Gold hits $1500.00 an Oz. for first time.

[Disco Pickle]

http://money.cnn.com/2011/04/19/markets/gold_1500_record/?section=money_latest

NEW YORK (CNNMoney) -- Gold prices topped a record $1,500 for the first time ever on Tuesday, shattering an important psychological barrier.

Gold futures for June delivery hit an intraday record of $1,500.50 an ounce near midday, moving above Monday's record settle price of $1,492.90.

The price spike comes amid a wave of market uncertainty that has sent investors looking for an alternative to the weak U.S. dollar. And gold has been the marquee beneficiary.

On Monday, it was a dour outlook on U.S. debt that sent gold prices higher.

Standard & Poor's lowered its outlook for America's long-term debt to "negative" from "stable," based on uncertainty surrounding the nation's fiscal problems.

That's exactly the type of news that creates a flight to safe haven assets like gold.

The price of gold has tracked steadily higher in recent months, as a cavalcade of unsettling world events created uncertainty in global markets.

Since the start of the year, investors have been forced to consider the implications of a Japanese tsunami, earthquake and nuclear disaster. That's in addition to a spike in crude prices and a slew of revolts in the Middle East and North Africa.

Inflation -- which gold is often used to hedge against -- has been rising sharply in emerging economies and is becoming more of an issue in Europe.
Gold and silver keep shining. Thanks, S&P!

Carlos Sanchez, director of commodities management at New York-based CPM Group, said prices could go as high as $1,550 in the next couple weeks as investors focus on political gridlock in Washington.

The next major event for the gold market is the May deadline for the government to raise the debt ceiling, Sanchez said.

On Tuesday, silver prices were also on the rise. The understudy commodity was trading above $43 an ounce -- its highest level in three decades.

Of course, the records this week are not adjusted for inflation. Gold rose to $825.50 per ounce on Jan. 21, 1980, which is $2,211.65 in today's dollars, according to the Minneapolis Fed Calculator.

that's a 31.5% gain from this time last year.  

and Roger's not here to go " gold bugs"

so I'll do it for him, so he can be here in spirit.

gold bugs

that's a hell of a jump though.

[EDIT] that's all inflation too, BTW..  the same reason we're paying what we're paying for gas right now.

CNN usually gets it wrong on purpose, saying that gas prices drove rising inflation, when the reality is that inflation drives the gas prices.  Financial reporting banks on no one of any consequence being worried about the distinction, but it's actually a pretty significant difference in meaning, because then the public will blame oil companies, instead of the people responsible.

[Prince Glittersnatch III]

When the Gold bubble crashes its going to be biblical.

[Disco Pickle]

When the Gold bubble crashes its going to be biblical.

at this point it would take another full crash of the economy.  If oil's tracking where it was before the last big crash, and gold is actually tracking higher, that should be real fucking scary to anyone watching.

The Fed has given no indications at all that they'll raise interest rates to fight inflation.  You'll continue to see gold, oil, silver, etc. rise until then.

[Elder Iptuous]

silver is up even more.
the gold/silver ratio is down to 34, which it hasn't seen in a quarter century.
i'm thinking of trading in Ag for Au about now...
that way i can play the GSR and increase ounces without ever actually selling for FRNs.

[Disco Pickle]

silver is up even more.
the gold/silver ratio is down to 34, which it hasn't seen in a quarter century.
i'm thinking of trading in Ag for Au about now...
that way i can play the GSR and increase ounces without ever actually selling for FRNs.

I like the way you think.   China's inflation rate is likely helping to drive silver, considering their reserves, even as their central bank is raising interest rates to levels they've never seen to combat runaway inflation.

We'll see the price increases here on our end at some point, but it does make me wonder how one of the strongest production market in the world can post double digit growth while the strongest (historically) consuming market is still stagnant where employment is concerned.  

IME we're seeing monetization of the debt (read: socialization of the loss) seeking out commodities.  too much money chasing after too few goods.  Wages aren't rising either (at least not at any level that makes a difference)

I'm expecting to see 70's level stagflation..  we're not any where near through this yet, we're going to reap this for awhile.  

I'm considering dumping all of my paper, even after it's mostly recovered since 08, and staying strictly in metals.   Working in them, especially copper, I'm seeing prices at levels never seen on this planet.  I'll keep a close watch on the Fed, but I really don't see them doing anything for the next year and a half unless it all dumps overnight.  

