/biz/ - Business & Finance

>>21347297

Gold is a tier 1 asset, it's safe. You don't have to buy mining companies, or silver, or anything else. Simply gold. Gold will protect your money. Consider the fundamentals. Real yields are negative and will never go positive again. Investors are going to buy up all the gold they can simply in order to prevent themselves from losing their money. Gold isn't even high yet. It needs to go 3x to reach its level with the Dow:Gold ratio in 2011, and it hasn't reached its nominal highs of either 2011 or 1980 when adjusted for inflation.

>>21189686

Gold would have to be $4800 in today's money to reach its level in the Dow:Gold ratio during 2011. This bull market is just getting started.

In fact, it isn't even a bull market. The dollar is going to zero, so it's more like taking part in the greatest wealth transfer in human history.

>>21190276

I hope by gold and silver shares you mean either miners (GDXJ/SILJ), or the Sprott trust ETFs for physical (PSLV/PHYS). GLD and SLV are scams which are soon going to be delisted and go to zero. They do not have the metals which are said to back them.

https://www.youtube.com/watch?v=9EOPKizJ_Y4

https://www.youtube.com/watch?v=D6DQtbn5nos

>>20785063

I don't think you understand the leverage which gold miners have to gold. Some gold miners, like FVL, are already up 50x. Gold is up only 30%, but the GDXJ is up 180%. Now extrapolate those gains if gold does or triples; which is it very likely to do in order to catch up with the Dow:Gold ratio. Peter Schiff, in his debate with Pompliano a day or two ago, was bringing up the gains in his gold stocks with good reason.

>>20769038

In real terms, gold would have to be $4800 to catch up with the Dow-Gold ratio and reach its $1900 nominal peak, so the 3x comparison is valid. Again, the miners are demonstrably already climbing 3x faster than the underlying metals, as they always do in a bull market. Gold is up 30% since the March lows, but GDXJ is up 180%.

>>20661928

GDXJ already has to go 3x to reach what it was when gold was $1900 in 2011, then gold itself is going 3x to reach its nominal $1900 high in real terms (see the Dow-Gold ratio). Bull markets also tend to overshoot to the upside, hence the GDXJ has 10x potential. Mining stocks are the most undervalued assets in the world.

>>20636466

You are welcome.

>>20636565

The GDXJ is still one third of what it ought to be, considering the price of gold. Look what its price was in 2011, and compare that with its price now. Then consider that the price of gold is going much higher--that it has to get, and will get to $4,800, to compare with its nominal peak of $1900 in real terms. This is why I say to expect a 10x gain in the GDXJ and SILJ. In terms of price, the miners are the most undervalued things in the entire world. Anybody who invests in them now is going to make a fortune.

>>20599404

Gold must go 3x higher in nominal terms ($4,800) to reach its $1900 nominal peak in real terms. See the Dow-Gold ratio. We have a long way to go in this bull market. If currencies get trashed, (and Alasdair Mcleod says that that may happen before the end of this year,) then gold may become worth as much as $10,000 in terms of today's purchasing power.

>>20558685

This is the direct opposite of the truth. Gold has to get to $5000 before it reaches its $1900 nominal peak in real terms, and silver has to fall from its current ratio of gold-silver 1:90 to at least 1:50, and possibly even as low as 1:12, before precious metals have achieved fair value. And the miners are even more undervalued than the metals themselves.

>>20542306

>Precious metal and their respective stocks are the biggest bubble on the planet

House prices are 8x earnings -- they should be 2.5x earnings.

P. E. ratios higher than ever before in human history - historic bubble in stocks.

Yields are now negative -- bubble in bonds.

All three of the above phenomena owing to artificially suppressed interest-rates.

Meanwhile, gold would have to triple to $4800 reach its ATH of $1900 in real times. Silver is even cheaper than gold, and should be at least double what it is worth now in relation to it, in order to return to a historically normal level; and mining stocks should be quadruple what they are.

The value of precious metals is that they preserve purchasing power and function as money, money being the foundation of civilization. They thrive in precisely the kind of environment which we are presently in -- high inflation and one of a currency crisis. Hence why people could buy mansions for a few hundred ounces of silver in Weimar Germany, and gold went up 25x in the 70s. In short, you are talking utter nonsense.

>>20481481

Gold is still vastly undervalued as compared to the Dow, and needs to go to about $5,000 before it reaches its nominal peak of $1900 in 2011. Hence it will buy you about 3x as many stocks, 3x as much real-estate, &c., at the peak of this new bull market. Now silver, to get a normal historical ratio with gold, would have to double what gold does in terms of real purchasing power. That gives you $120 dollar silver in today's currency, and the ability to buy 6x as many stocks, 6x as much real estate, &c.

As I mentioned in a previous post, the bond market is even larger than the stock market. And, as real yields are now negative, and will only get worse as inflation grows, a bull market in silver is inevitable, because silver is one of the few safe havens remaining. David Brady says that it could go as high as $500. Why not, when bonds provide you with currency which is becoming increasingly worthless, and assets are in an extremely dangerous bubble. Once people realize that the governments of the world are caught in an inextricable debt-trap, how can they not buy silver when they see it is so cheap? They will do just what they did in the 70s, and rightly so.

