OK, it’s not quite the “magazine cover indicator”…
…but surely this must be telling us something about the gold market (lol)?
Hat tip LOLFed
Source:
Cats for Gold
http://www.catsforgold.com/
While yesterday's US stock market close was poor, Asia and Europe didn't follow today as debt in Greece, Spain, Portugal, etc... rallied, their CDS narrowed and stocks bounced. The Greek finance minister said January tax revenues came in above expectations and that spending was below target for the month and said "that means the deficit reduction for January is well within what we have promised." The euro is rising in turn. Also helping is the story that Trichet is headed to the European Union leaders summit a day early in order to address Greece's problems even as the Greek finance...
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November 19th, 2009 at 8:12 am
or the market for fat cats…
November 19th, 2009 at 8:27 am
Cats land on their feet most nearly all of the time. And they have 9 lives. We have 2 felines, and I can personally attest to their resilience.
Not sure that I can say the same for gold.
November 19th, 2009 at 8:31 am
Gold will correct in the short term, but in the long term we are going to see $2000..thanks to Fed zero interest policy
November 19th, 2009 at 8:40 am
My not-so-cheerful take on it is: It’s part of a trend of Americans (people and companies) selling their assets to make ends meet.
A lot of the demand for gold is foreign. Foreigners are saying “give me your belongings such as companies, assets or even gold — here are your dollars back, since I don’t know what else to do with them”.
Gold doesn’t provide much “practical value”. Like the oversized house, the Hummer, the this, the that, Americans are dumping those possessions they don’t need to survive.
Notice that those ads aren’t targeted at the rich. They’re targeted at the masses, i.e., people with weak hands who must liquidate their possessions even amidst a bull market in the stuff.
…
Now, how soon will foreigners decide they don’t want any more gold? I don’t know. How soon will we either (a) create something else to export to the world that they’ll want instead of our gold or (b) reduce the rate of growth in the money supply?
Thanks to globalization, I expect the end in the bull run will occur as the ratio of median-gold-held-per-capita outside the US approaches that within the US. The rate of change will slow as the lines draw near. Somewhere, the curve won’t be as steep. At that point, gold will have reached its nominal value in dollars.
(Well, that’s a hypothesis at least.)
November 19th, 2009 at 8:42 am
This is freaking hilarious, +1 to the ‘only in America file’. Who would have thought that the key to dragging the economy out of the recession was a bull market in gold for felines swaps.
November 19th, 2009 at 9:12 am
wunsacon has it right.
This is a “desperation” indicator and not at all a sign of an incipient Gold bubble.
When you start to see ads offering to SELL Joe and Jane Six Pack Gold, then we can start to talk about the possibility of a Gold bubble.
November 19th, 2009 at 9:33 am
I was in a jewelry store yesterday when a well-dressed woman, who did not appear to need money, asked if the store bought gold. They eagerly replied that they did. Joe and Jane aren’t buying gold; they are definitely sellers. (Even Joe and Jane Chardonnay.)
November 19th, 2009 at 7:00 pm
Funny how the times have changed.
November 19th, 2009 at 7:23 pm
Yea, a LOT of people get this wrong. I’ve been hearing a lot of “gold bubble” talk lately on CNBC (of course they never recognize a bubble in real estate or the stock market). I’ve been hearing people point to all the “gold kiosks” opening up at malls and buying gold as a TOP. THIS ISN’T THE MASSES BUYING GOLD!
When your postman or hair dresser starts talking to you about buying gold or the latest gold mining company, THAT will be close to a top. I think MOST people make this “mistake” on purpose on CNBC.
November 19th, 2009 at 8:16 pm
Tim Iocono had this yesterday.
http://themessthatgreenspanmade.blogspot.com/2009/11/cats4gold.html
November 19th, 2009 at 8:16 pm
You have to admit that there are reasons people are buying gold. I learned that the USG is maintaining medical coverage on those who have become unemployed by paying their monthly Cobra payments. A family of 4 is about $1k per. Worldwide, people are beginning to wonder what all this accomodation is going to cost us and/or our descendants in the short and long runs?
November 19th, 2009 at 8:59 pm
I just read where central banks were net buyers for the second, consequtive quarter. Maybe they know more than what they’re telling us?
Also from Ed Steer’s column “As I noted yesterday… and as Dennis Gartman mentioned as well… there’s a huge pile of December gold call options at the $1,200 strike price. The CME preliminary report for Wednesday’s trading shows that there are still 28,157 call options at that price… down 1,696 from what was reported on Tuesday. But there are also 9,187 call options at $1,300… 12,319 at $1,400 and a huge 15,658 at $1,500… plus 2,892 at $1,700… 9,696 at $2,000… and 5,189 gold call options at $2,500. ”
People placing their bets on what an audit of the Fed might disclose? If it ever happens. Or what country will be the first to fiscally blow up?
