their assets. But that's not enough for Congress. They still want less regulation and are continually proposing it.

     

    Rep. Stephen Lynch (D-Mass.) called the provision “a wish-list of the financial industry. . . . We’re taking accountability and throwing it out the window.”

     

    http://wapo.st/10LjSU6

     

    The Fed is doing all they can to help "maintain stability." The verdict is still out on their success.

     

    You seem to think everything is fine based on your comments. I see it differently.

     

    It's not about winning an argument. It's about protecting one's wealth. You can invest based on your views that GDP will improve without the underlying data to back it up. See my article from yesterday; Economic Data Show Potential Of Stock Market Bubble http://seekingalpha.co...

     

    I'll stick with cash, gold and silver for now. Everything else is are Illusions of Wealth.
    10 May 2013, 02:24 PM Reply Like
  • The Hershey factor is what the government uses for it's housing numbers. You know ,fudge the figures .
    10 May 2013, 03:36 PM Reply Like
  • IT,

     

    I didn't say today. I said it will happen. It just takes awhile after a financial crash to earn back the trust of the investors of the world. That's all.
    10 May 2013, 03:48 PM Reply Like
  • I don't care about net worth when talking about how I feel bad for you. I feel bad for the millionaires of the world buying gold and land, fearful of QE. I feel bad for the billions of people who are poor who are having their prosperity delayed because of it.

     

    Regardless of net worth, happiness can be found or lost.

     

    Food shortages may be occurring. We are in a recession after all. I simply believe we will invest our way out of it. Then we will raise interest rates to curb inflation. All the while our debt will be reduced.

     

    Agreed that this has happened in history. In those times, though, there was more of a battle mentality between economies whereas these days everyone realized globalization is a good thing. Isolation is dead. Simon and Garfunkel were wrong.
    10 May 2013, 04:11 PM Reply Like
  • If they are within their regulated constraints, then I have zero problem with placing orders in the market. Even large short sales.
    10 May 2013, 04:12 PM Reply Like
  • Doug,

     

    Point of socratic's is to try to get the other person to contradict themselves. We both know what it is and neither are accusing the other of contradicting themselves, so lets move on.

     

    I appreciate your extensive details on the mark to market issues. Like I have said many times before, I think we have made and will continue to make many mistakes. With mark to market, deficits, etc. it's all about confidence. Yes, we may be running a risk of needing a gov't bailout again, but I am OK with that. If that is the risk we take to make sure people keep investing then it's worth it. Progression with set backs is much better than stagnation. Maybe not every single year, but over enough time it is (look at today vs. even 100 years ago, let alone 1000 years ago!). And I can have this mentality because I have no fear of the US gov't defaulting. US gov't default!? That is just not something I am willing to bet on. We are printing money left and right, producing terrible output numbers and yet there is zero fear of inflation (amongst academics).

     

    DoddFrank is going much slower than it should, but that is because they formed it poorly. They know their mistakes (most lie in the language they used to justify the deleveraging) and they are working on fixing them. And we will see these assets trading on lit markets soon. We will at least see the trades printing to a "TRF."

     

    I completely agree it's not about winning an argument. But it's not about protecting one's wealth either. That is exactly why we are still in this recession. Stop protecting your wealth with a "what if I need it all today" mentality and start investing in the future to increase your wealth.

     

    And if you wait for GDP to fully rebound before you bet that it will, then you will miss the trade. I want to be a frontrunner that takes risks based on an optimistic outlook on the world and how well it can learn from its mistakes. From regulation that will force the hands of private investors to start leveraging themselves and investing again lest fall behind the world awesomeness curve (WAC). From the 99% demanding housing and healthcare and education and the positive effects of those things.

     

    I refuse to submit myself to a life of fear. And I don't think, based on history, that is irrational in any way whatsoever.

     

    Lastly, you should dump your pm's and buy something of value. Not of value from fear. But of value from actual compoundable assets.
    10 May 2013, 04:35 PM Reply Like
  • How do you figure we're going to pay off our debt? The only way that can possibly happen is if we seriously devalue the Dollar.
    10 May 2013, 06:48 PM Reply Like
  • @TCDP

     

    Of course GDP is going to go much higher. They are changing the formula ! Now R&D, Entertainment, and other goodies will be included!

     

    Wonders never cease !!
    12 May 2013, 10:11 AM Reply Like
  • Pretty scary that legally they can short a commodity in a scale that is greater then ALL the physical in existence. Yup sure sounds like a fair trade to me !!

