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Gold hits all time high

goldprice.org

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Re: Gold hits all time high

#91

Post by m101 »

grafmax wrote: post #47
m101 wrote: post #22

The drivers of this in my view are: 1) flight from USD assets given views that one cannot depend on US assets as safe havens 2) central banks increasing gold holdings 3) purchases by Chinese investors as they have few places to invest their money 4) concern around debt levels deficits and democratic process ability to fix this 5) concerns around central bank independence, and hence inflation targeting, being undermin…

> and democratic process ability to fix this Actually we’ve shifted into authoritarianism and confidence has only worsened.

I assume you are labelling trump the authoritarian. He has very little ability to impact on the majority of US spending, whilst a true authoritarian should be able to. The system has been corrupted to such an extent that it is basically impossible to change.

Re: Gold hits all time high

#92

Post by vladimirralev »

glial wrote: post #60
vladimirralev wrote: post #27

Good time to remind everybody that the Fed, the US central bank, prices gold at $42.22 for some reason and nobody questions it ever. And all those dignified educated respectable board members and econ PhDs give speeches about science-based market economy, maintaining credibility and staying away from politics while caring about the wellbeing of households and families.

> nobody questions it ever Seems like anyone who buys or sells gold at any other price is questioning it.

Well, please show me any mainstream finance media that questions it. The Fed has a monthly press conference, I don't think they were asked even once in the last 10 years at least... Most of the buying now is from Asia supposedly.

Re: Gold hits all time high

#93

Post by mikestew »

nixass wrote: post #3

Other than for few years in mid 2010s gold seemed to be at ATH most of the time

That’s because no one prints headlines that read “Gold has been in a trading pattern for the past six months, 15% below its ATH”, or at least that headline didn’t stick in your mind like “ATH!!!” does.

As a sibling comments outlines, gold is actually quite volatile and risky versus returns, and your returns will very much depend on when you bought it.

Re: Gold hits all time high

#94

Post by jack_h »

onlyrealcuzzo wrote: post #50
paxys wrote: post #25

Gold, silver, stocks, real estate, Bitcoin, baseball cards, fine art, Rolexes - everything is trading at or near their all time highs. The value of the US dollar is simply going down.

Fiat money is not going down as much as asset prices are going up, though. So it's part of the story, money losing value in the real economy. That's been happening since moving off the gold standard at roughly similar rates. There's something that happened during ZIRP & Negative Real Interest Rate Policies that completely divorced the value of money in the real economy from the value of assets & future cash flows, an…

> There's something that happened during ZIRP & Negative Real Interest Rate Policies that completely divorced the value of money in the real economy from the value of assets & future cash flows

I’m not sure I follow. The USD is just a medium of exchange. 100% of the dollars commands 100% of the wealth of the economy. If you increase the number of dollars but the size of the economy itself doesn’t increase then the underlying prices would go up and the value of individual dollars would go down.

Re: Gold hits all time high

#95

Post by m101 »

ambicapter wrote: post #44
GeekyBear wrote: post #32

Earlier quoted context omitted.

We've also had four big rounds of Quantitative Easing from the Fed since the financial crisis, with the most recent coming right after the pandemic. https://www.wikipedia.org/wiki/Quantitative_easing

This really feels like the original sin to me (I am not remotely an economist). Perhaps it can just be fixed with taxes to take money out of circulation.

Central bank money printing is morally bad given it's largely used to bail out either irresponsible government spending, or irresponsible private sector actors.

Central banks could reduce their balance sheets significantly more (and until recently the pace was pretty quick), but given where things are today it will undoubtedly be pretty politically unpalatable to do so (bond markets puking, making deficits even worse in the face of an inability to cut spending).

Re: Gold hits all time high

#96

Post by floxy »

AnimalMuppet wrote: post #56
snickerbockers wrote: post #19

What is it about gold, anyways? None of its useful properties were known until recently (and mostly overhyped and upsold tbh, at least as far as those stupid cables go). Are we really just instinctively attracted to shiny metals? Or do people like it as a status symbol? (not to act like im above it all, i still have my gold-plated pokemon jigglypuff trading card from burger king in 1999 and i often use golden paint o…

Basically, the chemical composition of the earth's crust isn't going to change any time soon. That means that the supply of gold is going to increase only slowly. In contrast, Trump has been making noises about wanting to replace Powell as chair of the Fed, because Powell won't dance to Trump's tune. I do not want a world where Trump can determine (even if indirectly) the value of the dollar, or the interest rate, or…

>That means that the supply of gold is going to increase only slowly.

https://www.space.com/astronomy/earth/earths-next-mini-moon-...

