Pundit's Perspectives – Mon 4 Mar, 2013
Schiff on the Fed and precious metals
No exit: Peter Schiff on Bernanke’s latest public pronouncements.
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Schiff on the Fed and precious metals
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Bobby says:
Peter,
I could not have said it better myself. You nailed it.
MNH says:
Well Peter nails it a lot of the time. Too bad he can’t nail it in 15 words instead of a hundred. He has given people the impression that he too much likes to hear himself talk.
Unfortunately for hard asset investors— who must live in the real world (Never mind that the Fed is clueless in a best case scenario) —more and more people in the USA are unemployed & many who are working are suffering reduced hours. Plus what is it now?? A fifth college graduating class about to hit the streets with few prospects and student loans galore coming due in 9 months on top of it?? Hear all the time how seniors are needing to take more from their IRA’s and 401k’s because the rate of return is zip….
Seems to me hard assists may be for sale and on sale— for quite a while moving forward.
irishtony says:
Talk about confiscation by stealth . !!!
Article over at GATA,,,How India aims to turn Gold into paper & suppress its price , as in the west.
I dont think the Indian’s will fall for this SCAM they have a distrust of banks , & they like to keep their Gold , (physical ) close to hand…JUST GOES TO PROVE HOW IMPORTANT…(this useless yellow metal ) GOLD IS IN THE WORLD.
JERRYthe Short.OOTB says:
Irish…you are correct on the Indians…..”cemosavy,trust no whiteman”….Tonto 1959 Lone Ranger….episode 250….
Dennis F. Brophy says:
Gold into paper & suppress its price…..just what I`ve been thinking the reason why the metals that are ETF`s are what`s suppressing their prices, & not that there are too much physical metal in play out in the market place OR its the miners that are producing more physical metal thats suppressing the price factor, that people whin about so much. It`s those ETF`s after all thats doing it. Good reporting Irish….
James (the lesser) says:
Peter calls a great race. Unfortunately what is suppose to happen and what is actually happenning are two vastly different things. It all sounds very nice, but someone needs to tell the gold price.
har says:
You may be right, just don’t go broke in the process.
har says:
He has the ability to come to a conclusion and spin the facts to prove it.
James (the lesser) says:
first the etfs were heralded as another investment vehicle that would contribute to the bull market in gold, and it did. now people are blaming them on the price correction and suppression. I’m not buying it.
Dennis F. Brophy says:
When the a Deutsche bank announced in May 27, 2011, that there would the start of a physical Rhodium ETF it would reflect the spot price traded for this metal. For years this metal was static, it hardly had a pulse, it stayed at a medium price on the charts at about $2300. 00 at Bulliondesk.com for months at a time now its at a medium price at $1200.00. When it was announced that there would be an ETF in Rhodium, there was much discussion whether it could be traded that well because it wasn`t just a precious metal but a rare metal as well. But sure enough its traded like Gold is traded, but Irish is right if you want to exchange your paper ETF for metal, they don`t have to get it to you, because its just a paper instrument. Its a scam. Why else, if the FED can just invent paper money out of thin air, why not just invent paper metal out of thin air too. From one bank to another its just logical to do this ponzi scheme over & over again. The world is full of suckers, for worthless wooden, Al, base metal nickels. The U.S. is currently telling Germany that sure their gold is safe where it is, & not to worry about it. Ya, right.
irishtony says:
James…..Sorry man i have to say this…………”DUH”!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
irishtony says:
BTW….read the prospectus one is investing in Gold , but when you go to collect they dont have to give you the metal , they will give you paper instead….another scam thought up by the bankers…….in other words you give them money to buy gold..they keep your gold , & give you their FAKE PRINTED PAPER…..Touche
Bobby says:
anyone comment of the slaughter of silver miners today?
richard says:
Nope, but the charts tell that there is more to come—-more and more one wonders whether we’re seeing the initiation of a deflationary spiral with the last shoe to fall being the conventional markets. If gold breaks $1500-$1525 then we have a new player in town. It’ll be very important also that the trade weighted dollar doesn’t continue through strong resistance at about 8.50.
irishtony says:
Bobby…..”TODAY”!!!…..What about the last couple of years…..My understanding is the banks hold a lot of shares in these company’s….& they are the ones shorting them…
if i am wrong , then somebody correct me .
cfs2000 says:
Irish,
I have been watching the ETF EIRL go up and up and this does not match my impression of the Irish economy.
Admittedly I only tend to pass through Dublin on route to Derry and don’t stop for a pint of that ugly dark beer, but what’s up with the economy of Eire.
(This is an equal opportunity annoy as many as possible day. I try hard not to discriminate)
irishtony says:
cfs….i have to agree with you ….etf eirl……..the US bankers come up with a scam, & like a bush fire it spreads quickly tru the Eurozone…..ugly dark beer…the quickest way to upset an Irishman is to say his black stuff is ugly…..i’m coming for you…haha
I would get very annoyed if i WASENT discriminated against
cfs ..a word of advice ..DONT LET THE BASTARD’S GET TO YOU……
cfs2000 says:
Gold and Platinum are inverted again in US, but not in Hong Kong.
Paul L says:
Update from expected returns: note charts will not paste here
I’ll take the time to talk about gold today because I am sensing a bit of concern from people. Markets in general are very nuanced, and this is even more true for a divisive asset like gold.
