[MrBill]

Micki wrote:
$this->bbcode_second_pass_quote('', 'M')rBill.

I wouldn't go as far as blaming Greenspan for all the evils of the world. He did however represent the Federal Reserve, which is a Central Bank controlled by private interests.
They make money by lending, so an in debted nation is in their interest.

Secondly, all coins have two sides.
The feds kept the interest rates at a very low level for a very long time. Which is good as people didn't have to pay so much interest but bad as it does tend to build bubbles. I think the housing bubble is a collective responsibility where a lot of ignorant people have invested just on the assumption that prices never will come down and then withdrawn whatever equity they have.

[pogoliamo]

Well, thank you Micki and Mr Bill for the long posts here

After I have finished reading almost all posts of this thread I got the impression Micki is well informed and has some good arguments. But not being a gold bug myself, I cannot regard gold on its own.

Micki, what is the connection you make between gold and bond and stock market? In the political environment where we live, how to you imagine gold-standard working?

Investing in something is a complex matter, we all know that. So what is gold good for? Short-time speculation? Mid or long-term investment? As a diversification instrument? Who should buy gold, and how should you buy it, I mean literally, what do you exactly do , in which countries what is applicable, and how do you store it? And next how reliable is the information regarding gold supply and demand and other gold-related issues.

Many questions... Many but's anf many if's. And before you make an investment and put your money in gold you have to have the answers! Clear answers!

There are sites on Internet, SCAM's and HYIP's which pretend to have 1300% annual return of your investment, and there are pretty good reasons to suspect those as fraudulent. Correct?

So I want to hear sound answers to the questions above and want to warn some of the readers here, that gold makes sense only as 5-10% of the total amount of capital as an inflation hedge.

[threadbear]

$this->bbcode_second_pass_quote('pogoliamo', 'W')ell, thank you Micki and Mr Bill for the long posts here



So I want to hear sound answers to the questions above and want to warn some of the readers here, that gold makes sense only as 5-10% of the total amount of capital as an inflation hedge.

[MrBill]

$this->bbcode_second_pass_quote('threadbear', '')$this->bbcode_second_pass_quote('pogoliamo', 'W')ell, thank you Micki and Mr Bill for the long posts here



So I want to hear sound answers to the questions above and want to warn some of the readers here, that gold makes sense only as 5-10% of the total amount of capital as an inflation hedge.

[threadbear]

I wasn't meaning to insult Mr. Bill, who seems to have a good grasp on all things economic.

I'm thinking of brokers I've seen, in the US. It doesn't matter how smart these people are, as individuals, they are ALWAYS behind the curve because they limit their reading to the business pages, what they see on television, and in-house literature from their respective companies.

By the time it hits the mainstream, from an investment perspective, it's history. In order to spot a trend you have to read a lot, across a wide spectrum, and then invest within the sector of the trend when noone else is paying attention to it. Investing is an anticipatory sport. As soon as the word on the street is "buy this or buy that", that's the time to sell.

[mmasters]

Bottom line is the bankers control the currency and the gold. When the currency goes out of style gold is instituted as a safety measure, that is until the next best currency is devised. This is a historical bait and switch that has been going on for hundreds of years.

When the USD goes belly up one can expect a global economic crisis where markets and currencies are hit hard and most investments are devistated. This is where gold panic buying happens on a collosal scale and when it's time to start thinking about selling.

When the USD goes south a new currency similar to the EURO will replace it with a huge gold bubble in the mid-term. That is my prediction.

[pogoliamo]

$this->bbcode_second_pass_quote('MrBill', 'B')ut pull up a 20 year gold chart. Substract any nominal gains by inflation. You will see what a great bargain gold was over the past 20-years!

[hi-fiver]

Mr. Bill:
Thank you- I have followed this web site for two years and you have always been the the voice of lodgic. I feel likeI have received Econ 101&202 for free here at the PO. Com site... For whatever your reasons, thank you, I have benefited greatly from your frank economic discussions.

