Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 03-14-2012, 03:37 PM   #21
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
braumeister's Avatar
 
Join Date: Feb 2010
Location: Northern Kentucky
Posts: 8,630
Quote:
Originally Posted by EvrClrx311 View Post
true... I think for the very short term - gold is ok. Inflation is still a risk. Once we get through this rut we're in... Gold is going to drop pretty drastically. My prediction is that within the next 5-10 years we'll see Gold back at $500-800 (in today's dollars).

I'll probably buy some then
Sorry, but you're totally out of step with pretty much everyone in the financial community these days.

"Short term" refers to the period between now and tomorrow morning.

"Medium term" means next quarter.

"Long term means two or three quarters out.





__________________

__________________
Pas de lieu Rhône que nous.
braumeister is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-14-2012, 03:42 PM   #22
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,492
Quote:
Originally Posted by braumeister View Post

"Short term" refers to the time it takes for the first beer to reach the stomach on a hot day.

"Medium term" means the next beer.

"Long term' means you can finally settle back in your chair and take your time while you enjoy one.
fify
__________________

__________________
MichaelB is offline   Reply With Quote
Old 03-14-2012, 03:53 PM   #23
Thinks s/he gets paid by the post
Keim's Avatar
 
Join Date: Feb 2007
Location: Moscow
Posts: 1,128
Just saw this series of charts: Fred's Intelligent Bear Site - Dow-Gold Ratio

They purport to be a chart of the DOW divided by the price of gold over the years. Interesting, but I'm not sure if it shows anything the previous numbers I looked at don't also show.
__________________
You can't enlighten the unconscious.
But you can hit'em upside the head a few times to make sure they are really out...
Keim is offline   Reply With Quote
Old 03-14-2012, 03:56 PM   #24
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,613
Quote:
Originally Posted by Keim View Post
Just saw this series of charts: Fred's Intelligent Bear Site - Dow-Gold Ratio

They purport to be a chart of the DOW divided by the price of gold over the years. Interesting, but I'm not sure if it shows anything the previous numbers I looked at don't also show.
From the link:

Quote:
The Dow/Gold Ratio chart shows that we have witnessed the end of an era for equities. Stocks had an 18 year bull market where buy and hold was the guaranteed way to make money. Unfortunately for the stock market bulls, asset classes go in and out of favor, and gold has proven to be the next great asset class. The chart shows that it would be logical to expect the ratio to return to at least a value around 5. Perhaps a ratio of 5 would be gold 2000, Dow 10,000. How far down the ratio goes after that is completely dependent on government policy. Zero interest rates coupled with huge government deficits could send the Dow/Gold ratio far below 5.
WOOT! We have our "Death of Equities" sighting for this market cycle!
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 03-14-2012, 03:59 PM   #25
Full time employment: Posting here.
EvrClrx311's Avatar
 
Join Date: Feb 2012
Posts: 524
Quote:
Originally Posted by braumeister View Post
Sorry, but you're totally out of step with pretty much everyone in the financial community these days.

"Short term" refers to the period between now and tomorrow morning.

"Medium term" means next quarter.

"Long term means two or three quarters out.






No offense taken, guess its all relative... for me, with investing

Long Term: till SS gets here (35 years)
"money I need to last as long as me"

Mid Term: till my house is paid off (10-15 years hopefully)
"money I need to get to ER"

Short Term: that dang tax I get hit with when selling a stock within a year
"money I don't really care about... unless it makes me more money"

__________________
EvrClrx311 is offline   Reply With Quote
Old 03-14-2012, 04:15 PM   #26
Thinks s/he gets paid by the post
Keim's Avatar
 
Join Date: Feb 2007
Location: Moscow
Posts: 1,128
Quote:
Originally Posted by ziggy29 View Post
From the link:

WOOT! We have our "Death of Equities" sighting for this market cycle!
Yeah, I giggled at that quote too. Going to extremes in any discussion always makes the person making the extreme argument look ridiculous.
__________________
You can't enlighten the unconscious.
But you can hit'em upside the head a few times to make sure they are really out...
Keim is offline   Reply With Quote
Old 03-14-2012, 04:52 PM   #27
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,451
Quote:
Originally Posted by Keim View Post
Gold has increased 58 fold since 1928, Clifp. A pretty close match to DOW 1928, easily surpassed by someone that got in during the depression.

Lesson: By stocks in depressions. Gold when stocks are highly valued. IE Buy on the dips-duh! (duh aimed at self, not others.)
Ah another opportunity to make a lecture about dividends. The Dow and SP index don't include dividends. From 1871 to 2001 the average dividend yield was 4.54%, Dow stocks traditional have higher than average yield but of course the last 10 years yield have dipped significantly. If we add a 4.5% yield over the last 84 years that adds another 40 fold increase to stocks (and that also fits with dividend providing roughly 40% of the total returns in the market).

