[ARCHIVED THREAD] - Gold question (Page 1 of 4)
Posted: 2/20/2008 12:08:09 PM EDT
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Just curious, gold is at ~$940/oz right now, and silver is getting close to $18/oz. Are any of you guys buying or selling gold at these levels? added a poll to see what people think about this. |
hehe, thanks for the advice. I already own a lot, and I am mostly buying the mining companies at this point. |
Nice. I was just graduating from college when gold was hovering around $300 and I really thought about buying an ounce every month (that was all I could have afforded at the time). I am kicking myself that I didnt. Of course if I had been really smart I would have bought rhodium link |
I was basically just asking if people think these prices are high and they are selling, or they think theya re low and are buying, thats all. |
That concept is weak. Each purchase and sale should stand on its own. But it's very popular with brokers who have customers that don't realize this. And with investors who don't want to spend the energy or have the know-how to evaluate the strength or weakness or their position or intended position. |
Market timing doesn't work. Plain and simple. You are incorrect. |
Yep, tell that to the guys who bought Rhodium at $380 an ounce 5 years ago. I am sure they probably wish they knew what a bad investment it was going to be, since it sells for close to $9000 an ounce now..... |
Or the guy who bought a lottery ticket and won $20M. A gamble is not investing... |
Buying a commodity that you think is going to be worth more in the future is not investing? |
If you put all your money into it, it's a gamble. If you don't, it's call speculation. |
What are you talking about? First you say buying PMs is not investing, then you are talking about putting all your money into it? Where did that come from? Honestly I just am curious about if people are buying or selling, I am not interested in arguing the merits of PMs as an investment, no offense. |
I believe I've got it right, not you. You ignore fundamentals, it seems. Because magic 'dollar cost averaging' tells you because your holdings went down you should buy some more. Or that even if it's up, you should continue to buy. Read this: Nobody gains from dollar cost averaging analytical, numerical and empirical results Your definition of market timing seems to say that it means buying at the absolutely lowest and selling at the absolutely highest. I don't try to do that, but any rational investor who totally ignores weakness or strength in the market or a particular investment is asking for trouble. So what does averaging itself tell you about whether to buy a new stock or especially, to sell one you already have? Absolutely nothing. Are you supposed to forget what makes a stock good or bad? Dollar-cost averaging is more of a marketing tool than anything else. If that's good enough for, you, go right ahead. We need people like you who are willing to accept a lower rate of return without meaningfully reducing risk. But brokers like it because it encourages their customers to make regular transactions and pay fees for purchases on a regular basis. If you want to buy into their strategy, go right ahead. |
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I just bought a troy ounce of iridium, in the form of an arc-melted button. I don't have it yet, but I will in a day or two. I didn't get it as an investment, but just because I wanted a piece of iridium. It's the most corrosion-resistant metal in existence (aqua regia will dissolve gold but not iridium), it's tied with osmium for densest element (16% heavier than gold), and it's very hard and really shiny. Right now iridium is at about $450/oz. |
Well I buy and sell all the time because this is a side business for me. On the whole, I'm buying as much silver and gold as I can afford with my real jobs paychecks and whatever I make setting up at shows doing the rare coin and precious metals business. All in all, I'm very happy buying all I can afford even at todays prices.
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Nothing magic about dollar cost averaging. It's very simple. Here's an example. You buy 1000 shares of something. The shares go up to a certain level of price that you as an investor would like to take advantage of by selling. Do you sell all 1000 shares and bet the price will not go up anymore? Or will you not sell and risk the price going down. If you say that by your research you know exactly what will happen, you are full of BS. So say once you hit your magic selling price, you sell 500 shares instead of 1000. Obviously you will have to think the price has a chance of going up more, otherwise you would sell everything. Then if the price actually does go up in the future some more, you can sell some or all of the 500 shares you have left. If the price goes down, you have taken advantage of the higher price for the first 500 shares you sold. It's called mitigating risk. Something most investors like to do. Edit: Market timing is what it is. Trying to buy in at the bottom and sell at the top. It doesn't work. Nobody has a crystal ball, no matter how much research you think you can do. |
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It's a gimmick to sooth the feelings of people who worry about their decisions, by adding a factor of mediocrity to their outcomes by smoothing. This is why it's so popular with brokers. It helps them persuade their less-astute customers to feel better for buying into a falling investment. When their investment goes up, they can be persuaded, that "Well, look at the money you made. That's worth something, isn't it?". And generally these people don't have negative feelings as long as they're making money. And most importantly, for the brokers, it gives them a continuing stream of trades and fees. I'm curious, you seem to be heavily invested into cheerleading for this "strategy". Are you in financial services / a broker, or are you just advocating for it because someone else convinced you to follow it?
Which just means that you could have made more by not selling anything.
