Listening to experts can be dangerous

S

SteveS

Member
Continuing my research before starting to stack, I have been watching a few Youtube 'tutorials' from self-proclaimed experts, many of whom seem to claim professional expertise. Watching those from 2 or more years ago can be very informative, not regarding stacking per se, but the value of these experts.

Taking one I just watched as an example, the guy was strongly advising everybody to get into silver in 2012, and not gold. Looking at the current prices, his advice would have cost you a lot. Since then, gold has lost around 18% (taking the lowest price in 2012) while silver has lost a whopping 30%, again based on the bottom of the 2012 price. So not only was he wrong (as of today at least) about the potential gains, he was also wrong about silver vs gold.
 
Who's the guy, Kiyosaki? His "expert" advice has cost a lot of people a lot of money.
 
SteveS said:
Continuing my research before starting to stack, I have been watching a few Youtube 'tutorials' from self-proclaimed experts, many of whom seem to claim professional expertise. Watching those from 2 or more years ago can be very informative, not regarding stacking per se, but the value of these experts.

Taking one I just watched as an example, the guy was strongly advising everybody to get into silver in 2012, and not gold. Looking at the current prices, his advice would have cost you a lot. Since then, gold has lost around 18% (taking the lowest price in 2012) while silver has lost a whopping 30%, again based on the bottom of the 2012 price. So not only was he wrong (as of today at least) about the potential gains, he was also wrong about silver vs gold.
Click to expand...

Was it me? :P
 
As I see it, gold has two aspects.
It may become more valuable or less valuable worldwide.

Your countries currency may rise or fall.

So your looking also at a form of currency speculation with gold.
No use looking at only what gold will do in the future,
you must look at what your currency will do.
Will your countries currency become more or less valuable in the future.

So buying gold involves predicting currency movements also.

And who cares what it is in $ us if your not living in the USA.
Probably better off researching your countries possible currency movements
than golds, when buying gold long term.
 
Peter said:
As I see it, gold has two aspects.
It may become more valuable or less valuable worldwide.
Your countries currency may rise or fall.

So your looking also at a form of currency speculation with gold.
No use looking at only what gold will do in the future,
you must look at what your currency will do.
Will your countries currency become more or less valuable in the future.

So buying gold involves predicting currency fluctuations also.
Click to expand...

Absolutely. What matters is the value, not the price. What matters is the stuff you can turn it into.
 
Hindsight is 20/20.

No one is right always.

The precious metals market can be very unpredictable at times.

If you are stacking for the long term, buy on the dips down.

2016 appears to be the closing of the bear trample and the beginning of a bull run.

No one knows the future.



.
 
Peter said:
As I see it, gold has two aspects.
It may become more valuable or less valuable worldwide.

Your countries currency may rise or fall.

So your looking also at a form of currency speculation with gold.
No use looking at only what gold will do in the future,
you must look at what your currency will do.
Will your countries currency become more or less valuable in the future.

So buying gold involves predicting currency movements also.

And who cares what it is in $ us if your not living in the USA.
Probably better off researching your countries possible currency movements
than golds, when buying gold long term.
Click to expand...
What you name "better" is only a snapshot in time.
Sometimes your currencies value relative to other currencies is the dominant element within a price change, sometimes its a gold market supply/demand change that is.
And all in a degree. It's not like is either 99 or 1%, but can be 60-40% of the change, so one has to take into account both.
And to make things more complex: a currency value change is also a consequence of a cause. Predicting is digging down in a series consequences towards a first cause.
Things in economy have many relations / interactions.
So in the end, some1 that wants to succeed in evading the disguised central planned theft known as "inflation" and "intrest rates manipulation", has to observe the entirety instead of the focus.
That's what governments do with their central banks.