[hi-fiver]

Threadbear, you must be about my age... I am a 56 year old oil field worker, and "we" don't just talk about hunting and fishing anymore. Investiments... Hell, if I could just figure out if the near future was going to be inflationary or deflationary I might be able to adjust my 401K withdrawals. It was said somewhere, that the future holds inflation of the stuff I need and deflation of the stuff I don't. If the "crash" was bad enough, I can't see me eating gold or silver to survive, but then again I don't have the warehouse space to hold enough vodka and tobacco to hold out till the ET's arrive. (humor) God can piss down my neck every day of the week, but he can only drown me once. (unknown)

[MrBill]

$this->bbcode_second_pass_quote('threadbear', 'I') wasn't meaning to insult Mr. Bill, who seems to have a good grasp on all things economic.

I'm thinking of brokers I've seen, in the US. It doesn't matter how smart these people are, as individuals, they are ALWAYS behind the curve because they limit their reading to the business pages, what they see on television, and in-house literature from their respective companies.

By the time it hits the mainstream, from an investment perspective, it's history. In order to spot a trend you have to read a lot, across a wide spectrum, and then invest within the sector of the trend when noone else is paying attention to it. Investing is an anticipatory sport. As soon as the word on the street is "buy this or buy that", that's the time to sell.

[MrBill]

$this->bbcode_second_pass_quote('threadbear', 'I') wasn't meaning to insult Mr. Bill, who seems to have a good grasp on all things economic.

I'm thinking of brokers I've seen, in the US. It doesn't matter how smart these people are, as individuals, they are ALWAYS behind the curve because they limit their reading to the business pages, what they see on television, and in-house literature from their respective companies.

By the time it hits the mainstream, from an investment perspective, it's history. In order to spot a trend you have to read a lot, across a wide spectrum, and then invest within the sector of the trend when noone else is paying attention to it. Investing is an anticipatory sport. As soon as the word on the street is "buy this or buy that", that's the time to sell.

[hi-fiver]

Mr. Bill:
If you'rs and Threadbears comments are stiched-up, and I apologize if that's not the case, what can you say about the recent tail wagging between the Greek and Cypress people concerning offshore oil rights? Is there some quanity of oil to be concerned about, and if there is, who are the players?

[threadbear]

$this->bbcode_second_pass_quote('pogoliamo', '')$this->bbcode_second_pass_quote('MrBill', 'B')ut pull up a 20 year gold chart. Substract any nominal gains by inflation. You will see what a great bargain gold was over the past 20-years!

[MrBill]

$this->bbcode_second_pass_quote('hi-fiver', 'M')r. Bill:
If you'rs and Threadbears comments are stiched-up, and I apologize if that's not the case, what can you say about the recent tail wagging between the Greek and Cypress people concerning offshore oil rights? Is there some quanity of oil to be concerned about, and if there is, who are the players?

[MrBill]

threadbear wrote:
$this->bbcode_second_pass_quote('', 'A')t this point in time, buying a house, in the US or Canada at the conclusion of a peak is a BAD idea. First time buyers should wait it out. People buying up should too. Any newbie taking out a 25 year mortgage that has to be refinanced every 5 years (typical in Canada) is not only engaged in speculation, it's speculation of the most wild eyed, foaming at the mouth, crazy type. I know--you can live in it. You can live in a rental too, it's much cheaper. Do your own research, though.

Anyone, and I mean anyone who isn't following environmental and political events, doesn't understand resource depletion etc.. shouldn't be investing at all. They end up being red meat for "financial consultants" who may have several conflicts of interest, some which they may not even be aware, the main one being to prop up the present carbon buring based system. I'm certainly not saying MrBill fits this bill.

[threadbear]

$this->bbcode_second_pass_quote('MrBill', 't')hreadbear wrote:
$this->bbcode_second_pass_quote('', 'A')t this point in time, buying a house, in the US or Canada at the conclusion of a peak is a BAD idea. First time buyers should wait it out. People buying up should too. Any newbie taking out a 25 year mortgage that has to be refinanced every 5 years (typical in Canada) is not only engaged in speculation, it's speculation of the most wild eyed, foaming at the mouth, crazy type. I know--you can live in it. You can live in a rental too, it's much cheaper. Do your own research, though.

