Gyroscopic Investing

The Asian markets are open and I just checked over at Kitko to see whats up. And it definitely isn't gold. As of this moment gold is down about $22 (1.5%) and silver is down almost 4%. It looks like everybody and their mother is climbing on the "I hate gold" bandwagon. The short metals trade is looking damned crowded from my vantage point.

Holy crap! Metals are in a near free fall Gold down more than $45 and silver down almost 6% in just the last few minutes.

I'm glad I decided to wait a bit longer before buying. This fall is really an amazing buying opportunity for some of that "dry tinder" I've got 25% of my portfolio in... 

how long does this kind of "waterfall" last...3 days?

murphy_p_t wrote: how long does this kind of "waterfall" last...3 days?

Hard to say. This may just be a blip caused by all the dumb money following the hot money into the short metals trade. Or it may be the beginning of a bear market that could go on for a long while. The great crash of 1930-32 is the worst asset class collapse that I am aware of. I seriously doubt that is what we are looking at though.

I get nervous enough with gold during normal trading hours!

Ad Orientem wrote: Holy crap! Metals are in a near free fall Gold down more than $45 and silver down almost 6% in just the last few minutes.

Could this be why?:

"Researchers Find Link Between Earthquakes and Gold Deposits"

“The most surprising finding we made was that even very small magnitude earthquakes of four and smaller can generate sufficient pressure reduction within fault jogs to initiate flash precipitation of gold and quartz during the earthquake itself,”? Dr Weatherley said.

“While the amount of gold that would be deposited in any one earthquake is quite small, when you consider that tens or hundreds of magnitude four quakes and thousands of smaller magnitude quakes may occur each year within an earthquake fault system, the possibility exists that over time, large gold deposits may result.”?

http://www.sci-news.com/geology/article00951.html

I am not familiar with Paul Craig Roberts but this is interesting if true.

http://www.paulcraigroberts.org/2013/04 ... g-roberts/

According to Andrew Maguire, on Friday, April 12, the Fed’s agents hit the market with 500 tons of naked shorts.

whatchamacallit wrote: I am not familiar with Paul Craig Roberts but this is interesting if true.

http://www.paulcraigroberts.org/2013/04 ... g-roberts/

According to Andrew Maguire, on Friday, April 12, the Fed’s agents hit the market with 500 tons of naked shorts.

I'm skeptical of any article that begins, "I was the frist to point out..."

Plus, he looks really cranky in that picture.

whatchamacallit wrote: I am not familiar with Paul Craig Roberts but this is interesting if true.

http://www.paulcraigroberts.org/2013/04 ... g-roberts/

According to Andrew Maguire, on Friday, April 12, the Fed’s agents hit the market with 500 tons of naked shorts.

I am pretty sure the Fed isn't allowed to short anything. And to be honest I have never been a fan of all the weird conspiracy theories among the die hard goldbugs.

Anyone placing bets on where the bottom is on this drop?

A complete SWAG, but I'm guessing around $1400 before something else goes awry in the global economy and everyone realizes dumping gold may not have been their wisest moment.

RuralEngineer wrote: Anyone placing bets on where the bottom is on this drop?

A complete SWAG, but I'm guessing around $1400 before something else goes awry in the global economy and everyone realizes dumping gold may not have been their wisest moment.

i wish i shared your optimism.

-we have surpassed 50% decline in silver now. perhaps not relevant.


i suspect $1200 is in play (full disclosure...i read this somewhere)

RuralEngineer wrote: I'm guessing around $1400 before something else goes awry in the global economy and everyone realizes dumping gold may not have been their wisest moment.

Agreed (about something else going awry in the global economy).  Isn't it really just a matter or time before the Euro falls apart?

1975-1976: -44.13% MaxDD.  But only 25% reduced it to -8.79%

Peter Schiff has to be suicidal at this point.

This is really proving what everyone has been saying about gold being the most volatile asset. What an incredible buying opportunity.

MG, with all your fancy technical analysis, would you be able to tell when a good time to buy is? I know "don't try to catch a falling knife and all" but at some point it has to hit the ground.