Take for ex the Federal Reserve:

79 data sources:

https://fred.stlouisfed.org/sources

Anderson, Richard G. (27)
Automatic Data Processing, Inc. (29)
Baker, Scott R. (15)
Bank for International Settlements (7,196)
Bank of England (128)
Bank of Italy (1)
Bank of Japan (5)
Bank of Mexico (1)
Bloom, Nick (15)
Board of Governors of the Federal Reserve System (US) (12,075)
BofA Merrill Lynch (192)
Cass Information Systems, Inc. (2)
Central Bank of the Republic of Turkey (1)
Chauvet, Marcelle (1)
Chicago Board Options Exchange (21)
Council of Economic Advisers (US) (2)
CredAbility Nonprofit Credit Counseling & Education (134)
Davis, Stephen J. (15)
Deutsche Bundesbank (2)
DiCecio, Riccardo (9)
Dow Jones & Company (63)
Dwyer, Gerald P. (12)
European Central Bank (1)
Eurostat (7,085)
Federal Deposit Insurance Corporation (62)
Federal Financial Institutions Examination Council (US) (3,029)
Federal Reserve Bank of Atlanta (71)
Federal Reserve Bank of Chicago (98)
Federal Reserve Bank of Cleveland (27)
Federal Reserve Bank of Dallas (2,362)
Federal Reserve Bank of Kansas City (3)
Federal Reserve Bank of New York (271)
Federal Reserve Bank of Philadelphia (334)
Federal Reserve Bank of Richmond (2)
Federal Reserve Bank of San Francisco (4)
Federal Reserve Bank of St. Louis (64,352)
Freddie Mac (60)
FTSE Russell (36)
GB. Office for National Statistics (1)
Hafer, R.W. (12)
Hamilton, James (2)
Haver Analytics (132)
ICE Benchmark Administration Limited (IBA) (156)
International Monetary Fund (13,022)
Jones, Barry E. (27)
JP. Cabinet Office (1)
NASDAQ OMX Group (2)
National Association of Realtors (46)
National Bureau of Economic Research (3,036)
Nikkei Industry Research Institute (1)

...deliver 390,685 data series:

https://fred.stlouisfed.org/tags/series

Our "enemies", governments, have tenthousands, hundredthousands people busy on this, day in and day out.
At banks, central banks, and governments "State" organisation.
They daily collect data, process it, and pass it to the next up in their hierarchy / system.
Quite some people talk about the Fed as a whole, Bernanke and Yellen and whoever as person, in a ridiculizing fashion. Well, that is one of the biggest underestimations one can make.
They aren't stupid, they sit at the top of the most powerful / influential organisation out there, an organisation created to steal on the macro economical level.
Now compare that with the bunch speculators we are, alot already misleaded by powerless peanut organisations like Zerohedge, SilverDoctors.

Gold is a heavily speculated upon product, and one of the biggest sides on its market is exactly aboves top power organisation, that selectively grabs/dumps 600 tonnes annually from/on its market.

It's only in a strong/hyper inflating currency environment, that the long term dominant cause of a price change is on the currency side.
Outside that, it's the speculated-upon product side that is.
That UK pound sell off triggered by their vote to dump their EU membership card:
fut_chart.ashx

... was a 1.5 to 1.2 drop. That's 20% down.
The gold price:
fut_chart.ashx

... is since start 2016 driven up from 1100 to 1330. That's up 20% up.

But, what matters for a speculator is the future, and there is a crucial difference here: the GBP is a 2 decade low value, while GOLD is a 2 decade high value.
Meaning that the GBP is likely to correct up, and gold is likely to correct down.
 
What Casey did not anticipate was the willingness of the Central Banks to sacrifice everything to support the system. That was his major error. Will the collapse of the $ come - yes, far worse than he anticipated, but don't try and time it. He was wrong and so will you be.
 
Ronnie 666 said:
What Casey did not anticipate was the willingness of the Central Banks to sacrifice everything to support the system. That was his major error. Will the collapse of the $ come - yes, far worse than he anticipated, but don't try and time it. He was wrong and so will you be.
Click to expand...

But why go back to a gold standard system that failed, if gold was used as currency, what difference would it have compared to paper money.
For example if we have gold standard,
Still would have inflation?
People still want pay rises?
 
Ipv6Ready said:
Ronnie 666 said:
What Casey did not anticipate was the willingness of the Central Banks to sacrifice everything to support the system. That was his major error. Will the collapse of the $ come - yes, far worse than he anticipated, but don't try and time it. He was wrong and so will you be.
Click to expand...

