On top of that the artificially low gold price push miners to stop operation thus artificially shrinking the supply. If the gold price was higher, say $2000/ounce, several mining operations would resume because they would profitable.
I have a slightly different take on this that may be worth sharing here.
Also please forgive the amount of charts I'm gonna post, they are just a good way of seeing where things are going.
First of all many are certain that US equities markets have reached a top. The crash is always just round the corner, year after year, "the big one" is coming. As we know here on the forum between the Earth Changes, comets and the crazy people, something big is coming and it's likely to end spectacularly in a catastrophic way like with previous civilisations. BUT timing matters. Nobody knows if this is all coming in 5 years, 10 years, by 2030 or whatever.
So below are a few data points to consider on poor timing and missed financial opportunities, a lot of which is intuitive and obvious if you can drop the bias, but dropping bias is the difficult part as I have learned the hard way.
Obviously people hold gold for different reasons, but if you're doing it for profit seeking reasons this might be some useful info.
Consider this:
On the 20th November 2008 the low of the financial crisis was in, though few knew it. Since then 3765 days have passed and as you probably know, for the most part stocks and indexes have done nothing but rise.
That's 3756 daily candles on a standard chart, and 3756 attempts by Zerohedge to call the end of the US stock bull run - so far all wrong.
So it could be said that on any given day, the odds of you making a correct call for THE market top were more than 1/3765. Not exactly a good bet to make.
Since the lows the Dow Jones is up 300%, Nasdaq 600% and the SPX, (which bottomed at 666), is up 320%. That's pretty decent money even if you used no leverage and didn't pick any individual winning stocks.
But what if we zoom out a bit more?
Dow Jones Index all-time logarithmic chart:
Yikes that's a 100+ year bull run! Well they're clearly not messing around. OK so now the odds of calling the top of this are pretty much negligible. Notice that throughout each period you had plenty of reasons to think the end was near, and people had plenty of reasons to poop their pants and panic sell. This chart contains all the participants' worries about the great depression, world war 2, Vietnam war, the cold war, stagflation, global warming, the war on terror etc. You even have to squint a bit to see Black Monday (just under the Leg 2 label).
Anyone staring at reality without bias will see that we are now in a very impulsive break up from the "war on terror" decade of stagnation (the final blue square), with a good retest in 2016, and are now really getting into the 3rd leg. And what tech innovations do we have on the horizon that could fuel it? Cold war 2, space race 2, asteroid mining, 5g, driverless vehicles, foldable phones, AI and a bunch of other stuff that's probably bad for us but which will be pushed and wanted anyway.
All the while everyone is too scared to buy because they are convinced the end is just around the corner. I mean it could be, but you're only gonna get that call correct once and even then it may turn out to be a hollow victory.
In the most recent panic at the end of 2018, everyone was once again convinced the end was here. But what did we see? Plunge protection stepped in and bought it all up, while holders panic sold. They basically stopped out an entire country. And they can do it because central banks can print money to buy assets as much as they want. Something very similar happened in the 80's before Leg 2 by the way.
Point is there's a good chance it continues the trend. The long term chart shows a structured and deliberate pump with regular shakeouts, that's it. Keep it simple until data changes.
Returns of buying the NASDAQ vs. buying gold at the 2008 lows:
It goes without saying that stocks have out-performed gold over the past decade, but charts show it best.
Ratio of Gold to S&P500:
Notice that it is in a pretty steep downtrend and so far has shown only weak, if any, signs of reversal as of yet and plenty more room to fall.
So there's all that.
Now more on gold. Things tend to go in cycles and markets follow cycles too. Whether "natural" or engineered they always do it and its a seemingly permanent feature of our reality. You can make a good argument that gold is just in a normal crash cycle (bubble).
