I purchased a good deal of gold about 6-8 months ago and it’s up 31.5% since then. But I’m starting to get cold feet. Should I take the profit now or do you think I should even buy more? I don’t follow the markets closely anymore, especially since I work in real estate now. So are there any thoughts from the finance guys?
I would take your $50 profit and run…
Thanks for the juvenile, smartass reply. You feel big now?
Keep selling 1/3 of your position.
you should short gold. it’s a bubble that’s about to crash .
kkent Wrote: ------------------------------------------------------- > Thanks for the juvenile, smartass reply. You feel > big now? A little bigger - thanks! In all seriousness, who knows? With all the turmoil going on I don’t see a reason to sell. A flight to quality will persist…
That depends on if you believe commodities are unreasonably higher based on speculators push recently. There is very little people out that would say $1000+ gold makes sense. You could say for about every commodity except Coal and NG, which we do have shortages currently worldwide. But given what is happening in the market, who can time when the speculators will finally back off? The Fed sure is making it easy for them right now.
Unless you see a strengthening USD, gold will not suffer a meaningful decline anytime soon. With Euro inflation coming in at 3.3%, hopes by the FED of an ECB cut may not come true. This is not good news for the reeling USD and of course FED rate cuts will not help matters. With that said, I see no reason why you can’t take a third off the table and keep your weak-dollar hedge still in play. Personally, I have been playing the miners. Was in the last move for Barrick here and am now ready for move number two out of this beautiful ascending triangle. Heck, feel free to ride Yamana to new highs. http://stockcharts.com/h-sc/ui?s=ABX&p=D&yr=1&mn=0&dy=0&id=p45319984730 Not to hijack this thread, but I wonder when some of the massive insurance in currency and ir swaps are going to get triggered with the USD fall…? I know some are concerned about the credit swap market getting nailed next but…things could get uglier. Then again, the dollar “i” word is getting thrown about - “intervention” so, take your best guess in these interesting times, eh? “Diversification through investment that not only provides better yields, but may offer access to an otherwise inaccessible transaction. According to ISDA, at the end of 2004, the notional amount for the interest rate and currency derivatives market was US$183.6 trillion Credit derivatives comprised 4.4% of the entire derivatives market at US$8.42 trillion The players include insurers, reinsurers, financial guarantors and hedge funds; but the largest players are commercial banks, who are net buyers of protection” Edit : http://www.jpmorgan.com/cm/ContentServer?c=TS_Content&pagename=jpmorgan%2Fts%2FTS_Content%2FGeneral&cid=1136555202065 Some estimate the credit swap market to now be up to as much $45 trillion, how about the rest of the mammoth currency/ir swap market?
Intervention shall be very bullish for Gold, yea? It would seem to be highly inflationary in nature, depending on what the PPT does.
We’re still looking at stagflation in the near to mid term, and there aren’t very many assets that perform well in that environment. Gold does. As people wonder where to put their assets, gold will continue to look good and attract more demand, driving the price up. Just be sure to have some trailing stops on the position, because when gold finally does drop, it’s likely to fall like a rock.
bchadwick Wrote: ------------------------------------------------------- > We’re still looking at stagflation in the near to > mid term, and there aren’t very many assets that > perform well in that environment. Except for Kool & The Gang and bellbottom jeans!
Just read this article on Seeking Alpha http://seekingalpha.com/article/68761-4-recommendations-to-defend-against-a-financial-armageddon?source=side_bar_editors_picks#comment_form Bill Cara recommends waiting on gold until there’s a correction down to $780-$800, then buying (even saying up to 90%) in Gold. Here’s the text: “Then wait for the crack in the precious metals market, which will come as most of these record high commodity prices are futures contracts based, which will fall apart when the credit ring snaps and counter-parties are unable to pay off.” This seems vaguely plausible, but I’m not sure how the mechanics work exactly. People sell the futures contracts to delever, I guess, and you can’t find a counterparty who will buy so the price drops to reflect increasing selling and maybe credit/counterparty risk. Is that it? And that will make it drop 20%? Does the paragraph above make sense to someone and can they try to rephrase it to make it a little clearer. Just to finish up the context, here’s the next paragraph (which I don’t need interpreted, but am adding FYI). “When precious metal prices, after the peak, spike down on the extreme sell-off days that I see upcoming, use that low price to buy physical bullion bars and coins for safekeeping, preferably in a private Swiss bank. For those who want the least exposure to the current financial crisis, I would not hesitate to put 90% of the cash into a variety of precious metals bullion holdings in safekeeping because even during the Depression era of the 1930’s, physical gold was the best performing asset class.” Interesting article in general.
billwest Wrote: ------------------------------------------------------- > you should short gold. it’s a bubble that’s about > to crash . Good that there are idiots out there.
I also think that gold will continue performing well because of inflation. Fed’s actions are only accelerating inflation.
billwest so far looks correct, guess the US dollar can not sink any further at this point.
what are you talking about? The yen just dropped 4%. The FED just admitted they will be buying $20 Billion in FAKE CRAP BS WORTHLESS mortgages? This is as pure a debasement of dollar value as possible.
kkent Wrote: ------------------------------------------------------- > I purchased a good deal of gold about 6-8 months > ago and it’s up 31.5% since then. But I’m starting > to get cold feet. Should I take the profit now or > do you think I should even buy more? I don’t > follow the markets closely anymore, especially > since I work in real estate now. So are there any > thoughts from the finance guys? Yes take it and run. Its unanimous among my associates and senior associates that there is a gold bubble. I doubt ul be able to gauge when the peak is.
I would hang on to it. With the dollar going to the doldrums and inflation becoming a worry, you will only get better returns.
I think there is a much better chance that stocks will go down than gold. if Fed continues cutting interest rates, stocks might drop twice as much as they have this year.
Seriously - this board is a great contrary indicator!