$this->bbcode_second_pass_quote('Oakley', '
')I thing the profit potential from putting money in gold or silver now is very low, and I caution those of you planning to place your bet at this late date. When the run for the door starts, many dreams of wealth will be shattered.
PeakOil is You
On the metals sideline...best jump onboard. pt 2
Re: For those of you on the metals sideline...best jump onbo
by roccman » Tue 19 Apr 2011, 19:52:25
others don't think so...
$this->bbcode_second_pass_quote('', 'T')he University of Texas endowment has made a huge move into physical gold.
The endowment took a delivery of 6,643 gold bars, worth $987 million on April 15. They are now stored in a bank warehouse in New York.
The Texas fund’s $19.9 billion in assets ranked it behind only Harvard University’s endowment. Last year, UTIMCO added about $500 million in gold investments to an existing stake, said Bruce Zimmerman, the endowment’s chief executive officer.
http://www.newser.com/story/116657/univ ... -gold.html
"There must be a bogeyman; there always is, and it cannot be something as esoteric as "resource depletion." You can't go to war with that." Emersonbiggins
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roccman - Light Sweet Crude
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Re: For those of you on the metals sideline...best jump onbo
by Lore » Tue 19 Apr 2011, 20:17:21
One fresh dead squirrel for 5 rounds of 22LR.
The things that will destroy America are prosperity-at-any-price, peace-at-any-price, safety-first instead of duty-first, the love of soft living, and the get-rich-quick theory of life.
... Theodore Roosevelt
... Theodore Roosevelt
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Re: For those of you on the metals sideline...best jump onbo
by Cloud9 » Tue 19 Apr 2011, 21:13:55
I'm not a big player. For me physical silver and gold are a hedge against uncertainty. I did not buy it to sell it. I bought it to spend if other forms of portable wealth fail.
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Re: For those of you on the metals sideline...best jump onbo
by mattduke » Wed 20 Apr 2011, 00:27:10
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Re: For those of you on the metals sideline...best jump onbo
by roccman » Wed 20 Apr 2011, 11:02:58
silver up another dollar
maybe it will not pull back in a meaningful way - (>20%)...or maybe the "pull back" is the rug being pulled out from under the human project...
inquiring minds...
(anyone think Karl "PMs are losers bets" Denninger is eating crow?)
what a moron...
maybe it will not pull back in a meaningful way - (>20%)...or maybe the "pull back" is the rug being pulled out from under the human project...
inquiring minds...
(anyone think Karl "PMs are losers bets" Denninger is eating crow?)
what a moron...
"There must be a bogeyman; there always is, and it cannot be something as esoteric as "resource depletion." You can't go to war with that." Emersonbiggins
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roccman - Light Sweet Crude
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Re: For those of you on the metals sideline...best jump onbo
by roccman » Sat 20 Aug 2011, 20:46:25
Silver should be around $70.
JP Morgan needs 1.5 years of global supply to cover its shorts.
not gonna happen and I think silver broke out to the upside Friday.
got silver?
JP Morgan needs 1.5 years of global supply to cover its shorts.
not gonna happen and I think silver broke out to the upside Friday.
got silver?
"There must be a bogeyman; there always is, and it cannot be something as esoteric as "resource depletion." You can't go to war with that." Emersonbiggins
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roccman - Light Sweet Crude
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Re: For those of you on the metals sideline...best jump onbo
by Sixstrings » Sat 20 Aug 2011, 20:55:33
I pulled up the first page of this thread for some nostalgia:
$this->bbcode_second_pass_quote('Tyler_JC', '[')b]Gold has fallen off the cliff. We're down to $830!
$this->bbcode_second_pass_quote('Tyler_JC', '[')b]Gold has fallen off the cliff. We're down to $830!
Gold's at like like $1,873 now. So.. did anyone go all in on gold in '08, or before? If you did then you more than doubled your money so far, not bad.
OTOH.. Apple stock was $150ish in '08, now it's $350. About the same performance as gold.
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Re: On the metals sideline...best jump onboard. pt 2
by Outcast_Searcher » Sat 20 Aug 2011, 23:19:46
What I'm finding interesting is the breakdown of the correlation between the PM mining stocks and gold. If you look at either GDX or GDXJ for say, the past two years, the correlation is extremely strong -- and GDXJ has some silver miners, so clearly the issue is about mining STOCKS vs. the METAL.
The breakdown really took off about a year ago, as GLD's trajectory steepened compared to the mining stocks.
I've done some Googling and some reading, and haven't really seen anything overly insightful on this, IMO.
I have a few thoughts, and wondered if anyone had any (preferably productive) comments:
1). If people are getting more fearful of a REAL (but temporary) economic breakdown "emergency", such as a massive banking failure started by European idiocy, for example -- could this be spurring the demand for the REAL physical metal?
(If so, I assume this would impact GLD's price, since they hold the physical metal in vaults.) For me, no matter how high gold and silver go -- I am NOT tempted to sell my physical metal. If anything and I want to chicken out, I would want to put on some sort of hedge like GLD LEAP puts, or something, if the price gets truly parabolic.
2). I keep hearing about how costs are getting out of proportion and diminishing the profitability of mining. Does this make sense?
It USED to be (say 25 years ago), that the miners moved FASTER than gold, as they were leveraged to the price differential between their cost and their gold sales price (likely hedged to some extent by gold futures contracts).
I can understand that if the price is going way up AND the extraction price is going way up, then this ratio might greatly lessen. However, with relatively mild global overall inflation (so far) -- I just don't see this cost relationship changing drastically and suddenly like this price differential is. Perhaps I'm missing something.
