Gold as currency, the oldest most reliable currency.... We can argue how much gold is worth relative to the U.S. Dollar or Yaun or whatever paper you might choose. But, come on. To say it's not a currency when every major country accumulates as much as they can to back their paper money, that's silly. Currency is a generally accepted medium of exchange by defination. It's accepted anywhere in the world. Will its value go up as the continues to print money as a solution to every economic slowdown or financial problem-- who knows. Nevertheless, the value of a currency that can be duplicated by the trillions with the push of a button has to be losing value.
One more thing. I think China will also turn on the tap. The world will be flooded with a lot of hugely inflated currency and it'll boost markets right along with gold because at some point people will see it for what it is-- the big bubblelater machine.
Rx, Seems like the market senses more QE. Regardless what the Fed says, I believe there's the smell of a coming recession and then what'll the Fed do if it has to reverse itself after a small rate hike? Rather than embarrass itself with a false start I think it'll stall until the recession is obvious, then it'll do the only thing it can do-- print money etc etc... The dollar should fall and gold should rise. Or at least that's my current fantasy.g
Just read Rob's transcript from last conference call. I like how directly he and other officers answer. I also found it reassuring that Rob is thinking as a shareholder and not a million dollar a year CEO. To me it seems obvious that he will do what's best for shareholders etc etc.... In the end, it's gold that determines Mux value.
I agree. Dollar down, not a safe haven, should push gold up. Right now I believe people are selling anything they can to cover etc etc, and includes gold. But, when the dust settles, gold will be the place I want to be. It's the one and only currency that governments cannot manipulate. I'm thinking in the next months to a year for gold to go bullish.
The real news is nobody knows what might happen. Which to my mind means gold. The world is a skidish place today-- with a high probability of another "Black Swan" event, maybe a ways off yet, but the longer it takes the bigger the event. Mux, to my way of thinking, is a good place to hang out until....g
Gold is something that generally appreciates when the unexpected happens-- the unseen events that come out of nowhere. The black swan event. Nobody sees it coming, that's the whole point of safe haven. In today's world there is increased probability of some great crisis setting off another financial crisis. And the longer we go without one, the greater the probability that one something will occur.
...money supply. Prices of goods can be distorted to read as deflationary while the cost of basic things needed to survive skyrocket-- food, housing, transportation. It's great to get a phone for free and a new tv at 50% of what it was a few years ago, too bad we can't eat all the new tech junk. The real cost to live is much higher now than before QE. The official inflation numbers factor in all the cheaper tech gadgets that do nothing for someone who has only enough to buy essentials. What do I care about the lowered cost of virtual reality glasses and iRobot vacuum cleaners etc etc etc.....
So, why all the shorts? Even at this price they don't seem to budge. I don't get that. Do you have any insights? Thanks, g
It's inflating the money supply. Creating 4 trillion new dollars divided into the total number of people on the planet-- well the Fed coulda sent everyone in the world a fat check, even the children. So, historically, that's how nations have destroyed their currency. The inflation number put out by the govt is the fallacy. Can they continue to gigger things and fool us with phony numbers for years, of course. But I am betting the ending to the QE experiment is going to be very very bad. Who knows when. If solving the next financial crisis is just a matter of printing a few more trillion dollars, well, then we will never have another crisis. Right?g
Remember, there are a lot of buyers. The 20mln shorts, just waiting-- for gold to bottom, maybe. But Mux needs a strong gold rise to move back to $1 plus territory, and to me a reverse split is a gimmic. Don't need it. Just need patience. Need all that $ printing to be recognized for what it is, extremely inflationary.g
...not many buyers, not many sellers. So anyone needing to buy-- as shorts must-- would spike the price up like yesterday. Anyone trying to sell a larger amount also runs into not many buyers etc...
It seems to me we are witnessing the extremes of the currencies to gold relationship. The almost panic to buy US dollars by those certain that dollars will continue to rise against a world now copying the Fed QE printing trillions--- the logic is that it has worked for the U.S. Fed and now will work for everyone else. Just print and the debt will disappear in the coming boom. Except there is no real boom. The extreme tops of equities, dollars, etc...will eventually end. Then perhaps it'll be golds turn to rise to an extreme. Trouble is timing. Nobody can predict the dollar and equity market topping out. But it will. And the eventual crash will be much worse because of QE and QE copycats around the world. And you can be sure that the FED and central banks everywhere will do everything they can to stop that crash from happening. The Keynesians are not stupid people. I'm sure they believe some new tech invention or magical elixir will prove them right. All you have to do is print money and convince people that everything is ok and it'll all be ok. I'm buying Mux because I believe that is bs.g
Like the metaphor. But, let's not forget that the U.S. Dollar is valued relative to other paper currencies. It's been losing real value via inflation as it gains value relative to other currencies. And, at the same time it's being called a relic, central banks around the world continue to stockpile it. By any definition gold is a currency. You can buy things anywhere in the world with gold. The U.S. Does not hold 8000 tons because it's worthless.
As for Mux, gold has to hit a bottom. Like all miners, Mux will appreciate with the next gold run up. Trouble is, these cycles can take a long long time. The Keynesians can pull a lot of tricks out of the monetary bag of tricks to continue to stall the day of reckoning. Then too, a day of reckoning may never come. G