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Gold

Started by samiam, November 03, 2009, 04:59:16 PM

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samiam

November 03, 2009, 04:59:16 PM
India puchased 200 tons of gold, It looks like the world has finaly lost faith in the U.S. Dollar

samiam

#2
November 03, 2009, 05:07:24 PM
"The IMF sale, part of an agreement to sell about an eighth of the Fund's stock, fuelled speculation that other governments -- including Beijing -- may be ready to diversify their reserves even at near record prices"

Now thats scary!!!

mtraininjax

#3
November 03, 2009, 05:46:56 PM
QuoteIndia puchased 200 tons of gold, It looks like the world has finaly lost faith in the U.S. Dollar

Absolutely. The value of the US Dollar is tied to the spending and debt of the US. With 13 trillion in US Debt, every new stimulus, healthcare plan, SS, Medicare plan adds more debt to the dollar. So if you were an overseas company, would you invest in dollars that provide a lower return, or in the RMB (China) or Rupi (India) in countries that are growing and expanding? You can invest in these growing economies and make more money in businesses that are new to these economies, autos, manufacturing, measures of wealth.

Also, the IMF had to sell that off, their coffers were dry from bailing out countries like Iceland and Switzerland. They needed the money for the African countries that are feeling the pain of the worldwide drop. If it was not India purchasing the 200 tons, it would have been China who has been hoarding OIL, GOLD and other natural resources.

Crazy times we live in, but the US as the standard of the world, could be changing.
And, that $115 will save Jacksonville from financial ruin. - Mayor John Peyton

"This is a game-changer. This is what I mean when I say taking Jacksonville to the next level."
-Mayor Alvin Brown on new video boards at Everbank Field

Shine

#4
November 05, 2009, 07:17:59 AM
And what, exactly is gold worth? -- the perception that it is valuable?  In the modern economy, gold is valuable as a component of jewelry, electronics, etc.  Can an ounce of gold power your SUV?  Will it feed you?  Will it heal the sick?  Economies, technologies and energy are the new wealth.

mtraininjax

#5
November 05, 2009, 08:02:22 AM
Gold is worth what someone else is willing to pay you for it. How much food is a gold bar worth? Depends on the conditions, can you eat a gold bar if you are not willing to exchange it for the food?

Every commodity is only worth what someone else is willing to pay for it.
And, that $115 will save Jacksonville from financial ruin. - Mayor John Peyton

"This is a game-changer. This is what I mean when I say taking Jacksonville to the next level."
-Mayor Alvin Brown on new video boards at Everbank Field

gmpalmer

#6
November 05, 2009, 08:08:45 AM
Shine,

Money is money because people are willing to invest in it without regards to its usefulness.  Gold has long been a store of value.  Since it has intrinsic desirability as a monetary unit (unlike the dollar) it is going up in value as the official world currency (the dollar) is becoming more and more unstable/less valued.

mtraininjax

#7
November 05, 2009, 08:11:47 AM
GM - The US government is the one devalue-ing the dollar. But they have to due to the fact that the US economy is in the dumps. Sad but true, the US Government will devalue the dollar to help stimulate demand in the economy. The back side is that over time, the US dollar will be worth less and less, because it has nothing backing it, since the US went off the gold standard in the 70s. All we have backing the US is spit, grit, and American ingenuity. Try selling that to the foreign governments.

Its a bad time in so many ways, but hey, it could be a lot worse off.
And, that $115 will save Jacksonville from financial ruin. - Mayor John Peyton

"This is a game-changer. This is what I mean when I say taking Jacksonville to the next level."
-Mayor Alvin Brown on new video boards at Everbank Field

Captain Zissou

#8
November 05, 2009, 09:46:06 AM
India has set a new price floor at $1045, smart money is betting that gold will jump to $2000 in the near future.  I'm getting into gold as soon as possible.

gmpalmer

#9
November 05, 2009, 12:19:21 PM
ziss,

Not a bad idea (unless the dollar recovers).  Unfortunately I've just got a teeny bit.

mtrain,

It absolutely could.  We could have to spend our days looking for clean water.

Dog Walker

#10
November 05, 2009, 02:30:07 PM
India has long been the world's largest purchaser of gold both for cultural and political reasons.  Will never forget sitting in the lobby of a fancy hotel in Delhi that was  hosting a big wedding and watching women walk by with POUNDS of gold jewelry on them (not an exaggeration!) and gold thread pattern woven into their incredibly beautiful saris.
When all else fails hug the dog.

Cricket

#11
November 05, 2009, 03:39:57 PM
If you're not on board now I think you missed that train. :(
"If we bring not the good courage of minds covetous of truth, and truth only, prepared to hear all things, and decide upon all things, according to evidence, we should do more wisely to sit down contented in ignorance, than to bestir ourselves only to reap disappointment."

mtraininjax

#13
November 06, 2009, 08:39:23 AM
How quickly we forget or never knew about it to begin with. Anyone remember seeing the March 9, 1933 gold confiscation order, where President Roosevelt sent US thugs into each bank to rifle through deposit boxes and buy people's gold at the price of 20.67/ounce only to turn around and revalue gold at $35 an ounce?

Could it happen again, you bet your rear it could, the Treasuries "Trading with the Enemy Act" remains enforced in the US policy. If the day comes where foreign countries demand that the US pay its debts to them (treasuries) in gold, the US could again confiscate items in a deposit box.

Crazy times!
And, that $115 will save Jacksonville from financial ruin. - Mayor John Peyton

"This is a game-changer. This is what I mean when I say taking Jacksonville to the next level."
-Mayor Alvin Brown on new video boards at Everbank Field

Dog Walker

#14
November 06, 2009, 10:34:51 AM
I had an economist once tell me that gold never changes in price.  That what changes is the value of the currency used to purchase gold.  According to his view, we are not seeing an increase in the value of gold, but a decrease in the value of the dollar and other currencies used to buy gold.

He pointed out to me that in 1890 an ounce of gold would purchase a good man's suit and the same is true today at $1050 per ounce.

Interesting perspective.
When all else fails hug the dog.
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