I'll throw out a simple common buying opportunity. These parabolic rises often retrace at least 50%. Gold rose from what, 300ish to 1900ish?

Maybe 1100 is a good "buy" if you want to do something outside of your rebalance band rules.

First post after lurking for many months.

This is a bloodbath. The Gold in my PP is down 17.14% (all ETF--I don't yet have any physical gold).
I'm in a position to contribute some new funds. Surely there's no harm buying the lagging asset in this case...

I would just wait until a rebalancing band is hit. All the assets in the portfolio had been rising for some time, one was destined to break eventually.

If someone is buying gold for speculation, I'd wait until you see the headlines start to taper off in the news if you feel strongly about it. But really I'm not much into speculation. It's too risky.

craigr wrote: I would just wait until a rebalancing band is hit. All the assets in the portfolio had been rising for some time, one was destined to break eventually.

If someone is buying gold for speculation, I'd wait until you see the headlines start to taper off in the news if you feel strongly about it. But really I'm not much into speculation. It's too risky.

"Gartman on Gold: We’ve Never Ever Seen Anything Like It"
http://www.cnbc.com/id/100640665

Wow, what is happening...

MY two weeks old PP is now -3%.

How should I manage the lower re-balancing band assuming I hit 15% in gold quite soon (currently 21% after just 2 weeks)? Should I sell other assets (anything above 25%) or just add new money to the gold portion?

Add new money to gold and any of the other three assets to bring all to 25% (unless commission costs will be too high as a percentage of an ETF trade).

How does anyone really know whether gold is a "good buy" right now?  After hitting $1900, was it a good buy at $1800?  $1700?  $1600, etc.?

Interestingly for me (as opposed to "fortunately" or "unfortunately") I am overweight cash right now because my contributions go to cash and I also have lump sums that come late in the 1st quarter that I need to invest.  I would have rebalanced a couple of weeks ago but I have been very busy with a lot of other things and wanted to make sure I had time to carefully consider what I was doing.  Of course I am feeling fortunate to miss gold's big drop but now I am also feeling the burden of trying to time gold's bottom (or to at least not catch a "falling knife").

One lesson I think I have learned is to distribute contributions to stocks/bonds/gold more often, because then the timing of any one distribution has less of an impact and I won't have to worry about it so much.  My situation is a little complicated because I am running one PP made up of several accounts, tax-deferred/taxable, etc.  That might be something to reconsider too, not sure yet.

catacomb wrote:

craigr wrote: I would just wait until a rebalancing band is hit. All the assets in the portfolio had been rising for some time, one was destined to break eventually.

If someone is buying gold for speculation, I'd wait until you see the headlines start to taper off in the news if you feel strongly about it. But really I'm not much into speculation. It's too risky.

"Gartman on Gold: We’ve Never Ever Seen Anything Like It"
http://www.cnbc.com/id/100640665

Wow, what is happening...

MY two weeks old PP is now -3%.

How should I manage the lower re-balancing band assuming I hit 15% in gold quite soon (currently 21% after just 2 weeks)? Should I sell other assets (anything above 25%) or just add new money to the gold portion?

But they have seen something just like this, stocks in 2008, and stocks in 2000, and bond market gyrations in the 1990s, etc. every asset can fall in price. And any asset can do it quickly so we diversify.

I would wait for a rebalancing band AND also for volume to taper off before purchasing more.

catacomb wrote:

craigr wrote: I would just wait until a rebalancing band is hit. All the assets in the portfolio had been rising for some time, one was destined to break eventually.

If someone is buying gold for speculation, I'd wait until you see the headlines start to taper off in the news if you feel strongly about it. But really I'm not much into speculation. It's too risky.

"Gartman on Gold: We’ve Never Ever Seen Anything Like It"
http://www.cnbc.com/id/100640665

Wow, what is happening...

MY two weeks old PP is now -3%.

How should I manage the lower re-balancing band assuming I hit 15% in gold quite soon (currently 21% after just 2 weeks)? Should I sell other assets (anything above 25%) or just add new money to the gold portion?

Gartman must have a bad memory if he can't remember big moves in gold.