Gold hits $1,700... a bubble?

skiminnesota

skiminnesota

Active member
In a day that saw the dow drop 600some points, only a couple of days after the USA loses its AAA rating. Gold hits an all time high.

Gold: speculative bubble?

or accurately representing the value of Federal Reserve Notes? (approximately jack shit, give or take)

JP Morgan also predicted gold trading at $2,500 per once by the end of the year.
 
im dont really know alot about stocks, have a couple, including gold. my theory is it will always go up in the long run because it is a limited rescource
 
How long is your long run? You might want to look up what happened in the 80s.

I think gold will fall when (if?) investors stop panicking. Right now gold is shooting up because investors are looking for a save haven and aren't finding much else.
 
seeing as my dad is a ceo of a gold company i am happy. but no it is because we got dropped to AA+ credit rating, this was forseen, and gold is not seen to fall any time soon.
 
not a bubble just a terrible economy, gold will keep rising

the S&P dropped 6.66%and the NASDAQ dropped 6.90% fuckin wow
 
idk gold might fall if goldmann and sachs throw their hundreds of billions into something to make an artificial demand
 
my under educated 21 year old opinion has thought gold has been (is) a bubble for a long time.

however as we see the world lose faith in the USD and gold keeps rising. is it coming down anytime soon? will it crash fast, or make a slow gradual drop?
 
I was reading reports about a month ago predicting gold to stay at about1,550 for the end of the year 16,000 for next year then 14,000 for the year after. I think a lot of these different financial groups underestimate gold. Personally I think all precious metals are going to keep going up. Not only cause they are limited but because of inflation, which will never stop. Also a lot of people are afriad to hold their money in currencies right now so they dump money into a precious resource, most commonly gold. I feel silver is the next one to take a leap. I feel it could be really undervalued.
 
I don't know if gold is a bubble, but I'm not going to buy it. I see that this sell off is a bit unjustified...corporate earnings have been great lately, and keep in mind that a AA+ rating is still great. If you are looking for something with a strong negative correlation to stocks, I'd consider TIPS (treasury inflation protected securities), especially since Bernanke hinted the U.S. may print more $.
In addition, I'd be more worried about Italy, that would be like Greece X 10
...end rant about something I'm barely beginning to have a fair knowledge about!
 
The sell off is a hiccup in the markets overall value, generated by uncertainty and the fear that a lack of economic growth (particularly in the United States after massive spending cuts) that might negatively effect corporate profits. Coincided with uncertainty surrounding whether or not certain EU countries will be able to cover their debt obligations in the near future.Gold is a great capital and investment backing tool at this point, because it's reliable and has shown a massive increase in value since 2008, doubling it's value since the last crisis. With that said, all good things must come to an end. There are plenty of "educated opinions" out there that talk about gold's value plateauing in 2012 as the dollar regains it's strength, that is if the dollar can regain its financial horsepower.
 
I don't see the dollar getting even close to regaining its strength in the future. Gold and Silver could really start to be a world currency.
 
This is why gold hit 1700After the U.S. lost its AAA credit rating people got scared and started to sell their stock in risky business like industrial. The DOW lost 685 points today because of this sudden rush to sell of said stock. After selling their stock these people were still greedy so they said, lets invest in something safe that we can use as a buffer in case the recession gets way worse because of the credit rating down grade. So while the DOW lost a ton of points, gold exploded.
 
In the near future I agree with you, that's why i possed the "if" in regards to whether or not the dollar would regain its strength. On the contrary, I don't see gold being unanimously decided upon as a "world currency". As a commodity it serves as a crutch for current financial standings, the problem is that as gold increases in value the value and reliance of the dollar decreases, so it's a double edged sword in that sense.
 
My parents bought an ounce last year from my grandmother for i think 1000 even (my grandma paid 700 for it a few years before...

my parents want to know, sell it now, or wait...

we don't need the cash like this second, but if this is a bubble...sell?
 
if it were me i would keep it, like woozy said there will probably be a correction pretty soon but after that it should continue rising
 
That's what my parents are hoping, they will need to sell it when my brother goes to college, in two years, and by then i think it will be worth at least 2k
 
Be careful. Gold acts primarily as a market/economic hedge. When the economy/markets in general see disruptions or general bad times, it will continue to increase. When the economy (hopefully) moves towards a stronger, stable, bull market, gold will start decreasing. Gold has been jumping rapidly over the last year or so upwards signaling a general lull in the markets but I would set a price rather than a time that you'd like to sell it at. If it hits 2000 for instance, I'd be ready to jump ship and take the profit because it can easily start declining and its basically impossible to tell tops and bottoms of any financial asset.
 
Will do. Look at any financial asset - they're worthless if you never sell them, and they will always move up and then down again. When will they drop, or spike? who knows. I'm not saying gold wont continue to rise further, I'm just saying its not exactly a safe bet to go in on a multiple year rise.

What he should do if he has a lot of confidence in it continuing to rise is sell at 2,000 and repurchase. Make a profit and buy back in at a higher price assuming it'll continue to rise. Start lowering your personal maturity and continue to sell and grab profits, then buy in again.

Lets say he sells at 2000 and makes 1000 profit on it. Buy in again at 2000 and you're down 1000. Watch it rise to 2700 and sell again. Purchase at 2700, it drops to 2500- time to get out. Total profit? 1500. Just slowly cash out profits as long as transaction costs won't burn you too badly.
 
Why sell at 2000 then buy back at 2000? That's pointless your only giving other transaction fees.

If you bought it for 1000, and watch it rise until 2500, if you sell it you've made the exact same profit minus what you are paying to re-buy.

