The GOLD scream room

Discussion of the Gold portion of the Permanent Portfolio

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Kriegsspiel
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Re: The GOLD scream room

Post by Kriegsspiel » Tue Aug 14, 2018 2:45 pm

Gold is really sperging out. Major lame. I'm going to get drunk and play a child's game.
barrett
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Re: The GOLD scream room

Post by barrett » Tue Aug 14, 2018 3:07 pm

Cortopassi wrote:
Tue Aug 14, 2018 2:13 pm
The previous scream room post was Aug 3, 11 days ago!

Have we all moved onto the Acceptance stage?
My expectation for gold over the long haul is that it will do well in times when the USD is weak for extended periods. The link below is interesting:

https://www.macrotrends.net/1335/dollar ... -ten-years

Not sure why it says it's a ten year chart... when I pull it up I am seeing the gold/USD relationship all the way back to 1995, so almost 23 years of data. During the big run up in the 2000s, the USD was pretty weak in general. The relationship is far from being reliable in the short term but you can see, for example, that the low point in the USD in 2011 was pretty close to the high point in gold. The part of me that wants this relationship to REALLY make sense tells me that the last few hundred dollars of run up in 2010 and 2011 was largely a speculative bubble. Irrational Exuberance.

So, yeah, acceptance within this "understanding" of gold's price. As long as the stock market continues to hum along I expect gold to lag (and hopefully I'll be sensible enough to rebalance into it from time to time). Just my two cents.
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Cortopassi
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Re: The GOLD scream room

Post by Cortopassi » Tue Aug 14, 2018 3:37 pm

barrett, not sure that chart is accurate, or what info does it pull for the dollar basket? The dollar quote I use is this:

https://www.marketwatch.com/investing/index/DXY

which is currently about 96.69, but the chart is showing the dollar, at least as of a couple weeks ago at 124, which is not even close?
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Re: The GOLD scream room

Post by barrett » Tue Aug 14, 2018 4:33 pm

Cortopassi wrote:
Tue Aug 14, 2018 3:37 pm
barrett, not sure that chart is accurate, or what info does it pull for the dollar basket? The dollar quote I use is this:

https://www.marketwatch.com/investing/index/DXY

which is currently about 96.69, but the chart is showing the dollar, at least as of a couple weeks ago at 124, which is not even close?
That's an excellent damn question, Cortopassi! One sure can find all kinds of wacky gold and USD charts on the intraweb. While the absolute numbers on our two charts are quite different, they look fairly similar to me when looked at over the past three years (seems to be the only common timeframe of any meaning that I can get on both charts).

This FRED link seems to be pulling from the same basket as the first link I posted:

https://fred.stlouisfed.org/graph/?g=33vD

And on the FRED chart, the weak USD/strong gold (and vice versa) relationship holds true for the most part.
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buddtholomew
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Re: The GOLD scream room

Post by buddtholomew » Tue Aug 14, 2018 5:49 pm

I’ve always thought that a strong USD was the Achilles heal of the PP. With that in mind, I considered buying UUP until learning that the currency fluctuations were a wash over time according to Boglehead philosophy.

There is currently a positive relationship between a strong USD and SCV (not sure if this is historically true or the tariffs are contributing to domestic SC gains).

SCV has mitigated GLD losses this year and I am hopeful that holding this asset will continue to fill this void in the PP. Obviously this is the Golden Buttefly but do others see the strong USD a problem for the PP to mitigate?
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Re: The GOLD scream room

Post by modeljc » Tue Aug 14, 2018 6:16 pm

Gold is a precious metal. It so valuable that you can buy it at the cost of production! About $1100. Back up the truck. Get all you want. I do believe in PP. But it's a hard sell for all my friends. Think 1982 when interest rates were high. Went from $850 to $250. A little correction but it was a long one. Only about 20 years. All you lost was collecting the simple rate of interest. Now it is close to the cost of production. Maybe a store of value. Do you really want some! BUT if you bought it at $1900 probably not in my mind.
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Re: The GOLD scream room

Post by barrett » Tue Aug 14, 2018 7:06 pm

buddtholomew wrote:
Tue Aug 14, 2018 5:49 pm
I’ve always thought that a strong USD was the Achilles heal of the PP...
Looks like the FRED Trade Weighted U.S. Dollar Index includes includes currencies from the Euro Area, Canada, Japan, Mexico, China, United Kingdom, Taiwan, Korea, Singapore, Hong Kong, Malaysia, Brazil, Switzerland, Thailand, Philippines, Australia, Indonesia, India, Israel, Saudi Arabia, Russia, Sweden, Argentina, Venezuela, Chile and Colombia.

Don't know enough to answer your question, budd, but a strong USD would obviously be good for American companies that are importing raw materials to make stuff with. So quite possibly good for stocks while being bad for gold.

Not sure if or how this applies to the information economy though...
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Re: The GOLD scream room

Post by boglerdude » Wed Aug 15, 2018 1:51 am

Oh no, a strong currency. Those poor Swiss, cant export their chocolate and clocks :/
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ochotona
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Re: The GOLD scream room

Post by ochotona » Wed Aug 15, 2018 7:11 am

This thing is really breaking down today
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Cortopassi
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Re: The GOLD scream room

Post by Cortopassi » Wed Aug 15, 2018 7:43 am

When it happens it seems never ending.

My cash position is almost getting close enough for a rebalance. I sense TLT and GLD will carry the day come later this year and next. But that would be a prediction, which is >50% likely wrong.
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Cortopassi
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Re: The GOLD scream room

Post by Cortopassi » Wed Aug 15, 2018 8:00 am

Does anyone else look at lines and domes and head and shoulders and other such graphics drawn in technical analysis and call bullshit like I do? You can draw this rounding bottom in any manner you'd like and start at any year. Someone could take this same exact plot and show why silver will go down for years as well I bet.

Straight sloped lines that connect peaks and valleys to draw wedges, etc. They are all so subject to interpretation. It's like astrology.

Image
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buddtholomew
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Re: The GOLD scream room

Post by buddtholomew » Wed Aug 15, 2018 8:37 am

Where are all the “big shots”?
Calling techno...
What’s the plan?
Au still the be all end all...
I don’t think so.
It’s such a small portion of my portfolio it’s irrelevant now.
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