Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Inside the Global Gold Frenzy
NYT ^ | 11/08/09 | NELSON D. SCHWARTZ

Posted on 11/09/2009 8:14:29 AM PST by TigerLikesRooster

November 8, 2009

Inside the Global Gold Frenzy

By NELSON D. SCHWARTZ

MENDRISIO, Switzerland

HERE, in a corner of Switzerland where Italian is spoken and roughly one-third of the world’s gold is refined into bars and ingots, business is booming. Every day, bangles, bracelets and necklaces arrive in plastic bags — from souks in the Middle East, from pawn shops in Asia and from corner jewelers in Europe and North America.

“It could be your grandmother’s gold or the gift of an ex-boyfriend,” said Erhard Oberli, the chief executive of Argor-Heraeus, a major refiner here that processes roughly 400 tons of gold a year. “Gold doesn’t disappear.”

Amid a global frenzy fed by multibillion-dollar hedge funds, wealthy speculators and governments all rushing to stock up on the precious yellow metal, the price of gold briefly surpassed $1,100 an ounce on Friday, a record high.

Long considered the ultimate refuge for nervous investors, gold has climbed as the dollar has steadily weakened, budget deficits have expanded in the United States and Europe, and central banks have continued to pump trillions of dollars into weak economies, creating fears of another asset bubble that will ultimately pop.

“It’s not that gold has changed, but gold buyers have changed,” said Suki Cooper, a precious-metals strategist for Barclays Capital. “It’s a structural shift we’re seeing on the investing side, from Asian central banks right down to individual investors buying ingots and coins.”

“Gold’s appeal has broadened,” added Ms. Cooper, who predicts that it will hit $1,140 an ounce by the second quarter of next year.

(Excerpt) Read more at nytimes.com ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: boom; economy; gold

1 posted on 11/09/2009 8:14:30 AM PST by TigerLikesRooster
[ Post Reply | Private Reply | View Replies]

To: TigerLikesRooster; PAR35; AndyJackson; Thane_Banquo; nicksaunt; MadLibDisease; happygrl; ...

Ping!


2 posted on 11/09/2009 8:15:08 AM PST by TigerLikesRooster (LUV DIC -- L,U,V-shaped recession, Depression, Inflation, Collapse)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TigerLikesRooster

The shoe shine boy at the corner there gave me some good tips for buying gold..


3 posted on 11/09/2009 8:16:41 AM PST by 2banana (My common ground with terrorists - they want to die for islam and we want to kill them)
[ Post Reply | Private Reply | To 1 | View Replies]

To: TigerLikesRooster

Adventures in bubbleland


4 posted on 11/09/2009 8:19:02 AM PST by bsf2009
[ Post Reply | Private Reply | To 1 | View Replies]

To: TigerLikesRooster

I’m sorry - educate me as to what good Gold will do for me if the world economy goes to heck? I think food, smokes, booze, and ammo will be a better bet.


5 posted on 11/09/2009 8:19:54 AM PST by Core_Conservative (Proud to be "The self-righteous, gun-totin, military lovin, abortion-hatin, gay-loathin'...")
[ Post Reply | Private Reply | To 1 | View Replies]

To: 2banana
The shoe shine boy at the corner

at the corner of Harrods Department Store in London?

6 posted on 11/09/2009 8:22:06 AM PST by TigerLikesRooster (LUV DIC -- L,U,V-shaped recession, Depression, Inflation, Collapse)
[ Post Reply | Private Reply | To 3 | View Replies]

To: TigerLikesRooster
“Gold’s appeal has broadened,” added Ms. Cooper, who predicts that it will hit $1,140 an ounce by the second quarter of next year.

What's that, a projected 2% increase in 5 months? Way to go out on a limb there, Cooper.
7 posted on 11/09/2009 8:24:42 AM PST by Question Liberal Authority (Why buy health insurance at all if you can't be turned down for any pre-existing conditions?)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Core_Conservative

We will use gold as a medium of exchange. Just as people have done for the last 4000 years - during periods of history considerably more fracked up than today.

If it’s useless to you because ‘you can’t eat it’ someone will be glad to buy it off you.


