Gold continues to soar!

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000
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Re: Gold continues to soar!

Post by 000 »

Forester wrote: Tue Nov 24, 2020 4:48 pm Average price of gold since 1971, inflation-adjusted, is around $1,200. Not very scientific, but assume a global economic rebound next year, gold might drop to $1,400. I just think gold is richly priced any way you look at it. The 2020 high is an almost perfect triple top with 2011 & 1980.

https://www.macrotrends.net/1333/histor ... year-chart
Interesting that it only took 9 years to reach the last high, whereas the last high is separated from the previous one by 31 years.
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Re: Gold continues to soar!

Post by Forester »

000 wrote: Tue Nov 24, 2020 4:52 pm
Forester wrote: Tue Nov 24, 2020 4:48 pm Average price of gold since 1971, inflation-adjusted, is around $1,200. Not very scientific, but assume a global economic rebound next year, gold might drop to $1,400. I just think gold is richly priced any way you look at it. The 2020 high is an almost perfect triple top with 2011 & 1980.

https://www.macrotrends.net/1333/histor ... year-chart
Interesting that it only took 9 years to reach the last high, whereas the last high is separated from the previous one by 31 years.
Might be related to the common perception of bonds being 'done' in 2010/11 & 2020.
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Re: Gold continues to soar!

Post by Robot Monster »

"Goldman, Citi see gold above $2,000 in 2021: ‘The bull market is not over’" published today, November 24th. link

"'...inevitable for prices to revert back above $2,000 in 2021, as long as U.S. monetary policy [doesn't] take an unexpectedly hawkish turn."

Less interesting is the prediction, more interesting is the prediction's weakness: a rise in rates.

***

Edit: Bloomberg article published today, Nov 27th. "BlackRock’s Hildebrand Says Global Inflation Isn’t Dead."

"Central banks will face pressure to not tighten too quickly...Covid and its aftermath likely to lead to higher costs, wages...Hildebrand said financial markets are underestimating the risk of higher inflation in the medium term...'It will be a challenge to retreat from the current monetary policy approach even when inflation starts to rise.'

Who knows how much central banks might let inflation overshoot targets (or change targets) without raising rates. This is why I'm in TIPS and gold.
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Re: Gold continues to soar!

Post by 000 »

A golden start to the new year:

Gold (SGOL) +2.24% :)
Gold Miners (RING) +7.65% :D
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Re: Gold continues to soar!

Post by KlangFool »

000 wrote: Mon Jan 04, 2021 3:24 pm A golden start to the new year:

Gold (SGOL) +2.24% :)
Gold Miners (RING) +7.65% :D
https://finance.yahoo.com/quote/SLV?p=SLV


SLV (Silver) is doing better +3.17%


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Re: Gold continues to soar!

Post by 000 »

KlangFool wrote: Mon Jan 04, 2021 3:33 pm https://finance.yahoo.com/quote/SLV?p=SLV


SLV (Silver) is doing better +3.17%


KlangFool
:sharebeer

But strangely, Silver miners (SLVP) are NOT doing better than Gold miners.
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Re: Gold continues to soar!

Post by KlangFool »

000 wrote: Mon Jan 04, 2021 3:35 pm
KlangFool wrote: Mon Jan 04, 2021 3:33 pm https://finance.yahoo.com/quote/SLV?p=SLV


SLV (Silver) is doing better +3.17%


KlangFool
:sharebeer

But strangely, Silver miners (SLVP) are NOT doing better than Gold miners.
000,


In general, Silver is mostly mined as a side product of other minerals. It is not the same as gold mining. Gold usually mined alone.

https://en.wikipedia.org/wiki/Silver_mining

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Re: Gold continues to soar!

Post by 000 »

KlangFool wrote: Mon Jan 04, 2021 3:45 pm In general, Silver is mostly mined as a side product of other minerals. It is not the same as gold mining. Gold usually mined alone.
Yep. I guess I'll have to be content with my +7.46% today.
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Re: Gold continues to soar!

