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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1806995 times)
Ducky1
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January 25, 2014, 09:39:28 AM
 #7481

Top story on Bloomberg

http://mobile.bloomberg.com/news/2014-01-25/gold-mint-runs-overtime-in-race-to-meet-world-coin-demand.html

The most exciting phrase to hear in science, the one that heralds new discoveries, is not 'Eureka!' but 'That's funny...'
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Ducky1
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January 25, 2014, 09:43:52 AM
 #7482



I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

If you listen to corrupt bankers it will go down. If you listen to them you should thus not have bought gold in th first place. I think you will be lucky to find anyone in this thread who agrees with them.

The most exciting phrase to hear in science, the one that heralds new discoveries, is not 'Eureka!' but 'That's funny...'
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January 25, 2014, 10:32:04 AM
 #7483



I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

If you listen to corrupt bankers it will go down. If you listen to them you should thus not have bought gold in th first place. I think you will be lucky to find anyone in this thread who agrees with them.

Nobody in the thread "Gold Collapsing. Bitcoin UP" thinks gold will go down, huh?  Cyperdoc might have something to say about that.

https://www.bitcoin.org/bitcoin.pdf
While no idea is perfect, some ideas are useful.
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rpietila
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January 25, 2014, 11:01:39 AM
 #7484

It is helpful if we totally rid ourselves of fiat as a measurement of value:

The market cap of gold is currently about 1.5-2% of market cap of the world.
That of silver is way less and Bitcoin is still less (0.003%).

When Bitcoin reaches its potential and becomes 10-50% of the market cap of the world (the position that paper sludge is occupying now and metals occupied thousands of years), will gold still be 1.5% of the world?

I think, yes. I see no much reason why not. It will start to be used in more decorative purposes, though, such as the Solomon's Temple which was overlaid with gold.

To uphold the price of gold (or anything), it does not matter if 95% think it is worthless. The rest can happily bid it up, and gold is a prime example of this.

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January 25, 2014, 12:19:07 PM
 #7485



I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

800: Not happening.

1000: Very unlikely.

If you want to pick up some at cheap prices, you have the perfect time right now - calculated against the amount of fiat available, gold was probably never cheaper in the history of mankind. Also, it's rare you get the opportunity of buying an asset below/at its cost of production.

The opportunities on the upside are immense, the risks on the downside are relatively low by now.
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January 25, 2014, 01:32:52 PM
 #7486



I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

800: Not happening.

1000: Very unlikely.

If you want to pick up some at cheap prices, you have the perfect time right now - calculated against the amount of fiat available, gold was probably never cheaper in the history of mankind. Also, it's rare you get the opportunity of buying an asset below/at its cost of production.

The opportunities on the upside are immense, the risks on the downside are relatively low by now.

Can you let us 'in' on your calculations?  or was it an overstatement. Smiley



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January 25, 2014, 02:02:08 PM
 #7487

Can you let us 'in' on your calculations?  or was it an overstatement. Smiley

Yeah Smiley Most of us in this thread have been goldbugs for years, so it really takes more than that to convince us that our conversion has been wrong Wink

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January 25, 2014, 02:47:14 PM
 #7488



I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

800: Not happening.

1000: Very unlikely.

If you want to pick up some at cheap prices, you have the perfect time right now - calculated against the amount of fiat available, gold was probably never cheaper in the history of mankind. Also, it's rare you get the opportunity of buying an asset below/at its cost of production.

The opportunities on the upside are immense, the risks on the downside are relatively low by now.

Can you let us 'in' on your calculations?  or was it an overstatement. Smiley


Ha ha, ok, I will admit that I have never calculated this myself (price of gold vs. amount of fiat) - however, I have read it from several reliable sources. So maybe it's an overstatement. Smiley

Probably not easy to get all the data in for that calculation. If somebody wants to give it a shot, they are very welcome! Anybody coming up with numbers to prove me wrong - I would love to hear them! I'm not here to defend an abstract idea of mine.
Ducky1
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January 25, 2014, 06:40:33 PM
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I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

If you listen to corrupt bankers it will go down. If you listen to them you should thus not have bought gold in th first place. I think you will be lucky to find anyone in this thread who agrees with them.

Nobody in the thread "Gold Collapsing. Bitcoin UP" thinks gold will go down, huh?  Cyperdoc might have something to say about that.

Ok, get the point. But I don't see how gold price (price of actual physical gold) can go much down now. Even FT is onto it, can it get much more mainstream now?:

http://www.zerohedge.com/news/2014-01-25/ft-goes-there-demand-physical-gold-one-day-paper-price-manipulation-will-end-catastr

The most exciting phrase to hear in science, the one that heralds new discoveries, is not 'Eureka!' but 'That's funny...'
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January 25, 2014, 06:59:16 PM
 #7490

Calling thezerg (wasn't that a name from star craft? I played it about 15 years ago )

It's time for a reality check at this historic junction the silverbox update.

this one : http://starcraft.wikia.com/wiki/Zerg?