But why go back to a gold standard system that failed, if gold was used as currency, what difference would it have compared to paper money.
For example if we have gold standard,
Still would have inflation?
People still want pay rises?
Click to expand...

The gold standard did not fail. Inflation ? We have no inflation according to the RBA, in fact they dropped rates last week to create inflation. Their words not mine. What we have seen is a constant degrading of the value or buying power of fiat currency. Yes on a gold standard we get inflation and deflation but those moves are gentle. It is only the meddling of central banks and governments that create real moves in inflation. Since the fiat standard of 1971 how much has your $ lost. Remember a 1966 50c piece was 50c. In 1966 was 50c worth $10 of today's buying power? Probably. Did a sovereign buy $420 of today's things - probably. Over the long term gold preserves your wealth while cash loses its value. It's that simple. This is not a get rich scheme. That is the mistake that most SS make. This is a long term play. What I can tell you is we are far closer to the end than Casey was in 1980 :D Is that end next week, next year or next decade - I don't know and I don't care.
 
I think that is a nostalgic view of the gold standard.
Madness of the Governement or people running amok with the economy occurred regardless of currency used.

History is full of periods that had high and low inflation, Governements going bankrupt or cost of goods during war, look at world war 1 and prices. Admittedly that is extreme but go back to Victorian times or the Ancient Rome, many accounts of inflation, deflation.

Maybe your right about gentler inflation curve, since I never looked it up but it would be interesting to look an average house in London over a period from 1801 and if the house was still up, the value in 1901, possibly 2001.

1801 to 1901 was 100% during gold standard
1901 to 2001 was say roughly 50/50 gold and fiat system.
 
Unfortunately the modern inflation figures are worthless as they remove those pesky items that go up, like food. It is pointless comparing inflation over the past 20 years to anytime previously. you are wasting your time. The way I do it is pull out old newspapers from 1970/80's. Look at prices - they will shock you. Not the BS figures churned out by corrupt government hacks. I have a newspaper from 1983 in front of me - 33 years old. A brand new top of the range HSV statesman is $28,000, a new Volvo car is $16,440 (I though cars were cheaper than ever right now), a very big life policy suitable for a young professional with kids and a wife who does not work, is $100,000, and term deposits are 15%. I will look up some food prices which will make you ill. Most foods are valued in cents not $. That's is the real inflation not a made up bs figure.
 
True but have a look at two newspapers from 1801 and 1901 even 1851 people Id think said the same about prices.

Boom and bust occurs in every period, prices go up or down.
Prices go up because we get paid more and simply we want better things.

What difference would it make if we earned 10% of our income now and all prices are 10% of what it is.
If it was gold standard would that stops people paying more for a beach front property to a shack in Penrith.

Would people not bid up Sydney properties?
 
Ipv6Ready said:
True but have a look at two newspapers from 1801 and 1901 even 1851 people Id think said the same about prices.

Boom and bust occurs in every period, prices go up or down.
Prices go up because we get paid more and simply we want better things.

What difference would it make if we earned 10% of our income now and all prices are 10% of what it is.
Click to expand...

So since 1966 our small 50c piece has increased in value 18x. So you think salaries have increased 18x over that time ?
In gold terms the $35 / oz gold in 1971 has increased maybe 40x maybe 50x in AU$. Do you think salaries have gone up 50X since 1971. If that is correct and salaries have skyrocketed by 50 times, then you are right it makes no difference. If they haven't then Houston we have a problem.
 
Average weekly earning in 1983 was $358. I think base wage was $160 (I was on $110 - working for an a-hole) or at least reputedly so.
AWE in 2015 was ~$1500, base wage $672
So $28000/358 = 78. 78 x 1500 = $117000 Cars are cheap now! And so are sooooo many "things".
I really noticed it when I was a full-time student circa 2000. I could afford a DVD player every week, but needed a saving plan for margarine and tomatoes. Consumer goods have gone down whilst necessities seem to have been going up
 
As for rates of increase - it isn't constant. In 1984 I was working as an accountant for a firm and taking care of the payroll was one of my duties. Cleaning out old records in the storage room one day, I came across records from the early 1970's (may have been 72-73). At the beginning of whatever financial year it was, the average vineyard worker was getting circa $50-60 (it's a long time back to be remembering, but when I first started work in '75 I was on $54 pw, so believable)
By the end of that financial year, that wages bracket had doubled, more or less exactly. The Whitlam Years!
Life doesn't progress in a curve, but rather as steps.
 