It looks just like any bubble chart, which all come out similar in a fractal way regardless of time frame or asset. You knew there was euphoria on gold in 2011 when every radio ad was somebody offering to give you Cash4Gold, buy your old jewelry etc. Below are some examples of bubbles on different time-frames. The pattern tends to repeat no matter what:
Dotcom NASDAQ crash cycle:
Chinese stock crash cycle:
Bitcoin crash cycle:
Random cryptocurrency pair from just 1 day ago (each candle 5 minutes):
And finally, GOLD Inflation adjusted:
So actually you'll see gold had a very good run in the early 2000s (war on terror fear period) and made a lot of people some nice profits. But as cycles come and go, so does the gold cycle.
It's down significantly since the peak and has since been stuck in this stagnation area, where it moves up just enough to get gold bugs excited before being smacked back down. This period has lasted 6 years. It's no joke. If you were holding gold for this time with the intention of profits you have made no money, actually lost money to inflation, and lost much more than that through opportunity cost (staying out of the stock market).
It could go on a crazy run and invalidate this whole cycle, but the probability of that looks low. That whole 6 year period could prove to be an accumulation zone and the Russians and Chinese are gonna pump it or something. But until proper moves start happening, that is just a hope. Markets often don't go in the direction that the majority of participants are hoping.
Here's how I'd play it based on current data, subject to change, not advice or anything:
The oft-used response to this is that PM prices are artificially suppressed and equities are pumped with fake money and an ever devaluing dollar. Of course this is correct. All markets are rigged in some way but that doesn't mean you just ignore reality as it is and talk about an imagined world where markets are not rigged and PMs are "allowed" to reach their "true" price etc.
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BHelmet
The Living Force
Very Interesting and sober analysis, Carl. Nicely done. You have popped many bubbles (except the stock market! yuk yuk) So, what are the holes in this argument? (all arguments tend to have holes) I am sure you have thought about this. My thoughts: Yes the markets are all manipulated and fake, I totally agree - and manipulation has gone on for a long time. And there is no mechanism of true price discovery. And it is likely to continue this way (until it doesn't). But, there are more than a few scenarios where reality may intrude upon illusion.
1. A "black swan event" (so many to choose)
2a. At some point the trick of adding debt to create money to prop up stocks and suppress metals just fails to work.
2b. Or IOW, at some point it becomes obvious the emperor has no clothes (and the American consumer has no money)
3. At some point it is to the great advantage of those in power to "pull the plug"
4. Wishful thinking - ever the achilles heel of STS - will fail to foresee something that causes an avalanche
5. Perhaps the perfect way for the PTB to get rid of Trump - crash the market - and then that gets out of hand
6. China dumps all that US debt onto the market
After all, it is all a matter of belief and what if the 'wrong beliefs" get empowered more than the "correct" beliefs sold by the MSM?
One other note - the yield curve just went largely negative.
One last major important point: for gold, the chart is inflation-adjusted. If the stock charts were inflation-adjusted wouldn't they look massively different?? And paint a VERY different story?
1. A "black swan event" (so many to choose)
2a. At some point the trick of adding debt to create money to prop up stocks and suppress metals just fails to work.
2b. Or IOW, at some point it becomes obvious the emperor has no clothes (and the American consumer has no money)
3. At some point it is to the great advantage of those in power to "pull the plug"
4. Wishful thinking - ever the achilles heel of STS - will fail to foresee something that causes an avalanche
5. Perhaps the perfect way for the PTB to get rid of Trump - crash the market - and then that gets out of hand
6. China dumps all that US debt onto the market
After all, it is all a matter of belief and what if the 'wrong beliefs" get empowered more than the "correct" beliefs sold by the MSM?
One other note - the yield curve just went largely negative.
One last major important point: for gold, the chart is inflation-adjusted. If the stock charts were inflation-adjusted wouldn't they look massively different?? And paint a VERY different story?
Notice that the 100 year DOW chart contains every conceivable black swan or terrifying event, up to and including the very real threat of global thermonuclear destruction. Yet here we are today.
The 7 points you listed are all scary and possible, but also hypothetical right now. They could happen, and the result could range from bad to really bad, but in general it's not wise to make firm decisions based on hypotheticals, especially when the trend is still clearly in the other direction. If those things actually start happening then you will be facing a different reality.