8 posted on 11/09/2009 8:37:45 AM PST by agere_contra
[ Post Reply | Private Reply | To 5 | View Replies]

To: Core_Conservative

Years and years ago, I had a professor that asked the class a question. “What is purpose for democracy?” After the class tried to answer his question, he said “You are all wrong.” This guy was before the days of liberal professors. I didn’t answer because I knew this guy. There was more to the question than what we knew. His answer....”Democracy is a way for the government to keep you broke. If you are broke, they have total control over you. Remember, we are a republic, not a democratic society.”

Now, if the general public is into gold and they become very independent, the government won’t like it and will do what they can to recall the gold.....as was done in the past. You may be able to hide your gold from them, but what are you going to do with it when they make it illegal to spend or own it? I live in gold country. There are over 50 gold mines within 25 miles of where I live. The Federal government won’t allow them to open up. England owns most of the mineral rights but they can’t mine it because the Feds won’t allow it. Think they won’t control gold eventually? Think again.


9 posted on 11/09/2009 8:38:09 AM PST by RC2
[ Post Reply | Private Reply | To 5 | View Replies]

To: Core_Conservative
This is the one thing I never understood.

What in blazes will an ingot of gold be worth if things really crash? And we’re past the idea of a “crash” being a mere deterioraion of net wealth. We’re talking a bout a real crash.

You gonna eat that gold? Oh, you’re gonna by things with gold, huh? Like what? Food, ammo, fuel? Fom whom? Someone who can eat your gold?

What will have more intrinsic value gold, or food and ammo?

10 posted on 11/09/2009 9:01:48 AM PST by Obadiah (Obama: Chains you can believe in!)
[ Post Reply | Private Reply | To 5 | View Replies]

To: Obadiah
>>>What will have more intrinsic value gold, or food and ammo?<<<

Regardless of all the other arguments that favor gold, $20,000 dollars worth of the stuff is a lot easier to store and transport than $20K of .45cal or $20K of Snickers Bars.

11 posted on 11/09/2009 9:15:32 AM PST by HardStarboard ("The urge to save humanity is almost always a false front for the urge to rule - Mencken knew Obama)
[ Post Reply | Private Reply | To 10 | View Replies]

To: TigerLikesRooster

$1,140 by second quarter?

$1,140 by quarter after three on Tuesday!


12 posted on 11/09/2009 9:35:19 AM PST by djf (Maybe life ain't about the doing - maybe it's just the trying... Hey, I don't make the rules!)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Obadiah

While I am in basic agreement with your point, we are still going to have to pay property taxes and whatever other fees, taxes and bribes the remnant of government will continue to extort from us. IF gold is still legal for exchange, that will be its use. I include silver as a possible means of exchange.

As for food, ammo, fuel, et al, take a look at your stash. It is going to eventually run out or, in some instances, particular items are going to disappear from commerce because no one can obtain the raw materials, the energy or the means of transport essential to their production. It is good to have a balanced cache of goods, money and metals and to keep it replenished. It is still essential to have something to exchange for it. It is also essential to have skills that can be bartered, friends in the medical field and some plans for illness or old age that will allow us to survive the present regime, even before they bring us totally down.

If gold and silver are illegal for exchange and if goods in excess of short term needs are labeled hoarding, life is going to be nasty, brutal and short for most of us.

In spite of this, I have recently begun to notice just how much our own PMs have increased in value. We purchased them wholesale (spot+) over 15 years ago for use in a jewelry business. Most of us cannot afford coins or bars in today’s economy. The premium alone is nearly the price we originally paid for what we have now.

I doubt I would trade coffee, fuel, TP or tobacco for anything except antibiotics or food. Not that I ever want to find out, either.


13 posted on 11/09/2009 9:40:04 AM PST by reformedliberal
[ Post Reply | Private Reply | To 10 | View Replies]

To: agere_contra

“We will use gold as a medium of exchange. Just as people have done for the last 4000 years - during periods of history considerably more fracked up than today.”

Correct. Gold is a store of value.
I laugh at people who ignore history and think times are different today.
Who will buy it? You can’t eat it. Yada yada


14 posted on 11/09/2009 9:44:12 AM PST by cowtowney
[ Post Reply | Private Reply | To 8 | View Replies]

To: Obadiah

It’s not an either/or issue

it truly is possible to buy gold, ammo and food


15 posted on 11/09/2009 9:48:09 AM PST by cowtowney
[ Post Reply | Private Reply | To 10 | View Replies]

To: cowtowney

Say it isn’t so!


