Discussion in 'Gold' started by mmm....shiney!, Jan 7, 2020.
Do we need a thread to celebrate $2300 gold?
2325 at the moment!!!
Record high of AUD2322 I believe.....(could be out by a few dollars) due to AUD declining against USD and news out of Iraq pushing USD gold price up.
War is Hell.
But the price of Gold & Silver seem to increase.
Something starts going on-beginning of war? hopping NOT!
Iran rocket strike hits multiple US air bases in Iraq apparently
Not much of a celebration if its heralding Ww3
$2347 was the high on kitco
Too bad if that happens.
Not looking much more than a brainless involuntary market reflex we’ve seen so many times before, a pyrrhic celebration
In any case, I thought we got to around 2300 AUD last year, at least intraday
The real jaw dropper is rhodium in USD. The AUD price on infomine isn’t even updated. GSR about 85
Quite possibly so, but the fundamentals that have driven gold recently haven’t changed. Conflict is just noise on the sideline. It’s monetary and fiscal policy that will be the catalyst for the major moves higher.
I agree, nothing clearly changes the fundamental issue of debt fiat (“monetary and fiscal policy”).
However, large wars historically are immensely profitable for lenders. One book I’m a fair way through is Thomas Engdahl’s “Gods of Money”. It is an excellent supplementary history text to the mainstream ones of youth. In this case, from the perspective of money.
So conflict is not just noise but a means of acquisition and transfer of assets. I guess appealing to US military sentiment might be a rallying point in the USA. (For US stackers, I have no issue with it, other than cynicism considering the MIC, foreign influence and the long term futility of war)
With increasing war expenditures, more debt is issued to fund the carnage. From a gold standpoint, it is a sensible hedge given that “central banks” hold it. This is especially the case when you consider how war debts are often inflated away by currency debasement.
A small example is Australia’s situation at the end of WW2. There was not enough silver to pay the war debt to the USA, so Australia debased its pre46 stirling with the post46 50% silver and paid the debt at face value rather than in metal. The US did much the same in the 70s with their debt to France, which bankrolled a lot of debt to fund the Vietnam war.
As we all know, when France asked for their money paid back in gold, the US decided to change the rules and extinguished the capacity to redeem the USD in gold, then proceeded to pay the French in greenbacks.
As the “world reserve” currency is fiat since the 1970s, gold still makes sense as a hedge as it did then, though It has competition in the age of the internet. All comes down to herd agreement on medium of exchange for goods and services.
That’s irrelevant now. Central banks of sovereign nations can just print money for any purpose. Scomo, Trump, Putin etc can spend as much as a war on infrastructure or free cars for everyone.
That’s true from a gold hedge point of view but with or without war government expenditures are set to explode in the foreseeable future. This is why I argue that conflict is just a side issue, it won’t have any real effect on government budgets, all it does is channel their focus. During times of war there’s less clamour from other areas for government funding.
If we could find world peace tomorrow the price of gold would still rise.
The Japs are the masters of spending. 70 years of peace gets you a debt to GDP ratio in excess of 200%.
I would have thought conflict makes an excellent bedfellow for debt. The so-called sovereign nations do not amount to much sovereignty when their own monetary instrument is controlled by private banking interests, for which the primary interest is for others to remain in debt to them.
War works from the point of view of debt.
Conflict in a broader sense also is attractive from an endebting point of view. If your objective is to create more debt, then people competing against each other seems a natural enough fit.
I know as well as you do that our “leaders” are titular and the real power lies elsewhere. Hence they reliably tend to go against what the majority really want in life. This is because the minority wants to take the fruits of human labour away from the majority for its own self-interest, imo.
I don’t hold to the theory that the monetary instruments of sovereign nations are controlled by private interests nor do I agree that our elected leaders are titular. Yes they govern in the interests of minorities, but the power still rests with them because they have a monopoly on force, currency, government and whatever else you care to name.
Federal Reserve Act 1913
Joe expects a correction to 1480ish. I agree we should correct now all is calm but don't expect it to fall much below 1500. Hold off buying perhaps? That is of course unless Trump has plans to kill Hassan Nasrallah now.
Separate names with a comma.