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  • crazy1090631 crazy1090631 Dec 25, 2009 4:43 PM Flag

    Gold to $2000 or is it a Tulip Mania?

    You have to ask yourself why? The reason is the minions (you) have no idea what your gold is worth so you sell it to the sharks at a discount. It will be a bubble whe it IS NOT CALLED a BUBBLE of MANIA. It will be a bubble when the houswives of Orange County talk about the price of a gold eagle versus a silver eagle. We are not even close. If you understand manias and how they progress you would have answered your own question. History repeats, but human psychology does not.

    Good luck and btw $2000 is low

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    • So if gold is going to $5000 as some goldbugs point, why is it only $1104 per oz now?

      Why are the Jewelry experts buying gold now?

      The TV commercials show the goldbugs are buying gold for cash.

      • 2 Replies to carlosizquierdo2000
      • The market problem: Whenever you sell anything the person to whom you are selling to thinks it is worth at least what he is paying for it while you think it is worth no more than what he is paying.

        There are sharp divergencies in the opinion on the direction of the price of gold, and I have read at least one paper which predicted that gold would retrace to below $100/oz. I have no idea about where gold price is going, but I hold ABX to write calls against it. I make a bit of money this way.


      • Merry Christmas Carlos,
        The Tulip Mania took place in the early 1600's. I don't remember that. The big bull in silver and gold took place in 1979. I remember that.
        Gold rose then due to inflationary concerns; silver rose also but for more reasons. The Hunt brothers, of catsup fame, tried to corner the market on silver and forced prices up as they bought and bought. This is a simplistic account of the market forces at work then, I don't pretend to understand it all.
        Throughout 1979 silver was being purchased in motel rooms as temporary offices were established to acquire the rapidly rising commodity. People were willing to sell at these makeshift offices because the purchaser made the transaction easy and the cash paid was immediate.
        The current economy seems much like 1979. However, inflation then was easily observed and widely discussed. Today, inflation is mentioned as a distant possibilty. The truth is more immediate; the result of over spending will begin to cause a dollar to purchase less and less. The price of everything will increase. As more dollars are printed to keep the books balanced, the price of gold will rise and rise. Its not a mania. Your dollars have been placed in the inflationary clothes dryer and will keep shrinking until the buzzer goes off. It will take more and more of them to buy a bit of gold.
        The tulip bulbs went manic, blooming well outside their intrinsic value. They never had historic value. Think Beanie Babies=tulip bulbs.

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