A focus on gold and the global deflation which will impact everyone
Rick weighs in on the move buoyancy in gold today and what he sees happening when deflation really hits the globe.
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I don’t see any consumer goods going down in price, let alone insurance, tuition, and other service sectors. Nothing you need to buy goes down. Forget about inflation in the money printing environment. It does not make logical sense. I start to such small can of coke, it makes me laugh hard. You don’t see inflation even you look at the fake CPI.
You don’t see deflation even you look at the fake CPI
Deflation in some assets and inflation in others is a mixed bag, and lends credence to Chris Temple’s stagflation remarks in the past. We are in uncharted waters…
Deflation in terms of what? What is cash?
My point is, gold can be considered cash, and we may see deflation in terms of gold, as we did for 2000-2011.
Funny, we have seen commodity deflation in terms of the U$D, but that hasn’t tranlated into deflation in terms of anything that normal people have to buy. Ok, in oil just lately. But generally speaking, peoples’ costs are going up.
So when Rick talks about deflation, I translate that to mean deflation in certain asset classes where debt failure will impact. I don’t take it at all to mean that we will see our USD purchasing power increase for our necessities–there I see inflation continuing.
Dent’s $400?! Apt that pays 100K/yr going to zero?! Your thinking confuses me.
It’s interesting. I hear people complaining that every kind of insurance cost is always going up and how that is inflation. I think it is systemic risk that has raised the cost of insurance. These companies are milking their captive customers who have to insure their house / car / medical care or life – in order to get reserves to put against losses in the next crash. It’s just called risk premium.
That’s what Bob Hoye likes to call the real price of gold. Gold:CRB ratio is not a bad approximation:
http://stockcharts.com/freecharts/gallery.html?s=$gold:$CRB
I tried to cheat and get a 10+ year chart. Here is the point and figure chart modified to 10box reversal, giving Gold:CRB since 2004:
http://stockcharts.com/freecharts/pnf.php?c=%24GOLD%3A%24CRB,PLTCDANRBO%5BPA%5D%5BD%5D%5BF1!10!!!4!20]
Gr! These stockcharts URL don’t work! On tha above chart just change the Chart Scaling Method -> Reversal box to 10 under the chart.
I agree, GH. In real terms, gold has actually fared far better than most think even since 2011. For instance, it is worth 125% more oil than it was in June, 2014 and 322% more than during the summer of 2008 (26 barrels vs 6 barrels). In fact, gold is worth more than 20% more oil than it was when it peaked at $1923/oz.
http://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24WTIC&p=W&yr=7&mn=7&dy=0&id=p09492066640&a=388661094
Dent is worse than a joke. Those who give him money deserve to lose it. In January 2013, he said that the Dow would be below 6,000 by the end of 2014 or sooner.
In September, 2011, Dent said that equities will fall “by at least 50% and possibly as much as 75% to our best targets of 3,000 to 3,800 on the Dow.” He advised being out of the market or being short between early 2012 and late 2013.
Economic forecasting 101: always do the reverse of what Harry Dent predicts
http://www.arabianmoney.net/us-stocks/2012/09/11/economic-forecasting-101-always-do-the-reverse-of-what-harry-dent-predicts/
Dent is disgusting.
Yup.
and yep.
Matthew:
Dent is wonderful at marketing crap. In 2000 he was calling for 30,000 DOW based on demographics. We are going to see that about five minutes after the gold derivatives time bomb blows up.
Dent’s calls are so perfectly the opposite of what is likely to happen that he must be a shill. He called for 36,000 Dow just as it was about to lose about 40% in a couple of years. Then, when that didn’t work out, he said it would happen by 2007 or 2008 at the latest. So, when his followers were positioned and waiting for 36,000, they got 6,000. Then, when the Dow was on its way to 18,000+, he was calling for 3,000 and had his followers out and short.
I’m sure he’s good at marketing but it doesn’t hurt that there’s a never-ending supply of clueless people that refuse to do even minimal due diligence.
They did and they lured people into a big mistake! So, the gurus were morons.
gold should do very well in deflation! (not based on the deflation itself but the Fed’s response…and they will respond in kind!!)
I’m puzzled by this thought process since Gold started falling hard right around the announcement of QE 3, didn’t it? I don’t think that restarting QE necessitates increase in gold price.
QE3 didn’t technically involve more money printing whereas QE1 and QE2 did. Google the wiki explanation, it is very good.
Arguments both ways Dan.
Im not gonna claim I know.
Im just gonna stick with my 5% of investable income to physical.
At that % it really makes little difference what happens to the gold price.
I noticed on E Bay, bullion 1 oz coins of silver seem to be selling at $30 Canadian.
Very to extremely little junk other than dollars.
1oz gold maples were selling for $1600
Why don’t there people just buy from a bullion dealer?
GREEK NEWS……….GREEKS give a GERMAN FIRM….the rights to 14 regional airports, ….Debt slaves……..
article at FSN..(Financial Survival network)
That was on zerohedge and/or silver doc today.
Guess its a 50 year lease.
A lot can happen in 50 years.
But it is interesting the guys saying Greece will lose their assets are being proven correct.
Exactly as the “Economic Hitman” described.
I guess after they own everything on earth they will go after planets.
STAR WARS………….Hans Solo will be working at GOLDMAN’S….And the MORMONS will take flight………………….lol
Funny moment with Han Solo and Chewbacca in A New Hope
I hear Mars is nice this time of year. Titan is not so bad if you like going surfing in liquid methane.
Nice….. Surfing in liquid methane on Titan seems like a blast.
I can never make up my mind about Greece. I kind of feel sorry for them on their one way trip into the Third World. On the other hand, every bankrupt loses their assets or their company’s assets, so what’s different. The Greeks already spent the entire value of those assets probably many times over in past years. Now it’s reckoning time. Other countries have that to look forward to later. Those that still have their own central banks can lose their financial assets through hyperinflation. In Greece, it’s different – they are stuck in permanent near-default.
Allowing the right thing tp happen. There is one moment when it can be allowed to be happen. At the end of a President’s second term or even a falied President’s first term. A great time to bury bad news.
Think of Hoover in Nov 1932 March 1933 and the US banking collapse and bank holiday and then George W Bush Sept 2008 into Jan 2009.
How about Obama in late 2016 for an end of term disaster?
Gold has been soaring vs commodities for more than a year while mining costs have been coming down significantly for many miners. But the miners will catch-up at some point and the gains will be massive.
http://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24GNX&p=D&yr=4&mn=11&dy=22&id=p00210481423&a=421086453
The Theory Of Theories, Like Blisters That Have Blisters
Monday August 17, 2015 – Gary Wagner
Well, a few years ago the “gurus” were saying it was time to buy “stuff”.
Wealthy have been buying art land and prime real estate to protect their wealth.
If your right Rick, gold should get deflated too, maybe 817 is correct but should deflation go on, maybe Dent is right saying 400.
In other words, the only “things” to own would be what a person needs and cash until the deflation ends. excluding maybe income producing assets.
Who cares if the apt building goes to zero if its paying me 100k a year?
Maybe that’s “the crash”? People realise a deflation is upon us and stocks other than dividend payers are pointless, and I cant see dividend paying gold companies to continue too much longer should deflation make mining unprofitable.
Al, are you still ahead on physical silver buying at $14 when you take premiums buying/selling into account?