I remember this one my Pentium MX lol Is the word Pentium becoming outdated already? Felt weird typing that.

Can one mine with a voodoo graphics card?

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January 25, 2014, 07:05:06 PM
 #7491

I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

I have nothing substantial, but I have the feeling that the time is now and I'll pick up some more gold next week. That fiat needs to leave the bank.



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January 25, 2014, 07:44:56 PM
 #7492



I made my first purchase of gold and silver recently. With crypto earnings, lol. Got a good price just before it went up a bit. My question to you all is how likely do you think it is that gold will go to 1000 or 800? I want to pickup some more but at cheap prices...

If you listen to corrupt bankers it will go down. If you listen to them you should thus not have bought gold in th first place. I think you will be lucky to find anyone in this thread who agrees with them.

Nobody in the thread "Gold Collapsing. Bitcoin UP" thinks gold will go down, huh?  Cyperdoc might have something to say about that.

Ok, get the point. But I don't see how gold price (price of actual physical gold) can go much down now. Even FT is onto it, can it get much more mainstream now?:

http://www.zerohedge.com/news/2014-01-25/ft-goes-there-demand-physical-gold-one-day-paper-price-manipulation-will-end-catastr


Most people will just accept it is manipulated and steer clear.  They know better than to try and fight it out with the big banks directly in the market.

https://www.bitcoin.org/bitcoin.pdf
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Dr Bloggood
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January 26, 2014, 02:49:08 PM
 #7493



800: Not happening.

1000: Very unlikely.

I think a 0% chance of 800 Gold is a bit silly.


0% was a rounded number. If I absolutely have to put it in numbers, I will give it a 0,2%. So that's a 1:500, which seems fair to me.

In regards to 1000, I will change my "Very unlikely" to a simple "Unlikely". If the $1,180 resistance breaks, we could find ourselves much lower pretty quickly. However, the cartel has been trying to break that resistence with unprecedented force for 3-4 months now, they really gave it everything they had and couldn't do it (although they came very close at one point). So I have the feeling that they are not able to do it. Resistance just grows stronger by the week.

The whole manipulation thing is like pressing a volleyball under water. You can do it for a bit, then resistance (natural market force) just becomes more and more powerful. At some point you can't sustain the pressure anymore and the volleyball shoots up to great hights quickly.


800 gold is still almost 300% higher than it was in 2000.


Out of all your uninformed posts, I will now shine in part a light on this one:

To start with, in 2000, the cost of production was a LOT lower than today as well. This article here shows the only chart on the cost of gold mining I could find. It says the "cash cost" of mining gold has risen from approximately $130 in 2000 to $727 in 2012, the time at which the article was written (and you can be pretty sure it is even higher today):

http://www.247bull.com/rising-production-costs-put-a-1300-floor-under-the-gold-price/

It also quotes the total "all-in cost" of mining as $1300 (in November 2012).

Here you got an article from zerohedge about the all-in costs of mining being between $1250 and $1300 (in 2013):

http://www.zerohedge.com/news/2013-12-02/gold-tumbles-towards-marginal-production-costs

What matters here are not the exact numbers, but the dimensions we are talking about. So when costs of production have risen, say, at least 5.5 times ($130x5.5=$715) since the year 2000, a rise in the price of gold of 3 times ($265x3=$795) should still be an under-evaluation. (Gold at $800 is not 300% higher than gold at $265, btw, but it's three times higher.)

If you simply want to add the rise in "all-in" costs to the price of hold from the year 2000, let's take $200 (I don't have an exact number) as all-in production cost from 2000, so let's say "all-in" costs have risen about $900 since 2000. Add that to the gold price from 2000 ($265+$900=$1165) and you are almost at the prices from today, far above $800. Bottom line is, the numbers about production cost suggest a very different picture than the one you are painting here. This is not even taking into account ANY other factors than simply the price of production.

Just as a little addition to this, gold was already supressed in 2000 (but not nearly as heavily over the last couple of months, of course). Serious supression started about 20 years ago. So when you tell me with your type of arrogance "You fail to understand this game has been going on for 500 years" (post #7772 of this thread), while maybe technically correct, it's still an irrelevant and in that context stupid claim, because supression has had totally different levels and therefore a totally different magnitude of effects.

That's just one aspect of it, there would be much more to say, for example I could write about the expanding monetary base since 2000, but after a couple of minutes searching, I didn't find any useful statistics about it (anyone?), and it's not my job to make you understand better. I could also go on to write about many, many other things which would make gold at $800 not just ridiculous as an evaluation, but also extremely, extremely unlikely.