Post by KlangFool »

000 wrote: Mon Jan 04, 2021 5:27 pm
KlangFool wrote: Mon Jan 04, 2021 3:45 pm In general, Silver is mostly mined as a side product of other minerals. It is not the same as gold mining. Gold usually mined alone.
Yep. I guess I'll have to be content with my +7.46% today.

Basically, the Silver miner is not as good a bet as the gold miner.

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Re: Gold continues to soar!

Post by 000 »

KlangFool wrote: Mon Jan 04, 2021 5:33 pm
000 wrote: Mon Jan 04, 2021 5:27 pm
KlangFool wrote: Mon Jan 04, 2021 3:45 pm In general, Silver is mostly mined as a side product of other minerals. It is not the same as gold mining. Gold usually mined alone.
Yep. I guess I'll have to be content with my +7.46% today.

Basically, the Silver miner is not as good a bet as the gold miner.

KlangFool
For a short term chaos hedge, you probably want just bullion and not miners (silver OR gold). But for a longer term inflation hedge, I think industrial miners (and other commodity producers BTW) are a good hold.
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Re: Gold continues to soar!

Post by ohboy! »

I used to follow 321gold.com and try and get tips on mining companies there. It hasn't panned out that well for me. I think physical PMs are really the best way to go. And not in a safety deposit box. I hold them hoping to never sell.
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Re: Gold continues to soar!

Post by KlangFool »

000 wrote: Mon Jan 04, 2021 5:50 pm
KlangFool wrote: Mon Jan 04, 2021 5:33 pm
000 wrote: Mon Jan 04, 2021 5:27 pm
KlangFool wrote: Mon Jan 04, 2021 3:45 pm In general, Silver is mostly mined as a side product of other minerals. It is not the same as gold mining. Gold usually mined alone.
Yep. I guess I'll have to be content with my +7.46% today.

Basically, the Silver miner is not as good a bet as the gold miner.

KlangFool
For a short term chaos hedge, you probably want just bullion and not miners (silver OR gold). But for a longer term inflation hedge, I think industrial miners (and other commodity producers BTW) are a good hold.
000,


I do not believe in a long-term inflation hedge for the Gold miner. It is a good speculative gamble.


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Re: Gold continues to soar!

Post by Pawpatrol »

Lets get this thread soaring again. The negativity on gold is building- pretty much everyone thinks this is going down now to 1600 or lower. With so much volatility in bonds, equities, and commodities right now, im thinking gold is getting more attractive as diversification. No one knows how this qe infinity worldwide will end so might as well as diversify as much as possible.
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Re: Gold continues to soar!

Post by 000 »

Pawpatrol wrote: Sat Feb 27, 2021 5:04 pm
I remain bullish on the shiny metal. :sharebeer
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Re: Gold continues to soar!

Post by RiotAct »

Pawpatrol wrote: Sat Feb 27, 2021 5:04 pm Lets get this thread soaring again. The negativity on gold is building- pretty much everyone thinks this is going down now to 1600 or lower. With so much volatility in bonds, equities, and commodities right now, im thinking gold is getting more attractive as diversification. No one knows how this qe infinity worldwide will end so might as well as diversify as much as possible.
sure, Rubble, whatever you say ;)
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Re: Gold continues to soar!

Post by Forester »

Pawpatrol wrote: Sat Feb 27, 2021 5:04 pm Lets get this thread soaring again. The negativity on gold is building- pretty much everyone thinks this is going down now to 1600 or lower. With so much volatility in bonds, equities, and commodities right now, im thinking gold is getting more attractive as diversification. No one knows how this qe infinity worldwide will end so might as well as diversify as much as possible.
As a goldbug I'm more than happy for gold to slip below $1,500, gold miners to slide, and for the inflation narrative to be delayed. Gold can't do much for a portfolio above $2k IMHO.
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Re: Gold continues to soar!

Post by 000 »

Forester wrote: Sat Feb 27, 2021 5:36 pm As a goldbug I'm more than happy for gold to slip below $1,500, gold miners to slide, and for the inflation narrative to be delayed. Gold can't do much for a portfolio above $2k IMHO.
You think 2k USD is the peak?
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Re: Gold continues to soar!

