Archive through December 27, 2005

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archer

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Post Number: 1206
Registered: 11-2002

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Saturday, December 10, 2005 - 10:40 am:

Hilarius
Thats exactly what the poms said about gold as they sold
300 tonnes for 270 dollars
I'll leave you to work out how many billions they have lost on that trade
------
Yawn--Gold up 7.10 overnight
Here is a list of central banks STILL selling gold
At some point in the coming months/years its going to dawn
on them that they are selling one of the best performing
asset classes in the world,and they will stop selling
What will happen to the price of gold then
http://www.financialsense.com/fsu/editorials/2005/1208c.html
------
“David Walker, U.S. Comptroller General warned that the U.S. would face a “fiscal hurricane.” He said, “We face a demographic tsunami” that will “never recede.” The top budget chief explained that ageing baby boomers will present fiscal challenges as benefits swamp future budgets. Former Fed Chairman, Paul Volcker warned that America’s deficits cannot persist forever, “The United States is absorbing 80% of the net flow of international capital and at some point, both central banks and private institutions will have their fill of dollars…
------
GOLD HAS EXPLODED AGAINST ALL CURRENCIES especially those that everyone had considered the strong currencies of the world. Just go to Kitco.com and review the charts of gold against the once mighty Euro and the Yen.
------
Appealing To Occam’s Razor to Explain Gold Above $500
In other words, in 2005, the price of gold has risen not only in dollar terms, but in terms of most foreign currencies. WHY????????
Gold is a sterile asset. It pays no dividend or interest. Gold’s appeal as an investment asset comes
into play when central banks no longer provide for a positive inflation-adjusted return on short-term
investments – that is, when the yield on the central bank’s policy interest rate (or some related
money market rate) is below the inflation rate. In this case, gold becomes a better store of value
than short-term money market instruments denominated in fiat currencies.
So, we do not have to conjure up a lot of convoluted hypotheses as to why the price of gold is
soaring against paper currencies. Rather, we can appeal to Occam’s Razor (Google it) in coming up
with an explanation – global investors are losing faith in, as Jim Grant calls them, faithbased
paper currencies as a store of value.
http://www.sortweb.com/cwsimages/Miscfiles/2293_dd120805.pdf

archer

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Post Number: 1207
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Saturday, December 10, 2005 - 11:32 am:

Gold up to a 24 year high last night
U.S gold indexes finished DOWN last night
Some thing is WRONG here
I think there is a big game of "chicken" going on at the moment
On the one hand there is HUGE buying of real gold by people
who are losing faith in currencies-enough buying to easily
overcome accelerated selling by central banks
But as you can see from the chart below the HUI index is at
the previous highs when gold was at 400 in Dec 03 and when
gold reached 450 in Dec 04
There are some large short positions held in the gold shares
that make up the index
Either the real gold buyers have had there fill and gold
corrects or the buying continues and the stock shorters
realise they are on the losing side of the trade and cover
setting up an explosive move in the gold stocks
So who is going to chicken first
If the gold and silver futures traders who are asking for
delivery of physical metal(noted in above post)go thru with
their threat the stock shorters will experience considerable
pain
The silver situation is more extreme and it should continue
to out perform gold

hui

archer

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Post Number: 1208
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Saturday, December 10, 2005 - 11:36 am:

An economist on gold
I meet with US portfolio managers every day and the growth guys cannot
understand gold because there are no earnings. The value guys do not know how
to value it. But the story on gold, like any other commodity, is supply and
demand. Now it’s true that gold has no practical industrial use. But what it does
have is this intrinsic attribute of not having any substitutes.
http://www.sortweb.com/cwsimages/Miscfiles/2295_Merrill.pdf

zorba

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Post Number: 85
Registered: 12-2003

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Saturday, December 10, 2005 - 08:16 pm:

Archer

Is it possible to actually buy gold stocks or the real gold bars?

Zorba

archer

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Post Number: 1209
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Sunday, December 11, 2005 - 10:40 am:

Zorba
Yes you can buy gold in many different size bars
I will buy more when it corrects to around 480
This is just one Sydney dealer i use-there are many others
http://www.jaggards.com.au/news/medusa/article_7.asp

greatdane

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Post Number: 207
Registered: 12-2002

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Sunday, December 11, 2005 - 11:12 am:

Zorba,
Here are some other ways to invest in gold.

Benefits include:
- No manufacturing premium payable.
- No insurance cost
- No storage fees.

