When Will Gold Rise?

[JohnyMac]

With inflation for May at 8.6%, crude inching up, and the stock market on the yellow brick road to the basement, when will gold finally kick in?

Gold hit $2,052 at the beginning of March. Today it is $1,847. To me, I suspect that some organizations behind the scenes (The Fed) are manipulating the gold price. I suspect it is being manipulated to lower where it should be as world banks and countries are buying up gold as fast as they can.

I suspect, the dam will finally break and the world governments will not be able to hold back the flooding waters and we will see gold break through again the $2,000 an oz. mark. Then $2,100 will be come the new ceiling.

When do you think gold will rise? 

[Felix]

"Historically a store of wealth"
I'd guess many here would agree there is currently a _huge_ disconnect between the "price" and the "value" of PMs in today's market.
But since both price _and_ value depend on agreement between parties, how does this translate into gold (or silver) being a hedge against fiat currencies?   I believe it does by lore, by historical memory.   But this, to the average Joe, is a hazy measure.   And nowadays, the "Average Joe" would find a standard/manual clutch in a vehicle to be an "anti-theft device".
Paper money could become mere TP in Mad Max world but how and how quickly could/would the exchange "value" of a PM coin or bar be established?    What mechanism is a fractured society would re-connect "Value" to "Price"?

[JohnyMac]

Felix wrote, "and nowadays, the "Average Joe" would find a standard/manual clutch in a vehicle to be an "anti-theft device". Amen brother. 

[RB in GA]

No joke, yesterday I loaned my grand-daughter my car for a bit; the first question she asked me "Is it a standard transmission or a manual?" 

[JohnyMac]

My investment friend sent me a msg just now answering this question.

"The EU investment houses are selling gold to cover losses in the market as is spirals down here in the US and in the EU."

I guess if you were smart, it might be time to gobble up some gold at these prices.

On another note, DJIA is down ~600 points at this writing. It has been off up to 900 points today and I suspect we will finish about 500 points down for the day as some folks are buying up good deals.

[pkveazey]

I have to admit that I watch the price of Gold and Silver everyday, but I really only watch it so I'll know when to run out and buy some Physical Gold or Silver. So far, I'm pretty much a Silver Freak. Since the price of PM's is posted as Paper PM's, I know that the price is fake. All the Bubbles are right at the bursting point and when they pop, Physical Gold and Silver will be worth whatever you can get for it. I personally believe that PM's will purchase the same amount of goods and services that they did prior to 1912. I really feel that I should have gone to town today and bought some more Silver but I was just too lazy to dig out another thou and drive up there. Yes, I would have called the dealer before driving all the way up there. Sometimes the guy just doesn't have any to sell. When I first started buying it, I never had to worry about him being sold out. Those days are over because a lot of people are starting to wake up and buy the Physical PM's and they don't seem to care what the price is. We were called the 1%ers but now were called the 2%ers. I'll never understand why there are so many people still stuck in the "I'll just use this plastic money" thing. I have a credit card but I pay it off every month and pay zero interest. My interest rate is just under 9% and I have an unbeiveable limit but some people's rate is as high as 21%. Those 21%ers are the one's who are up to their eyeballs in debt and they'll never survive what's coming.

[Nemo]

So whats going on with Gold?

Nemo

https://www.cnn.com/2023/01/11/business/gold-price-rises/index.html

Gold is surging as investors bet on slower Fed rate hikes
By Anna Cooban, CNN
Updated 9:56 AM EST, Wed January 11, 2023

 Gold is shining once again, as investors bet that cooling inflation in the United States will slow the pace of Fed rate hikes and make the precious metal more attractive.

Gold futures were at an eight-month high, climbing 14% since late November to hit $1,882 per ounce on Wednesday.

Investors tend to flock to assets that offer regular returns, such as government bonds, when interest rates are rising. Gold prices slumped in April last year as the US Federal Reserve started to hike interest rates in a bid to tame runaway inflation.

But the market is increasingly expecting the Fed to temper US rate hikes as consumer prices increases slow, boosting demand for gold.

Despite the optimism among investors, the Fed has not indicated a shift in policy. Minutes from the central bank?s December meeting, released last week, stressed that ?substantially more evidence? was required for it to ?pivot? away from its path of further rate hikes.

Some countries are also beefing up gold reserves helping to push up prices. That effort has become easier in recent months as the value of the dollar has weakened, making it cheaper for countries outside of the United States to buy gold.

?We are seeing a lot of physical buying of gold from central banks. Not surprisingly, a lot of it is from Russia and China, countries that are keen to reduce their dependence on the US dollar,? Caroline Bain, chief commodities economist at Capital Economics, told CNN.
Safe haven

Investors also typically see gold as a safe haven during times of uncertainty.