Post by Pawpatrol »

000 wrote: Sat Feb 27, 2021 5:38 pm
Forester wrote: Sat Feb 27, 2021 5:36 pm As a goldbug I'm more than happy for gold to slip below $1,500, gold miners to slide, and for the inflation narrative to be delayed. Gold can't do much for a portfolio above $2k IMHO.
You think 2k USD is the peak?
If bitcoin didnt exist we would be way past 2k at this point. BTC and altcoins are a big problem for golds future value. I dont own any crypto fwiw.
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Re: Gold continues to soar!

Post by 000 »

Pawpatrol wrote: Sat Feb 27, 2021 5:48 pm If bitcoin didnt exist we would be way past 2k at this point. BTC and altcoins are a big problem for golds future value. I dont own any crypto fwiw.
I agree with this. Except that I did start a small position in crypto related stocks (now in BLOK) in case they really do replace gold.
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Re: Gold continues to soar!

Post by Forester »

000 wrote: Sat Feb 27, 2021 5:38 pm
Forester wrote: Sat Feb 27, 2021 5:36 pm As a goldbug I'm more than happy for gold to slip below $1,500, gold miners to slide, and for the inflation narrative to be delayed. Gold can't do much for a portfolio above $2k IMHO.
You think 2k USD is the peak?
That seems to match the 1980 & 2011 peaks, so my guess is $1,500 is nearer to fair value and north of $2k is rich.
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Re: Gold continues to soar!

Post by qwertyjazz »

Forester wrote: Sat Feb 27, 2021 5:54 pm
000 wrote: Sat Feb 27, 2021 5:38 pm
Forester wrote: Sat Feb 27, 2021 5:36 pm As a goldbug I'm more than happy for gold to slip below $1,500, gold miners to slide, and for the inflation narrative to be delayed. Gold can't do much for a portfolio above $2k IMHO.
You think 2k USD is the peak?
That seems to match the 1980 & 2011 peaks, so my guess is $1,500 is nearer to fair value and north of $2k is rich.
With long run inflation of the past 40 years, how are you a gold bug then? Or do you mean rich now and will continue to rise against the dollar?
Curious
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Re: Gold continues to soar!

Post by Robot Monster »

I'm adding a tiny amount to my miniscule allocation to Barrick Gold on Monday, raising my allocation from 0.3% to 0.37%, because I live on the edge, bro. Might bump my allocation up to 0.5% if the gold slide continues.

I will note that both gold and TIPS prices have been sliding lately, a correlation that is expected, yes?
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Re: Gold continues to soar!

Post by 000 »

Robot Monster wrote: Sat Feb 27, 2021 6:57 pm I'm adding a tiny amount to my miniscule allocation to Barrick Gold on Monday, raising my allocation from 0.3% to 0.37%, because I live on the edge, bro. Might bump my allocation up to 0.5% if the gold slide continues.
Why Barrick and not a miners ETF?
I will note that both gold and TIPS prices have been sliding lately, a correlation that is expected, yes?
Probably. There was a discussion by market timer about this earlier in the thread.
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Re: Gold continues to soar!

Post by 000 »

Forester wrote: Sat Feb 27, 2021 5:54 pm That seems to match the 1980 & 2011 peaks, so my guess is $1,500 is nearer to fair value and north of $2k is rich.
Those peaks were in nominal dollars though and both represented Gold's failure to breakout.
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Re: Gold continues to soar!

Post by Forester »

000 wrote: Sat Feb 27, 2021 7:03 pm
Forester wrote: Sat Feb 27, 2021 5:54 pm That seems to match the 1980 & 2011 peaks, so my guess is $1,500 is nearer to fair value and north of $2k is rich.
Those peaks were in nominal dollars though and both represented Gold's failure to breakout.
Gold hit $850 in 1980. Adjusted for inflation = $2,300 today.

2011 high = $2,200 today.

We have no more price data to work with, so around $2k seems to be golds natural upper bound.
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Re: Gold continues to soar!

