Gold comes back down, giving me a chance to buy in. Well clearly it’s useless to buy gold. It keeps coming back down after a run-up. I should probably buy dividend stocks.
Wow, it ran late last night!
Moderator: Global Moderator
Wow, it ran late last night!
It’s always interesting to take the dollar out of the equation when looking at gold!whatchamacallit wrote: ↑Fri Apr 22, 2022 2:23 pmhttps://goldprice.org/gold-price-japan.html
Gold looks to be doing its job in Japan.
Up over 30% in a year.
murphy_p_t wrote: ↑Wed Apr 27, 2022 10:55 amCongratulations! You purchased a tremendously undervalued asset.
https://twitter.com/uselinkinv/status/1 ... tvNYQ&s=19
Seems to be moving slowly but surely up. Not sure at what CAGR though. A troy ounce of a metal with little industrial value cost about $1900. It's been swinging a little lately but I view it as a very slow super tanker.Desert wrote: ↑Thu May 12, 2022 2:43 pmBut in all seriousness, it looks like Gold is mostly tracking inversely to a strong dollar. The "market" has decided that inflation is headed down to ~3%. Not that Gold is strongly correlated with inflation anyway.
In my investment view, gold has performed great twice in my lifetime:
1. When gold was unpegged from the dollar
2. When gold ETF's were introduced
It'll be interesting to see what drives the next run.
Desert, can you expand on point #2? What was it about the introduction of gold ETFs that you feel drove the price of gold up? Is it just that it became so much easier to own? I believe Medium Tex attributed the run-up in the 2000s to expected inflation that never really materialized. And I believe mathjak would say that gold did well in the 2000s because stocks were negative for the decade, in other words, because the favored asset of most investors did poorly for such a long time.Desert wrote: ↑Thu May 12, 2022 2:43 pmBut in all seriousness, it looks like Gold is mostly tracking inversely to a strong dollar. The "market" has decided that inflation is headed down to ~3%. Not that Gold is strongly correlated with inflation anyway.
In my investment view, gold has performed great twice in my lifetime:
1. When gold was unpegged from the dollar
2. When gold ETF's were introduced
It'll be interesting to see what drives the next run.
It's of course not possible to attribute gold's rise in the 2000's with 100 percent certainty to the availability of ETFs for the first time. But there are reasons to believe that the ease of investing in gold electronically with no thought to transport, storage, etc. had something to do with the dramatic rise after the introduction of GLD in 2004.barrett wrote: ↑Fri May 13, 2022 7:21 amDesert, can you expand on point #2? What was it about the introduction of gold ETFs that you feel drove the price of gold up? Is it just that it became so much easier to own? I believe Medium Tex attributed the run-up in the 2000s to expected inflation that never really materialized. And I believe mathjak would say that gold did well in the 2000s because stocks were negative for the decade, in other words, because the favored asset of most investors did poorly for such a long time.Desert wrote: ↑Thu May 12, 2022 2:43 pmBut in all seriousness, it looks like Gold is mostly tracking inversely to a strong dollar. The "market" has decided that inflation is headed down to ~3%. Not that Gold is strongly correlated with inflation anyway.
In my investment view, gold has performed great twice in my lifetime:
1. When gold was unpegged from the dollar
2. When gold ETF's were introduced
It'll be interesting to see what drives the next run.
The performance of gold recently has certainly been disappointing but I keep thinking that most investors are banking on the Fed being able to control inflation with their policy of raising rates... and that investors as a whole have become so forward looking that they refuse to bid down the price of certain assets (specifically bonds at the moment) because they believe they are fairly priced for the longer term. What I mean is that they haven't given up on bonds and are not yet seriously looking for an alternative place to put their bond money.
https://www.businessinsider.com/gold-et ... on-2012-12We believe, however, that ultimately it was the accessibility and liquidity provided by the ETF structure that facilitated the momentum and scope of gold’s performance. Our chart illustrates the rise of gold eight years before and eight years after the launch of SPDR Gold Shares (GLD).
Interesting. This dynamic makes me wonder if Gold will lose its historical un-correlation from the stock market, now that it is not as niche a product for retail investors.Desert wrote: ↑Fri May 13, 2022 4:36 pmIt's of course not possible to attribute gold's rise in the 2000's with 100 percent certainty to the availability of ETFs for the first time. But there are reasons to believe that the ease of investing in gold electronically with no thought to transport, storage, etc. had something to do with the dramatic rise after the introduction of GLD in 2004.
...
I don't say all this to disparage holding gold, I just think it's not obviously correct that gold is going to soar when the other three PP assets do poorly. We all experienced the four assets rising in unison, and now we're seeing them fall in unison. In other words, gold is generally uncorrelated with stocks and bonds, but it's not negatively correlated, and can't be counted on to save our portfolios when the other assets are in decline. Sometimes it will, and sometimes it will not. Still, an uncorrelated asset can improve risk-adjusted returns, so can be worth holding despite it's apparent randomness.
whatchamacallit wrote: ↑Mon May 16, 2022 9:57 pm
I don't know about ETFs causing trouble.
I still think it is more that the population doesn't even think about owning gold.
What was it like to buy gold in the 70s? Were there gold dealers everywhere or was it just a niche thing?
What are people buying now to hedge inflation? I guess what I have seen is cars and houses maybe? It doesn't appear to me that many people are thinking about gold.
Me personally: tractors, implements, log splitters -- productive tools. I've been pulling forward purchases when I can for items that will provide utility now and in the future.whatchamacallit wrote: ↑Mon May 16, 2022 9:57 pmWhat are people buying now to hedge inflation? I guess what I have seen is cars and houses maybe? It doesn't appear to me that many people are thinking about gold.
Yup.perfect_simulation wrote: ↑Wed May 18, 2022 9:30 amHB said gold would move during inflation. If we take his word at face value, we can conclude we've only had mild inflation these past 2 years despite what the CPI and other figures indicate.
Harry Browne wrote: Once U.S. inflation becomes more than a minor irritant (that is, once inflation reaches 6% or so), gold usually starts moving upward—and when the inflation rate gets into double digits, gold's rise accelerates.