Time to start accumulating oil and gold
- Thread starter mulder
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Ian Curtis
Established Member
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I'm not into the market scene, but then what is this:
The gold price has increased a lot, only to have lowered a bit recently...its not really at the bottom is it?
The gold price has increased a lot, only to have lowered a bit recently...its not really at the bottom is it?
The Gardener
Senior Member
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- 25
Depending on how things pan out, oil might get really cheap.
And I mean REALLY cheap.
My only heartburn with gold is that its only truly beneficial as a store of wealth in an inflationary scenario. We may very well have inflation, but only after what appears to be a deflationary cycle, which I don't believe we are close to turning a corner on. Additionally, gold is, in effect, a "short" on currency. And those who profit most from the currency regime, the central banks, are overwhelmingly the largest owners of gold on the planet. I'd hate to invest in gold as a currency short, and then have the central banks cross the shorts en masse and make a killing. Its risky to bet on a commodity when the majority owners of said commodity have a vested interest on you losing your bet.
I'm not down on gold... I just think its a bit premature. Just my opinion... there are plenty who disagree with me and have valid arguments, but I'm just presenting an alternative view.
I think this is a good time to be accumulating physical dollars, and storing them in a place where they have good liquidity. A savings account for now... and maybe a mattress later if we continue down our current trajectory (god forbid we reach this point).
And I mean REALLY cheap.
My only heartburn with gold is that its only truly beneficial as a store of wealth in an inflationary scenario. We may very well have inflation, but only after what appears to be a deflationary cycle, which I don't believe we are close to turning a corner on. Additionally, gold is, in effect, a "short" on currency. And those who profit most from the currency regime, the central banks, are overwhelmingly the largest owners of gold on the planet. I'd hate to invest in gold as a currency short, and then have the central banks cross the shorts en masse and make a killing. Its risky to bet on a commodity when the majority owners of said commodity have a vested interest on you losing your bet.
I'm not down on gold... I just think its a bit premature. Just my opinion... there are plenty who disagree with me and have valid arguments, but I'm just presenting an alternative view.
I think this is a good time to be accumulating physical dollars, and storing them in a place where they have good liquidity. A savings account for now... and maybe a mattress later if we continue down our current trajectory (god forbid we reach this point).
hair_tomorrow
Senior Member
- Reaction score
- 5
I don't really buy or sell stocks but my retirement money is tied to the stock market. Last time I looked at my accumulated total was when the DOW was at 14,000. I haven't checked my bottom line since the big slide.
Can't speak to gold prices but as far as the price of a barrel of oil bottoming out goes, just when I think it couldn't get any lower, it STILL manages to drop a few bucks - which at the very least translates into a significant savings (here in America anway).
I don't know how long I went without being able to fill my gas tank in the ol' Jeep. But this morning, $20.00 gave me 3/4 of a tank (which should last me until my next paycheck). Got gas for $1.699 per gal.
My house has electric heat (useless) and a supportive pellet stove which really cranks out the BTUs - but I'm sure people that are filling up their home gas or oil tanks are appreciative about the current price drop. I just hope they didnt all fill their tanks at the end of the summer when prices were still sky high.
It's only gonna be a matter of time before the OPEC nations get together and reduce their oil production - which will push prices back up again. I don't have a crystal ball or anything - but I think that's going to happen sooner than later - let's say in 2.5 weeks (don't ask where I got that figure).
So, oil might get a little lower - but if it hasn't really bottomed out - I think we're pert near the bottom, as TPTB won't allow it to get much lower.
Once OPEC drops the hammer - I just hope it doesn't get so bad that we go back to gas lines or only being able to buy gas on alternate days. They can really wreak havok depending upon how much they curtail production.
Can't speak to gold prices but as far as the price of a barrel of oil bottoming out goes, just when I think it couldn't get any lower, it STILL manages to drop a few bucks - which at the very least translates into a significant savings (here in America anway).