16 posted on 11/09/2009 10:05:24 AM PST by Obadiah (Obama: Chains you can believe in!)
[ Post Reply | Private Reply | To 15 | View Replies]

To: TigerLikesRooster

Double Ping!


17 posted on 11/09/2009 10:45:46 AM PST by Jack Black
[ Post Reply | Private Reply | To 2 | View Replies]

To: Core_Conservative

Okay I’ll do it.

There is a huge range of economic conditions between good times and TEOTWAWKI, Zombi Apocaplypse, Road Warrior total collapse. For 5,000 years of human history, gold has worked as a store of value for wealth in 99% of that continuum. Lots of people in the world were able to survive because they had a little gold or silver to use to trade or bribe with.

Does that mean you shouldn’t have food, ammunition, other trade goods put away? Of course not.


18 posted on 11/09/2009 10:50:57 AM PST by Kozak (USA 7/4/1776 to 1/20/2009 Reqiescat in Pace)
[ Post Reply | Private Reply | To 5 | View Replies]

To: cowtowney

Ammo and food and, perhaps, gold to survive a complete crash. But for those with progeny, it might be nice to leave them with something for after the crash somewhat recovers besides a can of beans. Real estate will always belong to the government, either through taxation or expropriation.


19 posted on 11/09/2009 10:59:06 AM PST by Hiddigeigei (quem deus vult perdere prius dementat)
[ Post Reply | Private Reply | To 15 | View Replies]

To: Kozak

Thanks for the info - I still will not be buying gold - as I have no job - I am stocking up on staples - I also manufacture my own ammo as I am into Civil War era weapons - All I really need is the powder - the stuff in front of the powder can be anything really - lol


20 posted on 11/09/2009 11:03:16 AM PST by Core_Conservative (Proud to be "The self-righteous, gun-totin, military lovin, abortion-hatin, gay-loathin'...")
[ Post Reply | Private Reply | To 18 | View Replies]

To: Core_Conservative

Well in that case I suggest you stock up on a few sacks of charcoal, sulfur and potassium nitrate. Or read up on sources of same you can find around any farm....


21 posted on 11/09/2009 11:52:15 AM PST by Kozak (USA 7/4/1776 to 1/20/2009 Reqiescat in Pace)
[ Post Reply | Private Reply | To 20 | View Replies]

To: Core_Conservative

I’m sorry - educate me as to what good Gold will do for me if the world economy goes to heck? I think food, smokes, booze, and ammo will be a better bet.


Those are fine, but if you start running out of room, or worry that not everyone is an ATF fan, you can buy gold as a very portable, concealable, and reliable way to preserve your surplus wealth until the end of a crisis.

One coin is $1000+. Try smuggling $10,000 in cigs (or booze, or ammo) across a border to flee whatever threatens you.


22 posted on 11/09/2009 12:11:19 PM PST by Atlas Sneezed (Even My Failures Are Edible)
[ Post Reply | Private Reply | To 5 | View Replies]

To: Obadiah

You gonna eat that gold? Oh, you’re gonna by things with gold, huh? Like what? Food, ammo, fuel? From whom?


I’m thinking food from farmers or those who stored more than they need. Ammo from ammo makers (bring some empty brass and lead wheel weights as part of the deal) or those who stored more then they need. Fuel, same thing.

Of course, you’re making a big mistake here. Gold doesn’t primarily help YOU survive a crisis. Gold helps your surplus wealth survive a crisis. Get your beans and bullet squared away first.


23 posted on 11/09/2009 12:15:14 PM PST by Atlas Sneezed (Even My Failures Are Edible)
[ Post Reply | Private Reply | To 10 | View Replies]

To: TigerLikesRooster; jiggyboy

at the corner of Harrods Department Store in London?


Just because a retailer is selling gold doesn’t make this a bubble. Consider this wisdom from jiggyboy:

- Nothing can be in a bubble unless it is well past the previous inflation-adjusted all-time high

- Gold regularly drops up to ten percent in three days or less and once dropped more than twenty percent nearly without a break in 2008. Bubble price action goes one way.