It’s hard for me to explain, but there is an aspect of “feel” to all of this. Let me give an example. In a period of low confidence in government, assets in general will tend to rise because of a weaker currency, which implies all “non-government” assets, including real estate, will rise. This is true. However, as confidence deteriorates further, certain assets will become less attractive than others because of their moveability, or lack thereof. So with a total collapse in confidence, real estate becomes increasingly unattractive, while gold becomes increasingly attractive. For now, I can safely say buy real estate and gold because of a general trend of no confidence, or to simplify, because of inflation. But when confidence really collapses, it will be time to unload real estate, unless you have something like a 20-30 year holding period. It’s hard to make a blanket statement about markets because they change dynamically.
Ok, so back to gold. There are a lot of heuristics people use to figure out trends, and some are valid to an extent. Below is the Dow to Gold ratio, which is a decent tool to recognize long-term trends in gold. For now, the bull market in gold appears to be intact by a comfortable margin. Gold and the Dow will probably rise together (unlike the 1970′s when the Dow was flat), so this implies a higher gold price.
As for the short to intermediate term trend in gold, it’s still a little early. I favor a cautious approach for now: first let’s see how gold reacts to $1570, then $1540. Below $1500 is basically an abyss with no support, so be careful. The price action thus far hasn’t really convinced me that we’ve hit a bottom.
The long-term, however, is still resoundingly bullish. In the chart below, you’ll notice that gold has traded sideways for almost 2 years. The last time I can remember this happening was 2007-2009. We all remember what happened out of that consolidation.
With gold, it’s critical to have a plan AND to execute the plan. For me personally, I know I don’t get scared off in sell-offs, which is why I don’t get too crazy trading. I just feel out the market and sentiment, then buy when a solid base has formed. This strategy is 100% fine in a bull market, and is probably the proper strategy for most people. Unfortunately, a lot of people say this is what they’re going to do and don’t do it. When gold declines 5%, they are resolute. 10% and they might buy a little while pounding their chest for being such a savvy investor. With a decline of 20%, they are nervous, but think the end is probably near for the correction. Next thing you know, gold drops 30-50%, and their plan is out the window and they sell in panic like everyone else. This happens all the time, and I get the sense this is the type of move gold has in store for us.
I am not at the point where I am just dying to buy gold yet. I’m not really sure when that will occur, but it will probably be in the $1300-$1400 range. Understand that this type of move is totally normal and healthy. Remember, the bull market of the 1970′s say a 50% correction before a rocket launch, which means a price of about $1,000 for gold is not a big deal. Keep your wits about you because I believe gold has the potential to get really volatile.
Allen says:
Too bad some of us are all in…………….
These prices are a buyers dream
The gold/silver market will have to double for me to break even.
AAHHHHHHHH…… I feel better
marc says:
Hang in there…… Allen…HANG IN THERE. FYI…I am all in too!
Matt says:
You write well but are a gold dumper ,Paul.
That was not hard for me to explain.
Load up here and now and pay me later.
Paul L says:
That is just an email from a subsc.service but I took some massive losses many months ago like 2008/2009 all over again.
Matt says:
We have all taken losses as this is 2008/2009 all over again.
However,the negative everything has reached an extreme the way I read charts and survey sentiment.
Calling for $1300 gold when one is not in the market is pretty naughty.
har says:
I said a couple weeks ago this is 2008 all over again and of course my resident troll told me this time is different. LOL
Matthew says:
LOL is right if you think this is 2008 all over again. The causes and character of the decline then vs. now are totally different. You really don’t understand, do you?
I hope you do realize that Matt is not me. He does not deserve your attitude.
Matthew says:
If this were 2008, my Constantine Metal Resources wouldn’t have finished up 28.5% (on 1.82 million shares traded) today. LOL
Matt says:
I have devised an indicator that picks tops and bottoms and this is an extreme bottom.
When we bottomed in 2008 I had $8,000 in mining equities and a $5,000 VISA payment and slept on the floor with a chicken coop outside my rented room($40 per month).
This time around I have $185,000 .00 in equities and am watching English football in my three bedroom house.
This is nothing like 2008/2009,believe me.Sentiment and paranoia -yes.
har says:
The loses in the miners and rise in the USD say otherwise.
Matthew says:
Matt, congratulations on your success! I take it some good junior(s) played a role?
Matt says:
I am purchasing royalty companies and dividend players that are at major extreme lows on their charts and in their sentiment.
I survived the 08/09 meltdown by selling all my stocks at the bottom (taking the stock loss for the record) and buying similar companies.I am doing that now.
I will allow you others to put their faith in the Fed Reserve note.
Matthew says:
I guess that answers my above question!
Matt says:
Matthew,the answer is yes.
I had a few quality juniors that allowed me to survive.However,these have lost all their gains of the last 2.5 years.
So,what I am doing is selling the juniors that I have large losses in and picking up gold royalty companies and mining trusts that I perceive will be the market darlings right up until and after gold is included in some global financial currency revaluation.
The mining trusts have diversified portfolios and the royalty companies have no attached liabilities.
Matthew says:
Anyone who’s been involved in the juniors has certainly seen profits evaporate at some time or another. Not selling enough at cyclical peaks is a mistake we can fix. What’s really frustrating to me is when a company is doing things right and making progress only to have something come out of left field (like government interference) and change everything.
For this reason, I like to hold up to 25 juniors while still allocating much more capital to the top 5 “most confidence inspiring.”
The royalty companies sure outperformed everything else in 2008. Definitely lower risk than the miners – both juniors AND seniors.
Paul L says:
Royalty companies are the best to invest in the sector. Juniors and seniors are just wiped out as sentiment has killed them. I took around a 200k loss on Barrick alone last year. Franco Nevada has done well through this collapse. I have a large position in Apple now still about $30 loss per share on it but it will do well in the medium and long term. I have been using materials etf such as UYM that has 15% mining exposure.