Right now, and for the past decade or so, expecting these things to happen any minute now and staying out of the market and hoarding gold is the actual illusion. Reality is painting a different picture.
As I kind of said above there is never a "final analysis" and everything changes. It could all come crashing down the very minute that I hit send on this post. Or we could wake up next week and see the S&P below 2100 and gold catching some serious buys above 1400. At this point zerohedge and Jesse Colombo can finally tweet "I was right, I told you so!". Then we get to watch it all unfold as things deteriorate rapidly (and roaming armed gangs come to take their gold bars anyway).
The 2nd gold chart is not inflation adjusted, but the first one is inflation adjusted just to show the clear mark of cycles in markets, and because gold takes such a long time to make any serious moves.
But below you can also see the S&P500 inflation adjusted chart.
Once we see a market crash cycle complete, climb back above and re-test its all time high it is not unlikely that it continues to run significantly further.
Given the accelerating times we are in, I would not be surprised to see this whole thing accelerate too. Pump it beyond anyone's imagination, get the general populace back on board cheering the stock market just like in the 90's, have the doubters thoroughly discredited. And just when everyone is super euphoric, pull the plug for real.
There's a quote by Sir John Templeton “Bull markets are born on pessimism, grown on skepticism, mature on optimism, and die on euphoria.”
With so many skeptics and bubble callers still around, I'd say we are in stage 2 skepticism, and possibly moving into optimism if this recent dip recovers fully and breaks to new highs in the next few months.
As always nobody knows for sure so stay safe
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Zerohedge has these charts all the time.... and everyone is right... the fake markets are in play until they are not... and the PMs are always the last card played..... remember it's the central banks themselves doing most of the buying these days, no the general public... in the West anyway, in the East, there's always been that old-school practices for dowries, temples in India etc.... but most of the real action is the billions spent by the CBs.. selling like Canada, Britain and the USA and the buyers in the East.... the game is always getting the herd to follow your lead... in our 'entimes', the American led Axis of Evil empire is reaching the breaking point... the psychos and crazies have been led to take over the OWO puppet show.... so that they can push the final destruction on the world as our empire explodes in insanity... just like the markets.
Have you seen that late 90s "10,000 yr Elliot Wave Analysis" report? Everything since the top in 2000 is essentially the long wave 'blowoff'... for the entire interglacial period.... which, like the Mayan Long Count calendar, that 2012 one dated by a german and american, not the mayans themselves.... once you hit the 'end', you are in the transition period.... you watch the 'signs'.... same with our markets... as the SG out their OWO, the signs are everywhere, but the rigged game goes on till it doesn't, same as in '08.... the signsng were there in the housing markets since late '05... a couple years before they really became obvious and couldn't be hidden anymore... the PMs are like gravity.... it can be manipulated a very, very long time.... but such instability only increases the need for stability, which is that pull back to the trendlines... the long term ones.... not that short term ones that merely show the manipulation and how it's progressing. Today, the push is on again.. even as the internals get weaker and weaker.... same as in the late 90s.... 2000 was a mostly flat year.. the real decline started in 2001... months before that 'black swan' event called 9-11 which nicely fit the script for late imperial push... empires that don't continue to expand, contract.... fast or slow, depending upon competition or nature... .and our Western financial debt empire is one most are tied to, none really want it to end, CHina is following our western debt model of development.... only Russia isn't.... but then, due to sanctions, they haven't been allowed to play our 'reindeer games'.... those 'games', like gravity, can only go on so long... .as this fits the SG script for global chaos..... imagine the fall when the CBs are told to 'dump' all that 'pump' they've done for decades.... should be 'fun', no?
Until then, the 'game' goes on.... in '08, it was over the weekend, the Jewish investors pulled their money market funds.... pulling their fingers out of the dyke.... like a young cat with a mouse....
