Gold

[mathjak107]

like all investments and things we buy to make money gold is just another vehicle..but as will rogers said only buy investments that go up and sell the ones that go down.....great advice....i made great money in gold the last 2 years ,why? it went up.....i intend to hold it just a little more and try to suck a little more profit and then sell off my gains and rebalance back to the 5% or so i normally hold.......the fact is too that gold with few exceptions tracks oil pricing but without the extreme swings..as volitale as gold can be gold only doubled over the last few years while oil was up 500%....it can be a slightly less volitile play on oil at least right now.

 

[Craig]

Through all the debate, it sounds as though a number of folks here are comfortable with 3% to 5% or so in precious metals. That's our position as well.

And as to the correlations, does gold have true intrinsic value, what will it do in the future ... seems to me, it is mainly perception and history. Perhaps no base logic, but human emotions are obviously a huge factor in investing. We may never be smart enough to understand all the psychological reasons people treasure gold ... but treasure it they do. Ergo, it remains a viable investment.

 

[Rustic23]

I have not studied gold. I have no clue if it follows inflation, or oil, or beaver cheese. I have thought about what makes gold a value. Nothing, well practically nothing. Those who say it has limited use, jewelry and electronics sure seem to be right. However, it seems throughout history mankind has valued gold. Long before electricity was discovered. I look at foreign nations, especially those that seem to hold large amounts of US currency, and they value gold. The average person on the street in those nations attempts to buy it as a ‘store house’ of value. Therefore, it is in my portfolio as a buy and hold. (a little over 5%). If things really turn brown, history does seem to indicate the rest of the world turns to gold, and in recent history dollars. If it is the dollar that is brown, maybe the euro. So for me, precious metals are not like the rest of my investments. It is a hedge against hyper inflation. I actually figure my SWR minus the precious metals investment.

 

[Jarhead*]

Hey CFB, just for fun sometime, take a drive on Hyw 70 (Out of Oroville, heading towards Quincy). Follows the Feather River the entire way.

The guys with power dredgers are all over that river like white on rice since the price of gold went up!

Hot Damn, the Rush is on.

 

[johnlw]

Even though there is no direct comparison between gold and “beaver cheese”…
I believe that G. Edward Griffin’s book “The Creature from Jekyll Island” contains some enlightening information about the nature of money and gold. Below is a link:

http://www.amazon.com/exec/obidos/ASIN/0912986409/imindebove40w-20


In addition to being an interesting read, it sheds some light on the relationship between gold and fiat money. Moreover, Griffin’s explanation of the rise of the Federal Reserve and the history of money in the United States is well worth reading.

I recommend this book with the exception of the later chapters. His conspiracy theories have to be taken with a large grain of salt.

 

[Nords]

The guys with power dredgers are all over that river like white on rice since the price of gold went up!

Fishing... power dredging... fishing... power dredging...

I think I'd rather be surfing.

 

[unclemick]

Hmm

I'd better start checking my e-mail in case Jerry tells me somebody shows up with a boatload of fiat money to reopen our mine near Jamestown, CO.

heh, heh, heh

Last guy went broke trying to meet mine safety reg.'s

 

[cute fuzzy bunny]

Hey CFB, just for fun sometime, take a drive on Hyw 70 (Out of Oroville, heading towards Quincy). Follows the Feather River the entire way.

The guys with power dredgers are all over that river like white on rice since the price of gold went up!

Hot Damn, the Rush is on.

Last time we had the big rains, slides and muck roiling (what was that...1997? 98?) everyone was buying their own panning equipment and sitting in the river panning. Lots of people came up with 500-1000 bucks worth!

Considering our local riverside park that has thousands of acres of open fields, soccer and baseball fields was under about 20' of water and currently covered with 2-5' of sludge that used to be the riverbottom in a rich gold area...might be worth a day of panning. I'll bet the competition for who gets to clean that mud off the fields is pretty stiff.

Which brings me to another question. I'll bet the tools and processes for finding and recovering gold are a lot better than they used to be. Does that change the dynamics of the metal pricing once it rises over a specific threshold? Like the tar sands in canada would be tapped at a specific oil price?

 

[Cool Dood]

Here are some fun facts from my federal government:

http://www.dfo-mpo.gc.ca/canwaters-eauxcan/facts-faits/cat_list_e.asp?Catid=1

• There are about 26,000 tonnes of gold in the ocean, about 5 grams for each of the 5 billion humans on the Earth.

(Of course, it'd be pretty pointless to get it out since the oceans are so huge.)

 

[sgeeeee]

Here are some fun facts from my federal government:

http://www.dfo-mpo.gc.ca/canwaters-eauxcan/facts-faits/cat_list_e.asp?Catid=1

• There are about 26,000 tonnes of gold in the ocean, about 5 grams for each of the 5 billion humans on the Earth.

(Of course, it'd be pretty pointless to get it out since the oceans are so huge.)

Cool Dude,

You can have my 5 grams. Just go to any ocean to collect.

 

[haha]

Even though there is no direct comparison between gold and “beaver cheese”…

I propose that beaver cheese be one of the words, like **** and ***** that get bleeped. As one who prefers his beaver sans cheese, this phrase is becoming difficult.

Ha

 

[cute fuzzy bunny]

Beaver cheese is a completely uncorrelated asset class. It neither rises, nor falls, nor has any intrinsic value. Nobody will buy it. Nobody currently sells it. I doubt there is in fact, any beaver cheese at all. Therefore we should all hold a nominal value in our portfolios. Say, 1.5% avocado colored cheese and 1.5% harvest gold colored cheese.