     

    MI, then Abe, now 95. anyone see a pattern here?

     

    They all sound the same to me !!
    12 May 2013, 10:15 AM Reply Like
  • 95, based on the data, you interpret "as a self proclaimed front runner" and live in a utopian world and I live in a world of reality based on my reading of it. That's the difference between you and I.

     

    I have multiple articles over the years to back up my point of view, and a book that is doing better each and every month...despite a falling gold and silver market. My next book will be out in a couple months, God willing. My 3rd book, over 7 years in the making, is one that I hope rights the ship (as I see it), to work towards your utopian (based on your reading of the data) point of view.
    13 May 2013, 09:18 AM Reply Like
  • Doug,

     

    I wish you luck with all of your projects! Most people don't even publish one book let alone several.

     

    The difference between you and I is that I don't see this world I describe, the one I live in, as utopian. I see it as being actually what it is. A good thing. If we change our perspective (which is really hard for us to do since we only live 75 years) to hundreds of years, you can easily see my point. The world may not definitely be better today than it was in 1995, for us, but for the majority of the world it is and it is certainly better for everyone than it was in 1913, 1813, 1713, etc.

     

    I understand my time horizon relative to hundreds of years is short, but I am going to keep betting on the macro trend of UP. I just don't think I'm "lucky" enough to guess the timing of the world getting so bad that we need trade in gold and silver.

     

    I also feel like its counterproductive to society and to yourself to not believe in the positive power of mankind working together. We wouldn't be here today if people hadn't taken risks and learned from their mistakes throughout history.
    13 May 2013, 04:40 PM Reply Like
  • Right 95, want the best, but have to face reality. We learned a couple times with the experiments of government money and they failed twice. Read up on Jackson a bit.

     

    "What it is" "is" Utopian if you ignore debt. How do you not address debt in all your posts? You think future GDP will somehow, magically, take care of future debt via growth and the taxes on the debt. This is incomprehensible for anyone who is Keynesian, Krugman or otherwise.

     

    Why don't our kids calculators go to $1 trillion?

     

    Why do Congressmen only compute deficit spending the next 10 years rather than taking care of debt?

     

    How long do you think Keynesian policy can pretend this game has a good solution? Did anyone, and I mean anyone, see 2007/2008 coming?

     

    Be positive all you want about the future man, but do simple math. Pretend GDP will grow with no industry to back it and wages that can't compete. Pretend government spending and future debt is all we need to spark the economy. Then look at Japan, Europe and the UK for what's to come.

     

    I want what's best. You and I both want what's best. We just see the future differently based on our own interpretation of the data. That's ok man. I appreciate the conversation. But nothing backs up a good future for our economy unless we cut, cut, cut. Feel the pain, pain, pain. Unless of course you buy some gold and silver as insurance for such cuts and pain.

     

    But seriously, how am I dollar bullish when I write what I write? How can this possibly be if I sell gold for a living? Riddle me that....
    14 May 2013, 01:30 AM Reply Like
  • The Geoffster,

     

    Nope. Just an optimist who rationalizes it through my perspective of history.
    10 May 2013, 09:19 AM Reply Like
  • In the shadow of the strong mighty dollar nothing grows.
    10 May 2013, 10:16 AM Reply Like
  • Right now barring cataclysmic situations ie.nuclear war with somebody or calamitous natural events that can always happen or don't forget zombie attacks, ride the wave while you're can be on top of it. Keep your eyes open and make prudent moves not panic moves.
    10 May 2013, 10:21 AM Reply Like
  • The onslaught of massive margin calls on PM's are going to be very brutal; very brutal indeed!

     

    Unraveling to say the least.
    10 May 2013, 10:38 AM Reply Like
  • @TEUT

     

    Just another buying opportunity as they try their hardest to shake out the weak hands ,that's all. It is called desperation!!
    10 May 2013, 11:08 AM Reply Like
  • I am not a expert but I read a article by a very successful expert that listed several of the myths about the Stock Market. One of the myths being that when the dollar gets stronger, gold goes down. He said history has shown that isn't necessarily the case. In fact he said the Stock Market has a mind of it's own and when you hear people trying to predict it's next move based on certain things, Don't count on it. When buying a stock look at how it is doing. Also, it never hurts to own Gold if you are willing to hold it for the long term, it is one of those things you may or may not need in the future, nice to have some just in case that day comes. If you don't need it in your lifetime, you can always pass it on to your children.
    10 May 2013, 10:44 AM Reply Like
  • I recently tacked a horseshoe to the wall above our bedroom door. Whereas I don't for a minute believe in lucky charms, my understanding is that the horseshoe brings good luck whether one believes in it or not.