No pain, no gain here in Purgatory... it's simply how we all learn... and most are asleep and will remain that way.... the same process is occurring in every facet or venue of life... not just the PMs... not just the markets.... but the entire Western civilization model is like that 10,000 yr Elliot Wave ...... in blowoff.... this year or next in time for the election cycle of the OWO here in the States.... as their puppet masters out their OWO.... 'pulling out the rug'... classic... as they seek to get as much energy out of the collapse as possible... keeping all the players on board playing along until that next critical point in the game... usually over a weekend.
Have you seen that late 90s "10,000 yr Elliot Wave Analysis" report? Everything since the top in 2000 is essentially the long wave 'blowoff'... for the entire interglacial period.... which, like the Mayan Long Count calendar, that 2012 one dated by a german and american, not the mayans themselves.... once you hit the 'end', you are in the transition period.... you watch the 'signs'.... same with our markets... as the SG out their OWO, the signs are everywhere, but the rigged game goes on till it doesn't, same as in '08.... the signsng were there in the housing markets since late '05... a couple years before they really became obvious and couldn't be hidden anymore... the PMs are like gravity.... it can be manipulated a very, very long time.... but such instability only increases the need for stability, which is that pull back to the trendlines... the long term ones.... not that short term ones that merely show the manipulation and how it's progressing. Today, the push is on again.. even as the internals get weaker and weaker.... same as in the late 90s.... 2000 was a mostly flat year.. the real decline started in 2001... months before that 'black swan' event called 9-11 which nicely fit the script for late imperial push... empires that don't continue to expand, contract.... fast or slow, depending upon competition or nature... .and our Western financial debt empire is one most are tied to, none really want it to end, CHina is following our western debt model of development.... only Russia isn't.... but then, due to sanctions, they haven't been allowed to play our 'reindeer games'.... those 'games', like gravity, can only go on so long... .as this fits the SG script for global chaos..... imagine the fall when the CBs are told to 'dump' all that 'pump' they've done for decades.... should be 'fun', no?
Until then, the 'game' goes on.... in '08, it was over the weekend, the Jewish investors pulled their money market funds.... pulling their fingers out of the dyke.... like a young cat with a mouse....
No pain, no gain here in Purgatory... it's simply how we all learn... and most are asleep and will remain that way.... the same process is occurring in every facet or venue of life... not just the PMs... not just the markets.... but the entire Western civilization model is like that 10,000 yr Elliot Wave ...... in blowoff.... this year or next in time for the election cycle of the OWO here in the States.... as their puppet masters out their OWO.... 'pulling out the rug'... classic... as they seek to get as much energy out of the collapse as possible... keeping all the players on board playing along until that next critical point in the game... usually over a weekend.
Gold in euros surged to an all time high at € 1,392/oz today, breaking the record of € 1.390/oz of Oct 12, 2012.
It surged to a more than six-year high in dollars ($ 1,550/oz) yesterday.
Anonymous gold purchases in cash will be limited to € 1.999 as of January 10, 2020 (currently at € 9.999) in the member countries of the E.U, according to a new compelling guideline from Brussels. Customers exceeding this amount will have to produce personal identification.
The reason for this "of course" is to curb money laundering and financial support for terrorism. As a side benefit governments will be able to survey all of those who are moving their savings away from electronic cash.
I fully expect this cash limit to be valid for sellers as well. So anyone holding gold in large denominations won't be able to sell it anonymously. Trading it in for cash (if still available) will get you booked and transferring the equivalent to your bank account will attract the prying eyes of the revenue board.
This could actually be a case for buying silver or even exchanging some gold for silver since it could help people to stay off the radar. Interestingly, the current gold-to-silver ratio is about 1 : 85 (while it has been 1 : 45 in 2013).
This is almost a record low and we might expect silver to pick up some value in comparison to gold.
It surged to a more than six-year high in dollars ($ 1,550/oz) yesterday.