>>20481481

Gold is still vastly undervalued as compared to the Dow, and needs to go to about $5,000 before it reaches its nominal peak of $1900 in 2011. Hence it will buy you about 3x as many stocks, 3x as much real-estate, &c., at the peak of this new bull market. Now silver, to get a normal historical ratio with gold, would have to double in terms of real purchasing power. That gives you $120 dollar silver in today's currency, and the ability to buy 6x as many stocks, 6x as much real estate, &c.

As I mentioned in a previous post, the bond market is even larger than the stock market. And, as real yields are now negative, and will only get worse as inflation grows, a bull market in silver is inevitable, because silver is one of the few safe havens remaining. David Brady says that it could go as high as $500. Why not, when bonds provide you with currency which is becoming increasingly worthless, and assets are in an extremely dangerous bubble.

>>19912937

>Where else are people going to store money where they can make gains that outpace inflation?

Gold. People will gradually realize that they are fools to be buying stocks at these P. E. ratios, especially with high inflation on the way. Why buy something which could crash at any time, and which pays either no dividend or a pitiful one, when you can buy gold, which is still extremely cheap when compared to the Dow.

>>19848990

I can't say exactly, but the Dow-Gold, House-Gold, Gold-Silver, and Gold-Miner ratios will inform my decision as to when gold, silver, or miners are overvalued. (Dow-Gold ratio, for example, still shows that gold is vastly undervalued.) But I will always keep a substantial amount of my money in gold, because that is simply good sense, since gold is insurance against unexpected disaster.

>>19830131

Posted this in another thread.

Houses are still in a massive bubble. Just as great a bubble as they were in during 2006, if not more so. On average, they are 8x earnings. The current prices only subsist because of the availability of easy credit. If you want to know why you should buy gold instead of a house right now, watch this video; bearing in mind that, at present, gold is still historically vastly undervalued. (It would need to be $5000 in today's money to reach its nominal peak of $1900.)

https://www.youtube.com/watch?v=l-knwwD-PZc

If you buy a house now, one of two things is going to happen:

1) If and when the U. S. government defaults on its debt, and interest-rates spike, both house prices and stocks will collapse by up to 90% in nominal terms. This is unlikely.

2) If and when the U. S. highly inflates the currency, which will happen before 2021, in order to prevent a stock market crash, house prices will soar in nominal terms. But, against the price of gold, which people will flock to as a safe haven, they will crash. A person who buys gold now will be able to buy three times as many houses in future as he can right now. Inevitably, by about 2024, the U. S. will reach hyperinflation, which will lead to a default, and then house prices will crash by 90% anyway.

>>19832504
>>19830558
>>19829953

Houses are still in a massive bubble. Just as great a bubble as they were in 2008, if not more so. On average, they are 8x earnings. The current prices only subsist because of the availability of easy credit. If you want to know why you should buy gold instead of a house right now, watch this video; bearing in mind that, at present, gold is still historically vastly undervalued. (It would need to be $5000 in today's money to reach its nominal peak of $1900.)

https://www.youtube.com/watch?v=l-knwwD-PZc

If you buy a house now, one of two things is going to happen:

1) If and when the U. S. government defaults on its debt, and interest-rates spike, both house prices and stocks will collapse by up to 90% in nominal terms. This is unlikely.

2) If and when the U. S. highly inflates the currency, which will happen before 2021, in order to prevent a stock market crash, house prices will soar in nominal terms. But, against the price of gold, which people will flock to as a safe haven, they will crash. A person who buys gold now will be able to buy three times as many houses in future as he can right now. Inevitably, by about 2024, the U. S. will reach hyperinflation, which will lead to a default, and then house prices will crash by 90% anyway.

>>19703717

Look at the chart. The 1929 crash followed a ten-year bull-market which itself was subsequent to a previous crash. Exactly like today. P. E. ratios are higher than ever before in human history. By contrast, gold and commodities have never been so undervalued when compared to the Dow. The choice of what to put your money in right now is obvious.

>>19672163

Gold and commodities have never been so undervalued compared to stocks and real-estate. Stocks have the highest P. E. ratios in history, and houses are eight times earnings. Both are inflated by artificial asset-buying, and both might crash at any time. Gold isn't inflated, nor does it crash with the markets (as we saw in March), and so is a good-value way to protect one's money.

The reason why gold went up so high in 1970 is because it had been artificially suppressed at 35 dollars an ounce since 1933. The U. S. lied to the world and said that the dollar was as good as gold; when it revealed this was a fraud, and that it didn't have the gold which it said it did, gold immediately accounted for 40 years of inflation.

>>19661930

On the basis of the Dow-Gold ratio, it is not unlikely that we'll get to $5000 in terms of today's money, a 3x gain in terms of real purchasing power.

>>19612889

The average house price is still 8x times earnings. Meanwhile, precious metals and commodities have never been so cheap. A person who wants to be successful should buy undervalued assets, not overvalued assets.

>>19574861

The rising yield which we are seeing means that even printing five trillion dollars in Q. E. hasn't been enough to suppress rates. A declared cap would be a formal resignation of defeat by the Fed. It would require another ten or twenty trillion to impose. The resulting inflation would make real yields plummet. The more real yields plummet, the greater a crash in the bond market becomes, because bonds become increasingly undesirable to investors; and the more the bond market crashes, the more the Fed must print to suppress yields, in a vicious circle, ad infinitum. Mean-while, a drop in real yields means a rise in the price of gold.

>>19574557

Nobody can say for sure, but probably at least $5000 in terms of real purchasing power. This is what gold would have to be equivalent to in today's money in order to be worth 1.6 times the S&P, as it was in 2011.