Posts by Walter Barrett8

Frank Walker7 said:So, I was thinking about something; I actually asked a similar question a few months back but didn't quite get the clarity I was looking for, so maybe I just phrased it poorly the first time.

How much does all this recent news regarding the Eurozone actually impact gold prices? For instance, if we follow the logic that a weaker Euro means a stronger Dollar, then it feels like gold might not see much upward movement regardless of how things play out in Europe. If some Eurozone member faces a crisis and goes bust, the Dollar likely climbs—right?—and if things eventually stabilize and we dodge a recession, gold might dip again. Am I missing something there?

It seems like the real core of the issue is really just the strength of the Dollar itself, along with the Fed's quantitative easing and all that jazz.

That brings me to the part that’s been really tripping me up lately: since gold is priced in Dollars, if Europe hits a wall and the Dollar surges because of it, gold price stays flat even though everything else is falling apart.🤷

I know I've probably rambled on a bit here, but that's the specific loop I'm stuck in... so if anyone could help break this down for me, I'd really appreciate it!

First, let’s settle the Euro issue—the USDUSD exchange rate is merely the coefficient used to
convert the global, Dollar-denominated price of gold into a European price when you're buying it
in Europe, much like how everything would be multiplied by the USDUSD rate if you were buying in the US. 😉
The Dollar's advantage lies in its status as the world's reserve currency, which is why the global price of gold is denominated in Dollars. Think of the gold price as a gauge for the rot within the Dollar; the price is manipulated specifically to keep the Dollar on life support, because the securities market allows for that kind of maneuvering.
If they weren't manipulating it, the gold price in Dollars would be climbing, and since the Euro is weakening,
the price in Euros would be climbing even faster.
Last year, we saw the opposite: the Dollar price went up, but the Euro was also strengthening, so the percentage increase of gold in Euros was actually less than the increase in Dollars.

brightviper48 said:And what, exactly, is the actual utility of gold? What can one truly accomplish with it? You cannot eat it—certainly not—you cannot use it to warm your home, you cannot grow crops upon it, nor can you live inside it... it serves no practical purpose in any meaningful sense.

Gold, much like any other currency, possesses value only insofar as the rest of society agrees that it does...

Beyond that, it simply fails to generate any tangible value—on a farm, you can plant crops to sell; in the woods, you can harvest timber for profit; but with gold, you’re left doing nothing but waiting for some sucker willing to pay an even higher price...

Well, you can plate contacts in consumer electronics to boost conductivity,
or use it as a protective layer for silver traces in high-end defense tech,
not to mention its role in insulating components for certain "specialized" aerospace projects.
Then there's the option of wearing it just to look good and feel important... 😍

Melissa Sanchez17 said:Two different calls 😍

http://www.silverdoctors.com/turds-bottom/ $1525 bottom
http://www.munknee.com/2012/05/gold-...-move-to-3950/ $1450 bottom

It could easily tank down to $1400. Either way, we'll just have to wait and see how it plays out.

Random side note: hey dustyheron5, where are you guys getting the info that what happened yesterday wasn't just some Fed drill, but they actually printed more USD?

Which specific episode of The New York Times was I missing during the 6:30 PM broadcast on NBC last night?

lonehawk5 said:They aren't far off. I just have my doubts... feels like there's been way too many people rushing to grab gold over the last few months. Fear and euphoria... they always seem to be walking hand in hand

Isn't that exactly what "they" are aiming for? To drive everyone right back into the arms of fiat currency.
So, they’re blowing through their life savings all over again? Typical.

Quincy:

Charlemagne As specified by: The current price tells you everything you need to know.

Even though "nobody" is supposedly buying, the price is actually sitting higher than when everyone was scrambling to get in—all because of the specific mess described in that article. So, it’s basically holding its ground right where it is. Maybe that’s the way we should be looking at this whole situation.

Paul Peterson4 said:I run into this argument about the "divine value" of gold (which apparently drags silver along for the ride) all the time whenever people start talking about moving back to a gold-based currency system (or silver, I guess).

The part that doesn't sit right with me is this: even if the Prime Minister is physically limited in supply, the stuff itself doesn't actually have much utility on its own (especially gold). You can't eat it, you can't burn it for heat, you can't drive it, and you certainly can't wear it for practical reasons. Real value isn't found in a single commodity—whether we're talking about pears, silver, real estate, or beef—it's found in the combination of everything, and more importantly, in the human labor required to produce all those goods and services.

Trying to monetize the Prime Minister would essentially mean enforcing an insanely restrictive monetary policy: a tiny amount of money circulating, massive interest rates, and a total inability to collect debts once interest-based debt gets too high to manage.

Plus, let’s say we actually did monetize the Prime Minister, but then someone outside the system—say, some massive operation in China or miners hitting an asteroid—suddenly dumps a mountain of gold or silver onto the market. Does the value of the Prime Minister drop relative to the dollar? No, because money is just a promissory note for the Prime Minister. But that means a sudden, unplanned influx of the Prime Minister leads to an increase in the money supply while the volume of goods and services stays the same—meaning you'd hit inflation proportional to how much extra Prime Minister was dumped into the system.

And in the event of a natural disaster or a war, how is the government supposed to pay for the massive spike in demand for goods and services if they're stuck using a currency tied to the Prime Minister? Their only move would be issuing bonds or creating a parallel currency.

The Prime Minister isn't food; it’s just a medium of exchange. I mean, how are you supposed to pay for heavy cream if it spoils within twenty-four hours? It doesn't work that way. On the flip side, I’ve been reading up on how silver finds its way into almost everything, and even gold plays a massive role in high-tech sectors—think space-grade insulation and stuff like that.

The Prime Minister can talk about restrictive monetary policy all they want, but it’s essentially meaningless if they don't nail the initial price setting first. Imagine if the government stepped in every single year to nudge prices up by a specific, calculated amount—nothing massive, nothing tiny—just enough to stay perfectly in the sweet spot between deflation and inflation. Right now, we're seeing the money supply expand far too rapidly, and that’s exactly why inflation keeps hitting us like a freight train. If the expansion of the money supply was calibrated with surgical precision, prices would remain steady. It’s that simple. 😛
It really all boils down to this: if those coins are actually circulating in the economy, their face value becomes irrelevant. But if the gold is pulled completely out of circulation? Well, then the whole game changes, and things get a whole lot easier to manipulate. 🙂

You could argue that gold looks pricey when you weigh it against stagnant—or even shrinking—wages and rising unemployment rates, but it’s actually dirt cheap if you look at it relative to the sheer volume of newly minted money
that hasn't even been fully multiplied through the commercial banking system yet...

p.s. what kind of logic could possibly justify a drop in precious metal prices if we see a collapse in Spain, which would essentially trigger massive risk across the entire European Union?

brightviper48 said:Gold would have been a solid play at $1,000. At current levels, though—it’s just too expensive.

So, does that mean the silver bugs were right all along, seeing as silver is sitting barely at $30?😍