Gold is often seen as a good hedge against inflation since it is a tangible, scarce asset that, in theory, holds its value.

During the coronavirus pandemic in August 2020, gold prices hit an all-time high of ?2,072.

The metal ?tends to do well in times of crisis,? Krishan Gopaul, senior markets analyst for the EMEA region at the World Gold Council, told CNN. He added that the risk of a global recession this year could be a factor drawing in investors.

Craig Erlam, senior market analyst at OANDA, echoed this view.

?This year the global economy is facing a serious slowdown, and in many countries a recession. That could make gold more appealing now that yields and the dollar are less of a negative factor,? he told CNN.

? Nicole Goodkind and Paul La Monica contributed reporting.

[JohnyMac]

War and rumors of war,
Continued inflation,
EU investors getting out of EU investments.

Comes immediately to mind.

[pkveazey]

I think Gold and Silver will be King but there is going to be a very painful transition. People are so used to using the toilet paper dollar that it will take a bit of pain to get them to price things in Gold/Silver. My mind sees 2 prices on products. The first price will probably be Dollars and the second (atlernative) price will be Gold or Silver. This inflation thing is starting to get serious. I used to go to "Little Italy" and buy a 12" Pepperoni Pizza for just under $10. Two nights ago, I went in there and the same Pizza was $19.04. Before its over, that Pizza will be 2 or 3 hundred dollars. The Government will be fighting us tooth and nail to keep us from using Gold/Silver for money. The CBDC digital crap will be pushed so hard that most of the public will fold like a cheap suit. I will resist the CBDC as much as is humanly possible.

[grizz]

I think Gold and Silver will be King but there is going to be a very painful transition. People are so used to using the toilet paper dollar that it will take a bit of pain to get them to price things in Gold/Silver. My mind sees 2 prices on products. The first price will probably be Dollars and the second (atlernative) price will be Gold or Silver. This inflation thing is starting to get serious. I used to go to "Little Italy" and buy a 12" Pepperoni Pizza for just under $10. Two nights ago, I went in there and the same Pizza was $19.04. Before its over, that Pizza will be 2 or 3 hundred dollars. The Government will be fighting us tooth and nail to keep us from using Gold/Silver for money. The CBDC digital crap will be pushed so hard that most of the public will fold like a cheap suit. I will resist the CBDC as much as is humanly possible.

This may seem like a stupid question but if you use gold for currency how do you do it? Have a scale at the counter and weigh everything is obvious but how do you set the price?

[pkveazey]

Its not a stupid question at all. In the beginning, it will be a painfull transition because people are not used to it. However, every piece of Silver that I have has the weight and purity stamped into it. Then there is the issue of, will the people who have Silver be willing to trade it at the price being asked? My mind is already made up as to what I'm willing to pay in Silver. Whatever an ounce of Silver would purchase in 1900 is what its worth to me. In 1900, people made $1 a day unless they had a high paying job of $2 a day. My Grandfather plowed fields with a plow and a mule for $1 a day right around the turn of the century.

[grizz]

Its not a stupid question at all. In the beginning, it will be a painfull transition because people are not used to it. However, every piece of Silver that I have has the weight and purity stamped into it. Then there is the issue of, will the people who have Silver be willing to trade it at the price being asked? My mind is already made up as to what I'm willing to pay in Silver. Whatever an ounce of Silver would purchase in 1900 is what its worth to me. In 1900, people made $1 a day unless they had a high paying job of $2 a day. My Grandfather plowed fields with a plow and a mule for $1 a day right around the turn of the century.

The stamping can be forged
How do you determine the quality if no stamps are present?
How do you give/get change?

[pkveazey]

That's a good question. We just go back in time when there was no paper money. Hmmm... That would be about 150 years. Well, let's see.... They used gold in different sizes, Silver in different sizes, Nickels, and Copper pennies. I have a bunch of pre 1982 pennies and a bunch of nickels, and a bunch of Silver that is marked. If I need to pay for something and it came out to something just over the price of one ounce of Silver, then I'd whip out my Nickels and Copper Pennies and the problem would be solved. There is fractional Gold and Silver out there that you can buy but the premiums don't line up with the premiums on one ounce Gold and Silver. That means you are getting over charged for Fractional Gold and Silver. When the SHTF, there will no longer be premiums on Gold and Silver. It will be worth whatever its worth and things will be the same as they are with the paper dollar. If I don't like the price, I'll try to negotiate a price we both can live with. Also, way back in time, people just clipped the coins in half or clipped them into quarters. The only problem that I see is the transition to Gold and Silver. If you are concerned about counterfiet coins, then you can do what I do. I carry a Strong magnet and a portable electronic scale to test the metal.