     

    By applying similar logic, I maintain a position in GLD as a form of insurance, all the while hoping that I'll never need it.
    10 May 2013, 10:45 AM Reply Like
  • whaddyamean?,

     

    That logic only works if you have unlimited liquidity. Otherwise, you should make rational decisions with how to invest your money.

     

    In my opinion, gold should not be on that list.
    10 May 2013, 10:55 AM Reply Like
  • @WHADDY

     

    Better do your homework on GLD !! Below is a post from someone who I hope does not mind me repeating it. I also have been yelling this as well for over 2 years !!

     

    THIS POST CAME FROM ANOTHER POSTER!!

     

    "At current prices physical gold demand will remain high, which, I believe, warrants an amazing buying opportunity since current reserves must be replaced with future high-quality production from miners."

     

    Keyword: PHYSICAL

     

    Easterners buy physical while Westerners buy questionable paper substitutes known as GLD.

     

    “Did anyone try reaching out to State Street Global Advisors and asking if GLD's physical assets are insured? I've personally called them at 866-320-4053 to ask about the state of GLD's insurance. They said that there is no insurance but at the same time they claimed HSBC bank do have insurance policies on their holdings. I could not get them to elaborate on this 'claim'.

     

    There are not many ways for the average investor to validate GLD's physical assets. Even the prospectus is full of legal writing removing liability. On top of everything, the GLD manager - State Street, has been shown to be less than trustworthy (Carina CDO, multiple instances of forex fraud). Where is the credibility in GLD?"
    10 May 2013, 11:40 PM Reply Like
  • IT,

     

    I recommend publications by those in academia over websites like these.
    13 May 2013, 04:41 PM Reply Like
  • @THE GEOFF

     

    Just read his Bio. That should answer all your questions..Kinda funny though.

     

    Like the last 12 years of gold's value increasing meant nothing ? Yup were hitting on all cylinders right now huh?
    10 May 2013, 11:00 AM Reply Like
  • Yes, because 12 years spells the whole truth. Fundamentals, as i have posted in detail about several times, are demanding a correction. There is no inflation.
    10 May 2013, 11:08 AM Reply Like
  • Did anyone say we can't have deflation before inflation? BB will print as much as he can to starve off deflation. That is his worst nightmare. Please !!
    10 May 2013, 11:18 AM Reply Like
  • IT,

     

    We have deflation - being fought by QE.

     

    Investor confidence will return and we will have inflation - which we will fight with increased interest rates.
    13 May 2013, 04:42 PM Reply Like
  • You are advocating a consumer based ,debt based economy. That's a guaranteed failure if you win .
    13 May 2013, 10:03 PM Reply Like
  • Yes, because "the economy is suffering from lack of demand" - means banks have hard time to find debt slaves, and "jobs are the first priority" - means we gonna screw every small businesses with tax and regulations and legislate our competitors out of business, and therefore we need to "stimulate the economy" - means print fresh dollars for our buddies and friends in order to "advance national agenda" - impoverish middle class through inflation and restrict freedoms.

     

    Press like!
    13 May 2013, 10:19 PM Reply Like
  • Then you just missed out on 12 years of tremendous gains in gold my friend. Now can you say the same thing about the stock market over that period of time?

     

    I know, I know, your right.. I am wrong ! I wish I had an ounce of silver every time I have heard that line the last 12 years !!

     

    "gold is overpriced" or "our fiat money is different then every one in history"

     

    Deer in headlights syndrome perhaps??
    10 May 2013, 11:06 AM Reply Like
  • Actually I didn't miss it. I bought GLD in the summer of 2007 and sold it about a year ago. I wasn't afraid, but I understood the fears based on the situation at the time. Now I don't understand the fears based on the situation at this time. Hence I am short gold.
    10 May 2013, 12:30 PM Reply Like
  • Oh I get it , you had perfect timing huh?

     

    I have heard enough. You just proved my point!
    10 May 2013, 12:41 PM Reply Like
  • PM me. I will show you the evidence I show other people who give me their money to short gold.
    10 May 2013, 01:11 PM Reply Like
  • And, to be 100% honest, the fact that I got my first real job and made good money starting in 2007 was nothing but extreme luck.
    10 May 2013, 01:13 PM Reply Like
  • Geithner and Bernanke won't be around to hold them accountable when the ice cream hits the fan. They both know when it's smart to depart like Larry S.
    10 May 2013, 11:10 AM Reply Like
  • Yup, they will pull a Greenspan !