I don't know how long I went without being able to fill my gas tank in the ol' Jeep. But this morning, $20.00 gave me 3/4 of a tank (which should last me until my next paycheck). Got gas for $1.699 per gal.
My house has electric heat (useless) and a supportive pellet stove which really cranks out the BTUs - but I'm sure people that are filling up their home gas or oil tanks are appreciative about the current price drop. I just hope they didnt all fill their tanks at the end of the summer when prices were still sky high.
It's only gonna be a matter of time before the OPEC nations get together and reduce their oil production - which will push prices back up again. I don't have a crystal ball or anything - but I think that's going to happen sooner than later - let's say in 2.5 weeks (don't ask where I got that figure).
So, oil might get a little lower - but if it hasn't really bottomed out - I think we're pert near the bottom, as TPTB won't allow it to get much lower.
Once OPEC drops the hammer - I just hope it doesn't get so bad that we go back to gas lines or only being able to buy gas on alternate days. They can really wreak havok depending upon how much they curtail production.
The Gardener
Senior Member
- Reaction score
- 25
Epic mistake.squeegee said:Good post! Yeah it is time to buy!unk:
My humble opinion:
Common stock is a claim on corporate earnings, and we are NOWHERE near turning a corner on the earnings environment. Job losses are accelerating, corporations are scaling back on expenses, and consumer demand is in freefall. This is NOT driven by a bad business cycle, as most downturns are.... which is why this is NOT a good downturn to buy into. This downturn is driven by a deleveraging of credit, which is continuing and accelerating unabated.
Now, this is not to say that I don't think that stock equities prices will inevitably bounce back up... its just that folks like me who lived through the 1970s know that the stock market can bounce along the bottom for SEVERAL YEARS before any hint of bullishness returns. And in the meantime, you've missed out on OTHER asset classes that could have been yielding you better returns.
In a deflationary deleveraging, the debt markets are attractive. Cash is scarce, so anyone that has money to lend out on the short term will get a premium return on it. How do you participate in this? Invest money in a bank issued CD account. Even in the midst of this economic meltdown, these CDs are offering a guaranteed 5% plus return on your money, and they are FDIC insured. I challenge anyone to beat those terms in this environment. Stocks have had their run for decades, and now they are WAY out of favor at this time and probably will be for a long time. When people are broke, having their credit lines snipped down or removed, are underwater in their mortgages, and are in fear of losing their jobs, the FIRST thing they do is stop gambling in the stock market, and they instead start saving their money somewhere stable. All things have their cycles. You need to consider other asset classes, the CDs being one class I am throwing out here as an example but there are many others.
I really can't underscore enough how serious of a crisis we are in. I really think you all need to take stock of your situations and anticipate some hard times ahead. This is a time to be kissing arse to your employer, and doing what you can to make yourself "indespensible" to your boss. There will be no quick money to be made on Wall Street, we are entering a "rebalancing" of sorts, a "reckoning" of two to three decades of built up excesses, built up trade deficits, built up government deficits, and most importantly built up excess credit being lent out... and the only money to be made will be that made by your own sweat and HARD WORK at your JOB, provided hopefully you keep it. This is a time when the best way to build wealth will be through honest living and honest savings.
hair_tomorrow
Senior Member
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- 5
Oil just fell $2.86 per barrel ($40 something a barrel now vs. $100+ per barrel not too long ago). FOX News reports that it could go down to $20 per barrel which could bring the price of 1 gal of gas to $1.00.
They didn't mention OPEC though - and again, I think OPEC is gong to act soon. No way they'll let the price drops keep coming.
They didn't mention OPEC though - and again, I think OPEC is gong to act soon. No way they'll let the price drops keep coming.
hair_tomorrow
Senior Member
- Reaction score
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When the price of gas first started soaring, Americans started cutting back on their mileage. What's interesting is - that even though the price of gas has come down, we haven't been driving more.