Post by 000 »

Forester wrote: Sat Feb 27, 2021 7:39 pm Gold hit $850 in 1980. Adjusted for inflation = $2,300 today.

2011 high = $2,200 today.

We have no more price data to work with, so around $2k seems to be golds natural upper bound.
No what I meant was 1980 and 2011 didn't see the fulfillment of conditions under which it could go higher. The petrodollar system "worked" and the US was able to tame inflation (1980). The fallout from GFC didn't spiral further downward (2011). So though I agree 2k in 2021 USD could be an upper bound during "normal" times I'm not sure it's a "natural" upper bound. I certainly won't be selling at $2k.
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Re: Gold continues to soar!

Post by Corsair »

Without COMEX the price would be higher, no? Fed owns 25% of TIPS, up from 8% one year ago. Both IMO are probably manipulated. What is the premium dealers are charging for physical?
All posts are my own opinions and are not financial advice.
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Re: Gold continues to soar!

Post by Forester »

Financial Times critique of gold as an investment from April 2004 when gold was $400.

Image
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Re: Gold continues to soar!

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000 wrote: Sat Feb 27, 2021 7:01 pm
Robot Monster wrote: Sat Feb 27, 2021 6:57 pm I'm adding a tiny amount to my miniscule allocation to Barrick Gold on Monday, raising my allocation from 0.3% to 0.37%, because I live on the edge, bro. Might bump my allocation up to 0.5% if the gold slide continues.
Why Barrick and not a miners ETF?
No defensible reason. Even though I can't defend my reasoning on this, I will tell you my reasoning, in case you're curious. Barrick appears to be the best gold miner, so I choose that one. It's only a tiny allocation, and it's my funny money, so I feel like it's okay. Funny money has different rules. There, I defend myself using the "funny money" exception rule. I hurl that defense at you, then go run and hide in the bushes...
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Re: Gold continues to soar!

Post by SeasOfCheese »

Forester wrote: Sun Feb 28, 2021 5:01 am Financial Times critique of gold as an investment from April 2004 when gold was $400.
It is certainly great "that independent inflation-targeting central banks are the norm across the industrialised world".

And that we do not have a compliant, politicized Fed that is dedicated to monetizing the national debt (which in no way could have possibly quadrupled since 2004, right?). Who knows what could have happened to gold in that case... maybe it would quadruple too?
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Re: Gold continues to soar!

Post by Forester »

SeasOfCheese wrote: Sun Feb 28, 2021 8:48 am
Forester wrote: Sun Feb 28, 2021 5:01 am Financial Times critique of gold as an investment from April 2004 when gold was $400.
It is certainly great "that independent inflation-targeting central banks are the norm across the industrialised world".

And that we do not have a compliant, politicized Fed that is dedicated to monetizing the national debt (which in no way could have possibly quadrupled since 2004, right?). Who knows what could have happened to gold in that case... maybe it would quadruple too?
It's possible the next bond bear market is worse than the last one. Just as 08/09 was worse than Dotcom. I think 25% of a portfolio in gold & gold miners makes it more robust. If gold goes out of fashion it will happen slowly and probably makes little difference to wealth vs an equivalent holding of ST bonds.
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Re: Gold continues to soar!

Post by Pawpatrol »

I like FNV (franco nevada)
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Re: Gold continues to soar!

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Pawpatrol wrote: Sat Feb 27, 2021 5:48 pm If bitcoin didnt exist we would be way past 2k at this point. BTC and altcoins are a big problem for golds future value. I dont own any crypto fwiw.
000 wrote: Sat Feb 27, 2021 5:51 pm I agree with this. Except that I did start a small position in crypto related stocks (now in BLOK) in case they really do replace gold.
They can't. 48.5% of Gold's World Consumption is Jewellery, 29.19% of Gold's World Consumption is Investment, 14.84% of Gold World Consumption is from Central Banks, and 7.48% of Gold World Consumption's is Industry. Cryptos can only replace the Investment Consumption of Gold but that is only 29.19% of Gold's Consumption. Image below is out-dated from 2012 but conveys roughly the same information in a more beautiful way.
Image
Land/Real Estate:89.4% (Land/RE is Inheritance which will be recieved in 10-20 years) Equities:7.6% Fixed Income:1.7% Gold:0.8% Cryptocurrency:0.5%
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Re: Gold continues to soar!