     

    Jump ship I guess...
    10 May 2013, 11:12 AM Reply Like
  • I am borrowing a post from another that I found interesting!!

     

    " As I read the part about savers moving to equities looking for better return, I can't help remembering something I read this morning. I wish I could remember where I read it (the CNBC "news" part on my iPhone app when I got up to check the European open, I think); but I read that the last time this many equities were being purchased ON MARGIN was sometime mid 2007. I remember thinking, that this little piece of overlooked data could be the game breaker once the selling starts. What could be starting as a normal correction, could balloon into something more as these margins are called.

     

    So, where are people going to move money when the equity markets turn, treasuries fall, and savings still pay .005% (OK a little sarcastic here)?

     

    Uh huh........... PM's."

     

    Just food for thought for some newbies!!
    10 May 2013, 01:19 PM Reply Like
  • @95

     

    "I think it is stupid to invest/obsess with gold. Just like Warren Buffet, it's a complete showing of ignorance. It's worthless except for sentiment. Irrational sentiment rooted in ignorant obsessions by very uneducated people from before Jesus' time. I gave up on Jesus years ago. Same with gold."

     

    Here are a few points of interest. I would bet that you did not know that Buffet tried to corner the silver market once...

     

    Now as far as a 6 year track record that is waaay too short to try and distinguish yourself as an expert investor. ALL of us doing it for much longer have battle scars. Yours will come. You really need to stop thinking of gold and silver accumulators as dooms day preppers. We do it as insurance, and invest in other things as well.

     

    Personally I hope you are right. I have a 25 year old daughter who graduated college with Honors and can't find a teaching job full time in over 2 years ! So who knows what the future holds.

     

    But as you get older, sometimes we also get wiser as well. I am glad your doing well for 6 years, but don't boast too loud because we have all been there, thinking we had this game figured out. Then have the BOOM dropped on you that might make your head spin.

     

    If you point out companies with a solid track record I would invest in them. Always have !! But these FLASH CRASHES quite frankly have changed the game. No longer are stop loss limits safe. You blow right through them , lose your investment dollars, only to see the stock rebound in 3 seconds!! If you need the link to that one about a week ago I will dig for it.

     

    Good luck and keep winning. No one wishes the USA collapses, but some of us want something stored away for that just in case scenario. I have a fishy smell I don't like right now with the markets, to be honest !

     

    10 May 2013, 06:38 PM Reply Like
  • That's very good info IT . He helped start the SLV ETF when he sold his massive Silver holdings to Barclays. Why would 95 revere someone that had that much "Evil" Silver. Warren must have been filled with that "Judas spirit" ,You know that guy that "Gave up on Jesus"

     

    8)
    10 May 2013, 09:21 PM Reply Like
  • @COINS

     

    Age does make you somewhat educated if you want it ! Boy, I wish I could go back a few decades and change some decisions in life! :)
    10 May 2013, 11:27 PM Reply Like
  • @Interesting Times:

     

    "Then you just missed out on 12 years of tremendous gains in gold my friend. Now can you say the same thing about the stock market over that period of time?

     

    I know, I know, your right.. I am wrong ! I wish I had an ounce of silver every time I have heard that line the last 12 years !!"

     

    Again, why 12 years for the gold gains? What about 20 or 30 years?

     

    What about the next 12 years instead of the past 12? :-)

     

    What about a non manipulated stock market when it goes up and a non manipulated gold market when it goes down (vice versa)? :-)

     

    Technically (30 weeks moving average) gold is awful while the stock market is super nice. Are we due for a short term correction /consolidation (down for the stock market and up for gold)? Probably.

     

    Gold is a good trading asset but a very bad religion :-)

     

    Best,
    Dom

     

    Ps: I really like MUX
    10 May 2013, 09:16 PM Reply Like
  • @DOM

     

    I only go back as long as I have been accumulating. You are correct as some go back way further then I do . But I cannot speak for those who did !!

     

    Now I also expect a market correction as well. When is the question as I surmise we now have bad money chasing after it! Looks like the smart money is getting removed slowly , which is the smartest way of course.

     

    Remind me.. What's a non manipulated market anyway? Did we ever have one?