Another of your straw bogeymen. You don't need to think you know the exact peak or bottom of either the market or a particular stock to make money on it. To have a price where you're willing to forgo further gains by selling, or to avoid further losses by selling, is NOT trying to "time" the market. Financial Services Review Volume 2, Issue 1, 1992-1993, Pages 51-61
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You don't buy gold as an investment, you guy gold because you think the currency is going to inflate. And I think it is. Like this housing/banking mess right now--the gov is lying left and right, coming up with pretend "plans". The reason they keep coming up with new plans is because each one has failed to address the underlying problems--which are problems that they would need a huge pile of GOLD to fix, which they don't have. Simply printing dollars will not fix the problem, because that would cause inflation to skyrocket.... And they'll do the exact same thing in 10-15 years when hyperinflation starts to hit the dollar, because of rising Soc security and medicare payouts. They're not going to tell the truth until it's way to late to avoid getting burned. ~ |
And that, my friends is why you do not EVER, for ANY REASON back a national currency with precious metals... |
Gold doesn't fix currency problems... It creates them, based on the fact that there is a fixed supply of it, primarily (a fixed money supply is a BAD THING)... This is further complicated by the false perception that gold has some sort of magic 'intrinsic value' which fuels speculation, bubbles, and irrational pricing... Such as what we are seeing right now... The dollar is the accepted medium of international exchange now... It suffers from none of the inherent problems with commodity/PM-based money, and so long as the world economy does not fall completely apart (an act that would destroy life as we know it) this will continue... P.S. The financial 'crisis' that is being predicted, if it happens, will be DEFLATIONARY... Prices will crash, the money supply will contract, the value of the dollar will go UP, and we will be fucked in a way hyper inflation can never manage... Unless, of course, we counter deflation with artificial inflation... It's a balancing act... Just like everything else... P.S. When gold drops below $250/oz... It will be quite amusing... The cycle points to continued up-and-down swings in the price going forward... Folks who believe the gold-bug nonsense & buy in to this 'sure thing' with 'intrinsic value' will be crying their eyes out when the bubble bursts & the price free-falls... |
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You could have just said "No, not buying gold and never will". Instead of spouting all that nonsense that you dont understand. Thanks for the contribution to the thread though. |
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No, not right now. Traditionally, gold sales slow down in the summer months. I'm waiting to see what happens in, say, June/July. If gold holds to past form, we ought to see some easing off on price; maybe get lucky and see $840 to $860 per ounce. I'm definitely a buyer at those prices. If gold is still at $920 or so, then I will also buy on the assumption that it will continue to go up strongly in the Fall. |
Only to those that didn't buy it and are trying to cover themselves........  Ask yourself this question, when someone talks bad about AU/AG. What is their track record? When Gold was 400 and silver 4, what were they saying then? Were they saying it was a "bad investment" then? My bet is they were. GR |
Exactly. Ive been trading my dollars for gold. People who have dollars (that have lost 30% of their value in the last few years) keep saying to sell gold (up 300% ). None of them seem to be able to tell me why I should listen to someone who has been consistently wrong for years though.... |
Did you sell any of your stocks to greater fools when it hit an all time high? There are plenty of stocks that give no yield. and if cash/bonds yield at or less than inflation, the yield is meaningless. Having said that, anyone that has all PM's is wacked, just as being in all stocks (with no bonds, real estate, Pm's, etc) is just as wacked. There is a such thing as balance in your investments. PM's are part of that. GR |
True that. One also has to figure in broker fees AND capital gains taxes. The Fed stopped reporting M3 but many are attempting to recalculate the total increase in money supply and have it at 18%/yr. 18%/yr means the money supply will DOUBLE in 4 years. Got inflation?  We're in an incredible time right now. This moment is the lag between money supply inflation and price inflation for most ALL consumables (ammo notwithstanding). Anyone think prices will not rise significantly in the wake of a money supply that is doubling every 4 years?  (where's Capt. Obvious when I need him??!?!, lol)Gold is still an extreme value at present USD$ pricing. Silver too. Those of us who saw the writing on the wall and stocked up on Au/Ag at $400/$4/z (& ammo to boot!) are getting simple value for money. Were there any other "plays" that could have given (& continue to give) those sort of "returns" (I quote returns because, in truth, it is just a save haven against an incredible loss of purchasing power)? - sure... but nothing so simple, easy & low risk. All investing in stock markets is gambling. Any holdings solely valued in USD$ is a risky proposition imho. |
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I can't vote in this poll. I do not own any gold, but I would certainly not say "I never plan to". Maybe gold just keeps going up and up and up, in which case $940 an oz. today is a bargain. Or, maybe it goes back down again... like it always has in the past. I don't know, and don't care to bet on the outcome. |
Based on what? Seriously, everyone has a different idea. Sell, buy... that's either based on an opinion, or cold facts that support your position. What facts lead to the inescapable conclusion that 3-5 years from now gold prices will be at a low? |
Good question. The reason I think gold will continue to go up, is that the price of gold in $/oz has been very close to the DJIA twice. Once was at the peak of the depression, and another time was 1981, after the huge bull run in commodities, at the end of a very long bear market for stocks. I think that governments, especially our government, will inflate our money supply, which will devalue the dollar. Since the DJIA is about 13 ounces of gold now (down from 40+ at the tech boom peak), I think we have a lot of room to go. My target for gold is ~$10000 /oz. People laugh at me all the time when I say this, but they also laughed when I predicted we would see Nasdaq 1000 before Nasdaq 10000. (This was when it was just under 5000) |
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If I offered you $5K in gold or $5K in cash and you couldnt cash it in for 5 years......which would you take? Gold has gone up but the dollar has also fallen ... A lot!!! Soo... the price of gold is partly inflation driven here in the US. Through out this entire post ... I never saw Platinum (PT) mentioned. PT is trading today for around $2150 and ounce. I tried to get a buddy of mine to buy 3 years ago @1200 per.....He wishes now he had. Being a jeweler I get lots of scrap gold as I allow people with gold to trade in gold toward a purchase. works out well for me and them. Soon I will melt it all down and cast it into 24Kt bars towards my retirement...if that ever happens. Buy Gold ... Buy Plat...buy Berkshire Hathoway! |
That is a stupid choice. You are comparing apples and oranges. Cash is only supposed to be a TEMPORARY store of money. You aren't supposed to shove it under your matress. Gold is a commodity. (Or a risky investment as all commodities are.) If you give me the choice to invest that 5K in whatever I like? I'll take the investment over gold for 5 years any time. |