Gold and silver prices have been in bearish territory for some time now. 2013 has been a brutal year for the precious metals, but how about 2014? Legendary investors such as Jim Rogers, Marc Faber, Eric Sprott & Tom Fitzpatrick are unanimously bullish for 2014 citing the tight physical market, the looming threat of war with Syria and the continuously rising debt levels. [youtube]http://www.youtube.com/watch?v=CooHvAH_76Q[/youtube] Source: http://wp.me/p3GFw1-Kp Do you guys agree with these predictions? Anything to add to them?
How many times can the Fed and the US government continue to cry wolf over QE tapering before the markets finally have enough?
Now that is a good question. It seems like they'll always say they'll taper soon but they never plan to. They believe (and rightly so) that the herd will be swayed by words alone. The fed is into the whole lies and psychology thing as well as their official, criminal, money/debt creating role. Pathetic.
Do you guys believe all the talk that the Fed is actually planning on scaling back QE in early 2014 or is Janet Yellen just going to keep the tap running or possibly increase it some. Should be interesting to see how this plays out.
Whether they scale back or not is irrelevant to the gold price.....it is only one of many factors which will determine the gold price and by itself has little, if any effect.......much that same as all the other factors........alone they make no difference. It is only when broad sentiment changes that gold will make its move. Don't forget bad news has no effect on a bull market in the same way that good news does not stop a bear market.
I suspect the market isnt that stupid as to really believe the Fed commentary. I suspect the game theory is in play - everyone knows the FED is full of crap but who is going to bet against the trend to trade as if they were serious? Its just a game. The fed comes out with information that the market responds to, as every investor realises that the fed is talking crap, they cant afford to bed against them because they know the market will react WITH the news. So its not worth being the first person to bet against them. So i dont believe anyone really thinks they are going to taper - but the individuals in the market are stuck in a dilemma.
Taper re US Bond purchases? Only if the deficit decreases. Taper re buying trash from the banks? Why not? The banks have to run out of junk bonds sooner or later.
What is fascinating is the dynamic between physical and paper. Physical is being bought up at every opportunity. At any other time this would push the price up. However, some time ago, in order to make owning physical more convenient, instruments were set up to allow investors to buy the equivalent physical as paper. This, in an honest transaction, would maintain the integrity of the physical market. What we instead have, is a situation where, as in the Comex, 70 times more ounces have been sold than is held. The escape clause is that it can realise the debt in fiat not physical. This mirrors the Fed's and other reserve banks' printing of fiat where the debt far exceeds the tax revenues. Similarly now with digital currency, we have the creation of wealth out of thin air. This is seen as a hedge against fiat or as a way of accumulating fiat. The smart operators are taking their crypto profits as physical. I believe much of this translates as the emperor's new clothes. As long as he's the emperor, no one is willing to say anything. Somewhere, there will be trigger that will bring all this crashing down. Then physical will be the only true measure of wealth. Funnily enough, during this collapse, I think paper fiat may hold its own against digital in the short term as bank holidays and haircuts limit the exchange of goods and services. However, this is where I think that I am weak in my uptake; I am not buying enough physical during this time of low interest money and cheap physical. I am not leveraging to my full potential. "What did you do through the Humongous Depression Grandpa?" "I lived okay, but I could have done better because I saw it coming."