Ronnie 666 said:
Ipv6Ready said:
True but have a look at two newspapers from 1801 and 1901 even 1851 people Id think said the same about prices.

Boom and bust occurs in every period, prices go up or down.
Prices go up because we get paid more and simply we want better things.

What difference would it make if we earned 10% of our income now and all prices are 10% of what it is.
Click to expand...

So since 1966 our small 50c piece has increased in value 18x. So you think salaries have increased 18x over that time ?
In gold terms the $35 / oz gold in 1971 has increased maybe 40x maybe 50x in AU$. Do you think salaries have gone up 50X since 1971. If that is correct and salaries have skyrocketed by 50 times, then you are right it makes no difference. If they haven't then Houston we have a problem.
Click to expand...


I am basically saying cost/prices change, not everything in the same ratio, but wage, prices, houses, food and whatever else.

Why do people think if Australia was still on the gold standard from the 1980s to 2016, why the wages would only have gone up slowly.

Wages increased because we had a shortage of labour and the miners was paying big dollars over the past decade.
If you were a FiFo truck driver, would you have worked for the same, as a 8 hour a day truck driver in major city? I am sure some would have, but most of them would have said no way.

Mortgages in 1980s and 1990s we had limited options. 1989 the advertised rate was 17%, most people paid more.
If anyone asked for 30 years or interest only they would have been laughed at.

My First PC was $5,500 in the mid 80's -> paid for my parents
My First mobile Brick/phone was $7,900 in 1989
My first car was $5,000 in 1992 absolute junk of a secondhand nissan bluebird

Overall are people better off or worse off than 1983.
What was the home ownership percentage in 1966, what is it now?

Australia had a unprecedented boom over the last decade of which we haven't seen since the Gold era, I am sure properties in the 1800s in Gold boom towns and cheap, average and expensive suburbs in major cites of that era also had a boom.

If we had with gold standards would it have been different today, yes.... but it is a big call to say wages or houses prices in gold would not have changed just as much.
 
Ipv6Ready said:
Ronnie 666 said:
What Casey did not anticipate was the willingness of the Central Banks to sacrifice everything to support the system. That was his major error. Will the collapse of the $ come - yes, far worse than he anticipated, but don't try and time it. He was wrong and so will you be.
Click to expand...

But why go back to a gold standard system that failed, if gold was used as currency, what difference would it have compared to paper money.
For example if we have gold standard,
Still would have inflation?
Click to expand...
Under a gold standard, general price risings are coupled to a rise of gold stock.
Since it's more costly/harder to produce gold than to produce fiatcurrency, a gold standard puts a limit on the amount fiatcurrency that can be created.
The currency is then redeemable in the gold that backs it up. By any holder of the currency, and by any number of holders simultaneously, even all.
For ex, the last Bretton Woods standard actually was not a gold standard. Because only selected (governments institutions) were permitted to redeem in gold, and as long as they nicely cooperated and didn't, US government could produce (expansion) / destroy (contraction) all the dollars it wanted, without having to buy/sell gold in order to fix the gold price.
It was a dollar standard not a gold standard and thus didn't block those foreign governments to manipulate the exchange rates of their currencies.

Inflation, in the meaning of a increase of the general price level, cannot be caused by fiatcurrency production anymore.
There are also other causes for a general price level to increase. Imagine someone bombs away half the economical production. Then prices would double. Amount gold stayed, amount fiatcurrency stayed, prices changed due to the supply side not the demand side.

Btw, what did Central Banks "sacrifice"?
Can't imagine anything. They continued their business, just switching their monetary planning / inflation control method back to a crisis dedicated one: controlling money supply - accept consequences for interest rates versus control interest rates - accept consequences for money supply, along the use of the excess reserves balance, so that they have a separate intrest rate and thus don't pay unintended people (automatic wage, pension etc adjustments).
Before, they expanded, then they contracted, and even sold the contraction to alot speculators as an expansion. :D
 
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