drbagel

Decoupling Of Physical Gold And Paper Gold Prices

Secmaven is right on. When gigantor investors buy gold they buy enormous bars at low markup. Now, as they dump their bars, small investors are scrambling to pick up small size bullion items (krugerrands...etc.) Hence the heavy markup in coins.

It may be that fiat money is eventually doomed, but that doesn't mean it's doomed in the immediate future. This is just one man's opinion, but I really think a lot of small time gold investors are going to take a bath on this one.

Gold Speculators Rushing In?

Small investors are buying gold coins while huge sales of gold bars and futures are occurring. Thus the shortage in coin. They always say that small time investors get in too late and take a beating just when something peaks. Maybe we are witnessing that right now.

Silver and Gold: Buy, Hold or Run?

"I Has anyone tried to buy physical gold lately? It's getting harder to do, i.e. waiting for deliveries,etc. yet the price was going down?"

Buy it cheap makes an interesting point. I have noticed this too. I wonder if the "smart money" is getting out in bulk (comex bars) while the small investors are piling onto a sinking ship (coins and small denomination bullion). This would explain both.

The International Gold Rush: Bulls May Soon Be Rewarded

fiddle,Nero, fiddle

Interview with Nick Barisheff: Gold is Money

Currently, all active financial endeavors are denominated in fiat currency. Borrow money, sell a product, earn a salary...you're dealing in fiat dollars. Gold can be money under certain circumstances. It is important to realize that by owning gold, you forgo participation in the rest of the economy. A lump of metal is a lump of metal. The current system creates a dichotomy between active financial endeavors and gold. Perhaps this is by design. The result is that holding gold carries an opportunity cost. The wealthiest people in the world earn their keep in the fiat economy, because the greatest oportunity for wealth creation exists in trade. No one ever gets rich by stuffing their mattress full of money. Owning and holding gold provides no trade opportunity. Ironically, golds greatest strength is also a major weakness. It is never someone elses obligation, but lets not forget that obligations can be very lucrative. Don't get me wrong. I like gold. I own gold. Its a hedge and its insurance but holding gold is putting money in a mattress. It is clear to me that Mr Barisheff is selling something. He has a business, and guess what, its denominated in dollars.

Comparing Commodity ETFs/ETNs

Just to clarify, the target (base) weight of the underlying components of DBC are somewhat different and are probably the more important numbers over the long haul.
Energy 55%
Grains 22.5%
Gold 10%
Aluminum 12.5%

I think DJP has the best mix but I would be afraid to allocate such a large portion of my portfolio to a single corporate bond (which is what DJP is, essentially)

XME is a nice way to gain commodity exposure without funky tax consequences (its a stock fund), with low costs (35 basis points), with limited energy exposure (35% coal) and with virtually no oil and gas exposure (these are already well represented in the S&P 500.)

I own none of these.

'Gold as Money' Means a Potentially Massive Rise in Valuation

The problem with discussing the gold standard, is that almost nobody remembers how it works anymore. A fractional gold standard like Bretton Woods fixes the value of a currency, say the dollar, to a specified amount of gold. Since gold is scarce, heavy, and earns no interest, most people want to hold notes or paper investments which represent a specific value and will do so as long as they know they can exchange it any time. This results in most currency circulating as paper. This is similar to fractional reserve banking where deposited money is available on demand as long as most people don't demand it simultaneously. This allows currency in circulation to far outnumber gold in reserve. A Bretton Woods like standard is about fixing the VALUE of money to gold, not the 100% backing discussed in the article above.

Gold as an Investment? Think Again

This is a well written article. A true gold bug plans to earn the big bucks as everyone else crashes and burns. While it is true that all paper currency regimes have ended and that gold is the final common medium of exchange, going long on catastrophe is a piss poor long term strategy.

The Myth of Gold as an Inflation Hedge

Gold is money. It is the final common money in our society. It will always be accepted and it will always have value. That does not mean, however, that it will always maintain its value or appreciate in a given time period. Investing in gold has a cost. The opportunity cost of missing out on going concern investments, driven by profit margin and adapting to the economy as it changes. In such, a long term bet on gold is a cash position and an overall bet against the financial markets. I'm not sure I want to take that bet. I will use it as a hedge, though.

Commodity Analysts Believe the Party's Over

Nothing goes up forever.

Commodity Analysts Believe the Party's Over

Nothing goes up forever.

WSJ's One-Two Gold Punch

Or maybe this is the kiss of death. Gold is now firmly in the main stream. Perhaps a front page article in the WSJ represents a top.