Post by jpmorganfunds »

000 wrote: Tue Aug 04, 2020 7:36 pm Why do people keep posting Gold Bear sentiments with the market at all time highs AGAIN!
More of us are becoming Gold Bulls everyday.
I continue to adjust my AA - moving Gold to stocks - but it appears there is no stopping this Bull!
This post did not age well - Aug 4, literally 2 days from the very top.
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Re: Gold continues to soar!

Post by 000 »

jpmorganfunds wrote: Mon Mar 01, 2021 10:04 am This post did not age well - Aug 4, literally 2 days from the very top.
Don't you mean two days from the dollar's bottom? :mrgreen:
jpmorganfunds wrote: Fri Feb 26, 2021 3:38 pm Gold is money, not the other way around. You should be asking what is the intrinsic value of $ in terms of gold.
:sharebeer
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Re: Gold continues to soar!

Post by Robot Monster »

Gold is currently +0.66%. Isn't anyone gonna be like, "yea, soaring!!," or is everyone so downtrodden by gold's fall from recent highs that no one can summon any enthusiasm?
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Re: Gold continues to soar!

Post by Salmo Trutta »

Living in Colorado, we bump into old or mothballed mines all the time while out hiking, fishing, biking, overlanding etc.

One thing I've learned is that there is plenty of gold still in there, but the current prices do not support extraction. If the price goes up, or the technology/productivity improves, many of those mines will restart production.

And the price will drop...
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Re: Gold continues to soar!

Post by JBTX »

Salmo Trutta wrote: Wed Mar 03, 2021 7:05 am Living in Colorado, we bump into old or mothballed mines all the time while out hiking, fishing, biking, overlanding etc.

One thing I've learned is that there is plenty of gold still in there, but the current prices do not support extraction. If the price goes up, or the technology/productivity improves, many of those mines will restart production.

And the price will drop...
https://www.usmoneyreserve.com/blog/how ... the-world/

Most gold is estimated to have been discovered. Of course that is an estimate. Hard to estimate what you haven't discovered. About 80% of gold discovered gold has been mined.
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Re: Gold continues to soar!

Post by asif408 »

JBTX wrote: Wed Mar 03, 2021 7:28 am
Salmo Trutta wrote: Wed Mar 03, 2021 7:05 am Living in Colorado, we bump into old or mothballed mines all the time while out hiking, fishing, biking, overlanding etc.

One thing I've learned is that there is plenty of gold still in there, but the current prices do not support extraction. If the price goes up, or the technology/productivity improves, many of those mines will restart production.

And the price will drop...
https://www.usmoneyreserve.com/blog/how ... the-world/

Most gold is estimated to have been discovered. Of course that is an estimate. Hard to estimate what you haven't discovered. About 80% of gold discovered gold has been mined.
As long as there is a narrative for gold and silver and it is still being peddled on TV and the radio to old people there will probably be a place for it for a few more decades. Then when this old generation dies out the next one will have crypto peddlers maybe. But the story for gold is still alive and well.
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Re: Gold continues to soar!

Post by Forester »

asif408 wrote: Wed Mar 03, 2021 7:36 am
JBTX wrote: Wed Mar 03, 2021 7:28 am
Salmo Trutta wrote: Wed Mar 03, 2021 7:05 am Living in Colorado, we bump into old or mothballed mines all the time while out hiking, fishing, biking, overlanding etc.

One thing I've learned is that there is plenty of gold still in there, but the current prices do not support extraction. If the price goes up, or the technology/productivity improves, many of those mines will restart production.

And the price will drop...
https://www.usmoneyreserve.com/blog/how ... the-world/

Most gold is estimated to have been discovered. Of course that is an estimate. Hard to estimate what you haven't discovered. About 80% of gold discovered gold has been mined.
As long as there is a narrative for gold and silver and it is still being peddled on TV and the radio to old people there will probably be a place for it for a few more decades. Then when this old generation dies out the next one will have crypto peddlers maybe. But the story for gold is still alive and well.
Sentiment on gold of Asia / 'The East' will be increasingly important, that of Millennial / Zoomer Westerners, less so.
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Re: Gold continues to soar!

