Economic update

[brunt]

Ask anyone who bought it and stored it since 1980 they did not get a good enough return to cover inflation as of 1980 to 2010

Any asset can be shown to be bad if you pick and choose the appropriate start point.

Gold and silver have done spectacularly well since 2001, up 300% or so. This is not an arbitrary point in time that I chose to make my case, 2001 is the point in time where I decided that the metals were priced so that I could not possibly resist them.

I am not really a gold bug, but at this particular point in time, I honestly believe that the metals will hold their value better than paper dollars. I also fully anticipate that in the future, another asset will become priced cheap enough that I cannot possibly resist trading some metals for them.

[ashedfc]

Gold and silver have done spectacularly well since 2001, up 300% or so.

I am not really a gold bug, but at this particular point in time, I honestly believe that the metals will hold their value better than paper dollars. I also fully anticipate that in the future, another asset will become priced cheap enough that I cannot possibly resist trading some metals for them.

Absolutely TRUE.
Its actually 400% since 2001 (in US Dollar terms).

In future (though its too early to conclude the fate of fiat currencies), IMF SDR or the Chinese Remimbi will be an attractive alternative.

[ashedfc]

"INNOVATION - America has a Structural Problem"
(worth reading, as the population demographic changes impacts the entire developed world to a major extent & the developing world to a lesser extent).

http://home.comcast.net/~lcmgroupe/2...al_Problem.htm

[ashedfc]

Me again
putting on the flame retartant business suit

Here we go

Gold itself is not a good investment at the moment, it is a bubble and God onlyknows when it collapses.

...Evil Genius here so kind of not going to bet against God...

Gold may be a hedge if you are an extreemely sofisticted investor.
Ask anyone who bought it and stored it since 1980 they did not get a good enough return to cover inflation as of 1980 to 2010


see chart..
http://www.pensions.gold.org/assets/...art/index.html

Please Go through this - as 1980's & todays economy is lot different.

http://goldswitzerland.com/index.php...greyerz/print/ I have added the printable version.

[ashedfc]

Here is another chart of Gold in US Dollar,in Pound, in Euro, In Swiss Franc, in Swedish Kroner, & finally in Dow (blue chart).
(Mostly its always the contrarians who benefit).

http://goldswitzerland.com/index.php...d/gold-charts/

[ashedfc]

An analysis on historical store of value. Gold !!!!!!! (Chinese influence seems justified).

http://www.hindecapital.com/docs/hil...ept%202010.pdf

[ashedfc]

Nine Bullish Arguments for Gold.

http://www.usfunds.com/investor-reso...k-talk/?i=3877

& What's driving Gold? The critical drivers of Gold are pointing in the same direction.

http://www.usfunds.com/whats-driving...TOKEN=28377470
.
.

[Cheap]

"10 Practical Steps That You Can Take To Insulate Yourself (At Least Somewhat) From The Coming Economic Collapse".
This info is reflecting the US economic situation, however, Canada will also be indirectly affected (although not to the magnitude of US).
http://www.infowars.com/10-practical...ollapse/print/

With reference to the above post, how can I get off the grid? Apparently solar power is still not that affordable and it takes years to get back what a person has invested into the solar power equipment.

How can a person live without the utility companies? An ISP provider is required for internet. ...I live in the city...if I told my friends that I was digging a well in the back yard to get off of city water...they would all laugh at me... Although I totally agree with the idea of getting off the grid...I just don't know how to do it...

[ashedfc]

Gold futures rise to record high at USD 1,267.50/oz (as I write this)
Gold Small caps have exploded with Gold historical level.

[brunt]

With reference to the above post, how can I get off the grid? Apparently solar power is still not that affordable and it takes years to get back what a person has invested into the solar power equipment.

How can a person live without the utility companies? An ISP provider is required for internet. ...I live in the city...if I told my friends that I was digging a well in the back yard to get off of city water...they would all laugh at me... Although I totally agree with the idea of getting off the grid...I just don't know how to do it...

In general, getting off the grid in good times requires one of two things:

1) Dramatically reducing your standard of living. Think no A/C, minimal heat, tiny living space, much more work done by hand (your hands), and such.

2) Spending a lot of money for alternative power sources and power saving strategies. The solar and wind generators are not cheap, and they don't really generate a lot of power.

In bad times, you basically have to either do #1 above or move out into the country where people will tend not to steal your solar panels and wind generators on a daily basis. And even at that, there is no guarantee.

[brunt]

x

[ashedfc]

Physical metals have returned a 19% ROI annually for me. I put a fair bit of my worth into metals in 2000-2003 and basically nothing since then. Even though I have been saving like the dickens ever since, metals have been growing at such a rate that they are still the same proportion of my worth since I bought them.

Still a fair bit of upward room left IMHO.

Stay PUT, they will magnify as other asset class are expected to shrink (in ratio) in the future.
Next week tuesday, rumors are of a massive QE from Fed, & bad news from Germany is the trigger for today's skyrocketing rise of Gold/Silver/PM/Bullion/etc/etc.
I have been telling my clients (& at public forum like SC), to added at least some (anything more than zero) into this asset class, & watch the debt mania unfold, first at individual (mortgage, credit cards, LOC, car loan, student loan, etc.), than corporates, now soverign. This game has to end somewhere. No one knows, what will happen when this music of money printing stops.

[brunt]

Stay PUT, they will magnify as other asset class are expected to shrink (in ratio) in the future.
Next week tuesday, rumors are of a massive QE from Fed, & bad news from Germany is the trigger for today's skyrocketing rise of Gold/Silver/PM/Bullion/etc/etc.
I have been telling my clients (& at public forum like SC), to added at least some (anything more than zero) into this asset class, & watch the debt mania unfold, first at individual (mortgage, credit cards, LOC, car loan, student loan, etc.), than corporates, now soverign. This game has to end somewhere. No one knows, what will happen when this music of money printing stops.

I too suggest that people should have at least 5% of their worth in metals. This has been my advice for over a decade now.

I got in at 35% of my net. It is now at 34%. Not a proportion that I would recommend for most.

I have no intention of getting out yet. My rule of thumb is that I will keep it until I feel that there exists another major equity class that is more undervalued than metals. If they exceed 50% of my worth, I will likely sell some to bring it back down to 35%.

[ashedfc]

When one adds Real Estate exposure, the whole equation changes. Its just people don't look RE as a portfolio (where the leverage & exposure is the highest). Most people have over 3/4 in RE & negligible in Gold, Silver, PM, etc.
Regarding technicals, it seems we are on verge of a parabolic move (but nothing can be predicted, as Central banks money printing has tremendous power). Long term there is lot of room upside.
Today mornings technical analysis is http://www.fmxconnect.com/fmxmetalsc...r-15-2010.aspx

[brunt]

When one adds Real Estate exposure, the whole equation changes. Its just people don't look RE as a portfolio (where the leverage & exposure is the highest). Most people have over 3/4 in RE & negligible in Gold, Silver, PM, etc.
Regarding technicals, it seems we are on verge of a parabolic move (but nothing can be predicted, as Central banks money printing has tremendous power). Long term there is lot of room upside.
Today mornings technical analysis is http://www.fmxconnect.com/fmxmetalsc...r-15-2010.aspx

Many have more than 100% in RE. If your house is valued at more than all of your net worth (including the house minus mortgage), then you effectively have more than 100% of your net worth in RE. I know many people in this position.

Leverage works wonders on the way up, and it is disastrous on the way down.