gold chat, page-391

aimho.

40 remembers the gold rally up to the end of the 70's so what brought gold back down i ask.

my guess was the high interest rates on offer at that time and for some time afterwards. then the big effort to get inflation back under control. both killed off golds attraction. high oil and inflation attracted the rise of gold in the first place.

US Treasuries 10% and UK gilts 11.5%. yep you read right. US TREASURIES 10% headed up to and preceding the 87 crash.

gold now as we stand...
the real only problem in the mkt place today and just about everything rests on it as i write.

it is the EURO.

it is EUROPE

and their pussy footing around trying to save a poor dog just run down by a steam roller.

when the owner of the dog (ie ecb, merkel and hollande etc) realise that the vet's bill (the man in the street) demands much to much money for stuffing the poor dog back to life then the mkts will move on. and imo once the dust has settled then move on quickly we shall.

all money machines will be put into reverse as far as possible.

the inflationary growth flame will be heaped with petrol and shoot off like no tomorrow.

gold will adjust to the new inflationary enviroment.

interest rates will rise.

the killing of inflation will back on the agenda

AND GOLD WILL GO BACK DOWN.

WHAT WORRIES 40 IS THAT WHEN THE TRAIN SLOWS DOWN AND MOST WANT TO GET OFF THEN JUST HOW MUCH OF THE GOLD IS REAL AND WHO HAS THE MONEY TO STAY ON THE TRAIN (PAY THEIR CALLS)

it is frightening but there is a similarity building, just like :
1987
the techo bubble
and the period mid 2006 onto the last stampede out.

buy gold for now but watch the signs. when the euro quits, however it quits, and growth patterns are put into place then the hot money into the aud and gold will be reversed. could be dynamically reversed.

the euro quitting imo will be the first sign to get out of gold.

gold has little following in reality. you can't eat it. etc etc.

40, you're gonna get some flack i reckon.

can take it ted.



be good,

40.