Post by jpmorganfunds »

Forester wrote: Wed Mar 03, 2021 8:55 am
asif408 wrote: Wed Mar 03, 2021 7:36 am
JBTX wrote: Wed Mar 03, 2021 7:28 am
Salmo Trutta wrote: Wed Mar 03, 2021 7:05 am Living in Colorado, we bump into old or mothballed mines all the time while out hiking, fishing, biking, overlanding etc.

One thing I've learned is that there is plenty of gold still in there, but the current prices do not support extraction. If the price goes up, or the technology/productivity improves, many of those mines will restart production.

And the price will drop...
https://www.usmoneyreserve.com/blog/how ... the-world/

Most gold is estimated to have been discovered. Of course that is an estimate. Hard to estimate what you haven't discovered. About 80% of gold discovered gold has been mined.
As long as there is a narrative for gold and silver and it is still being peddled on TV and the radio to old people there will probably be a place for it for a few more decades. Then when this old generation dies out the next one will have crypto peddlers maybe. But the story for gold is still alive and well.
Sentiment on gold of Asia / 'The East' will be increasingly important, that of Millennial / Zoomer Westerners, less so.
The west is in decline while China is on the rise. The People's Bank of China as well as its citizens have been continuously accumulating gold. If they ever back the yuan with gold it's game over.
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Re: Gold continues to soar!

Post by DB2 »

asif408 wrote: Wed Mar 03, 2021 7:36 am
JBTX wrote: Wed Mar 03, 2021 7:28 am
Salmo Trutta wrote: Wed Mar 03, 2021 7:05 am Living in Colorado, we bump into old or mothballed mines all the time while out hiking, fishing, biking, overlanding etc.

One thing I've learned is that there is plenty of gold still in there, but the current prices do not support extraction. If the price goes up, or the technology/productivity improves, many of those mines will restart production.

And the price will drop...
https://www.usmoneyreserve.com/blog/how ... the-world/

Most gold is estimated to have been discovered. Of course that is an estimate. Hard to estimate what you haven't discovered. About 80% of gold discovered gold has been mined.
As long as there is a narrative for gold and silver and it is still being peddled on TV and the radio to old people there will probably be a place for it for a few more decades. Then when this old generation dies out the next one will have crypto peddlers maybe. But the story for gold is still alive and well.
Gold has held value for thousands of years. I don't think that vanishes when the old folks pass.
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Re: Gold continues to soar!

Post by SeasOfCheese »

Given the high level of pessimism towards gold (at least as I see things), it is probably a safe/good time to be accumulating. The metal and/or the miners. The miners have started paying respectable dividends. Which is hopefully a positive expression of a desire to focus on returning shareholder value, if it lasts.

I do think that bitcoin is the new shiny object that is currently helping to depress gold. If the tech bubble deflates further it will be interesting to see how bitcoin reacts. I tend to think, with no data beyond my observations on who is investing in both, that bitcoin would be forced down in sympathy. Who knows? It will be fun to watch.
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Re: Gold continues to soar!

Post by KlangFool »

Hi,

What would be the right gold price if the real interest rate drop to negative 5%?

Thanks.

KlangFool
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NoRegret
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Re: Gold continues to soar!

Post by NoRegret »

KlangFool wrote: Sat Mar 06, 2021 8:06 am Hi,

What would be the right gold price if the real interest rate drop to negative 5%?

Thanks.

KlangFool
-5% is a little extreme although I won’t argue directionally. People predicting negative US yields never bother with gold price under the same circumstance.

IMO the next leg up in nominal yields will be accompanied by widening breakevens and lower real yields as actual CPI inflation is more recognized. We’ll see.
Market timer targeting long term cycles -- aiming for several key decisions per asset class per decade
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Re: Gold continues to soar!