This to me is the biggest difference between gold and stock, gold is non productive asset you have to pay to store, and insure so from an investors perspective you have can't actually realize all of golds gain. I.E. the returns of gold mutual fund or GLD lag the price appreciation of the metal . In contrast stocks produce income in the form of dividends and now days have very low transaction costs.

The caveat is that stocks look really good compared to gold from the prospective of US investors, for the rest of the world, I doubt the gap between stocks and gold investment is nearly as large.
__________________
clifp is offline   Reply With Quote
Old 03-14-2012, 04:55 PM   #28
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,613
Quote:
Originally Posted by clifp View Post
Ah another opportunity to make a lecture about dividends. The Dow and SP index don't include dividends. From 1871 to 2001 the average dividend yield was 4.54%, Dow stocks traditional have higher than average yield but of course the last 10 years yield have dipped significantly. If we add a 4.5% yield over the last 84 years that adds another 40 fold increase to stocks (and that also fits with dividend providing roughly 40% of the total returns in the market).
Good point, when people only look at index levels and not factor in dividends for total return.

During the crash I cringed every time someone said that someone who owned "the market" (as defined by the Dow 30) at the 1929 market peak didn't come back to break-even until 1954. The reality is, if you include reinvested dividends, they got back to even in 1944, not 1954.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 03-14-2012, 06:43 PM   #29
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Quote:
Originally Posted by ziggy29 View Post
Good point, when people only look at index levels and not factor in dividends for total return.

During the crash I cringed every time someone said that someone who owned "the market" (as defined by the Dow 30) at the 1929 market peak didn't come back to break-even until 1954. The reality is, if you include reinvested dividends, they got back to even in 1944, not 1954.
True. Historically dividends were a huge portion of total return. But back in 1930 the dividend yield was something like 8%. Today it is 2%. With luck, the money that used to be paid out as a dividend is finding equally productive uses. Otherwise
__________________
Retired early, traveling perpetually.
Gone4Good is offline   Reply With Quote
Old 03-14-2012, 07:49 PM   #30
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 19,445
Exactly the anti-Wh*** that I have been hoping for.

Quote:
Originally Posted by ziggy29 View Post
From the link:

WOOT! We have our "Death of Equities" sighting for this market cycle!
__________________
"Old age is the most unexpected of all things that can happen to a man" -- Leon Trotsky
NW-Bound is offline   Reply With Quote
Old 03-15-2012, 10:40 PM   #31
Confused about dryer sheets
usafmd's Avatar
 
Join Date: Jun 2010
Posts: 7
I'm no gold bug, but as many of you know, the Harry Browne Permanent Portfolio has 25% gold and for a risk(volatility) return basis has been extremely hard to beat.

A discussion about the permanent value of gold should include the long-term viability of any fiat currency ever created. Given how QE1 or QE2 has inflated the money supply, when employment increases, watch out for inflation. Then maybe gold might be as worthy of scorn.
__________________
In a democracy it is possible to be ignorant and free at the same time.
usafmd is offline   Reply With Quote
Old 03-15-2012, 11:10 PM   #32
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
clifp's Avatar
 
Join Date: Oct 2006
Posts: 7,451
Quote:
Originally Posted by usafmd View Post
I'm no gold bug, but as many of you know, the Harry Browne Permanent Portfolio has 25% gold and for a risk(volatility) return basis has been extremely hard to beat.

A discussion about the permanent value of gold should include the long-term viability of any fiat currency ever created. Given how QE1 or QE2 has inflated the money supply, when employment increases, watch out for inflation. Then maybe gold might be as worthy of scorn.

+1

The Harry Browne Permanent Portfolio, the experience of non US citizens with gold on this forum, and listening to one of my smartest friend discuss its value, are 3 reasons that I am no longer a gold skeptic.

I don't necessarily buy it at this level, but anybody who is at or near retirement and has <5-25% of their assets in gold I think is being prudent.

Of course I think prudence is over-rated, what fun would the 2008-2009 crisis have been if 25% of your assets were going up in price
__________________
clifp is offline   Reply With Quote
Old 03-16-2012, 05:27 AM   #33
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,492
The permanent portfolio adds the discipline of rebalancing to its holdings, and this makes all the difference. It's success is part from the holdings and part from the rebalancing, and is a good example of how gold and PM can be used to increase overall portfolio return.
__________________

__________________
MichaelB is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Do you see your neighborhood differently now that you're there all the time? Tree-dweller Life after FIRE 57 03-26-2012 05:42 PM
The Anxiety of Success ShortInSeattle Young Dreamers 51 03-26-2012 01:25 PM
MPT -"Investment Strategies for the 21st Century" seraphim Stock Picking and Market Strategy 10 03-16-2012 10:49 AM
Why can't we get our lab test results directly from the lab? Disappointed Health and Early Retirement 21 03-16-2012 09:16 AM
When does the giddy wear off? Tree-dweller Life after FIRE 30 03-13-2012 04:44 PM

 

 
All times are GMT -6. The time now is 09:48 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.