Gold. GOLD!!!!! Gooooollllllllllddddddd!!!!!!!!

[Balzac89]

If you try to save in the U.S. dollar you will get burned. It is not a means of storage of value. The Federal Reserve has a target of 2-3 percent inflation annually. They are printing 85 billion dollars a month into the system to keep it floating. The majority of the cash is going into the stock market accounting for the new all times highs.

They don't want you to save promissory notes they want you to spend it so they can take their piece.

Bernake is planning to step down after this year and he is leaving a hell of a mess. His predecessor is going to have to raise rates and cut back on the printing. Hard times till be back real soon.

 

[Harrekin]

In response to the OP's COMPLETE missing of the point AS USUAL.

Now is a fucking awesome time if you're buying physical metals. Paper markets shit all over themselves so you get the real deal cheaper!

Still growing long-term above inflation too.

So yeah...GOLD! (And silver)

 

[tokeprep]

If you try to save in the U.S. dollar you will get burned. It is not a means of storage of value. The Federal Reserve has a target of 2-3 percent inflation annually. They are printing 85 billion dollars a month into the system to keep it floating. The majority of the cash is going into the stock market accounting for the new all times highs.

They don't want you to save promissory notes they want you to spend it so they can take their piece.

Bernake is planning to step down after this year and he is leaving a hell of a mess. His predecessor is going to have to raise rates and cut back on the printing. Hard times till be back real soon.

You aren't supposed to save dollars. That would be moronic. The inflation rate is very easy to beat. You can do it with a CD, stocks, bonds, dividends, physical assets--and that's exactly what people do.

 

[tokeprep]

In response to the OP's COMPLETE missing of the point AS USUAL.

Now is a fucking awesome time if you're buying physical metals. Paper markets shit all over themselves so you get the real deal cheaper!

Still growing long-term above inflation too.

So yeah...GOLD! (And silver)

You realize silver would have been a horrible investment save a few select decades, compared to the price now, right? And the price now isn't based on silver being a precious metal or "store of value," it's based on industrial demand, especially in the electronics industry, which didn't exist so much a few decades ago. If you buy silver you're making a bet about demand for a product just as much as you are when you buy Apple stock or an office building REIT.

What's most amusing about the precious metal bugs is that they have exactly the same psychology as the housing bugs used to have. "This is an asset that cannot go down in value! Up, up, up! Look at the track record! I'll see you losers from the top, counting my stacks of cash!"

Of course, in reality, gold doesn't actually hold its value in the way its advocates claim. The real price of gold fell in the 30s through the 70s, and then again from the 80s to 2000. We're more than $1000 away from the real peak price hit in the 80s. Yeah, we saw a good rise over the last 10 years, but that's nothing that hasn't been seen before in history. How do you know when the bottom falls out and you're in for 10 or 20 years of stagnation or decline? No one ever knows that; everyone's buying "while it's still cheap." Good luck.

The real story in gold has nothing to do with fiat currency, except that the people who have the gold remain perfectly content to trade their gold for said currency. If you look at gold imports by the developing world in 2000 compared to 2012, I think you'll see where the real price action came from. Since gold isn't like wheat, having 2 billion additional people with demand has a different effect on the price than 2 billion new people demanding wheat, which can just be grown.

 

[ChesusRice]

You realize silver would have been a horrible investment save a few select decades, compared to the price now, right? And the price now isn't based on silver being a precious metal or "store of value," it's based on industrial demand, especially in the electronics industry, which didn't exist so much a few decades ago. If you buy silver you're making a bet about demand for a product just as much as you are when you buy Apple stock or an office building REIT.

What's most amusing about the precious metal bugs is that they have exactly the same psychology as the housing bugs used to have. "This is an asset that cannot go down in value! Up, up, up! Look at the track record! I'll see you losers from the top, counting my stacks of cash!"

Of course, in reality, gold doesn't actually hold its value in the way its advocates claim. The real price of gold fell in the 30s through the 70s, and then again from the 80s to 2000. We're more than $1000 away from the real peak price hit in the 80s. Yeah, we saw a good rise over the last 10 years, but that's nothing that hasn't been seen before in history. How do you know when the bottom falls out and you're in for 10 or 20 years of stagnation or decline? No one ever knows that; everyone's buying "while it's still cheap." Good luck.

The real story in gold has nothing to do with fiat currency, except that the people who have the gold remain perfectly content to trade their gold for said currency. If you look at gold imports by the developing world in 2000 compared to 2012, I think you'll see where the real price action came from. Since gold isn't like wheat, having 2 billion additional people with demand has a different effect on the price than 2 billion new people demanding wheat, which can just be grown.

Housing stocks and bonds never had paid celebraties like Glenn Beck saying you needed to buy it because America is going to collapse. When the bottom falls out of gold it's going to be a spectacular event. There will be many suicides in back yard bomb shelters all over the USA

 

[Harrekin]

Housing stocks and bonds never had paid celebraties like Glenn Beck saying you needed to buy it because America is going to collapse. When the bottom falls out of gold it's going to be a spectacular event. There will be many suicides in back yard bomb shelters all over the USA

Yeah, those finite resources, they definately depreciate in value as they become more rare.

