Investing

[Screwball]

26 minutes ago, Deleterious said:

Gold broke through $5,000 tonight.

As I type this at 9:03, Gold is $5072 and some change, and Silver is $107 and change. This is nuckingfuts.

[oblong]

What’s the context?  Like what do you think it means going forward?  I’m ignorant to this stuff but I saw it mentioned elsewhere too. 

[gehringer_2]

14 minutes ago, oblong said:

What’s the context?  Like what do you think it means going forward?  I’m ignorant to this stuff but I saw it mentioned elsewhere too. 

the phrase is attributed (likely wrongly) to Baron Rothschild, "when there is blood in the streets, even if it's your own  - BUY"

[Screwball]

56 minutes ago, oblong said:

What’s the context?  Like what do you think it means going forward?  I’m ignorant to this stuff but I saw it mentioned elsewhere too. 

I go by charts. It's hard to explain in a short paragraph what they mean. Using charts, known as technical analysis, is a long time science that started over in Japan many years ago. Charts are a visual history of how "things" trade - price. One of the main things they do is give the people in the market entry/exit points to trades. They talk about this every day on the business channels. It helps both institutional and retail investors. The best computer geeks on the planet who work for the pigmen of Wall Street write their HAL 9000 trading algorithms on this stuff.

My point, some charts look normal, and then there are some that don't. Gold and Silver look like hockey sticks right now - that isn't how it works. They are going up way to fast way too quick. It kind of reminds me of back in...2007 ish... crude oil did the same thing. Went from..don't remember, around a hundred maybe to $147. It looked like a hockey stick on the chart. It became exponential. Then it was 2008 and we know what happened. Some economists think the oil shock started the credit/housing mess. I think they are right.

The gold/silver thing is different. American's sucks up 20% of the worlds crude, which is our lifeblood of growth. Gold and silver isn't near as important of commodity. But a message? The gold/silver (they usually trade about the same way even though silver has industrial value) thing is about our currency. The value of the dollar trades on the world markets each and every day. Like going to Canada and the exchange rate you get. So many dollars buys so many CAD.

One might say (well, many) going long Gold is shorting the currency of the United States. This topic has been argued forever in the political realm between the Keynesian's and Von Mises wings of monetary policy. The "gold bugs." Some say this is all retail moving the price. I don't know. The old intrinsic value of an asset or "specie" as they said before that kind of thing.

What I do know, this ain't normal. 

 

 

[Deleterious]

FOMO is part of it, which is true for most trends in investing.  The weak dollar is definitely another part of it.  The dollar is off by about 10% since Trump took office.

Flight to safety is another big driving force.  People think the market is due for a downturn.  Treasuries would be a normal spot to park money coming out of the market.  But the president is on TV every other day demanding the Fed lower interest rates.  Lower rates equal lower yields on treasuries.  So some people are turning to gold.  The odds of a shutdown also went up this weekend after the shooting.  Democrats will not pass any funding bill that includes funding for ICE, where they probably were going to before this weekend's events.  

A more simple answer.  Lack of confidence in US fiscal policy.  

[gehringer_2]

11 minutes ago, Deleterious said:

FOMO is part of it, which is true for most trends in investing...

yup. Also more generally there is a lot of investable wealth chasing relatively few interesting investment opportunities - increases herd behavior and volatility in general.