November 19th, 2009 at 9:20 pm
There were some Day Traders looking for exit today….but Mark Faber has piped up AGAIN just today…repeating:
———
Marc Faber: “I don’t think that you’ll see gold below $1,000 per ounce probably ever”
By Edward Harrison of Credit Writedowns
Marc Faber is in a bullish mindset, particularly on gold. In a wide-ranging interview with CNBC TV-18 in India, Faber talked about where he sees markets headed and why he thinks gold will never drop below $1,000 an ounce.
Private sector contracting while public sector expanding
This is the frame that Marc Faber puts on recent events post 2008 panic, namely that we are likely to see an era of increased government intervention. This is an echo of comments Bill Gross has been making for some time. We are seeing this stimulus on both the fiscal and monetary sides through fiscal stimulus programmes and quantitative easing worldwide.
The economy has not responded robustly given the size of stimulus, Faber says. Asset markets, on the other hand have. This sets up a clear dichotomy between ordinary citizens and those who benefit most from asset price appreciation on Wall Street and elsewhere in the financial sector. Moreover, the spill-over of asset price appreciation into commodity prices further constrains purchasing power for ordinary citizens.
Less certain about carry trade
Faber is less certain about the U.S. dollar carry trade. He sees a dollar overhang due to the enormous U.S. current account deficit and $7.7 trillion in U.S. dollar reserves as more the issue. Many are looking to sell these dollars and hedge their exposure in precious metals and other currencies.
more of his comments at…….
http://www.nakedcapitalism.com/2009/11/marc-faber-i-don%E2%80%99t-think-that-you%E2%80%99ll-see-gold-below-1000-per-ounce-probably-ever.html
November 19th, 2009 at 9:28 pm
@ TakBak04
That “dichotomy” you refer to is simply summed up as, “the rich get richer and the poor get poorer” due to it.
November 19th, 2009 at 9:30 pm
BTW…I’m not a trader…hold gold in two Mutual Funds in my F**ing 401-K…so I can’t short or get out. I don’t own that Gold ETF, THINGY, though. You all did read about the “fake gold bars.” I wouldn’t touch that GOLD ETF (based on paper or delivery) thing after reading about counterfeit gold bars. But, I’m confined so I could either get out of the two mutuals and go into cash like I did in March with the rest of my Mutual Funds I was forced into…or keep the two gold funds and wait it out. I don’t have protection…so I will GAMBLE IT AWAY OR UP. I kept the gold on “Intuition.” I’m one of those Myers-Briggs Types.
November 19th, 2009 at 9:35 pm
http://gata.org/node/8046
Seems like you’re not the only one TakBak04…
November 19th, 2009 at 10:10 pm
@PAT G. :
Interesting video interview, thanks. I have mix of Gold Currencies and Miners Mix in the two funds. And, as I said, I wouldn’t do the ETF because I worry they can deliver what they say they have in REAL GOLD..because of the “conspiracy or true” articles out there about tampering with the Gold Bars.
But, since I’m in there…and can’t easily get out with hedges and such that the traders can….I have to monitor daily and figure I can still move it into 0 interest Money Market if it starts to slide. UGH. I’m sure that I won’t be able to “catch that falling knife in time,” like the Traders can, but I’m still holding and will ride out for awhile along with reading daily to try to keep on top of the latest.
Somehow I still have that feeling like I own a couple of Dot Coms and it’s 1999, though. I got through that one okay..though, without being a Trader. Have to hope I can escape in time from this one. If not…well …one has to have some little fun and danger in life…given the gloom of our time. And my amount is puny compared to what the Traders and the rest own but it’s something to me, although I won’t starve if I lose it.
November 19th, 2009 at 10:28 pm
so what does this indicator mean ??
Gold will now go down and the USD go up ??
I’d rather doubt that.
November 19th, 2009 at 10:37 pm
Good news for all of you who have Citibank credit cards and got your interest rate jacked to 29%…Citibank is willing to lower it for you….IF and ONLY IF you agree to spend 750 dollars EVERY MONTH on your citi credit card…
http://contraryriches.blogspot.com/2009/11/want-lower-credit-card-rates-spend-750.html
November 19th, 2009 at 10:47 pm
@drewburn Says:
November 19th, 2009 at 9:33 am
I was in a jewelry store yesterday when a well-dressed woman, who did not appear to need money, asked if the store bought gold. They eagerly replied that they did. Joe and Jane aren’t buying gold; they are definitely sellers. (Even Joe and Jane Chardonnay.)
