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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
 Posted - 08/07/2008 : 19:22:49
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What happened to $1,000 gold?
By Craig R. Smith, CEO Swiss America
May 1, 2008
Excerpts-
The recent pullback in the price of gold has sparked a slew of inquires as to just what precipitated the drop and if this is the end of the bull market in gold. The following is my analysis of the current market activity and prospects for gold's future.
There have been five prior “corrections” to the current long-term secular bull market in gold that began in 2001:
1. 2003 - Gold at $382 dropped to $319 for a 16% correction
2. 2004 - Gold at $425 dropped to $375 for a 13% correction
3. 2005 - Gold at $536 dropped to $489 for a 9% correction
4. 2006 - Gold at $725 dropped to $560 for a 22% correction
5. 2007 - Gold at $841 dropped to $778 for an 8% correction
Correction #6, from a March 17th high of $1002 to a low of $852 on May 1st, is 15% so far.
..................Secular bull markets in commodities tend to have a life of 15 to 20 years. I see the current gold market no differently.
.........While there may be more volatility and wider price swings in this market, it has been seven years in the making. It is very different from the rapid run up and run down we experienced in 1979-80. Therefore comparisons to 1980 are not valid.
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Gold and silver are going to have their up times and down times, just like all commodities. Just consider the decline in PMs as gold and silver taking the summer off to rest up for higher prices sarting in a few months.
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horgad
1000+ Penny Miser Member
USA
1641 Posts |
Posted - 08/08/2008 : 06:04:59
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| The chart sure looks ugly at the moment. August just can't end soon enough... |
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Neckro
1000+ Penny Miser Member
Saudi Arabia
2080 Posts |
Posted - 08/08/2008 : 06:08:45
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| Gold/silver at a lower price. Excellent chance to stock up. =) |
Trolling is an art. |
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horgad
1000+ Penny Miser Member
USA
1641 Posts |
Posted - 08/08/2008 : 08:57:51
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Gold is testing the May low of $850 right now. So far it is holding. A bottom here would be nice.
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Neckro
1000+ Penny Miser Member
Saudi Arabia
2080 Posts |
Posted - 08/08/2008 : 09:01:33
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| Haha, silver at 15.30 Maybe it might drop below 15 soon. =D Woot, more silver for my paper. |
Trolling is an art. |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 08/08/2008 : 15:55:55
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Aug 1 2008 3:00PM
Stalled Out
By Howard Ruff
Excerpt-
Gold and silver seemed to have stalled out, raising questions as to whether or not the bull market is still intact.
It still is! I remember during the bull market of the ‘70s when gold and silver stalled out for as much as two years with a decline of up to 30% on the way to their eventual highs of $50 silver and $850 gold. Then as now we heard a chorus of voices claiming the bull market was over, so liquidate! The fundamentals of money-supply growth were still in place, so I begged you to hang on, and we were eventually handsomely rewarded.
Today is the same, only more so. With government unfunded liabilities (for Social Security, Medicare and Medicaid) more than $50-trillion, and no end in sight, and government doing its ostrich act (head in the sand) hoping the pain will just go away, and their standard practice of just throwing money at every intractable problem, we have set the stage for continuing soaring inflation.
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Looks like history is repeating itself (or at least historical prices for gold and silver). I remember in 2006 as gold climbed up to and beyond $700 per ounce, only to get knocked down and remain below $700 for quite some time. Now gold has fallen from around $1,000 per oz. to $856. I am in no hurry to sell, I will just keep an eye on the prices and see what is what price wise when 2009-2010 roll around.
If history is any guide, PMs are not likely to decline back to 2001 prices until some central bank somewhere pulls a Volker and spikes interest rates to reign in inflation. |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 08/11/2008 : 19:52:45
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2006
Anyone recall 2006 and what happened to PM prices a few years ago?
Gold was in the low $700 range in 2006 when it dropped to the $600-$650 range.
Silver was at a peak for the year of $14 in 2006 when it fell and bounced around the $10-$12.90 range.
Both of these delines began in August of 2006 and gold's decline ended in September of 2007 while silver would bounce around the $12-$14 range until it stayed at $14 in September 2007 and went on from there. (Thank you Kitco for providing historical price information.)
Are we in for another year of depressed PM prices, or is this a short term decline? Either way the lower prices will weed out the weaker hands who will dump their holdings onto the market giving us a chance to buy more for less and a better quality of coin too.
This bull hasn't been corralled yet, so let it catch its breath and let it run after it rests a little.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 08/12/2008 : 17:54:23
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Still more words of encouragement-
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... Commodities have taken on major water too, and have led some pundits to write that the commodity bull market is over and is now a "bear market"... To that I say, HOGWASH! But, I've seen this many times in the past 6.5 years of the weak dollar trend... I was in Phoenix in May of 2003, and the USA Today had a headline that said, "China to slow, commodities to fall" or something like that... And it sent the commodities down the slippery slope, along with the commodity currencies of Aussie, New Zealand, Canada, and South Africa... Was it true then? NO! The same thing happened in 2005... Was it true then? NO! So, what gives traders the sure thought that it's right now?
People say... Hey, Chuck, the price of oil is dropping, isn't that great?....Ahem... The price of oil isn't dropping... The dollar is rising, thus pushing the price of oil down... That's two different scenarios there... If the dollar is "allowed" to return to the underlying weak dollar trend once again, the price of oil will rise again, and people will be throwing darts at the heads of oil companies again!
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gold ups & downs
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