Agnico Eagle Mines Limited Message Board

  • whartonmba99 whartonmba99 May 16, 2013 10:12 AM Flag

    the gold trade is done

    gold only thrives in an inflationary, recessionary or weak dollar far the economy is improving in the US, bottomed in Europe and the Japanese pumping has only strengthened the US dollar.soon QE will end, rates will rise and the global economies will continue to strengthen. Unless all the things I mentioned reverse dont buy or hold gold or silver . common sense shyte really.

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    • When people flog the economic dog it is usually a sign that an inflection point is coming.

    • you forgive the debt, the debt , the debt, you have to repay it before or later and you have no money, japan has got no money ,europe has got no money, it's the bankrupt baby.They are printing more and more debt like no tomorrow.Corrupt banksters and politicians won a battle but gold will win the war!

    • This is an interesting statement. In one breath you point out that gold performs well in an inflationary environment and in the next you point out that rising rates will be negative for PM's. Are you implying that the fed would raise rates (and effewctively increase debt service costs for the treasury) without the existence of inflation? in other words....the only reason that the Fed has ever raised rates is to combat inflation.

      As an aside its true that historically golds performs poorly in a negative real rate environment and a rate hike would definitely hit gold short term....but with a more moderate time frame a rate hike is the first indication that velocity of money is picking up......the match to light that mountain of kindling (TARP, QE1,QE2, QE3) the fed has created for the past 5 years. I find it hard to believe that the fed will be able to unwind their massive monetary policy without making mistakes. This is an experiment on a sclae that nobody has ever seen before...human error will definitely play a role.

      Its funny that everyone starts hating gold AFTER it has fallen........for me that makes for an interesting sentiment indicator.

      • 1 Reply to g_luck777
      • its a catch 22. gold is being slapped on both cheeks. As you noticed today, for some reason despite all the QE`s, Cyprus, Japanese printing, UK holding rates till kingdom come, inflation actually dropped around the world.the opposite should have occurred. what does that translate to, central banks can print and at the same time continue to hold rates without any major consequences for now. Another slap is coming from the US dollar strength. US dollar`s relationship to other currencies pretty much dictates the value and need to hold gold. so Japan`s printing only strenghtens the US dollar which in turn weakens gold. US dollar has to fall for Gold to rise and that wont happen as long as other currencies (canadian, south Africa, Australia, india)..

        hating gold is all about opportunity cost. do you want your money to be tied up in a losing trade for months or possibly years or do you admit that you are wrong and switch to a winning trade.

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