I'll be creating a new ETF that will be available for trading by next monday, symbol: BECH. Shares will trade for one dollar. Always.

 

[Cool Dood]

Can I get a Beaver Cheese DRIP?

 

[cute fuzzy bunny]

When I wrote that last post, I thought about saying there was also a DRIP program, but decided that was going too far.

I do appreciate that there is someone who will go where I will not...

 

[Cool Dood]

hey, I'm just grabbing anything I can find that's still available. It's not my fault if all that's left is a bit toward the edge!

 

[REWahoo]

I'll be creating a new ETF that will be available for trading by next monday, symbol: BECH. Shares will trade for one dollar. Always.

I'm thinking BECH is a stock ** would probably short.

 

[greg]

Haha: You nailed it again, but boys like to be boys someplace in life.

cfb: I thought about what you said also. When I was presenting my non-argument I thought it would be more important to identify the problem (too much money in the system) rather than a spoon fed answer about gold. Scientists and engineers and others trying to solve a problem first try to see it, the problem, as clearly as possible. Oftentimes, if the problem is seen correctly, the answer almost spontaniously flows out of the real problem. As you know, businessmen try to work in the same way. I didn't do an excellent job about what has been going on with our money over the past 75-92 years (since the creation of the Fed). There is much history in books and on the internet about such stuff, and they can do a much better job than me. I thought if I presented a little bit about the degeneration of money, which I see as accelerating especially over the past five years, you automatically would see gold as a spontanious answer (fake money vs. real money). History is rich with what has happened to "representative" currencies.

Far more important than gold, which truly is less useful than just about anything, is the fact that it serves as a new and different tool to measure what may or may not be going on in our economy. (I was originally hoping for questions regarding this um phenomenon from you.) I see it as a powerful tool in recognizing various facets of the economy. For example, a year ago, it took about 420 oz of AU to buy the median house in this country . Today it's about 380. R. Russell thinks the DOW and price of gold need to cross before
the economy is close to rebalanced. He's written a book about Dow theory. Again, I can't/won't monopolize a huge part of this message board. I suspect you can find it yourself if you are truly interested in understanding the not only out economy, but our current political problems and the alienation that exists in this country.

But it's not yours until you do the work. I will point if you ask the correct questions, not the ones where you appear to be baiting me. I have a book called Empire of Debt by Bill Bonner. If you send Martha or me a mailing address I will be happy to give it to you and even pay for the postage.

--Greg

 

[Zipper]

To quote Gordon Lightfoot, "In this fair Land". Where might you'se be from Dood? eh?

 

[johnlw]

Apocalypse (Greg):

I thought you did a pretty good job in your post, given the constraints of a message board like this.

I also read Bonner’s book and thought it was good.

As you state, if someone is really interested in the subject, some in depth reading is probably required.

 

[Cool Dood]

Shouldn't there be like a Wikipedia page that lays out the basic premise behind what you're arguing?

I can't imagine it takes a thousand-page book to explain a reason to buy gold, at least I'm sure most of the millions of people holding gold never read that book...

 

[unclemick]

Book - I don't need no stinking book - I like rocks aka gold, sillver, platinum, faceted unmount semi precious.

Now a book on beaver cheese and freezed dryed food.

Old habits die hard - a beaver cheese DRIP? Wonder how it correlates MPT wise with freeze dryed?

History channel repeated their gold program the other night. And yes - I've been caught reading Bonner in the past - not the book though.

Sanity is overrated!

heh heh heh heh

P.S. Raddr has a gold timing model on his board.

 

[Focu$ed]

Far more important than gold, which truly is less useful than just about anything, is the fact that it serves as a new and different tool to measure what may or may not be going on in our  economy.  (I was originally hoping for questions regarding this um phenomenon from you.)   I see it as a powerful tool in recognizing various facets of the economy.  For example, a year ago, it took about 420 oz of AU to buy the median house in this country .  Today it's about 380.  R. Russell thinks the DOW and price of gold need to cross before   
the economy is close to rebalanced. 
--Greg

I agree, and wish I could find the data on the Dow:Gold ratio over the last 100+ years.  There have been times in the not so distant history when buying the Dow was considered the speculative investment. There have been times when stocks in general were considered risky. Cycles come and go. We appear to be entering the era when tangible assets of all kinds, which have been depressed for 20+ years, are making a come back. I don't see why this is surprising. It is very likely that for a period of time the commodities themselves, and companies that produce them, and provide support and infrastructure, (such as mining equipment) will do very well. Of course the trend will not last forever, any more than any other cycle has, but I don't intend to fight the trend. Year to date I have already made one and a half times what I will make at work all year, and my portfolio is only a fraction of what most people here have. Again, this is not sustainable long-term, but in the short-term it's hard to "dis" the metals market.

 

[d]

Re: G**d

now that the discussion seems to have veered back to g**d (from beaver cheese) ... seems appropriate to at least mention that g**d broke $600 ... just another 40% or so and it will be back to a more than quarter century high.

... a look at the CRB commodities index might lead one to think we're approaching a cyclical peak ... as Focu$ed notes, "cycles come and go" ...

 

[haha]

I agree, and wish I could find the data on the Dow:Gold ratio over the last 100+ years.

This would be more or less useless, as gold was pegged to the USD for years prior to Nixon removing the peg in 1971.

Ha

 

[Focu$ed]

Re: G**d

now that the discussion seems to have veered back to g**d (from beaver cheese) ... seems appropriate to at least mention that g**d broke $600 ... just another 40% or so and it will be back to a more than quarter century high.

But not in inflation adjusted dollars. The same price point would be considerably higher now.