Re: Gold hits all time high

#97

Post by rayiner »

jack_h wrote: post #94
onlyrealcuzzo wrote: post #50

Earlier quoted context omitted.

Fiat money is not going down as much as asset prices are going up, though. So it's part of the story, money losing value in the real economy. That's been happening since moving off the gold standard at roughly similar rates. There's something that happened during ZIRP & Negative Real Interest Rate Policies that completely divorced the value of money in the real economy from the value of assets & future cash flows, an…

> There's something that happened during ZIRP & Negative Real Interest Rate Policies that completely divorced the value of money in the real economy from the value of assets & future cash flows I’m not sure I follow. The USD is just a medium of exchange. 100% of the dollars commands 100% of the wealth of the economy. If you increase the number of dollars but the size of the economy itself doesn’t increase then the un…

That’s not accurate for two reasons. First, the dollar isn’t just a medium of exchange, but a medium for storing value since it’s the reserve currency. Second, a dollar can get spent multiple times so there isn’t a direct relationship with the amount of economic activity as you suggest.

Re: Gold hits all time high

#98

Post by bryanlarsen »

GeekyBear wrote: post #32
m101 wrote: post #22

The drivers of this in my view are: 1) flight from USD assets given views that one cannot depend on US assets as safe havens 2) central banks increasing gold holdings 3) purchases by Chinese investors as they have few places to invest their money 4) concern around debt levels deficits and democratic process ability to fix this 5) concerns around central bank independence, and hence inflation targeting, being undermin…

We've also had four big rounds of Quantitative Easing from the Fed since the financial crisis, with the most recent coming right after the pandemic. https://www.wikipedia.org/wiki/Quantitative_easing

The significant post-pandemic inflation came during a period of Quantitative Tightening.

Re: Gold hits all time high

#99

Post by MountDoom »

pizlonator wrote: post #84
MountDoom wrote: post #75

Earlier quoted context omitted.

Pretty long, given that the US had a fully-fiat currency for 50+ years, and many European countries had it for longer than that. Per CPI, your dollar is worth 8x less than what it was worth in 1970. This, in itself, doesn't mean anything profound. There's nothing to "snap" if the expectation of stable, modest inflation is baked into the markets. Fiat currencies usually implode only when something else undermines the…

The issue is that we're seeing asset price inflation that is far greater than CPI In other words, we have two different inflations happening at once, leading to people who happened to own the right assets getting richer and everyone else getting poorer. I don't think that's what an efficient market would do, which implies that efficiency will kick in at some point and BOOM

> In other words, we have two different inflations happening at once

CPI is just an index of consumer prices. It's like saying that we have two stock markets because Nvidia is going up faster than Costco.

> People who happened to own the right assets getting richer and everyone else getting poorer

It's not a zero-sum game. Almost everyone is more wealthy than their peers 30-40 years ago.

Wealth disparities widen, but the reasons for this are complex and go beyond inflation. And frankly, many of them are self-inflicted. Every single housing development in my neighborhood is thoroughly protested by everyone. And most of what my city officials do is inventing new rules and regulations. They're not working for big corporations or the federal government.

> I don't think that's what an efficient market would do

Sounds like you spotted an arbitrage opportunity?

Re: Gold hits all time high

#100

Post by xhrpost »

thanhhaimai wrote: post #61
xhrpost wrote: post #31

Earlier quoted context omitted.

>flight from USD assets given views that one cannot depend on US assets as safe havens I keep seeing this but then I also keep seeing the opposite: https://finance.yahoo.com/news/foreigners-buying-us-stocks-r...

I think you're conflating between 2 different things: the USD and US stocks from US companies. - The USD is definitely losing value. That also means stocks from US companies would be cheaper from a foreigner's point of view. - That means it represents good investment opportunity as long as the fundamentals of those companies are not affected too much (e.g. AI companies not directly affected by workers' raid, or pay t…

I understand what you're saying but I don't think I'm conflating. OP specifically said "USD assets", which I took to mean things like stocks.
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