     

    Best to you as well.
    10 May 2013, 11:32 PM Reply Like
  • >> Read his Bio.
    yep, he is ahead of himself,

     

    @9532921, what about a word called corruption?
    10 May 2013, 10:12 PM Reply Like
  • @95

     

    I appreciate you trying to give me advice. But stop! When you attack my family you have gone overboard and I will just bypass all your post from now on. None of it makes sense to me anyway.. Just look at your likes to see who agrees with your assessment of what is happening.

     

    Please talk you book somewhere else. Not even going to ask what type of job your sister took. But you have to lighten up dude.

     

    This isn't Yahoo and SA will not tolerate it I am sure.
    11 May 2013, 07:16 PM Reply Like
  • @95

     

    With all due respect not all comments are made for you! If you do not like my reasoning then bypass it.

     

    Others might want to read what I have researched. Being angry posting isn't working.
    11 May 2013, 07:35 PM Reply Like
  • @KAV

     

    It is sad that some just want to ruin a thread. Insults have no place here !! I agree with your assessment. I will just bypass 95's posts as they aren't helpful.

     

    Lets just move on !!
    11 May 2013, 08:42 PM Reply Like
  • Amazing how someone that doesn't believe in the fundamental concept of SAVING,wants to give his bad advice to others. Seems to me ,he knows so many things that aren't so .
    13 May 2013, 07:52 AM Reply Like
  • Saving your money, in a recession, is a very conservative strategy. I prefer to spend and invest when times are down.

     

    If you look historically, when interest rates were low and recessions were in, people who bought cheap came out on top. They believed in the future enough to invest in those days. I feel the same way these days.

     

    I cannot buy a house in my city without a bidding war. I am selling my house for 20% more than I bought it for two years ago (i did get a steal, though). My vacation costs are up this year vs. the last several. Yet interest rates are still low. Economic growth is barely puttering.

     

    What more do investors need to stop deleveraging and start taking risks again?
    13 May 2013, 09:01 AM Reply Like
  • 95 wrote: "Done talking to you, Curt."

     

    Good !
    12 May 2013, 09:16 AM Reply Like
  • "Buffet had less than $3BB in silver. Not quite cornering the market."

     

    Yeah, most of us accumulators who hate a commodity have about that much invested in what we hate!!

     

    $3 billion or 33 billion is not small potatoes for sure.

     

    Sad that people post fiction instead of facts!
    12 May 2013, 10:24 AM Reply Like
  • It's humorous to see 9 criticize fear, ie irrational pessimism, while embracing equally irrational optimism. Pay down our national debt? The last year we did so was 1957 if my five minutes on google is accurate. If he has been as successful in investing as he claims it is a shame he has chosen not to share his successes and the lessons he's learned with his fellow posters here and has instead devoted 100% of his comments to bashing the PM trade. I for one am here to learn so I don't repeat past mistakes and am happy to share both wins and losses with fellow posters, but for me it's not about an ego trip.
    12 May 2013, 12:23 PM Reply Like
  • Destin,

     

    Your 5 minutes are very wrong. I have posted legit sources time and again to why we are going to be just fine. As soon as people stop hoarding their money and start investing in each other again
    13 May 2013, 07:36 AM Reply Like
  • If I am wrong, then please correct me. When exactly was the the last year we actually paid down the national debt?
    13 May 2013, 10:36 AM Reply Like
  • By 'pay down' you mean pay off? Was it 1957? Correct me if I'm wrong. Income tax for the super rich then was something like 95%, I believe.
    13 May 2013, 10:40 AM Reply Like
  • Off and down, like knight said are different.

     

    Destin,

     

    Try this, as a thought exercise. If you had plenty of money to buy a house with cash when interest rates are 1%. Would you spend the cash or get the loan?

     

    I have a hard time understanding why people think debt at 0-0.25% interest rate, that the QE has been generating, is such a bad thing? Unless you think the world will start selling US Treasuries and that the US gov't will subsequently default, then I am just at a loss for the basis of the logic being used.
    13 May 2013, 11:25 AM Reply Like
  • You predicted in another post that the economy will continue to improve, the budget deficit will disappear and we will begin paying off the national debt. I responded that my cursory search indicated that we have not actually paid down the national debt in any year since 1957. When you stated I was wrong I simply asked for the correct information and in response you're now providing nonresponsive analogies. Claiming you can't understand the logical basis is a complete non-sequiter. I'm asking questions in response to YOUR claims, simple questions that should have simple answers, especially for someone like you who's smarter than most everyone else here.
    13 May 2013, 01:23 PM Reply Like
  • Easy to clear up, Destin.

     

    We will pay it down once people start investing again. We will pay it even further down after inflation starts to kick in from investing and we raise interest rates.