A long time family jeweler friend of mine has decided to start brokering gold.  I think it's a good idea in the short term, but like Glittersnatch mentioned, it's ultimately a bubble that will correct.  I'm not so sure it's going to correct as badly as he thinks though.  It will normalize relative to the amount of dollars in the system.

I really wish those fuckers still published the M3

[Bruno]

silver is up even more.
the gold/silver ratio is down to 34, which it hasn't seen in a quarter century.
i'm thinking of trading in Ag for Au about now...
that way i can play the GSR and increase ounces without ever actually selling for FRNs.

wat?

[Disco Pickle]

silver is up even more.
the gold/silver ratio is down to 34, which it hasn't seen in a quarter century.
i'm thinking of trading in Ag for Au about now...
that way i can play the GSR and increase ounces without ever actually selling for FRNs.

wat?

seekingalpha.com would probably be a good place to start.  look up gold silver ratio and go from there.

[Elder Iptuous]

silver is up even more.
the gold/silver ratio is down to 34, which it hasn't seen in a quarter century.
i'm thinking of trading in Ag for Au about now...
that way i can play the GSR and increase ounces without ever actually selling for FRNs.

wat?

the price of gold is 1501.10; silver is 44.69... so the ratio is 33.59
it takes 33.59 ounces of silver to buy one ounce of gold, at the moment.
that number bounces around, of course.  a couple years ago, it was 80 something.
right now it's really low, indicating that silver has gone up much faster relative to gold.  so if you have a good stack of silver, now might be a good time to convert it to gold.
If you buy as an investment, maybe you want to sell for federal reserve notes.  but if you have Au/Ag as an insurance for carrying some stored value through the zombie apocalypse, then you might be hesitant to sell, so playing the ratio is a good way to take advantage of the price fluctuations without actually ever being out of the metals.

[Phox]

You know, I never quite understood the "invest in metals" ideology. Can someone explain the rational behind it?

[Elder Iptuous]

You know, I never quite understood the "invest in metals" ideology. Can someone explain the rational behind it?

well, as far as 'investing', it seems pretty simple.  if you believe they are going to go up in price for one reason or another, you dump money in to seek roi.  actually, i'm not sure what the confusion is... why would it seem any different than investing in wheat futures, or anything else?

as far as zombie apocalypes insurance, that's a bit more nuanced.

[Phox]

You know, I never quite understood the "invest in metals" ideology. Can someone explain the rational behind it?

well, as far as 'investing', it seems pretty simple.  if you believe they are going to go up in price for one reason or another, you dump money in to seek roi.  actually, i'm not sure what the confusion is... why would it seem any different than investing in wheat futures, or anything else?

That's what I mean. Investing in gold and silver doesn't seem like it's any different than investing in... anything else. Yet, I know quite a number of people who strongly advocate that investing in gold and silver is the most important thing you can do with your money (my ex-fiancée's grandparents, for example). So, I'm wondering... what makes it more important?


As for the zombie apocalypse, I think you're better off investing in a decent sized patch of land away from civilization with a few engineering projects to make it self-sufficient and defensible, personally, but.... hey, maybe the zombies will be allergic to gold? 

[Mesozoic Mister Nigel]

Farmland is a better investment.

[Luna]

Yet, I know quite a number of people who strongly advocate that investing in gold and silver is the most important thing you can do with your money (my ex-fiancée's grandparents, for example). So, I'm wondering... what makes it more important?

Glenn Beck's babbling.  He takes money from one of the ripoff "buy gold" companies, and pushes investing in gold...  Call 'em up and you're not investing in gold, you're investing in gold COINS.

http://www.ritholtz.com/blog/2010/07/glenn-beck-goldline/

[Phox]

Farmland is a better investment.

That's what I tend to think, as well.

Yet, I know quite a number of people who strongly advocate that investing in gold and silver is the most important thing you can do with your money (my ex-fiancée's grandparents, for example). So, I'm wondering... what makes it more important?

Glenn Beck's babbling.  He takes money from one of the ripoff "buy gold" companies, and pushes investing in gold...  Call 'em up and you're not investing in gold, you're investing in gold COINS.

http://www.ritholtz.com/blog/2010/07/glenn-beck-goldline/

Of course. 

[Elder Iptuous]

what Luna said...
they are primarily ripoff companies with ripoff marketing catering to unfounded fear/greed.