Post by KlangFool »

NoRegret wrote: Sat Mar 06, 2021 10:00 am
KlangFool wrote: Sat Mar 06, 2021 8:06 am Hi,

What would be the right gold price if the real interest rate drop to negative 5%?

Thanks.

KlangFool
-5% is a little extreme although I won’t argue directionally. People predicting negative US yields never bother with gold price under the same circumstance.

IMO the next leg up in nominal yields will be accompanied by widening breakevens and lower real yields as actual CPI inflation is more recognized. We’ll see.
NoRegret,

Please answer the question if you know the answer.

<<-5% is a little extreme >>

Historically, it had happened before and at a greater extreme. So, it is not impossible.

<<People predicting negative US yields never bother with gold price under the same circumstance.>>

I do not understand why this statement could be true. At that extreme, the sky is falling. The gold is the only few options left.

KlangFool

P.S.: I found the formula. At -5%, the gold will be about $10,000 per ounce.

viewtopic.php?f=10&t=299656&hilit=marke ... 0#p4939835
Last edited by KlangFool on Sat Mar 06, 2021 10:49 am, edited 1 time in total.
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Re: Gold continues to soar!

Post by watchnerd »

Hmmm.

Gold as substitute for muni bond MM fund?

They both pay 0%...
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Re: Gold continues to soar!

Post by smitcat »

KlangFool wrote: Sat Mar 06, 2021 10:03 am
NoRegret wrote: Sat Mar 06, 2021 10:00 am
KlangFool wrote: Sat Mar 06, 2021 8:06 am Hi,

What would be the right gold price if the real interest rate drop to negative 5%?

Thanks.

KlangFool
-5% is a little extreme although I won’t argue directionally. People predicting negative US yields never bother with gold price under the same circumstance.

IMO the next leg up in nominal yields will be accompanied by widening breakevens and lower real yields as actual CPI inflation is more recognized. We’ll see.
NoRegret,

Please answer the question if you know the answer.

<<-5% is a little extreme >>

Historically, it had happened before and at a greater extreme. So, it is not impossible.

<<People predicting negative US yields never bother with gold price under the same circumstance.>>

I do not understand why this statement could be true. At that extreme, the sky is falling. The gold is the only few options left.

KlangFool
"I do not understand why this statement could be true. At that extreme, the sky is falling. The gold is the only few options left."
I agree - precious metals can be valuable in those circumstances. What % of your portfolio are in these metals now?
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Re: Gold continues to soar!

Post by KlangFool »

smitcat wrote: Sat Mar 06, 2021 10:44 am
KlangFool wrote: Sat Mar 06, 2021 10:03 am
NoRegret wrote: Sat Mar 06, 2021 10:00 am
KlangFool wrote: Sat Mar 06, 2021 8:06 am Hi,

What would be the right gold price if the real interest rate drop to negative 5%?

Thanks.

KlangFool
-5% is a little extreme although I won’t argue directionally. People predicting negative US yields never bother with gold price under the same circumstance.

IMO the next leg up in nominal yields will be accompanied by widening breakevens and lower real yields as actual CPI inflation is more recognized. We’ll see.
NoRegret,

Please answer the question if you know the answer.

<<-5% is a little extreme >>

Historically, it had happened before and at a greater extreme. So, it is not impossible.

<<People predicting negative US yields never bother with gold price under the same circumstance.>>

I do not understand why this statement could be true. At that extreme, the sky is falling. The gold is the only few options left.

KlangFool
"I do not understand why this statement could be true. At that extreme, the sky is falling. The gold is the only few options left."
I agree - precious metals can be valuable in those circumstances. What % of your portfolio are in these metals now?
smitcat,

It is not part of my portfolio. It is less than 1%. I use precious metals as a form of insurance.

KlangFool
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Re: Gold continues to soar!

Post by Anon9001 »

watchnerd wrote: Sat Mar 06, 2021 10:21 am Hmmm.

Gold as substitute for muni bond MM fund?

They both pay 0%...
Gold is a long duration investment due to it's volatility. I assume muni/MM bond is short-duration investments so they should not be compared.
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