No offense Chesus, but you're missing even basic market fundamentals.

Only you could lose money on silver coins...

 

[ChesusRice]

Yeah, those finite resources, they definately depreciate in value as they become more rare.

No offense Chesus, but you're missing even basic market fundamentals.

Only you could lose money on silver coins...

My house rose in market value

 

[ginwilly]

My house rose in market value

In US dollars. How is the value in gold? Is your house worth more gold now compared to when you bought it?

How about the Looney? How has your home value held up compared to the Canadian dollar?

 

[NoDrama]

You realize silver would have been a horrible investment save a few select decades, compared to the price now, right? And the price now isn't based on silver being a precious metal or "store of value," it's based on industrial demand, especially in the electronics industry, which didn't exist so much a few decades ago. If you buy silver you're making a bet about demand for a product just as much as you are when you buy Apple stock or an office building REIT.

Of course, in reality, gold doesn't actually hold its value in the way its advocates claim. The real price of gold fell in the 30s through the 70s, and then again from the 80s to 2000. We're more than $1000 away from the real peak price hit in the 80s. Yeah, we saw a good rise over the last 10 years, but that's nothing that hasn't been seen before in history. How do you know when the bottom falls out and you're in for 10 or 20 years of stagnation or decline? No one ever knows that; everyone's buying "while it's still cheap." Good luck.

.

The official U.S. Government gold price has changed only four times from 1792 to the present. Starting at $19.75 per troy ounce, raised to $20.67 in 1834, and $35 in 1934. In 1972, the price was raised to $38 and then to $42.22 in 1973. A two-tiered pricing system was created in 1968, and the market price for gold has been free to fluctuate since then.

The price of gold was CONTROLLED and set by government.
So was silver. set at $1.20 per ounce until 1967.


Look, an inflation chart using official BLS numbers.



Amazing how that inflation coincides with removal of gold backing from the currency does it not?

 

[ginwilly]

If you try to save in the U.S. dollar you will get burned. It is not a means of storage of value. The Federal Reserve has a target of 2-3 percent inflation annually. They are printing 85 billion dollars a month into the system to keep it floating. The majority of the cash is going into the stock market accounting for the new all times highs.

They don't want you to save promissory notes they want you to spend it so they can take their piece.

Bernake is planning to step down after this year and he is leaving a hell of a mess. His predecessor is going to have to raise rates and cut back on the printing. Hard times till be back real soon.

I can't imagine what happens to the deficit and economy when we have to pay real interest on our debt.

 

[tokeprep]

The official U.S. Government gold price has changed only four times from 1792 to the present. Starting at $19.75 per troy ounce, raised to $20.67 in 1834, and $35 in 1934. In 1972, the price was raised to $38 and then to $42.22 in 1973. A two-tiered pricing system was created in 1968, and the market price for gold has been free to fluctuate since then.

The price of gold was CONTROLLED and set by government.
So was silver. set at $1.20 per ounce until 1967.

Look, an inflation chart using official BLS numbers.

View attachment 2642173

Amazing how that inflation coincides with removal of gold backing from the currency does it not?

Yes, I'm aware of the government's control of gold prices, and that's why I referenced periods outside of the time when government controlled the prices. That the government controlled gold prices just serves to undermine the gold bug claims about its reliability and stability even further. We can't see what the market fluctuations would have been.

Your interpretation of that chart is flawed. First, the economy as it exists didn't exist for most of the time on that chart. Most Americans were subsistence farmers. When you build your own house, grow your own food, and otherwise are mostly self-sufficient, there's no such thing as "wages" or "inflation." Second, the wage of a manufacturing worker in 1913 was $2.09 a day in 1914 dollars (for 9.33 hours of work each day). Adjusting for inflation, that $2.09 would be $47.20 a day in the present. Let's say the 1913 worker worked 5 days a week at the 9.33 hours. Their take take would be $236 a week in 2012 dollars for 46.65 hours worked. My roommate works for minimum wage, so I used on of his pay stubs to calculate that he gets 89.8% of his $7.25 per hour after taxes, or $6.51 per hour. Working 30 hours a week, he would make $195.30; working 40 hours a week, he would make $260.40.

Of course, my 1913 data is for a manufacturing worker. The equivalent of a "minimum wage" job in 1913 probably made less money--perhaps much less--but I'm having trouble finding data. It doesn't matter. The point is that for less work today--with your earnings at the very bottom--you end up with more money in real terms than you would have in 1913, for less work. This is why the chart, as you're seeing it, is just a mirage. Your inflation data is meaningless without also considering wage data, since people in 2013 don't earn 1913 wages.

 

[tokeprep]

Yeah, those finite resources, they definately depreciate in value as they become more rare.

No offense Chesus, but you're missing even basic market fundamentals.

Only you could lose money on silver coins...

That's why they're good investments. It doesn't mean they're any more reliable or stable as stores of value.