- In every case, gold “corrections” have taken weeks and months to recover. Bubble price action is exponential — not a grinding, grudging “recovery”.

- It is almost a commodity, yet supply is not readily available. That’s a supply shortage, not a bubble.

- Boiler-room companies (i.e. cash4gold) are begging the masses to sell to them, not to buy from them

- CNBC is still bashing goldbugs instead of worshipping them

- We haven’t seen a TIME or Business Week magazine cover with a cartoony John Q. Public engaging in borderline-sexual acts with Lady Liberty from the Saint Gaudens Double Eagle

- Nobody you know, knows what Lady Liberty from the Saint Gaudens Double Eagle looks like

- Hollywood hasn’t yet made gold-related TV shows, movies, etc.

Also, this article specifically addresses the harrods issue:

“....If the top were in, we’d be in the midst of an all-out Mania. Are we? Do you get the impression there’s a rush into gold by the greater public right now? Are headlines blazing the covers of major magazines pronouncing gold as the new investment king? Has Wall Street gone gaga over gold and silver? I ask because these are the true signs that a trend has entered its final blow-off top and would signal it’s time to get out.

“I decided to put Bert’s prognostication to the test, and I invite you to play along.

“First, I struck up casual conversations with my friends, neighbors, relatives, acquaintances, my wife’s co-workers - heck, even my seatmates on airplanes - angling to learn how much gold they were hoarding, about the killing they were making in gold stocks, and how they were getting rich from all their precious metal investments. (In fairness, I had to exclude my dad, who is an award-winning gold panner, but he’s the only one.)

“I found no one - not one person - who is actively investing in anything gold or silver, let alone rushing to buy or hoard the stuff. I had two people who confided that they did own gold, but in both cases it was inherited. A few were curious how they would go about doing such a thing, and fewer asked if I thought they should. Most everyone looked at me blankly when I asked; they didn’t seem to know what I was talking about. When I got a reaction like that, it was pointless to ask about gold stocks. Of the handful I did ask, most had never heard of Barrick Gold, the world’s largest gold producer....”

http://www.321gold.com/editorials/casey/casey110509.html


24 posted on 11/09/2009 12:20:38 PM PST by Atlas Sneezed (Even My Failures Are Edible)
[ Post Reply | Private Reply | To 6 | View Replies]

To: Beelzebubba

It was a joke.


25 posted on 11/09/2009 1:36:28 PM PST by TigerLikesRooster (LUV DIC -- L,U,V-shaped recession, Depression, Inflation, Collapse)
[ Post Reply | Private Reply | To 24 | View Replies]

To: Hiddigeigei

I was making the point that you can both accumulate gold and silver AND other things. Not just one of the other.


26 posted on 11/09/2009 1:57:30 PM PST by cowtowney
[ Post Reply | Private Reply | To 19 | View Replies]

To: TigerLikesRooster

It was a joke.


Sorry, I didn’t get the joke, because others had written about it seriously.


27 posted on 11/09/2009 2:11:48 PM PST by Atlas Sneezed (Even My Failures Are Edible)
[ Post Reply | Private Reply | To 25 | View Replies]

To: Beelzebubba

When I see Lady Fortuna graffiti on subway cars/deserted buildings I will know it’s time to sell


28 posted on 11/09/2009 3:03:32 PM PST by qam1 (There's been a huge party. All plates and the bottles are empty, all that's left is the bill to pay)
[ Post Reply | Private Reply | To 24 | View Replies]

To: cowtowney
I was making the point that you can both accumulate gold and silver AND other things. Not just one of the other.

I was too.
29 posted on 11/09/2009 4:09:43 PM PST by Hiddigeigei (quem deus vult perdere prius dementat)
[ Post Reply | Private Reply | To 26 | View Replies]

To: 2banana

It’s a bubble - but the shoeshine boy’s not buying in for another year or two...


30 posted on 11/09/2009 7:05:14 PM PST by GOPJ (Sad.. when a military base.. is as defenseless as a shopping mall. - Freeper:EGPWS)
[ Post Reply | Private Reply | To 3 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson