21
October
GoldCore Update: Niall Ferguson: "Dollar is Doomed; US Empire is Finished"
Gold
Gold is trading at $1.056/oz this morning and traded in a very tight range overnight. In EUR and GBP terms, gold is trading at €707/oz and £638/oz respectively.
With oil and the dollar trading near their respective recent highs and recent lows, gold continues to be well supported. It appears to be consolidating after its recent break out above previous resistance around $1,030/oz. Gold was up yesterday despite weakness seen in equity markets in the US and this equity weakness has continued in Asia and Europe. Should we have another sell off in stock markets (which looks likely) gold may also fall and be correlated in the short term. However, as seen in recent years gold will likely fall by less and recover quicker meaning that the correlation will be only in the short term. In the medium and long term, gold is inversely correlated to equities (and currencies) and this is why it remains an important diversification for prudent investors.
Concerns about the health of the US economy and the dollar, and concerns about the decline of American power in a globalised multi polar world with an increasingly powerful China (see Niall Ferguson interview at The Economist’s Buttonwood Gathering on our home page), shows why gold remains an important and essential long term investment.
Silver
Silver is currently trading at $17.46/oz, €11.68/oz and £10.54.
Platinum Group Metals
Platinum is trading at $1,375/oz and palladium is currently trading at $342/oz. Rhodium is trading at $1,800/oz and has broken out and looks robust and could see further gains.
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1 Comments Add Comment
Not news to me
In the seventies I saw the beginnings of the economic malaise in the US.
As a hobby I acted as a finder of machinery for the pressure vessel and piping business belonging to a neighbor and close friend.
At first I attended hundreds of machinery liquidations and saw the bulk of the US metalworking industry evaporate under the auctioneers gavel.
I have commented many times "I would go to an auction just for the hotdogs."
It didn't take me long to figure out that these sales were a rigged operation comprised of dealers, auctioneers and shills.
My modus then became a practice of knocking on doors and offering to buy idle or surplus machinery for cash.
In this role I eliminated the middle men and equipped my own machine shop for about twenty five cents on the dealer dollar.
Many of the middle management people I approached to negotiate such sales had larcenous streaks to say the least.
Fiat Franklins usually did the trick, however.
In the eighties it occurred to me that the US was on a one way trip into an economic sinkhole and I started to convert my leverage wad into metals.
Presently I have about thirty years average income in an Au and Ag position, a thousand-odd gallons of diesel fuel and five or six years supply of fuelwood to heat my elaborate machine shop which really was only a hobby though I ran it as a business primarily for tax purposes.
I live in a self designed and built passive solar house.
I am a preppy and alumnus of an ivy league university.
My first dicipline was electrical engineering.
Finding the corporate politics annoying I turned my skills to more adventureous persuits.
For many years I had a regular route of machinery dealers, salvage yards and even landfills along the East Coast.
Wisdom , and stuff, is where you find it and seldom where you seek it.
The lawyers have kicked us out of the salvage yards and the enviornmentalist morons have stoppped us from sensible recycling.
The machine dealers have gone the way of the rest of our manufacturing industry.
I still can't resist a ten dollar Harris Tweed jacket at the local thrift shop, however.
I will probably keep adjusting my plan until they put me in the box and light the gas.
This article is one of many placed in my mental database from used to adjust my course.
It is good to be in such great company.