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21/04/16

15:37

Post #: 17569185
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Originally posted by AverageJoe ↑

Could you elaborate what you are trying to say or hint?

I was responding to SP when he countered that US blue chips are highly valued through the eyes of the PE. No doubt historical mean average they are but the conditions of investing have changed drastically ever since the introduction of QE and a ultra low yield ZIRP/NIRP environment globally.

There is a difference between paranoia and just investing. No one is forced to ever fully loaded to the eye balls in the stock market or any asset class however safe they are. Whatever happened to mixed asset class of portfolio weighting?

If you have been following some of my post, I see sustainable revenue from gold producers domestically but that is not a green light to load up to the eye balls in this sector. XAUAUD is currently down on the bearish swing and understandable as the AUD is rallying from a host of reasons. If the gold bugs agree that interest rate hike is looking unlikely the next 6 months then 2 things will surely happen;

sell off USD
Rally US stock markets

Currently that is playing to the market expectations. How will gold sits in this new paradigm? It needs inflation traditionally to trigger reasons to use gold as inflation hedge. Stock market crash is an even less likely event from 6 months ago. Assuming US inflation falls off the rails and Schiffy is correct anticipating fresh round of QE, where will the excess funds flow to in an even lower yield environment for safe asset class? Do you see people jamming funds into the safety of gold with no dividends?

I am certainly be the last person to know where gold in AUD or USD will be heading so I am not rolling a fully loaded dice. Yes I have exposure to gold but that does not mean I shouldn't be critical of this sector. I rate discussions based on world events now and conspiracies does not form part of that thinking. It is what it is and there is only price.

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AJ

I'm not hinting at anything. I'm merely stating a fact that you proclaiming that holders of gold have had a 40% haircut since 2011 is incorrect. It's an Australian stock market forum, it's highly likely that people in Australia buy things with Australian dollars. Hence if you check the AUD gold price you could have bought gold at $1,400 and it's $1,600 now. Of course there was some volatility in 2011 so depends when you bought.
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