———–
A jewelry store our family has used for years…great couple who repair and reset stones into different settings along with selling jewelry has notified us they are retiring. They said that with the price increase in gold and the economy in downturn they just couldn’t keep up the business any longer. They were mid-fifties and very fit…so I assume it was more that it was a true “forced” retirement due to the economy and price of gold and even silver going up.
I will miss this small business. You could take things to them and they were reasonable with repairs. Also did watch battery replacement for almost nothing while you waited. Nice folks…small business..gone.
I don’t know where one would go for repairs. Sort of like trying to find shoe repair people. Just throw the shoes out or sell the jewelry at a “Gold Buying Wine Fest.” Or, sell Grandma’s silver and Grandpa’s pocket watch to some Conglomerate “WE BUY YOUR JUNK GOLD JEWELRY” outfit, who comes to your local mall. I love the local neighborhood “Wine and Cheese Gal’s Night Out”….. “Junk your Ex-Hubbies & Old Boyfriend’s Gifts Night” in our local neighborhoods where I live and that have been going on for the last two years all over the country. Saw it advertised on vacation when I was in FlA in ‘07 and it’s spread to where I live and even up into NY and CT where I have friends who’ve gone to them and gotten rid of what was sitting in their jewelry case, drawer or chest that they just didn’t wear or use anymore.
Interesting times as to what has value and what doesn’t, these days.
November 20th, 2009 at 8:34 am
I wouldn’t touch that GOLD ETF (based on paper or delivery) thing after reading about counterfeit gold bars
———–
I didn’t touch it after reading the prospectus… Criteria number 1: I don’t touch a fund unless it has limited liability.
Too much fraud out there.
November 20th, 2009 at 8:40 am
I wouldn’t touch that GOLD ETF (based on paper or delivery) thing after reading about counterfeit gold bars
———–
I didn’t touch it after reading the prospectus… Criteria number 1: I don’t touch a fund unless it has limited liability.
Too much fraud out there.
————————————–
Can’t remember if it was that fund in particular but I took a look at many commodity funds and I didn’t get the warm and fuzzy feeling.
November 20th, 2009 at 9:21 am
The dollar has been devalued 20% since March. Gold’s response up to now has been relatively muted.
November 20th, 2009 at 10:57 am
@Bam_Man: Listen to lefty and/or righty radio (yes, I like to listen to both to get a balance perceptive of the crazy). There have been ads trying to SELL (“invest in”) gold to the paranoid extremists on either end of the spectrum for quite a while now (since before the economy was tanking). When both Rush Limbaugh and Randi Rhodes are trying to sell me the same thing, that’s a sure sign that something is wrong! These ads have been slowly creeping into more “neutral” outlets, especially since the recession hit.
@Pat G.: Iceland – it already happened. People hoping for financial Armageddon like to forget that Iceland already blew up, and life moved on.
November 20th, 2009 at 11:52 am
Since I no longer watch CNBC (watched it the first time in almost two years last week b/c they had a hour long special on the UFC) and rarely watch Bloomberg, I do recall that they always had “invest in gold” commercials. Certainly, Monex has been advertising on CNBC since the late ’90’s. I have also seen the occasional “invest in gold” commercials on basic cable (and not just in the past couple years.) I don’t think the mere fact that these commercials are on tv is indicative of a top of any sort. If you start seeing these commercials regularly on the major networks, or Parade, or Time, or USA Today, etc. then I think there is an argument to be made.
Brendan,
I don’t how familiar you are with “far-right” & “far-left” media/publications, but gold has always been seen as a store of value for these groups b/c the global order is always collapsing in their eschatology. Part of the “far-right” are made up of gold bugs and one only has to remember the rash of post-apocalyptic movies from the ’80’s & early ’90’s that was generated by members of the “far-left”.
Simply, I don’t think the meme of gold investment is widespread enough through American investing psyche to call a psychological top (particularly when you factor in the current monetary policy.)
Regards,
TDL
P.S. Since I mentioned the UFC, what do you guys think a good match up would be for CNBC cast?
November 20th, 2009 at 11:52 am
and life moved on.
————
Apparently, someone is not living there.
November 20th, 2009 at 11:58 am
Simply, I don’t think the meme of gold investment is widespread enough through American investing psyche to call a psychological top (particularly when you factor in the current monetary policy.)
————
If a financial collapse is on its way, I don’t thing your average Joe will be buying gold. He’ll be selling.
In such a case, I think your peak gold price would be when your average Joe would be selling his kids.
November 20th, 2009 at 12:57 pm
Ford unveils a car that we all can afford, via The Onion:
http://www.theonion.com/content/video/ford_unveils_new_car_for_cash?utm_source=videoembed