3). Is the smart money wanting to own something SIMPLE and RELIABLE and PORTABLE and TANGIBLE that has a low long term correlation with the major global stock markets? Especially if they fear a repeat of 2008 (possibly on steroids)?
This makes some sense to me. This is part of why I don't want to sell my physical PM's at basically ANY price. (I can imagine that there are a LOT of people like me that really don't want to trade non-gold futures contracts, or put up with the cost and contango issues of general futures ETF's -- so by owning their inflation assets (like oil) via stocks -- they end up with a LOT of risk in stocks).
4). Fear of a global fiat currency breakdown, leading to a bond market breakdown, hyperinflation, and the consequences.
To me, this is another possible risk -- if things get bad ENOUGH, mining stocks are pieces of PAPER (actually electronic blips these days) and may not pay off if there is an economic disocation that is major and NOT temporary. I just wonder if there are ENOUGH investors percentage-wise who place a high enough liklihood on this outcome to allow a big and widening mining stock discount to persist. It seems the general investing public still isn't stampeding toward gold in the first world. They are in India and China -- but that is more of a long term cultural thing.
.....
So, if we aren't heading toward near term doom -- is this a good (and getting better) hedging or relative value opportunity? It's sure easier to click on (GDXJ orders than fool with coins, safe deposit boxes, etc.)
One other point in the miner's favor for the patient -- one can get some really decent premiums on options for even mining ETF's like GDXJ. This makes me think that holding a core position of a GDXJ and selling some short term options around the edges (as an adjunct to your physical metals holdings) -- should be a solidly profitable long term proposition for the:
a). PATIENT investor
b). Who expects PM's to trend upward over the longer term
For one thing -- this is a way to garner current income on a PM position -- which is one of the weaknesses of a core holding of coins/bullion.
The breakdown really took off about a year ago, as GLD's trajectory steepened compared to the mining stocks.
I've done some Googling and some reading, and haven't really seen anything overly insightful on this, IMO.
I have a few thoughts, and wondered if anyone had any (preferably productive) comments:
1). If people are getting more fearful of a REAL (but temporary) economic breakdown "emergency", such as a massive banking failure started by European idiocy, for example -- could this be spurring the demand for the REAL physical metal?
(If so, I assume this would impact GLD's price, since they hold the physical metal in vaults.) For me, no matter how high gold and silver go -- I am NOT tempted to sell my physical metal. If anything and I want to chicken out, I would want to put on some sort of hedge like GLD LEAP puts, or something, if the price gets truly parabolic.
2). I keep hearing about how costs are getting out of proportion and diminishing the profitability of mining. Does this make sense?
It USED to be (say 25 years ago), that the miners moved FASTER than gold, as they were leveraged to the price differential between their cost and their gold sales price (likely hedged to some extent by gold futures contracts).
I can understand that if the price is going way up AND the extraction price is going way up, then this ratio might greatly lessen. However, with relatively mild global overall inflation (so far) -- I just don't see this cost relationship changing drastically and suddenly like this price differential is. Perhaps I'm missing something.
3). Is the smart money wanting to own something SIMPLE and RELIABLE and PORTABLE and TANGIBLE that has a low long term correlation with the major global stock markets? Especially if they fear a repeat of 2008 (possibly on steroids)?
This makes some sense to me. This is part of why I don't want to sell my physical PM's at basically ANY price. (I can imagine that there are a LOT of people like me that really don't want to trade non-gold futures contracts, or put up with the cost and contango issues of general futures ETF's -- so by owning their inflation assets (like oil) via stocks -- they end up with a LOT of risk in stocks).
4). Fear of a global fiat currency breakdown, leading to a bond market breakdown, hyperinflation, and the consequences.
To me, this is another possible risk -- if things get bad ENOUGH, mining stocks are pieces of PAPER (actually electronic blips these days) and may not pay off if there is an economic disocation that is major and NOT temporary. I just wonder if there are ENOUGH investors percentage-wise who place a high enough liklihood on this outcome to allow a big and widening mining stock discount to persist. It seems the general investing public still isn't stampeding toward gold in the first world. They are in India and China -- but that is more of a long term cultural thing.
.....
So, if we aren't heading toward near term doom -- is this a good (and getting better) hedging or relative value opportunity? It's sure easier to click on (GDXJ orders than fool with coins, safe deposit boxes, etc.)
One other point in the miner's favor for the patient -- one can get some really decent premiums on options for even mining ETF's like GDXJ. This makes me think that holding a core position of a GDXJ and selling some short term options around the edges (as an adjunct to your physical metals holdings) -- should be a solidly profitable long term proposition for the:
a). PATIENT investor
b). Who expects PM's to trend upward over the longer term
For one thing -- this is a way to garner current income on a PM position -- which is one of the weaknesses of a core holding of coins/bullion.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: On the metals sideline...best jump onboard. pt 2
by roccman » Sat 20 Aug 2011, 23:25:48
where did 55 pages of discussion go from 2008?
"There must be a bogeyman; there always is, and it cannot be something as esoteric as "resource depletion." You can't go to war with that." Emersonbiggins
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Re: On the metals sideline...best jump onboard. pt 2
by Sixstrings » Sat 20 Aug 2011, 23:52:24
$this->bbcode_second_pass_quote('roccman', 'w')here did 55 pages of discussion go from 2008?
For that matter.. where is the post I just quoted above.. It was on the first page now it's not there. Weird.
hm.. yeah all the '08 stuff is gone, it was just there and I quoted a snippet.
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