OilyGasMiner

Why Gold Will Decline More than the Markets

I think it's safe to say that the US government is on the brink of default for the first time. Before it was NEVER a real threat, however given the nature of the economy and their growing debt, the becomes more and more of a possibility.

As the above point mentioned
"At any point in time Gold’s value needs to be thought about in the context of its then current and prospective purchasing power, having regard to prevailing and prospective macro-economic conditions."

What is the context though? an ailing economy, country at war, rising debt levels, rising unemployment, lack of liquidity, lack of consumer confidence. THE LIST GOES ON! I do agree that there is a possibility that Gold may fall more than the market, however this will be for a short period of time, with a massive spike occurring in gold for a major correction.

Precious Metals Will Depose Cash from Its Temporary Throne

Peter, it seems our thoughts appear to align very well. Is it no surprise that the money supply is up over 100% over the past few months? According to Obama, TARP has already spent some $300B of the $750B. Hence money is being pumped at a RAPID pace into our withering economy.

I fully agree that this action coupled with the US debt increasing each day, will only result in furthe devaluation of the US. Dollar.

We must recall that the massive sell offs in hedge funds aren't usually voluntary and fund managers are being FORCED to sell because many investors believe that they are forced to sell. For example in Canada, investors with RRIFs, must pay taxes on at least $10,000 of their investment. However this value was determined at the start of the year, and with some portfolio's down by over 50%. They are now actually paying taxes on 20% of their current portfolio. Due to the lack of transparent investment advice, we will continue to sell these massive sell offs take its toll on already undervalued equities. It is only a matter of months IMO before we see a commodity correction.

And as we know "Concurrently, the U.S. Government runs large operating deficits in circumstances where its National Debt approximated $9.6 trillion at July 31, 2008, up from $9 trillion at December 31, 2007 and $6.2 trillion at December 31, 2006."
Quote Source: www.stockresearchporta.../

The question is with the money supply increasing, debt increasing, unemployment increasing, foreclosures increasing, consumer confidence on the decline. How worse can things really get?

Is Hyperinflation on the Horizon?

With trillions being pumped into our economy, and the lowered interest rates.. this indicates to me a massive devaluation of currency, leading to higher prices to compensate for the rising cost of living. However it is important to note where the actual cash is being deployed. As it is going to institutions rather than the consumer directly, the likelihood of inflation is reduced. However if the bailout is carried out as intended, and trickles down, I can see hyperinflation starting to develop over the next few months

Gold: Protect Yourself from Future Inflation

Jason, the proof is defiantly in the pudding. Both Gold and Gold equities is the only safe haven I see from the rapidly rising prices that NO ONE is focusing on.

OBBBAAAAAMAAA where are you?

80 Years' History of Brutal Gold Stock Corrections: How Does Today Compare?

Boris,

Good history lesson. I think this is supplemental information used by many value investors during times similar to our current economy. The reason for the drastic recovery percentages..is due to the fact that fundamentals hold true, and the market always realizes the proper valuation over the course of time.

Have confidence, and invest patiently.

Response to Bloomberg's 'Gold May Pay Only in Case of Maximum Despair'

Michael, you've seemed to uncover a group of the less intelligent individual flabbering their jaws on the market. I trust no one but my own analysis and perception of what is going on in the market. I do this as I've realized how LOST analysts are relative to retailers. As Jim Cramer would say: "THEY NO NOTHING".

Gold is not just a speculative play, but is also a sound investment, I hate the fact that their is this huge misconception that you MUST be rich to afford it, and I'm glad you've highlighted that. Gold rises during times of uncertainty. But as other investments posses a lag period, where it takes time for prices to truly reflect its trued value. And in essence one could say that at these levels the yellow bricks are considered undervalued. no?

I read that "Finally, it was reported last week (again I have not been able to verify this) that the European Central Banks sold 7.6 tons of gold in the week ended October 10. If this is true, that ought to have put downward pressure on the gold price"

This might also indicate the sagging prices in the market. But, a word of warning for investors, be ready to pounce, because once gold starts to take off, you'll be saying. Shoulda, Woulda, and Couldas.

Gold ETF Reaches One Dollar Per Tonne

Funny how everyone seems to be out oakman, but the price is still so low. I strongly believe we are waiting on a significant market correction to occur. Merrill has indicated that they see gold going to $1500 within the next few years. At first I thought that this what's very far fetched , but the more and more I examine the turmoil in the market. The more I believe that their projection will come to pass.