Anonymous gold purchases in cash will be limited to € 1.999 as of January 10, 2020 (currently at € 9.999) in the member countries of the E.U, according to a new compelling guideline from Brussels. Customers exceeding this amount will have to produce personal identification.
The reason for this "of course" is to curb money laundering and financial support for terrorism. As a side benefit governments will be able to survey all of those who are moving their savings away from electronic cash.
I fully expect this cash limit to be valid for sellers as well. So anyone holding gold in large denominations won't be able to sell it anonymously. Trading it in for cash (if still available) will get you booked and transferring the equivalent to your bank account will attract the prying eyes of the revenue board.
This could actually be a case for buying silver or even exchanging some gold for silver since it could help people to stay off the radar. Interestingly, the current gold-to-silver ratio is about 1 : 85 (while it has been 1 : 45 in 2013).
This is almost a record low and we might expect silver to pick up some value in comparison to gold.
Rich
The Living Force
I heard an interesting prediction by Gerald Celente who suggested that the time of the upcoming US Elections will be THE breaking point for the fiat system.
Kitco NEWS Published on Aug 20, 2019
I have been fascinated by this happening for a long time ever since watching Max Keiser on RT. I know it won't be much fun as global chaos steps up a gear.
I really do find it so strange how the weather change to "Maunder Minimum" Ice agy type thing coincides with this economic collape.
Certainly interesting times and I'm doing what I can to get my ducks in a row as best I can.
I have been fascinated by this happening for a long time ever since watching Max Keiser on RT. I know it won't be much fun as global chaos steps up a gear.
I really do find it so strange how the weather change to "Maunder Minimum" Ice agy type thing coincides with this economic collape.
Certainly interesting times and I'm doing what I can to get my ducks in a row as best I can.
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In the NL i had the ID copied while selling some PM. But also for scrap copper.
Thanx for the warning of jan 2020. Selling more than 2k eu would then ring a bell someplace wrong. Police will be informed about these new standards, so it is maybe better when travelling not to take monetary pm´s, worth over 2k along. (But smart to take a little gold).
The market was especially dynamic on the 26th of august, when within the first hour, both gold and silver rose with 1,5%.
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Do you have a link, Ursus Minor? Thanks.
DianaRose
Jedi Master
Yeah, the upcoming major economic downturn has been on my mind a lot lately. I've been thinking that things could worsen around December. It would "make sense" if at a time of celebration, the economy would get worse which would increase global tension. But I also felt that something big would be coming for the US election. Wait and see, I suppose. But as I've said in other posts, I'm not looking forward to any of these things. What happen when the veneer of civilisation is lifted? When rules written and unwritten are snuffed away? Chaos. Complete and absolute chaos. We will be entering a Dark Age.
I have read accounts of various civil wars or economic collapse. The main difference this time is that nowhere in this world will be safe. The entire globe will become a churning volcano and then, it will erupt. It's one thing to say that you're grateful to be here or that you want to survive to be of service seated safely behind a computer when life is still normal, but it will be a completely different beast once the seam of society crumbles. Frankly, I wish we were already at the stage of cometary collision, but I know the world has to go through many steps before that. Suffering first need to be stirred and ramped up.
DianaRose
Jedi Master
I just read that article: Germany is the new 'sick man' of Europe - Credit Suisse -- Sott.net
For me personally, it raises many question about the near future. I live in the UK, and other here, there are also signs that the economy is struggling. There is as previously noted, an economic collapse looming in the near future, but I wonder when it will hit. Late this year or are we looking at the next? What do you guys think? Also, what happens when this economic collapse occurs? Because certainly, it will worsen everything and the quality of life will worsen by x100.
I think it's interesting to think seriously about how life will become once this disaster occurs. Food is likely to be harder to find and buy. Money, I suppose will become somewhat obsolete. I've bought some gold some time ago and I have kept a sum of money out of my bank account, but I don't know how useful things like that will be. Also, obviously, the economic collapse will propel social collapse which means the economic crash will bring in civil war/ extreme violence. I keep wondering if my family and I will have to leave our house due to the violence or because financially once the economy crash we might not be able to pay rent.
