Where are all the gold gurus?

[sumdumguy]

Just a few months ago, it was a given that gold
would hit $2500 by Xmas.

[ColevilleH2S]

I think their hiding out with the $200
oil, and $24 bean, guys.

[cottonpicken]

The guys calling for 2500,24,200 have been much
more right that those who have not.

[checking]

The inflation guys could launch several blimps.

[ColevilleH2S]

With all of the QE, and political pressure to lower currency values, we have the right ingredients to form explosive inflation. And yet, core inflation remains stable. Why is that?

Greenbacks are being created out of vapour and yet they seem to be disappearing back into the vapour just as quickly. Where the heck is all of the stimulus going? I expected new money in the quantity of trillions, would flood over the US like a wave, drowning thoughts of deflation in an ocean of cash. But after more than 4 years, we are still wondering, when this breaks, which direction will it go?

[cottonpicken]

First i'd say real inflation is around 6% asJohn Williams
of shadow stats states,he is very well known for
alternative data.

Secondly,qe is being used to recapitalize the banks
and support government deficits,the fed is
purchasing over 80% of the treasuries being issued.

Thirdly,the cycle out of bonds is just getting started.

Fourth,money velocity is still in the toilet,probably do
to the fear that is in everyones minds,a return on
capital is not as important as the return of capital in
so many peoples mines.

fifth,patience's,it just takes time.

[ajl]

A pile of it went into farmland.

[TOM4CWB]

Another big pile of it went into Google, Apple,
Samsung, GM, Chrysler, GE/PW/MD/Boeing/Airbus and
green power projects. Infrastructure like AB power
lines... roads Ships... and a megaload of Chinese
goods. Why do you think China/India have gone along
with QE. They are huge beneficiaries!

Cheers

[hedgehog]

its all gone to bail out property speculators and pay bank bonuses.

[errolanderson]

Coleville . . . the reason why excess money printing is doing dittily-squat to inflation is because this out-of-control debt problem is far greater than what keynesian economics (money printing) can handle.

Crankin up the money presses works in mild recessions (Reagan era). This is NOT a mild recession. Money printing (QE3) is making matters worse and extending this recession much longer than needed (IMO), than if politicians and governments would act responsiblity with spending. A massive tuneup is coming to governments and their thinking over the next 2 to 3 years.

Believe the next generation will have a different mindset spending and debt as the 'hammer' has yet to come down in this current 'lets overspend now and think about later mentality'

The U.S. Fed is likely starting to sweat about this as they are now on the hook for their ballooned balance sheet.
(IMO, you just don't print money wildly, banking on an inflationary spiral and somehow say the the problem is fixed and just walk away from it).

The fed plan is now to somehow eventually sell off this debt . . . that is beyond my brain power how that will work.

To me, that's a key reason why gold has been a flop of late. And precious metals may head lower yet as the battle of deflation appears nearing.

Look at the cattle market right now . . . supply fundamendamanetals are bullish beyond belief, but beef prices are struggling. Demand is king in this market envirnonment, not supply.

Also, there is a recession in India as well. People in India are by far the largest buyers of physical gold in the world. It is apart of their culture. This demand is far bigger than any speculator demand. Demand for gold in India is dropping sharply right now.

In a deflation market, precious metal prices and demand may simply suck . . . which is the case right now and a serious shock to the speculator believing that the sky-is-the-limit for precious metals. Well, it ain't (IMO).

Errol

[sumdumguy]

In the back of my mind keeps ringing, "every dog
has his day."

I think that America has exported its jobs that
generate GDP, brought in a pile of immigrants
who are now on the dole.

Capital is flowing out to China for everything. No
jobs, no money, no inflation, simple pimple!

The only way to fire the engines is industry &
Jobs as cost-inflation only goes so far when the
masses have no money. Where is Roosevelt,
oops gone.

[sumdumguy]

That is cost-push inflation. America needs
demand for its own goods.

[cottonpicken]

Lol,Errol,how in the world do you believe the soverign
debt of the western world will ever be paid off?

[rhoff]

The QE is a lot like trying to break a damn. They
won't stop till it gives way and when that happens
"smart" people will not be in control of market
sentiment.the bond vigilantes will,and the fed
won't be able to unwind in a nice gradual decline
like they speak of. All there theories seem
dreamed up in a vacuum where market sentiment
and human nature don't exist.
Also the fed has a problem where the long
bonds they hold will not be able to fund the
ongoing demands of servicing banks reserves.
Which means they will have to either sell there
massive holdings of debt or print money. Given
what we know about how govt likes to spend I
highly doubt they will have the treasury step in to
fill the gap and I highly doubt they will try to sell
debt at a huge capital loss - so they will print more
money in order to cover the shortfall which could
last for years and years. Remember this bond
market has been in a bull market for 30 years and
is now a bubble. It could take 20 years and a
spike in interest rates to turn that around.

[liberty]

Every time gold has a pullback in its bull run, the naysayers have proclaimed its demise. It's had several pullbacks in the past several years, and each time went on to set new highs.

Inflation is amply evident in the price of farmland, now that we have institutional investors piling in as they search for better returns.

Central banks have also created a bubble in government debt worldwide, as governments borrow money to service obligations that they cannot possibly make good on.

Gold is just taking a breather.

Central banks are only good at two things: creating inflation and creating asset bubbles. They literally have no idea or interest in creating deflation.