Worst idea ever.
 
Thats fine. Lets say you're sitting at 2000 and have the choice to continue or sell. You sell, and make the 1000 since you bought in at 1000 in my example. Awesome, make 1000. Lets say you don't sell, gold drops to 500 and you try to continue riding it and eventually selling. You lose 500. I'm not making recommendations, I'm throwing out common sense, continue with your worst idea ever, watch how that plays out, dopediecuts.
 
And don't tell me you 'know' it'll go up for sure. A lot of people have been wrong over the years... in fact most people have.
 
IT's going up for both reasons. Inflation and speculation/fear of whats going down.

Wish I still had my silver. Still doubled my money in two years. Better than noobs did in the stick market.

IT will keep going up though
 
gold and similar high value metals such as platina and silver will always be a safe investment, the availability of those precious metals isn't gonna change dramatically and demand will only increase (these metals are very important in the fabrication of hi-tech components )

on the other hand, if you really want an investments that's certainly gonna skyrocket, invest in some Rare Earth minerals/elements, there's an incredibly high demand, there's very little available on the market and the mines that produce it are situated in conflict zones.....
 
No dude don't try to change what you're saying. You said he should sell Gold for 2000 then buy it back at the same price. That's preschool shit to realize that doesn't do shit all but waste your own time and transaction fees.

I can't predict gold prices but you're throwing out idiotic ideas.
 
I didn't read anything except the original post but I wanted to add the following:

The price of gold is not a bubble. With economies and governments falling worldwide and in unison, the price of gold will only go up. Inflation is rising and governments are failing. if this continues (many people see it this way) the price of gold will only go up. In times like this hope in government is lost and belief in the few true valuables - gold and silver are the only things that have trade value.

Of course gold will have days where it falls in value but in the long term/longrun of things gold will continue to rise until it reaches the 2000 mark. at this point it will continue to slowly rise. Until our economic times become more stable gold will continue to increase iin its value but in my expectations the new price of gold will remain around $2000 - at least for the next 5 years.

When economic times begin to finally shift - for better or worse gold may plummet or soar but if you havn't invested in gold by now you might as well, because I only see prices rising in the next 5 years. My family invested in $50,000 worth when it was 1,100 an oz. you do the math.

That NS, is one of few of my reasonable posts.
 
My whole argument revolves around this:

You say: He's bought at 1000, so sell at 2000, then buy again at 2000 and you're down 1000.

(-1000) + 2000 - 2000 - Transaction Fees = -1000 minus the transaction fees

I say: He's bought at 1000, so keep at 2000, and you're still down 1000.

(-1000) = -1000

Why would you sell, then buy again at the same price?
 
as more belief in the government begins to ensue price of gold will drop. but we are in unstable times right now but times still could be worse, that is why the price will not skyrocket too much more after the 2000 mark. THey may get as high as 2200 and unless soemthing drastic occurs I don[t see them leaving the 2200 mark in the forseeable future.
 
as i said; when the government regains strength the price will drop. Right now it's weak and people are panicking about what to do so obviously gold's price will rise as more people want it because they have no belief in the government.

The bond market is iffy right now and many people expect it to default but personally I think the economy will recover and be back to normal before these long term bonds - most being 20 or 30 years - have a chance to default.

When the economy picks up again which it surely will, we will see the price of gold drop again. What I'm saying is i expect it to increase another $500 before the stocks become stable and the economy begins to increase. once this happens the price of gold will decrease as there is less demand and more confidence in the governmental system.

The economy always recovers and unless something drastic happens such as a war/bomb terrorism etc... we will see a good pick up as the baby boomers finally all retire and die off and there is less strain on the social security and medicaire.

Whenever there is a scare or recession price rises, you can count on that. At the same time when the economy recovers and business is good again there is less demand for gold so the price drops.
 
of course, but the government has A LOT to do with the economy. In the USA the government is not supposed to interfere with capitalism but in reality it has a lot to do with it. Yes our economy hit the dumps when the housing crisis hit and people couldn't pay for their homes. But now people are looking towards the government to fix the problem.

Our stocks rise and fall not only because of foreign markets and businesses. But they also are directly correlated with what the government is going to do next. When the fed anounced that interest rates were going to remain nearly zero until mid 2013 stocks plummeted and then rose drastically. I know the stock market is not the economy, but it sure has a lot to do with it.

In my opinion the government is directly correlated with our economic well being today. Of course in the past it was not like this, but since the bailout people are surmising the government will help us get through these tough times, and in all reality this is probably true. Healthcare and social security issues are looming and people are looking for a fix.

Of course the economy will rebound eventually on its own, but people are waiting for political leaders to make positive actions that will lead to an economic headstart.
 
I agree with you.

The people defaulted on their loans because banks approved 90% of mortgages - not the government

Yes ARM's skyrocketed

and yes I agree the stock market is not an instrument to measure economic strength but it definitely has correlation with how the economy is doing. falling or rising 400 points in 4 days (never has this occured before) shows that peoople don't know what to make of the situation unstable economy across the world = unstable and bearish market.

My point that I was trying to make originally is that the use of paper is only worth as much as the government says its worth. When the government starts to fail people no longer believe the money (that the government states the value of) is worth that amount. (example being the currency in germany in WWI and WWII when bread was bought with a wheelbarrow full of deutsche marks) When the government begins to fail people invest in gold. In times when the economy prospers people like and trust the government, resulting in the price of gold to drop because confidence in the economy and government is strong.

Now I hope you see my original argument.
 
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we will see what happens next. my dad works in a hedge fund in NYC and he says people are going nuts. I went into NYC with him today and he's definitely right.
 
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