For me personally, it raises many question about the near future. I live in the UK, and other here, there are also signs that the economy is struggling. There is as previously noted, an economic collapse looming in the near future, but I wonder when it will hit. Late this year or are we looking at the next? What do you guys think? Also, what happens when this economic collapse occurs? Because certainly, it will worsen everything and the quality of life will worsen by x100.
I think it's interesting to think seriously about how life will become once this disaster occurs. Food is likely to be harder to find and buy. Money, I suppose will become somewhat obsolete. I've bought some gold some time ago and I have kept a sum of money out of my bank account, but I don't know how useful things like that will be. Also, obviously, the economic collapse will propel social collapse which means the economic crash will bring in civil war/ extreme violence. I keep wondering if my family and I will have to leave our house due to the violence or because financially once the economy crash we might not be able to pay rent.
Wandering Star
The Living Force
We are seekers of the "truth" and the signs are obvious. The bubble is butt and almost ready to break. "Their plans" are prepared.
Just one note ...
You are the C's in the future ...
Maybe help is on its way, right?
Maybe "you" are the help.
Just one note ...
You are the C's in the future ...
Maybe help is on its way, right?
Maybe "you" are the help.
Wandering Star
The Living Force
Session 28 November 2009
(L) On all of them. Put it on all of them. Okay, so now you say that we have taken steps towards joy. The joy of a new world.
A: The wave is coming, you are teaching people to surf it instead of being dragged under and out to stormy seas.
Q: (L) You once said that the wave was something like "hyperkinetic sensate". And I've often wondered if that means that it's something that massively amplifies whatever is inside an individual? And if that were the case and they were full of a lot of unpleasant, painful, miserable feelings, repressed and suppressed thoughts and so forth, and something that was hyperkinetic sensate amplified all of that, what would it do to that individual? I mean, can you imagine any of us in our worst state of feeling yucky and then having that amplified a bazillion times? If it was bad stuff inside you, you would implode!
A: Soul smashing!
Q: (L) So it is really important for people to go through this process of cleansing to prepare themselves for that?
A: Yes, then they will "rise up with wings as eagles"!
(L) On all of them. Put it on all of them. Okay, so now you say that we have taken steps towards joy. The joy of a new world.
A: The wave is coming, you are teaching people to surf it instead of being dragged under and out to stormy seas.
Q: (L) You once said that the wave was something like "hyperkinetic sensate". And I've often wondered if that means that it's something that massively amplifies whatever is inside an individual? And if that were the case and they were full of a lot of unpleasant, painful, miserable feelings, repressed and suppressed thoughts and so forth, and something that was hyperkinetic sensate amplified all of that, what would it do to that individual? I mean, can you imagine any of us in our worst state of feeling yucky and then having that amplified a bazillion times? If it was bad stuff inside you, you would implode!
A: Soul smashing!
Q: (L) So it is really important for people to go through this process of cleansing to prepare themselves for that?
A: Yes, then they will "rise up with wings as eagles"!
Corvus
Dagobah Resident
Let me be frank and say either way, staying in house or being outside it when the extreme violence is present in a crowded city, you are already dead. I read on these pages about stockpiling food and weapons and it is all funny and there is a lack of reasoning and logic in all these but mostly lack of knowledge of the scale of it that is the result of those prior two. These does not mean that you do not prepare as much as you can and with what you have at hand, and hope for the best but in most cases it ends the worst.
Without a community that has some security you re not going to last for long, or at least a team because only food and water will not provide security and vice versa. Owning a weapon does not mean much if you do not have skill that requiers time and effort and money, likewise alone without others that also have training and tactics you re not in a good position to be in. Even with all that chances are that you re not going to make it because that is life, and even after all that there is worse to come with the end result.....Maybe it is a time to accept that is the case. Frankly I do not see the point of living for long in such a world, it is bad already or frankly it was whole my 32 years here so the death is sometimes looked as a kind of salvation.
