Results 1 to 10 of 10

Thread: Bubbles are Popping

  1. #1
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Bubbles are Popping

    For those holding gold and other precious metals; oil and stocks; you might want to think about selling and locking in your profits. I just finished selling all my gold stocks and 80% of my coins as well as my energy stocks.

    The chief economist of Fortune Magazine, among others, agrees with me that gold, oil and stocks in general will follow real estate and seriously decline. For a while. I'll be on the sidelines for a while unless and until Obama becomes a closet Supply Sider and/or the Republicans retake the House.

    If, like me, you try to stay ahead of the curve, you might want to look at investing in agriculture. An increasing world population, a stagnant supply of arable land and a lot of unusually severe weather in many prime growing regions all point to likely supply problems for basic foodstuffs. Add in China's trillions of foreign reserves and their resultant ability to buy whatever they need to feed their people ( remember how many people live in China ) and it all says HIGHER PRICES for food.
    Last edited by Eric Stoner; 02-04-2010 at 01:34 PM.

  2. #2
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Bubbles are Popping

    Again there are a number of different 'schools of thought' where the (manipulated) price of Gold is concerned. The last time the price dropped anywhere near $1000 an ounce both China and India sold some of their US dollar foreign exchange holdings and bought gold. If this repeats, then gold has a de-facto $1000 'floor' price no matter what happens ... which may or may not justify cashing in present holdings given the spread / commission involved to sell and repurchase later.

    On the flip side, the upside on gold price ( in US dollar terms at least ) is a function of a lot of 'safety' perceptions. Thus any future mideast conflict, any future global impression that US gov't policy will be zero interest rates plus running the printing presses overtime, any major defaults on private sector or sovereign debt obligations etc. could spike the price upward. Thus 'holding' in expectations of a 'black swan' event is another option.

  3. #3
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Bubbles are Popping

    Quote Originally Posted by Melonie View Post
    Again there are a number of different 'schools of thought' where the (manipulated) price of Gold is concerned. The last time the price dropped anywhere near $1000 an ounce both China and India sold some of their US dollar foreign exchange holdings and bought gold. If this repeats, then gold has a de-facto $1000 'floor' price no matter what happens ... which may or may not justify cashing in present holdings given the spread / commission involved to sell and repurchase later.

    On the flip side, the upside on gold price ( in US dollar terms at least ) is a function of a lot of 'safety' perceptions. Thus any future mideast conflict, any future global impression that US gov't policy will be zero interest rates plus running the printing presses overtime, any major defaults on private sector or sovereign debt obligations etc. could spike the price upward. Thus 'holding' in expectations of a 'black swan' event is another option.
    Yeah maybe. But the price of gold relative to its cost of production is still very high.
    One reason it's price shot up so much was in repsonse to inflation fears. While they haven't disappeared, they have abated somewhat. Interest on the 10 yr. has declined. Oil has gone down.

    China and India could resume buying gold on the dips thus driving up the price. OR they could invest more in their own infrastructure OR even more likely use the money to buy food.

    Three things I always try to keep in mind with my investing :

    1. Pigs get slaughtered.
    2. Never be afraid to take a profit.
    3. No bubble lasts forever. They all burst sooner or later.

    If you follow Rules "1" and "2" you'll never get hurt. You might miss out a little bit but you'll never get left holding the bag.
    Last edited by Eric Stoner; 01-27-2010 at 02:30 PM.

  4. #4
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Bubbles are Popping

    Following my own advice, I've sold enough of my equity positions to be about 25% in cash; 25% in basic commodities including FOOD; 25% in high grade bonds and 25% in stocks - mostly high tech like Apple.

  5. #5
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Bubbles are Popping

    I told you so. The Dow is down well over 200 points; gold is down almost $50 an ounce and oil is down $4 a barrel.

    Corn, wheat and soybeans are all UP sharply.

  6. #6
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: Bubbles are Popping

    ^^^ the 'gold foil hat' crowd would tell you that the currency exchange rate volatility is the result of international 'judgement calls' as to whether the Eurozone, the US, or Japan is facing the worst relative situation re 'sovereign' debt distress. This week the bad news from Greece, Spain etc. have allowed the US $ to appear stronger than the Euro ... but in truth this is a 'least of the evils' situation. And yes 'hot money' is getting nervous and again returning to global commodities in a 'flight to safety'.

    As to the price of gold, the $1000 an ounce China / India 'put' remains in place as 'free' insurance.

    As to US stock indexes, did you happen to notice that the DOW dropped to precisely to 9999 before instantly rebounding ? Plunge Protection Team at work !

    ~
    Last edited by Melonie; 02-04-2010 at 06:12 PM.

  7. #7
    God/dess threlayer's Avatar
    Joined
    Aug 2003
    Location
    Syracuse
    Posts
    5,921
    Thanks
    369
    Thanked 419 Times in 290 Posts
    My Mood
    Fine

    Default Re: Bubbles are Popping

    "unusually severe weather" where have I heard that one before?

    Three things I always try to keep in mind with my investing :

    1. Pigs get slaughtered.
    2. Never be afraid to take a profit.
    3. No bubble lasts forever. They all burst sooner or later.
    And number four" don't let your greed get ahead of your head.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

  8. #8
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Bubbles are Popping

    Quote Originally Posted by threlayer View Post
    "unusually severe weather" where have I heard that one before?


    And number four" don't let your greed get ahead of your head.
    No. That's just a rephrasing of Rule Number "1".

  9. #9
    God/dess threlayer's Avatar
    Joined
    Aug 2003
    Location
    Syracuse
    Posts
    5,921
    Thanks
    369
    Thanked 419 Times in 290 Posts
    My Mood
    Fine

    Default Re: Bubbles are Popping

    But it is much better phrased.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

  10. #10
    Banned Eric Stoner's Avatar
    Joined
    Oct 2006
    Location
    NYC
    Posts
    5,150
    Thanks
    1,261
    Thanked 1,430 Times in 888 Posts

    Default Re: Bubbles are Popping

    Quote Originally Posted by threlayer View Post
    But it is much better phrased.
    You say : toemaytoe - I say: toemaahtoe.

Similar Threads

  1. Popping The Question
    By mariesgame in forum Hustle Hut
    Replies: 16
    Last Post: 08-01-2011, 11:57 PM
  2. More Asset Bubbles Ready to Pop ?:
    By Eric Stoner in forum Dollar Den
    Replies: 6
    Last Post: 11-03-2009, 06:00 PM
  3. Replies: 2
    Last Post: 08-08-2009, 10:29 AM
  4. Bubbles in nail polish
    By LilyLove in forum Body Business
    Replies: 16
    Last Post: 04-30-2008, 03:34 AM
  5. Popping the question
    By NewMoon in forum Hustle Hut
    Replies: 6
    Last Post: 12-21-2007, 08:20 PM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •