Bye Bye Gold Nonsense

[dead0man]

Gold closed at $1661.10.  It was at $1421.60 on 12/31/10, which Opebo thought was too high.

We get it. He didn't time the peak right. Get over yourself already. There's no way to know exactly when a bubble wil burst.

I think we're entering the bubble.  Had you bought gold on 12/31/10, and you sell it at its peak, you would probably be able to treat it as a capital gain.  I would be surprised it it was still going up on 8/2/12.

You know, this is the second time you've done this this week.  I use someone else's parameters, and you complain about that parameter.

Give him a break, defending opebo has got to be one of the hardest things a lefty does around here.

[J. J.]

Gold closed at $1661.10.  It was at $1421.60 on 12/31/10, which Opebo thought was too high.

We get it. He didn't time the peak right. Get over yourself already. There's no way to know exactly when a bubble wil burst.

I dont think gold is in a bubble.  we're out of fiscal bullets, so all that is left is QE3.  The Euro is screwed and business is going to suck.  Glad I am not Obama.

Actually, the gold market looks remarkably like it did in 1979, except it is not quite increasing at the same rate.  In 1979, it started at about $235, then rose to about $300 in July; it retreated in early August to about $280, then soared until January 1980 to $850.  That was about a 27% increase.  Gold, since 12/31/10 has increased about 20%.  

I think there is the starting of the bubble, but it could easily peak at 175% the 12/31/10 price.

Bluntly, I think we're look at gold above $2000 per Troy Ounce, if not above $2500 in the next six months.  It won't stay there, but I'd still rate it as a hold at this point.

[J. J.]

Give him a break, defending opebo has got to be one of the hardest things a lefty does around here.

He was trying to defend the New York Times by doing the same thing on another thread.

[memphis]

If that's what you believe, please put all your money into gold.  You really can get double digit gains forever. It's truly an excellent idea to buy a commodity when it's the hot thing that everybody is talking about and is very expensive. I also have something else to sell you that's an equally amazing opportunity:

[J. J.]

If that's what you believe, please put all your money into gold.  You really can get double digit gains forever. It's truly an excellent idea to buy a commodity when it's the hot thing that everybody is talking about and is very expensive. I also have something else to sell you that's an equally amazing opportunity:

I wouldn't say put all your money in anything, but I'd expect gold to peak above $2000.00.  The problem is, it will probably do so within a year.  You'll get hit by a high tax rate on it, if you sell at peak.

Memphis, I'll make a deal with you:

If you will sell me ten ounces of gold today, at the close on 12/31/1978, adjusted for inflation, I'll buy it.  And I'm such a nice guy, I'll give you 10% on top of that.

I won't give you the 10%, but if you will sell me 5 ounces at the closing price on 12/31/10, when Opebo told us the the "gold nonsense" was over, I'll buy it.

[bullmoose88]

I think we're entering the bubble.  Had you bought gold on 12/31/10, and you sell it at its peak, you would probably be able to treat it as a capital gain.  I would be surprised it it was still going up on 8/2/12.

As long as you held it past 12/31/11, sure.  If the prices hold up that long.

[specific_name]

Considering that the problems of the Eurozone and the US seem to be going nowhere, likely getting worse - and more and more people are realizing this, I don't see why a safe haven for the wealthy like Gold wouldn't continue to rise for some time. Other havens like the Franc are also breaking records. If these factors were absent and other precious metals were staying flat, gold would be a clear speculative bubble. However, it's not and the point at which it may become one can't really be delineated with precision. The world's de facto reserve currency is in a state that makes a conclusion difficult to reach. Looking at Gold against other currencies for the past few years would probably be the best way to draw something reasonable out of the hype.

I'm failing to see why most of my fellows on the left aren't acknowledging these conditions - if it stems from a misguided defense of Obama's early "Keynesianism" (which it really wasn't), that argument should be dead in the water now that our first steps toward national Austerity are being made.

[J. J.]

I think we're entering the bubble.  Had you bought gold on 12/31/10, and you sell it at its peak, you would probably be able to treat it as a capital gain.  I would be surprised it it was still going up on 8/2/12.

As long as you held it past 12/31/11, sure.  If the prices hold up that long.

I think the peak will come sometime after 12/31/11.  By 8/3/12, it might still be higher than today, but I'd expect it to be off of the high price.

[bullmoose88]

I think we're entering the bubble.  Had you bought gold on 12/31/10, and you sell it at its peak, you would probably be able to treat it as a capital gain.  I would be surprised it it was still going up on 8/2/12.

As long as you held it past 12/31/11, sure.  If the prices hold up that long.

I think the peak will come sometime after 12/31/11.  By 8/3/12, it might still be higher than today, but I'd expect it to be off of the high price.

Well, as you probably know, if you sell the gold before holding it one full year...you have to treat it as ordinary income (STCG) as opposed to a capital gain (LTCG).

[J. J.]

I think we're entering the bubble.  Had you bought gold on 12/31/10, and you sell it at its peak, you would probably be able to treat it as a capital gain.  I would be surprised it it was still going up on 8/2/12.

As long as you held it past 12/31/11, sure.  If the prices hold up that long.

I think the peak will come sometime after 12/31/11.  By 8/3/12, it might still be higher than today, but I'd expect it to be off of the high price.

Well, as you probably know, if you sell the gold before holding it one full year...you have to treat it as ordinary income (STCG) as opposed to a capital gain (LTCG).

Yes, that is why I use the one year benchmark.  I think there is bubble forming but we're not at the upper edges of it.  I think we'll see:

1.  Gold will peak in the 1st Qtr. of 2012.

2.  Gold will peak above $2000, possibly well beyond that.

3.  On 8/3/12, gold will be higher that on 8/3/11, but it will be off the peak.

If I'm correct, if you bought gold when Opebo called it "nonsense," you could sell at the peak, make probably a 45% profit, minimum, and be taxed at the lower capital gains rate.  If you bought when we all started pointing out wrong Opebo is, you could either:

A.  Sell it at peak, and make a smaller profit, and pay a higher tax rate.

B.  Sell it after peak, make an even smaller profit, but pay a lower tax rate.

[That kind of means we are just smarter than Opebo; it doesn't mean we're particularly smart.]

[J. J.]

Prediction:  on 12/30/11, gold will close between $1770 and $1850 per Troy Ounce.

[J. J.]

Gold down $12.80 to close at 1648.80.  It was less than a 1% drop.

I hold with the predictions.

[johnhoffman]

in real terms the value of gold hasn't changed much since 94.

[J. J.]

in real terms the value of gold hasn't changed much since 94.

Boy, are you wrong.  Gold peaked at just over $390 in 1995.

http://www.kitco.com/scripts/hist_charts/yearly_graphs.plx
 
Adjusted for inflation, it would about $610 in 2011 dollars.

It must be troll season.

[J. J.]

in real terms the value of gold hasn't changed much since 94.

Hey johnhoffman,

Welcome to the forum!  Don't mind J.J. he has nicknames for everyone that doesn't agree with his gold obsession.  I'm sock puppet and I guess you're troll.  Just ride it out.  The gold thing will eventually blow up and we won't have to hear from Glenn Beck and his mindless minions anymore.

Troll season, and a sock on one hand talking to the sock on the other.

[J. J.]

Gold closed up at $1663.40, today.  The question is, will there now be a flight from dollars to gold.  We'll start finding out in about 42 hours when the Asian markets open.

[J. J.]

Gold opened in the panicky Asian markets at above $1690.00.  It has fallen back into the upper 1680's however.

Asia has a habit of inflating gold prices over the NY close.

[J. J.]

Gold is spiking to 1704.40.  I think you will see a retreat this week, by probably not to below 1670.

Goldman Sachs gave a 12 month estimate of 1860.

[J. J.]

Gold is spiking at 1716, with higher trades.  Will it close above 1700.

[J. J.]

J P Morgan expects gold to reach $2500 by year's end.

[phk]

Today, Goldman Sachs raised its 12-month target from $1,730 per ounce to $1,880 an ounce.

[phk]

A lot of people are missing is that it's part of Asian culture to buy lots of Gold. Demand in China and India is spiking after 9% GDP growth for the past 10 years. Indian demand went up 63% in 2010 alone.

[J. J.]

A lot of people are missing is that it's part of Asian culture to buy lots of Gold. Demand in China and India is spiking after 9% GDP growth for the past 10 years. Indian demand went up 63% in 2010 alone.

I think I noted the difference in the Asian markets earlier.  They care not the best guide for London and New York.  You probably nailed the difference.

[J. J.]

Gold closed at 1717.20, up 53.80.  That is a spike related to the market and will likely fall within the next week.

[J. J.]

Asian spot markets are showing a slight gold increase, around $5 per ounce.