 

[Balzac89]

You aren't supposed to save dollars. That would be moronic. The inflation rate is very easy to beat. You can do it with a CD, stocks, bonds, dividends, physical assets--and that's exactly what people do.

Any investment is stocks is exactly that. An investment in Federal Reserve paper

 

[tokeprep]

Any investment is stocks is exactly that. An investment in Federal Reserve paper

Except that the value of a stock is based on a company's earnings, which aren't fixed to the value of cash. If you mean that's it's denominated in paper, sure, but it's not an investment in paper.

 

[NoDrama]

Yes, I'm aware of the government's control of gold prices, and that's why I referenced periods outside of the time when government controlled the prices. That the government controlled gold prices just serves to undermine the gold bug claims about its reliability and stability even further. We can't see what the market fluctuations would have been.

Your interpretation of that chart is flawed. First, the economy as it exists didn't exist for most of the time on that chart. Most Americans were subsistence farmers. When you build your own house, grow your own food, and otherwise are mostly self-sufficient, there's no such thing as "wages" or "inflation." Second, the wage of a manufacturing worker in 1913 was $2.09 a day in 1914 dollars (for 9.33 hours of work each day). Adjusting for inflation, that $2.09 would be $47.20 a day in the present. Let's say the 1913 worker worked 5 days a week at the 9.33 hours. Their take take would be $236 a week in 2012 dollars for 46.65 hours worked. My roommate works for minimum wage, so I used on of his pay stubs to calculate that he gets 89.8% of his $7.25 per hour after taxes, or $6.51 per hour. Working 30 hours a week, he would make $195.30; working 40 hours a week, he would make $260.40.

Of course, my 1913 data is for a manufacturing worker. The equivalent of a "minimum wage" job in 1913 probably made less money--perhaps much less--but I'm having trouble finding data. It doesn't matter. The point is that for less work today--with your earnings at the very bottom--you end up with more money in real terms than you would have in 1913, for less work. This is why the chart, as you're seeing it, is just a mirage. Your inflation data is meaningless without also considering wage data, since people in 2013 don't earn 1913 wages.

You reference periods outside the government control? So basically the only period of which you could possibly mention would be from 1974 until now and no other times.
Min wage in 1938 was $.25 an hour, I assume it was less than that 25 years earlier.

Min wage in 1950 was $.75

Factory workers made a very good wage.

http://www.dol.gov/whd/minwage/chart.htm

What was that you were saying?

Edit: In 1987 I was making $7 an hour, about double the min wage. I guess my point here is that your point just became meaningless.

 

[heckler73]

The minimum wage in 1913 was $.22 an hour.

That is so far below your factory worker wage that it doesn't even compare.

Min wage in 1938 was $.25

Once again, you demonstrate your inability to read.
What is $2.09 divided by 9.33hrs?

You must smoke a lot of wax, or dabs, or whatever they call hippie-crack these days. Are you trying to prove you ARE dumber than Finshaggy, or what?

 

[Canna Sylvan]

Except that the value of a stock is based on a company's earnings, which aren't fixed to the value of cash. If you mean that's it's denominated in paper, sure, but it's not an investment in paper.

And what happens if the Fed gets permission to print 10 times the current outstanding notes? Show me a gold printer.

 

[ChesusRice]

Yeah, those finite resources, they definately depreciate in value as they become more rare.

No offense Chesus, but you're missing even basic market fundamentals.

Only you could lose money on silver coins...

I said 30 years ago I lost money
Now look back on this chart 30 years ago Pretend it is 1984-1985

 

[NoDrama]

I said 30 years ago I lost money
Now look back on this chart 30 years ago Pretend it is 1984-1985

So what caused that huge spike? was it low low interest rates and debt monetization???

I mean, my god, someone who bought silver in 1964 and waited to sell AFTER the price tanked only made like 500-600% profit, TERRIBLE!!!! Oh the HOrror!!

 

[tokeprep]

You reference periods outside the government control? So basically the only period of which you could possibly mention would be from 1974 until now and no other times.
Min wage in 1938 was $.25 an hour, I assume it was less than that 25 years earlier.

Min wage in 1950 was $.75

Factory workers made a very good wage.

http://www.dol.gov/whd/minwage/chart.htm

What was that you were saying?

Edit: In 1987 I was making $7 an hour, about double the min wage. I guess my point here is that your point just became meaningless.

That's what we have to go on, and the price hasn't been fixed, stable, ever and consistently increasing. You might say that it is now, in the present, but we have no idea what the chart is actually going to look like in 10 years or in 20 years. If the world economy collapses, as so many are seeming to suggest, I think you'd see the gold price collapse too. If no one can buy gold, no one will, and then it won't be worth anything. And then think of all the gold that isn't in circulation because it's in jewelry, etc.--image all of that getting melted down and coming up to the market! I really think the confidence in gold prices has been misplaced, but this is an aside.

Minimum wage of 25 cents an hour in 1938 = $4.02 an hour in 2012. 75 cents in 1950 = $7.06 in 2012. Your $7 an hour in 1987--double the minimum wage-- = $13.93 in 2012, which is almost double the minimum wage. What is it that you're trying to say?