Anyone, and I mean anyone who isn't following environmental and political events, doesn't understand resource depletion etc.. shouldn't be investing at all. They end up being red meat for "financial consultants" who may have several conflicts of interest, some which they may not even be aware, the main one being to prop up the present carbon buring based system. I'm certainly not saying MrBill fits this bill.

[MrBill]

threadbear wrote:

$this->bbcode_second_pass_quote('', 'M')r. Bill, as far as the undervalued apartment idea, I did just that about 3 years ago, with great trepidation, understanding a peak was forming. I fixed it up and then followed local real estate forums very carefully. As soon as the newbie investors, from outside of the city, started talking up investing in my area , I listed and sold it within a week. Think it was about 11 months ago, in Victoria, B.C. Prices dropped or hit a plateau, in that particular market., in the Spring, just after I listed and sold. Return on initial investment? 70%

Sigh...What was a poor democratic socialist trapped in a ravenous upward price spiral generated by the excesses of capitalism, supposed to do, anyway?

I agree with all the points you're making, particularly the idea that all things being equal, real estate tends to go up, over time, (historically speaking)

However, when you are moving into an inflationary period, with interest rates rising and banks becoming more cautious, AND the general public tapped out, debt wise, you're in for the mother of all price corrections in housing. The downslope could go on for years, with prices plateauing at a much lower level, or rising very slowly from that point. This could take 20 years, or more. It will be the inverse of what has happened in the last 20 years.

There will be much biblical type wailing and gnashing of teeth, accompanying the high pitched squeals of the financial machinery as the unwinding gets going with increasing velocity.

[threadbear]

$this->bbcode_second_pass_quote('MrBill', 't')hreadbear wrote:

$this->bbcode_second_pass_quote('', 'M')r. Bill, as far as the undervalued apartment idea, I did just that about 3 years ago, with great trepidation, understanding a peak was forming. I fixed it up and then followed local real estate forums very carefully. As soon as the newbie investors, from outside of the city, started talking up investing in my area , I listed and sold it within a week. Think it was about 11 months ago, in Victoria, B.C. Prices dropped or hit a plateau, in that particular market., in the Spring, just after I listed and sold. Return on initial investment? 70%

Sigh...What was a poor democratic socialist trapped in a ravenous upward price spiral generated by the excesses of capitalism, supposed to do, anyway?

I agree with all the points you're making, particularly the idea that all things being equal, real estate tends to go up, over time, (historically speaking)

However, when you are moving into an inflationary period, with interest rates rising and banks becoming more cautious, AND the general public tapped out, debt wise, you're in for the mother of all price corrections in housing. The downslope could go on for years, with prices plateauing at a much lower level, or rising very slowly from that point. This could take 20 years, or more. It will be the inverse of what has happened in the last 20 years.

There will be much biblical type wailing and gnashing of teeth, accompanying the high pitched squeals of the financial machinery as the unwinding gets going with increasing velocity.

[firestarter]

$this->bbcode_second_pass_quote('MrBill', '
')Having said that I see NO unwinding of the global credit play in the near future. Not from American, Japan, China or anyone else that matters. I really do not! I see the near future as seeing very much like the immediate past. I can find no other path. And I have looked from a critical point of view.

[pogoliamo]

$this->bbcode_second_pass_quote('threadbear', '
') Mr. Bill has chosen a recent 20 year block of historical time, BEGINNING with gold priced at $800 to explain to you why gold may not be such a good bet. I could just as easily choose the twenty year block of time prior, where gold ENDED at $800 per oz., and draw comparisons to that time and today to explain why it IS a good bet. Both are looking in rear view mirrors.

I think it wise to understand that everything we do is a form of speculation. Waking up in the morning and getting out of bed, somedays isn't a good idea, statistically speaking. Holding dollars in an inflationary environment is a dopey idea too.