All the above reasons and many other reasons will ultimately lead to World War III. So gold price have reached record-high. Today it was $1133 per ounce.
So basically you think he could be spectacularly right, currently have no position (or may even be long) and you will only go short if the price falls 15%. Sounds like a real strong conviction you have there makloda
The recent bubble in crude oil and real estate, followed by the dramatic crash, is fresh in all traders' memory. That is leading people to say the same thing is now happening with gold. However, I remember that during the crude oil bubble, many of the news articles and politicians were saying that there was no reason for crude to be going so high and that it was the fault of traders. Similarly, with real estate, everyone was talking about the people flipping properties in California and that the rise in prices had no fundamental reason to continue. However, there are fundamental reasons why gold is rising. Astronomical amounts of US dollars being printed and interest rates staying near zero are causing the value of the dollar to go down and the value of metals to rise. And it is not just small traders running the price of gold up, it is large funds and entire countries using their US dollar surplus to buy tons of gold. I do not see any evidence that this a speculative bubble in gold being caused by small traders alone. It is smart money trying to protect their country's financial stability in the face of American economic insanity. In fact, until we see large numbers of Americans who are non-traders starting to buy gold and silver, I think that the rise in gold and silver is still in it's infancy. When the common man starts to buy gold and silver, it may even become difficult to find. That is when things may get very interesting.
Let's say you're right...we expanded 64% from 1/1/2008. That's basically 32% annual growth in the monetary base. That's huge. What I'm looking at though is $800 Billion to $1,900 Billion. I can't tell the start date. But it's clearly well more than a double. Whatever the rate of growth is, it's huge. What do you suppose that translates into in terms of inflation somewhere down the road? I don't have the answer. But it is what gold is trying to discount now. OldTrader
I'm trading rule-based. I'll go short when my rules say to go short. I never short anything that is going up without first starting to retrace, regardless of how much it feels it went up "too high" (whatever that is). Conviction has nothing to do with it. My position size is based on historical volatility, not how convinced I feel. To me a trade is a statistical probability, not a feeling of how sure I am. I'm long Gold and $HUI since a while simply because recent history statistically slightly favors rising prices rather than falling, not because rising prices are a 100% certainty like Faber and others argue. I wouldn't be surprised to end up giving back all (small) profits, taking a small loss and going short.
Looks like Faber changed his mind. Now he says "If Gold drops below $1000 it could signal a violent counter-trend move". So what is it? No more "Never to drop below $1000 again"? http://www.bloomberg.com/avp/avp.ht...//media2.bloomberg.com/cache/vMiRnaebC63Y.asf
The never below 1000$ an ounce gold was a soundbite with the intellectual weight right up the alley of his audience at that time: the financial sector. His vision on gold nevertheless remains unchanged as it has been for the last decade and that is gold being one of the prime beneficiaries of most of the western world going in default either by overprinting or factual bankruptcy. For years now he advices in each and every newsletter to buy some physical gold regardless of the spot price fluctuations. Having said that Faber aims to provide his audience with short term recommendations as well and has been actually a bit of the mark these last few months as he basically called a top in the stockmarket somewhere around september and the move of gold above 1k probably a headfake. Anyway, I understand peoples quarrels with 'prime time guru's giving bad cals. When Cramer tells people Bear Stearns is fine or when Roubini says gold is a dud and it backfires it's funny except for the people who listened to them I guess. But then again as Jim Rogers always says: "Lesson nr 1: Don't listen to one word myself or any other talking head has to say, do your own homework!"
Here he is on CNBC India, giving his audience what they want to hear: Marc Faber: "I donât think that youâll see gold below $1,000 per ounce probably ever" http://www.creditwritedowns.com/200...-gold-below-1000-per-ounce-probably-ever.html But just one week prior, I read this: Marc Faber: "Gold Will Fall to $800" http://moneynews.newsmax.com/streettalk/faber_gold_will_fall/2009/11/11/284839.html So what is it?
My Prediction is that within next 2 years there will be World War III. Today gold reached $1140 per ounce.