The Perth Mint Certificate Program (PMCP) is operated by Gold Corporation, an international precious metals refining, minting and trading group wholly owned by the Government of the State of Western Australia.
The Program offers investors a unique range of precious metal storage options on attractive terms, under Government Guarantee. The PMCP is the only Government Guaranteed certificate program in the world.
The Perth Mint Certificate gives you legal title to precious metals deposited on either an Allocated (segregated) or an Unallocated (unsegregated) basis with The Perth Mint. The Certificate is in your name and identified by a Certificate number. The Perth Mint also assigns a client code to ensure the confidentiality and security of your storage account. http://www.perthmint.com.au/gc/depository/depository_layout2.asp?url=6

Article from World Gold Council’s Gold magazine:
“You don’t have to worry about physical storage or security as the
certificate gives you guaranteed proof of ownership and it is backed 100% by real gold”
http://www.perthmint.com.au/gc/depository/pmcp/WGCMagazineArticle.pdf

Another option:
The Perth Mint Gold Quoted Product ("PMG") is essentially a right created on-market by Gold Corporation to enable you to invest in gold on the Australian Stock Exchange ("ASX"). PMG is structured as a call warrant in accordance with the ASX Business Rules. Each PMG entitles you to acquire one hundredth of a troy ounce of fine gold on or before the Expiry Date of 31 December 2013 and may be exercised by you at any time before the Expiry Date.
PMGs trade on the ASX under the code ZAUWBA. PMGs can be purchased by investors only on the ASX. They cannot be purchased directly from Gold Corporation.
http://www.perthmint.com.au/gc/depository/perthmintgoldasx.asp
}

Regards, GreatDane

hilarius

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Post Number: 1361
Registered: 04-2004

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Sunday, December 11, 2005 - 12:11 pm:

Good Afternoon

Using compound interest it would be interesting to calculate the current value of the UK government's seemingly "unprofitable" sale of gold

The opportunity cost of holding non-income producing gold could be enormous ... especially now

Hilarius

I come in peace to share my thoughts and to shine my candle light on possible long term opportunities

vermante

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Post Number: 518
Registered: 11-2002

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Sunday, December 11, 2005 - 05:00 pm:

Gold - US$1000 an Ounce

Business Sunday speaks to Newmont's President Pierre Lassonde about the criminal charges against the company in Indonesia and his prediction of gold prices climbing to a staggering US$1000 an ounce

http://businesssunday.ninemsn.com.au/article.aspx?id=74203

greatdane

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Post Number: 208
Registered: 12-2002

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Sunday, December 11, 2005 - 06:21 pm:

President Pierre Lassonde’s prediction of gold prices climbing to a staggering US$1000 an ounce in five to seven years.

- Silver will become a ‘poor’ man’s substitute for gold as POG head further north.

Regards, GreatDane

zorba

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Post Number: 86
Registered: 12-2003

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Sunday, December 11, 2005 - 08:05 pm:

GreatDane / Archer

Thanks for the info.
I am thinking about setting up some sort of instrument to be used as a growth savings account for my new-born grandson. I am thinking that gold would be the ideal product rather than depositing cash in a trust account.
Does anyone have any comments on my idea - would greatly appreciate it.

Zorba

glenn

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Post Number: 46
Registered: 11-2005

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Monday, December 12, 2005 - 07:30 am:

Zorba,

I've thought a little about a similar sort of idea (admittedly kids are quite a few years off yet though). The one thing I want to look further into are endowment warrants. Basically you front up a deposit now and that buys a stake in a basket of various companies (banks, resources, etc.).

They are structured in such a way that over the following 10 years the dividends *should* make your "repayments" each year so that at the end of the 10 years you own the stock outright without any further outlay.

The ASX warrant course only covered them briefly when I attended it a few years ago, but sufficiently enough to pique my interest and I need to investigate it further. Thought it might be an idea for you also.

Smrt-trader

carolyn

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Post Number: 34
Registered: 09-2002

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Monday, December 12, 2005 - 05:09 pm:

HI Glenn,I have used endowment warrants in the Super Fund, and they have gone very well. The best was AGL, and that was just paid out early. They are a good way to get leverage without borrowing, because you can't borrow in a Super Fund.
The only thing is they are a bit illiquid, so if you need to liquidate them, it can take a while. Not a problem if you want them for the long term though.
Carolyn

ptman

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Post Number: 12
Registered: 12-2004

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Tuesday, December 13, 2005 - 09:52 am:

Carolyn

Would be grateful for any more details on the endowment warrants please?

What is the best source of learning?
How do you choose?

Thanks, ptman

carolyn

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Post Number: 35
Registered: 09-2002

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Tuesday, December 13, 2005 - 12:21 pm:

ptman, i used Maacquarie Bank endowment warrants, which are listed on the ASX. If you went to the Macquarie site, I would presume there would be some information there on any new warrants, or a broker for info about existing warrants that can be bought on the ASX.
I choose the few I bought based on a mix of fundamental and technical pointers- good solid companies paying a dividend in an long term uptrend. Endowment warrants tend to only be available in the larger stocks anyway. But you still need to be careful- Sons of Gwalia is an example that comes to mind.
Hope that helps, Carolyn

archer