You have demonstrated again and again over your last posts that you are very uninformed about the topic of gold. You might have already bought it 20 years ago, but you certainly didn't learn a lot about it in those 20 years. After reading uninformed post over post from you about gold, I finally couldn't take it anymore, hence this post of mine... maybe somebody else can learn something from it.
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January 26, 2014, 03:04:52 PM
 #7494


I share this and have been stacking, however I would not be shocked if we see even lower prices.


Exactly my feeling. Any further sell off just means a better entry points over the coming months.

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January 26, 2014, 03:06:12 PM
 #7495

Hey Goat,

I have a kind of newbie gold-manipulation question... I've never really understood what it even means to manipulate the price of gold. Is there an ELI5 version of how the price of gold is manipulated? Or is the only answer long and complicated and I have read books about it to know...

Thanks in advance!

The very simple answer is about 5 banks get to just make up the price of gold and that is what it is. This is not a transparent process.

Another one of your posts about gold that made me slightly cringe. There are seemingly at least half a dozen people in this thread who are very knowledgeable about gold, but for some reason (authority on BTC? fancy nickname? mighty post count?) out of all the people, a gold-newbie asks you for advice. Well, if he could hold apart the people who know from the people who don't know, he probably wouldn't have to ask in the first place, right? It's understandable.

Your answer, while not completely wrong, is mostly beside the point here, and I really can't be arsed to explain in detail why. Another poster clarified with a spot-on answer.

Rant over, calming down slowly... calming down... lol!
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January 26, 2014, 03:54:33 PM
 #7496

The comments about gold mining costs being higher as a price support floor is invalid.  First the only reason it's higher is because the higher market price led miners to invest in low margin mines.  With lower prices unprofitable mines will close and mining cost price will drop.  Secondly the argument is similar to stating bitcoin is hugely overpriced because the electricity costs to mine a single bitcoin are magnitudes lower then the current price.  Market prices are just bets by market participants with production costs being one of many different factors.
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January 26, 2014, 04:13:20 PM
 #7497

The comments about gold mining costs being higher as a price support floor is invalid.  First the only reason it's higher is because the higher market price led miners to invest in low margin mines.

Can you give me a source for that?

It doesn't sound very logical to me: If the price of gold has just steeply risen to $1000, I would have to be a complete moron to open a mine that only renders profit above $900 (to give an extreme example, you get the point). It takes a relatively long time and much effort to get a mine running, so when one considers opening a mine, they can't calculate like that (with the gold price in steady motion, manipulation, etc..).


Market prices are just bets by market participants with production costs being one of many different factors.

True, it's just one of many factors - but a very important one. What comes into play here is that the current price of gold is mostly a product of manipulation (if it wasn't, there would be a lot more weight to that argument of yours).

As I said, there would be many, many other things to mention - but it would take a lot of time to go into them in detail, so I just picked production costs to have a closer look at. Most of those other points make an overwhelming case for gold as well.

EDIT: You make a very interesting point for sure, but I think my main objection is that this kind of thinking is not relevant anymore when the TRUE price of a market would be so much higher without manipulation.

Is price a function of existing production cost or existing production cost a function of price?

It's a bit like asking "Who was there first, the hen or the egg?" You have to look at it on a case-by-case basis, and for me the case is quite clear here, considering where the price gold would be at without all of the manipulation. That's the difference to the BTC market as well.
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January 26, 2014, 04:49:03 PM
 #7498

Thanks for all the opinions. That feel when you've spent all your time reading the last 50 pages of this thread...

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January 26, 2014, 04:53:29 PM
 #7499

Gold is mostly money, and the value is determined by supply and demand for having money in reserve.

The cost of mining follows the gold price with a delay of about 10 years.

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January 26, 2014, 05:04:21 PM
 #7500

Bullion banks have effectively gone long. This suggests a total shift is nigh.

The problem is that there must be muppets of sufficient size to fleece in order to recover the underlying assets, in this case gold & silver. The targets that make sense include managed money -- retirement funds, pensions,value

What's wrong with this is that managed money holds the same thing as the banks: paper derivative promises. This is a major reason for banks looking to sell their hot potato commodity businesses, which they've effectively run into the ground by extracting all the value.

With physical metal so heavily concentrated, it's a matter of time until populations realize the disparity. Since a potent alternative exists and is much more applicable to our increasingly abstract infrastructure, transition is all but guaranteed. Transparency (honesty) is one of the greatest draws -- required for comprehensibility.

Obviously this will not happen overnight. I think it will be at least two more years before that trend gains enough traction to become noticeable.
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