Why Gold Will Rocket

Bah humbug in NEED James. The naton will fall and the skys will rain blood. You can't expect that a nation with thousands of homeless and jobless to sit tight and wait for things to get better. Bad things are upcoming in months ahead. Point Blank. Gold performs during periods of uncertainty. Let us be aware of this, and hedge not only our investments, but also our livelihood. Brace yourselves, as we are headed for rough seas ahead.


"it was reported last week (again I have not been able to verify this) that the European Central Banks sold 7.6 tons of gold (about U.S.$250 million)

in the week ended October 10. If this is true, that ought to have put downward pressure on the gold price. In any event, it strikes me there is a disconnect between the current market demand/supply equation and the futures market where gold is quoted this morning at under U.S.$760 per ounce, down from approximately U.S.$900 approximately two weeks ago. As best I know, the price of gold should gain ground in uncertain economic times – which we certainly are in – and it is not doing that as this is written."
source: www.stockresearchporta.../

Why Gold Will Rocket

Bah humbug in NEED James. The naton will fall and the skys will rain blood. You can't expect that a nation with thousands of homeless and jobless to sit tight and wait for things to get better. Bad things are upcoming in months ahead. Point Blank. Gold performs during periods of uncertainty. Let us be aware of this, and hedge not only our investments, but also our livelihood. Brace yourselves, as we are headed for rough seas ahead.


"it was reported last week (again I have not been able to verify this) that the European Central Banks sold 7.6 tons of gold (about U.S.$250 million)

in the week ended October 10. If this is true, that ought to have put downward pressure on the gold price. In any event, it strikes me there is a disconnect between the current market demand/supply equation and the futures market where gold is quoted this morning at under U.S.$760 per ounce, down from approximately U.S.$900 approximately two weeks ago. As best I know, the price of gold should gain ground in uncertain economic times – which we certainly are in – and it is not doing that as this is written."
source: www.stockresearchporta.../

Survival of the Longest

Thomas good observation on the circuity breaker "work around". The question is: is there a difference between dropping 20% in one day opposed to over a week? In the short term? long term?

I do think you are on the right track with the recessionary forecast. However what has me up at night, is trying to assess given market factors, HOW LONG it will last? will be see a "U" shape recovery? "V" shaped recovery?orrrrrrrrrr an "L" and simply flat line for a while.

Anyone?

Bullion Shortage and Spot Prices Tell Two Different Gold Stories

working link www.stockresearchporta...

Bullion Shortage and Spot Prices Tell Two Different Gold Stories

In times of market decline and recession, investors will naturally go to precious metals, such as gold and silver. During the last couple weeks we’ve seen a large influx of investors cashing out of equities and jumping into gold in particular. Given the fact that no currency is no longer pegged to gold, the once “safe haven” doesn’t hold it’s true value as it once did, IE our fiat money. We currently have a rally in the market, some say this won’t last, while others are taking advantage of the lower gold prices. Either way gold usually stands true over the long run during periods of uncertainty. I’ve been reading on mining valuation, and the differences between the intrinsic value and the market’s perception, very good read.
See Mining Valuation <br>
Emotionless Investing.

Some True Safe Havens Are Still (Surprisingly) Undervalued

btw i'm with Mr.Kaiser on PAL. But I didn't buy at the start of the year.. and I'm glad i didn't because I would be down 45%

Some True Safe Havens Are Still (Surprisingly) Undervalued

proper links:
Sec Guidance:
www.stockresearchporta..." target="_blank

Mining Valuation 101
www.stockresearchporta.../

Some True Safe Havens Are Still (Surprisingly) Undervalued

Valuation is in need the fundamental reason behind buying a company (finance or mining) or an outright precious metal like gold.

I have 2 points I'd like to make:

1. a) with the $700B being flooded into the books of financial companies, the proper valuation will be skewed by having excess assets that were once not there.

b) with the new SEC guidance passed, these companies can assess the value themselves, value their assets, (particularly the mortgage bonds, and loans) to the value they think best reflects the true amount. What the..? SEC Guidance<br>


2) I've been reading a series specifically on mining valuation, and I thought I would share it. It goes beyond the substance being mined, and places emphasis on other external factors outside of the mine that contributes to the valuation process. Mining Valuation 101<br>