Posted on 09/16/2012 4:48:28 PM PDT by blam
Here Comes $10,000 Gold...
Sam Ro
Sep. 16, 2012, 5:56 PM
"It has never been easy to have a rational conversation about the value of gold," wrote Ken Rogoff in a 2010 piece titled $10,000 Gold?.
But with the national debt passing $16 trillion and the Federal Reserve launching a unlimited quantitative easing, the gold bulls will increasingly tell you that the sum of their fears are coming true.
In this week's issue of Barron's, Jim McTague spoke to Guggenheim Partners Scott Minerd:
Hedging against the most pessimistic case without crippling the upside potential of a better or even miraculous case appears to be as unsolvable as the proverbial Gordian knot. Alexander the Great "solved" the intellectually challenging knot riddle by severing it with his sword. Scott Minerd, chief investment officer of Guggenheim Partners, offers a more reasoned but equally simple solution to the hedging conundrum: gold. In extreme circumstances—like miscalculations regarding inflation by the Federal Reserve—the metal could hit $10,000 per troy ounce, he asserts. Thursday, after the Fed disclosed its latest financial-stimulus scheme, the metal rose about 2% to $1,768.
The ultra bullish forecasts for gold aren't without precedent. Applying the "Pareto principle" – the idea is that 80 percent of the effects of something come from just 20 percent of the causes – Erste Group analyst Ronald-Peter Stoeferle argued that we could see $8,300 gold by the spring of 2015.
Citi's Tom Fitzpatrick also has an extremely bullish gold scenario out there. "We see no reason why this gold trend cannot perform as well as the last bull market in gold between 1970 and 1980," he told King World News. "If you replicated that move exactly, it will take gold to $6,300."
Inflation and technical pattern aren't the only ways to get to extremely high
(snip)
(Excerpt) Read more at businessinsider.com ...
“If the people pushing you to buy gold really believed it was going to increase by 600% or more, they wouldn’t be selling it at $1600.”
Pretty simple Blood. He’s a dealer, what he sells you for $1600, he buys from someone else for $1550. Called a spread.
For instance, at this moment you can buy a one ounce gold American Eagle from Kitco for $1,858.79, or you can sell the same gold ounce to Kitco for $1,775.70. Spread is $83.09.
It’s all quite legitimate.
Pump and Dump?
Probably. It's going to take a dive when Obama loses and then hover for a while. Depending on what Romney and Congress do in those first few months you'll see a steady downward spiral through most of 2013. I'm going to predict $500 on Jan 1, 2014.
Apropos of nothing in particular, how does one go about buying gold these days, and does one actually take the gold into possession, or does one buy certificates of some sort, which signify that one owns gold someplace in some bank vault somehwere?
If Romney get the economy moving again, we will have some inflation because the money will start moving after coming off the sidelines. Interest rates will go up and so will gold and everything else. But if BO wins, we will continue to have lots of money printing which will result in currency devaluation and likely gold appreciation. However, if BO wins, the economic contraction in the private sector could counteract inflationary pressures and gold would be flat because of reduced demand from wealth destruction.
If Romney wins, I will probably shift into energy related interests. If Obama wins, I will still accumulate physical gold for the greater likelihood of total currency collapse. I also think that treasury shorts like VIPSX will be a good bet.
Go to a coin show and purchase it in cash. That way, you can minimize the paper trail. Buy a good safe, a floor safe is idea, or store it in multiple locations with smaller safes. A safe deposit box can be opened by the IRS.
If you want the paper gold, you want to make sure that you can take physical possession of it if needed. This might be a good option for pension plans.
Sure they will. They make their money on the spread between the buy and sell prices.
Say No to banks, safe deposit boxes, and other conventional
venues. Also, “paper gold” is just that...paper. I wouldn’t trust anyone but me, when the SHTF. ETF’s are a mirage. Physical gold/silver, that you hold in your hand, has no substitute. (along with brass and lead)
Not saying you should buy gold, however if you decide to buy gold, then buy gold, not a piece of paper that says “gold”.
Oh, there’s profit to be made trading ETF and stock and futures, but the level of fraud and thievery, plus the repudiation of contract law means that
at some point the music is gonna stop and there won’t be enough chairs.
Do you like Silver Wheaton? http://www.google.com/finance?q=NYSE%3ASLW&sq=SILVER%20WHEATON&sp=1&ei=a5FWUKDjE6TklgP2-QE
Silver seems like a better bet for inflation and money printing by the Fed. Gold less so but but gold will cover you better in a deflation. Silver Wheaton cratered in win winter 2008-2009 down to $5. Today it is $39 but has been higher
SW is up more that 25% in the last 6 weeks
Depends on your budget and such; hell, get’m all!
Can you please add me to your goldbug ping list?
You are added.
Catching up on my Goldbug Pings...
Post #25 - How prescient!
I’m doing the exact same things, though adding more ammo to the stockpile and more canned goods. :)
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