     

    That is as clear and as simple as my viewpoint can be stated. I hope that helps.
    13 May 2013, 01:43 PM Reply Like
  • I didn't ask for your viewpoint. I asked a very direct and simple question which you obviously have no intentions of answering. Clearly I am wasting my time here.
    13 May 2013, 03:21 PM Reply Like
  • Destin,

     

    What is your issue here?

     

    You asked if 1957 was the last time the US paid down it's debt. The answer is actually Q1 of this year. We ran a deficit.

     

    The debt has been paid down several times since 1957.

     

    I think the confusion, and maybe your anger(?), lies in the difference between the words "down" and "off."

     

    The PM market (outside of its industrial value) takes away value from the world. I will continue to feel that way until all technologies have been invented and we have time to waste buying and selling (besides sentiment and hobby) non-compoundable items.
    13 May 2013, 03:38 PM Reply Like
  • IT, I've called out people like 9 before only to get chastised by the editors and have my posts deleted as "personal attacks". I figured I would try the "kill them with kindness" back-handed compliment approach this time. They would have you believe that a few hundred tons of paper shorts dumped on the market in the 3-4am Sunday AH represents "price discovery". You and I of course know better.
    12 May 2013, 12:48 PM Reply Like
  • Destin,

     

    That is quite an aggressive investment plan to buy gold and then not even believe it's spot price is valid. How did you justify your entry price in the first place? Was it just, "give me gold, I don't care what it costs?"
    13 May 2013, 07:42 AM Reply Like
  • Sorry to disappoint but I'm actually long SLV puts currently to hedge the PM streamer positions that I've held and done quite well on for several years. They only represent 5% of my portfolio so I am not sweating this decline, it will eventually result in a great long-term buying opportunity if not already. I know better than to fight the trend. I also know better than to think legitimate sellers liquidating gigantic positions do so in the span of five minutes in the Sunday AH. The irrational goldbug strawman you've constructed doesn't really resemble the actual people you're arguing with.
    13 May 2013, 10:53 AM Reply Like
  • All I said is that investing in something you don't believe the price of is aggressive.
    13 May 2013, 12:04 PM Reply Like
  • Huh?? Sorry I do not understand what you mean??
    13 May 2013, 12:11 PM Reply Like
  • IT,

     

    I was addressing Destin. He said I was arguing when really I was saying it seems aggressive to invest in something you don't believe the price of.

     

    That's all.
    13 May 2013, 12:27 PM Reply Like
  • @95

     

    Oh ,ok . I was trying to understand the logic of both sides. I got confused!!

     

    But believe the price of what? Gold ? Stocks? Because ALL prices change daily. I am still confused.
    13 May 2013, 01:35 PM Reply Like
  • He doesn't believe the quoted price of gold is legit. At any given moment.

     

    Yes, I know prices change, but I believe the current price is the value. Others believe it is a manipulated, non-real value.
    13 May 2013, 01:44 PM Reply Like
  • @95

     

    But spot on silver is less then $24 bucks but it does cost around $29 bucks if you can find it. I am talking ASE'S.. So he is right that silver cannot be bought for spot. Do you agree? Am I missing something?
    13 May 2013, 02:09 PM Reply Like
  • IT,

     

    That was not his point, but I understand yours.

     

    If you need physical silver then you are going to have to pay through a huge spread. Especially when volatility spikes and people keep less inventory (like right now).

     

    If you want to buy huge blocks of physical AT spot, sign up to trade on the COMEX (not sure how much $$ you need to do this - probably a ton). Or you can buy paper at very close to spot.

     

    If you are a small player and you don't trust paper, then a spread (sometimes big, right now huge) will always be there.
    13 May 2013, 03:50 PM Reply Like
  • 95 What's your philosophy on savings ? Sounds like this to us that believe in it "hey just spend it don't worry be happy ,they'll just make more "
    A man that doesn't pass anything on but debt to his children is not much of a man IMHO.
    13 May 2013, 07:48 AM Reply Like
  • Curt,

     

    I think you may be bunching a lot of things under "savings" and everything else under "spending," when it seems to me to be much more complicated.

     

    Of course we cannot just print money and distribute it to people and move on pretending the world will get better. Nobody is doing that. The Fed's newly printed money is sitting in banks waiting for private investors to borrow and invest it. In fact, there is actually less money going to poor people (sequestration). The Fed's policy is to maintain inflation and employment. Inflation is down (despite QE), but so is unemployment. There are two scenarios that I see:

     

    1) You do not believe investing in America is smart for your future
    -This currently puts you in the camp with a lot of people with a lot of money. Due to this, though, we have low unemployment and a low inflation. Until employment normalizes or inflation rises, the fed will (should) continue QE. Unless you believe in bond vigilantes, i.e. inevitable US default, then there is no problem with QE under these circumstances. In this scenario, you do not believe investing in America, because of it's debt, will provide an increase in GDP which would allow for a reduction in debt. Under this scenario, you either think added sequestration is the way to cut debt (I'd be careful saying this with conviction - see austerity criticism in Europe), or you believe America is a lost cause.

     

    2) You do believe investing in America is smart for your future
    -Under this scenario you realize debt is a function of an extremely low GDP due to fear and irrational behavior from investors. You continue to buy cheap products at low interest rates. You do not hoard your money into different instruments of saving. You see austerity measure as counterproductive as it lowers quality of life and reduces production and output. Money compounds when it flows through society. Having it sit stagnantly in the bank (at low interest rates) or in the likes of gold, does not help progress society and/or aid us out of this recession.

     

    I understand human biology pretty well. We know that human beings are geared for survival. Especially in a recession I can see why, inherently, people are saving to protect themselves. The thing is, it's those who fight past nature and start to use history and logic to realize investing the in world, throughout history, has proven to be the correct thing to do.

     

    I say we stop saving and hoarding and starting investing. Every dollar held in gold is another dollar (with compounding value) not researching technology, medicine, food production, etc.
    13 May 2013, 09:26 AM Reply Like
  • 95, you seem to have a general point of view we are hoarding, but the savings rate is down based on the latest treasury data. You can find the data in my latest article; Economic Data Show Potential Of Stock Market Bubble http://seekingalpha.co...

     

    Wouldn't you think this depletion of savings is just, for those who have, putting it from one pocket (savings) into the other (investment)? For those that don't have, they are dipping into their 401k's at a tune of 28% more than a year ago. http://bit.ly/10lAjKY (talk about your human biology and survival).

     

    This to me is a sign of the "real" economy, not one that is hoarding, but one that IS surviving. The Fed in fighting this is a non-event (QE), hence no real inflation in "their" numbers, except for a few industries they like (the stock market, banking, and real estate in some areas where the money has flowed).

     

    The real estate issue you might have made some money on, but you sold. Most don't invest that way. Congrats on making money, but many played that game in 2003-2007 and got burned (those that didn't sell). Most don't buy a home to turn it and sell it. The Fed doesn't demand that low income earners do this. They just want them to obtain the "dream" of ownership. Since when is owning a home any longer the American Dream the Fed and our government still thinks it is? (saying this from the perspective of my read on the real estate market and don't really know yours except that you sold, and I have to assume are just waiting for another good opportunity to buy and sell again)....most don't do that as they don't have the expertise to do it.

     

    I think we both want the same thing overall, based on our discussion. We just read the data differently, which I pointed out in my last reply to you.

     

    13 May 2013, 09:44 AM Reply Like
  • I'm not an expert. I was simply making an observation that housing prices are up in the last couple of years. Which is a good thing, in my opinion. I sold because I wanted a different house - nothing more than that. Population increases. People move towards higher populated ares. Housing becomes more expensive. Therefore it is smart to invest in a home (instead of renting) in and around a city, as long as your time horizon is long enough. Dream talk is a bunch of nonsense. It's simply the smart financial decision.

     

    You don't know what people are taking money out of their 401k for, Doug. Maybe they are doing it because they want to spend their money on fun things because their 401k has recovered? Maybe it's to buy physical gold. It's definitely not just to for necessity.

     

    What we want and what we invest in our two different things. We can talk about our mutual desire for world peace another time. For now, I'd like people to open their minds to a world of investing in each other. Believing in human's ability to prosper instead of our inevitable demise.

     

    I'm going to invest in prosperity, because prosperity has perpetuated through time. Gold will crash and technology will soar. That's my hope anyway.
    13 May 2013, 01:56 PM Reply Like
  • @95

     

    "Gold will crash and technology will soar. That's my hope anyway."

     

    I hope that as a nation we prosper as well. I do have kids. But I seriously doubt that gold will crash. imo.

     

    BB saw to that not happening by printing away at will. Doesn't mean we can't recover. But I don't think we will see $600 gold anymore! The CB'S bought way too much to let it go that low.

     

    One day, and I do not know when, I firmly believe that our fiat money will die. May not be in my lifetime but NONE have ever missed being put in a grave !! In history !!
    13 May 2013, 02:15 PM Reply Like
  • 95, what websites do you read that gives you such hope?

     

    The "dream" talk isn't nonsense, it's what our government wants for each of us, as if real estate was an investment or something.

     

    While I don't know the amount people are taking out of 401k's, or whether it is 100% for necessity, I can say that many are doing so because they want control of their money, and are worried the Fed/IRS will come in and take it/nationalize it. This is a form of survival, is it not? Depending on one's trust of the system. Not everyone in America has your trust and faith in the future, nor your reasoning to invest/spend/believe in their fellow man. Some people could give a hoot about their neighbor.

     

    Yes, some of those people withdrawing from their 401k's are investing in gold and silver. Others are paying bills. I didn't assume anything except what was written; that the number of people withdrawing are increasing in numbers.

     

    Your last sentence about investing in prosperity hasn't hurt anyone who has invested in gold or silver since 1971, except for a few that have bought here of late, something I have been cautioning about going all-in because I have been dollar bullish. But that time is getting close to an end. My next article will shed some light on that.

     

    Glad you are for world peace. But if one has a positive attitude as you do, and invests accordingly, they should also think about a Plan B if things don't go as expected. That would be prudent (aka asset allocation that includes some gold).
    13 May 2013, 03:40 PM Reply Like
  • IT,

     

    "BB saw to that not happening by printing away at will. "

     

    It's not "at will." There is a science to it. I truly think everyone who doesn't understand QE, or is fearful of it, should read this: http://bit.ly/UhwJus

     

    Hopefully this gives you some insight as to why fiat is so powerful, yet controllable.

     

    Do you really think mining gold for eternity to keep up with population growth and the inevitable demand for more money flow is a good thing? You do know who and where most gold is mined, right?
    13 May 2013, 03:44 PM Reply Like
  • So what your are saying 95, is if Greece could print their own money, (via Krugman's views) there problems would disappear, right?

     

    Do you really think printing money for eternity is going to be perceived by intelligent population growth as a good thing? You do know money is printed out of thin air right?
    13 May 2013, 03:52 PM Reply Like
  • Doug,

     

    I'd really love for you to read the piece I just shared: http://bit.ly/UhwJus

     

    Yes, I do believe that for Greece. They would have had a really rough time of it (meaning high valuation of their currency and therefore low exports, tourism, low GDP) for a long while, but at least they could determine their own fate instead of having to ride the wave with all of Europe.

     

    I do not thinking printing money, as you describe it, would be good. I do think printing money, under our circumstances (which is described in the attached) is good.

     

    Just to be clear: The link I share. Read it. Please. Before you get upset about money out of thin air. Please read what I shared. It will help make things more clear. It did for me.
    13 May 2013, 04:04 PM Reply Like
  • Glad you brought fake-economist Mr. Krugman into discussion.

     

    Basically what he is saying in his pdf, Ben will print fresh USD to buy all that bonds, and exchange rate will fall.

     

    How is that good for the economy given huge permanent trade deficit, you'll end up paying much more for imports?
    13 May 2013, 07:11 PM Reply Like
  • Folks

     

    I have seen recession and low unemployment written on this thread. First, who ever said were in a recession? Second, who ever said we have low unemployment?

     

    Just because people stopped looking for work doesn't mean they are employed does it? Real unemployment has been quoted at around 15% or more!

     

    Please don't produce government numbers for me. I laugh too hard when I see those!

     

    Entitlements are at the highest level in a long time, where does one say they are low as well.?

     

    I give up!
    13 May 2013, 11:16 AM Reply Like
  • IT,

     

    I could see how you may be confused about us being in a recession. Econ 101 says stimulate inflation in a recession and not create austerity measures. Since we are doing both, it can be confusing. But, in my opinion, we are still, slowly but surely, working out of this recession.
    13 May 2013, 12:34 PM Reply Like
  • @95

     

    I agree, I never thought we left the last one. But the govt. says we did !!
    13 May 2013, 01:36 PM Reply Like
  • In my opinion, the fact that we paid DOWN our debt and raised interest rates (too fast) all the while further paying down our debt, under Clinton, shows we had left the recession.
    13 May 2013, 03:46 PM Reply Like
  • >> In my opinion, the fact that we paid DOWN our debt

     

    Paid down? Look at the chart, you won't see it on the chart. How about it is growing exponentially, and as far as I remember every year end it is growing for many decades.
    13 May 2013, 07:23 PM Reply Like
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