Getting Bad

[TheScotsman]

Nearly 1520$ oz for gold, and Silver running nearly 49 at open this AM.

Yet on one of the Sunday shows (on that liberal cable network) an analyst says that doesn't necessarily spell trouble for the US economy. How do they figure that?


They seldom ever mention the copper spot to inventory ratio. When both go up, it's an indicator no one is building anything, and the dollar is going in the bin. The tipping point in the past has always been a 7% increase in value, and a 7% increase in stock over a 60 day running period. The numbers for copper have been beyond that mark by, well, 250% this year.

How can anyone with a half a brain think that insane precious metals gains, and even more insane commodities prices could possibly do anything except destroy the US economy?

[agunn1231]

i really don't know much about what you are talking about. I'm just a youngin who hasn't given a damn about this stuff till reading the serious discussion section on forum, but i am interested to learn more about what you are talking about. could you maybe PM me about it so that i can understand what this is saying exactly.

[thatonethere]

Wow. I saw this coming a couple of years ago. In fact, I posted a thread about it and everybody thought I was batshitcrazy, or stupid or both. I'm seeing places that say "We buy gold!" as well as "gold conventions" where people can sell and buy gold. I posted a link to a video where a supermarket offered the option of cashing in scrap gold or using it to make purchases. I think Scottsman was the only one who could see what I was talking about.

I'm going to go ahead and gloat and say I TOLD YOU SO to those who thought I was retarded.

[Dr. B]

nevermind Edited April 27, 2011 by Dr. B

[ezxen]

it boggles my mind how much worth we put into a shiny rock

[mustafabey]

The rise in gold certainly shows a general uneasiness people have with the economy. It shows also that foreign governments have less faith in the strength of the dollar. Quite a few nations want to replace the dollar as the dominant world currency,especially when dealing in oil.Our governments massive and increasing debt has alot to do with this rise. What is scary is that people listen to the likes of Glenn Beck, touting gold as a hedge against inflation and a weak dollar. That means alot of folks with limited resources are putting their money in gold. A couple of thousand dollars in gold isn't going to help you in a financial crisis. Speculation is part of what is driving the price of gold up,just like oil.Although the dollar is weak and the American economy is troubled,these speculators are just slipping their slimy hands in your pockets to steal your money. However the world financial crisis resolves itself, the price of gold is going to drop,like a rock. Its nothing more than another financial bubble that is going to burst and lots of peoples money is going to just "disappear". Some financial advisors do not recommend gold as an investment. One way or another it seems America's time as the worlds leading power is going to end soon to be replaced,probably by the BRIC nations. But the decline will not collapse America, we will probably join Britain and France in that wonderful fraternity of has beens. Which,BTW, leads to wonder how the British populace, currently undergoing financial austerity pains can cheer over the massive expenditure of money for the royal wedding.It must have cost billions! And yet the peons cheer. Insanity is now becoming a world wide epidemic

[Survival Nate]

I now this thread is aging but I figured I would put my 2 cents it

The best way to look at it is the price of gold is not going up, the price of the dollar is going down.

[acolorado]

"Yet on one of the Sunday shows (on that liberal cable network) an analyst says that doesn't necessarily spell trouble for the US economy. How do they figure that?"

Probably because precious metals [i]are[/i] commodities. Like all commodities they are subject to speculation, hoarding, production shortages, and increasing demand (as new uses are found in high tech). Since we dropped the gold standard, gold and silver no longer serve as a critical market staple, such as petroleum. Gold can be three times higher and it still won't have a major impact on the vast majority of Americans. It's just not that important any longer, unless you happen to be a jeweler.

You may have been watching the commercials warning you of a coming economic apocalypse and then helpfully telling you the smart thing to do is buy gold. Yes, those charitable people are so sure that GOLD is the only safe bet, that they are willing to trade you their precious GOLD for your soon to be obsolete dollars. Lucky thing they found you in time.

Seriously, rising coffee prices would be more damaging to the economy than gold or silver - we all need a pot of that in the morning.

[TheScotsman]

[quote name='acolorado' timestamp='1309870307' post='514658']
"Yet on one of the Sunday shows (on that liberal cable network) an analyst says that doesn't necessarily spell trouble for the US economy. How do they figure that?"

Probably because precious metals [i]are[/i] commodities. Like all commodities they are subject to speculation, hoarding, production shortages, and increasing demand (as new uses are found in high tech). Since we dropped the gold standard, gold and silver no longer serve as a critical market staple, such as petroleum. Gold can be three times higher and it still won't have a major impact on the vast majority of Americans. It's just not that important any longer, unless you happen to be a jeweler.

You may have been watching the commercials warning you of a coming economic apocalypse and then helpfully telling you the smart thing to do is buy gold. Yes, those charitable people are so sure that GOLD is the only safe bet, that they are willing to trade you their precious GOLD for your soon to be obsolete dollars. Lucky thing they found you in time.

Seriously, rising coffee prices would be more damaging to the economy than gold or silver - we all need a pot of that in the morning.
[/quote]

The original querie was as to the BASE metals markets, specifically the gold/copper, gold/aluminum, gold/zinc, and gold/iron ratios. Not the precious spot. Bullion is just that, just bullion-a form of hard value money, and not an industrial requirement. As I hear one talking head tell me how great the econ is recovering, and another telling me the zombies are coming for us, the simple fact remains that no recovery is possible if industry is not buying materials. The other fact that is indisputable is that when the avalible inventory goes up, and the base metal falls in the gold/base ratio it demonstrates that primary commodity buyers aren't buying, and investors are putting their $ somewhere else (bullion). No matter what the CNN plonker says, there is no recovery when Unemployment is up/holding, and no one is buying any material. Just what of value can be mfgd W/O copper, and Aluminum? When they are loosing value (like the recent 20% hit copper took after Bejing's reports of a slowing Chinese economy.) No one is bidding up the important bases, no one wants to put their money in futures for a raw material that isn't in demand-because no one is using the stuff to build things to sell.

True, precious metals are a commodity, but they stand out as the commodity that sets the value for all the others. That will become more pronounced as people flee the euro (resulting from Spain, Ireland, Portugal, and Greece being in financial ruins). As people flee the dollar as a result of the every president since Nixon printing more of our monopoly money. A million dollars in bullion is just over 3 bars, That fits in a safe very nicely. What the hell do you do with a million dollars worth of coffee? how about if they can't afford a cup of coffee? How long does it last? The 3.19 bars are going to be good forever. That is why the value of bullion is so important.

As gold value goes up the ratio to any other item goes up, more to the point, when gold goes up, so does the coffee... and every other item you buy every day. What fool thinks that is good for the country?

Once it all boils down, it is exactly as Nate put it.

Strangely, amid all that value change , Cobalt, moly, steel billet, and lead are suddenly bullish. All the key requirements of armored military hardware. Hmmmmmm.....


IMNHO the commercials are for retards. Too expensive now-numismatic valued coinage is cool to look at, and all... but the premium for that historic value is too high. To make any money you had to buy bullion back when it was 280-500. Those commercials are capitalizing on the people that missed the boat, and are now looking for a life-ring.