Barrons Article: Gold is Cheap. Inflation is Coming.

Discussion of the Gold portion of the Permanent Portfolio

Moderator: Global Moderator

Post Reply
Don
Full Member
Full Member
Posts: 71
Joined: Fri Apr 21, 2017 6:21 pm

Barrons Article: Gold is Cheap. Inflation is Coming.

Post by Don » Sun Sep 30, 2018 1:55 pm

https://www.barrons.com/articles/gold-i ... 1537582480

U.S. stocks are at record levels exactly at a time when global stress—trade tensions, populist nationalism, and the like—appears to be growing. This may be an opportune moment for investors to shift at least a portion of their portfolios to gold: both the metal and depressed mining shares.

To flip Buffett’s phrase, gold may do more than just look back at you in the coming years."
boglerdude
Executive Member
Executive Member
Posts: 263
Joined: Wed Aug 10, 2016 1:40 am

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by boglerdude » Sun Sep 30, 2018 11:43 pm

> global stress—trade tensions, populist nationalism, and the like—appears to be growing

Meh, business as usual. Question is, how bad will the panic be when the rising rates set off some defaults
User avatar
dualstow
Executive Member
Executive Member
Posts: 7806
Joined: Wed Oct 27, 2010 10:18 am
Location: next to emotional support peacock
Contact:

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by dualstow » Mon Oct 01, 2018 3:02 pm

I just saw this at bogleheads and was going to ask if anyone here has a subscription.
Nice illustration and title, anyway. O0
TLT hit a 52-wk high, or so says an email from Vanguard 📈
User avatar
dualstow
Executive Member
Executive Member
Posts: 7806
Joined: Wed Oct 27, 2010 10:18 am
Location: next to emotional support peacock
Contact:

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by dualstow » Mon Oct 01, 2018 3:05 pm

Hey, I found more text, possibly the full text, here. Grab it while you can -
https://provenandprobable.com/precious- ... nd-silver/
TLT hit a 52-wk high, or so says an email from Vanguard 📈
User avatar
Ad Orientem
Executive Member
Executive Member
Posts: 2970
Joined: Sun Aug 14, 2011 2:47 pm
Location: Florida USA
Contact:

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by Ad Orientem » Mon Oct 01, 2018 8:46 pm

As I have been noting on another thread, with a silver to gold price ratio of appx 82:1, silver is looking much more attractive than gold right now. But that is strictly variable portfolio stuff. For those not looking to speculate, I'd just tune all of this out and go back to your favorite hobby. The HBPP has you covered.
User avatar
dualstow
Executive Member
Executive Member
Posts: 7806
Joined: Wed Oct 27, 2010 10:18 am
Location: next to emotional support peacock
Contact:

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by dualstow » Mon Oct 01, 2018 8:54 pm

Why is the ratio important, Ad? I mean, remember when Medium Tex was all excited about the miners? GDX or something?
TLT hit a 52-wk high, or so says an email from Vanguard 📈
User avatar
Ad Orientem
Executive Member
Executive Member
Posts: 2970
Joined: Sun Aug 14, 2011 2:47 pm
Location: Florida USA
Contact:

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by Ad Orientem » Mon Oct 01, 2018 9:06 pm

dualstow wrote:
Mon Oct 01, 2018 8:54 pm
Why is the ratio important, Ad? I mean, remember when Medium Tex was all excited about the miners? GDX or something?
There are no guarantees in life. But whenever the ratio has gotten over 80:1 in the past it has signaled that precious metals had become inexpensive, and silver was oversold, at least relative to gold. I find it hard to believe that gold is really 80 x more valuable than silver. Historically when the metals bounce silver outperforms and the price gap narrows. Thus allowing one to flip cheaply acquired silver for gold at a more attractive rate.
User avatar
dualstow
Executive Member
Executive Member
Posts: 7806
Joined: Wed Oct 27, 2010 10:18 am
Location: next to emotional support peacock
Contact:

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by dualstow » Mon Oct 01, 2018 9:18 pm

Thank you!
TLT hit a 52-wk high, or so says an email from Vanguard 📈
technovelist
Executive Member
Executive Member
Posts: 4736
Joined: Wed Sep 15, 2010 11:20 pm

Re: Barrons Article: Gold is Cheap. Inflation is Coming.

Post by technovelist » Sun Oct 14, 2018 8:14 am

Ad Orientem wrote:
Mon Oct 01, 2018 9:06 pm
dualstow wrote:
Mon Oct 01, 2018 8:54 pm
Why is the ratio important, Ad? I mean, remember when Medium Tex was all excited about the miners? GDX or something?
There are no guarantees in life. But whenever the ratio has gotten over 80:1 in the past it has signaled that precious metals had become inexpensive, and silver was oversold, at least relative to gold. I find it hard to believe that gold is really 80 x more valuable than silver. Historically when the metals bounce silver outperforms and the price gap narrows. Thus allowing one to flip cheaply acquired silver for gold at a more attractive rate.
On a forum inspired by Harry Browne's work, I think I should point out that Harry didn't put any stock whatever in the gold-silver ratio.

Paraphrasing his counter-example to the relevance of historical ratios, the ratio of California real estate prices to those in NY will probably never return to what it was in 1850.

Although with what's going on in CA right now, that may not turn out to be true after all. ;)
Post Reply