Wednesday, August 3, 2011

Gold Bubble talk starts up again....

Before reading this non sense, remember that this 14 year old has not mentioned once in this verbose or AKA verbal diarrhea, that Gold performs even more exceptionally in times of inflation....and if he knew anything, which he doesnt, he knows that the ONLY way to perpetuate the ponzi, is to inflate and print. There is no room for deflation. Pay close attention to his "When it ends" section, because its 10 years now, and it hasnt ended, of course, he wouldnt remember he was probably playing pogs in grade 6 when it started.

Deflation Drives Prices Higher:

Owning gold does not create value. The price of any commodity is a function of the marginal supply and demand. The largest motivational force in the world, fear, is driving gold prices higher. The fear of what? Right now, the fear is a deflationary spiral. The reason gold tends to do well during periods of deflation in my opinion is that the prevalent global monetary powers prefer low inflation to deflation, and as such can be expected to increase the money in circulation during periods of economic slow-down and malaise.

Click here to read the rest of this idiosy...


  1. quote of the day

    "What part of never don't you understand? I mean it, I would rather die poor than invest in gold. I don't want to live in that world."

    M. Campbell

  2. His whole premise is wrong too. He says that gold does nothing but protect one from currency debasement, and as such is nothing but an expression of fear. He says it does nothing to create value. I argue the protection it offers is exactly that value. If I want protection from, say, a bodyguard or security force, I have to pay. I'm paying for the value of the service they offer. Gold, likewise, offers protection against central banker thugs. It creates value by preventing loss. Intuitively, most people "get it" even if they're too lazy to act on it and buy gold. It takes a special sort of idiot to try to justify the claim that gold ownership truly is valueless.

  3. Why do you even put this shit on your blog if you hate it so much? Do you really need to spread the filth? Most people don't get it and will never get it so fuck'em and leave them for the wolves. You're better than this nonsense.

  4. A reliable contrary leading indicator is when the shills come out of the woodwork. Do these dipshits really not understand how inflation-through-the-currency works? WTF!

  5. Chill out Dr Durden - it is always important to analyze the mentality of the herd. It may be impossible to escape the long term trend but the sheep can still rock the boat in the short term.

  6. That kid is clueless dolt of epic proportions.

    Tool if you will.

    Thanks SGS


  7. The absurd part is Glen Bradford is long the double silver ETF AGQ even though he thinks its a bubble.

    I am sure it will be a bubble, but that's a decade away!

    He is stumbling blind drunk onto the train to rich-ville!

  8. SGS - or anyone - what is silver concentrate used for?


    9: It Contributed to the Decline of a Nation

    The vast amounts of gold and silver seized by Spanish conquistadors and shipped back across the Atlantic in galleons increased the European supply of precious metals five-fold between 1492 and 1600. But all that gold actually weakened the Spanish empire, rather than enriching it, because the Spanish used it to buy consumer imports rather than investing the wealth in productive enterprises that would generate income. That drove up prices, which made the gold worth less, and Spain wound up amassing huge foreign debts that ultimately led to its decline as an international power.

    Now, where have I heard that before?

  10. I thought deflation is an increase in purchasing power of a currency. Wouldn't gold go down in value against the dollar if we are deflating?

  11. If gold was in a bubble it would be expensive. Gold isn't expensive, it is cheap if you adjust for inflation. In fact the price of gold really isn't going up, just the purchasing power of the dollar (and all other fiat currencies) eroding. It is a great hedge against inflation. That is why it has averaged 490 percent over the last 10 years.

  12. Many people will tell you that Gold is not an investment but a means of retaining your wealth. Even some of our respected Gold gurus say this. Well I for one think they are completely wrong.
    Gold has the ability to not only protect your wealth but to increase it.
    The reason your wealth can increase is because of "production-ingenuity".
    We are always finding better and more efficient ways to produce things. Think of TV sets and cars. They were once only affordable by the rich.
    If your stash of Gold buys you a Ferrari now it will, in the future, buy you two Ferraris:
    This goes doubly for Silver.

  13. georgesilver: your 'production-ingenuity' theory is a bit wobbly.... that would also mean in the future we'll find cheaper and better ways to mine gold/silver or recycle it. For example Umicore is right now investing massively in new processing power to recover gold and silver from old electronics. Cheaper and more precious metals would drive down the price. Your idea of holding on a stash of gold to buy 2 Ferraris in the future only means you are hedging agains inflation, thus retaining your wealth

  14. Bubble, are they serious?

    You must be completely brain-dead to believe this now.

    I just use stories like this as an indicator that something is brewing.

    Something. Is. Brewing.

  15. Look at volume of gold contracts !!. Especially last week. Incredible...

  16. Wow! I think this is his video on Youtube:

    Notice around the 9 minute mark he states he's quite familiar with AIG. If someone is going to play the market, he may have a good system. However, and I'm not an expert, it seems to me he doesn't have a good grasp of economic history and maybe doesn't understand how manipulated everything is.

    By the way, SGS, I am so looking forward to your new site. I am very interested in learning how to invest, from a more pragmatic, experienced, viewpoint. I hope the more experienced investors will stop by the amateur section to clue us in.

    In the meantime, do you have any sugessted reading materials?

    Best regards,

  17. @ Dr Maneki Neko

    You are somewhat wobbly yourself. Meant in the nicest possible way. Steel and other materials are easy to come by for your Ferrari but Gold and Silver are not. You may have a more efficient process but they become more difficult to find and extract. More people inhabit the planet and as they become wealthier their need for Gold and Silver will increase. I could go on but I'm even boring myself. Gold and Silver are "brilliant" investments not just a hedge against inflation. The only reason we have inflation is because of FIAT debt based money.

  18. "The question is ... is that marginal demand going to increase or decrease over the coming months."

    Hello? The lights are on but is anyone home? Hello? Indian wedding season coming up. Inflation in India. India = largest retail PM market in the world. Hello?