Out at the peak

Tuesday, May 09, 2006

$700 gold

My dad called me up to tell me the news that $700 gold is here. Of course, I already knew that, but it was interesting to hear what the radio told him. They are predicting gold will go to $1000 because the Chinese are trying to diversify away from USD.

This is old news, but having it repeated to Joe Sixpack is a remarkable event. This is the beginning of phase III as the everyday guy starts getting wind of the market movement and motivation behind it. Phase III could last years. As commercials come on late at night encouraging everyday people to buy into gold as an investment, we have to be aware of the time when greater fools are no longer found.

This phase III could be a combination of some fundamental central banks buying in as well as high speculative demand. The latter reason will get us into bubble prices.

Over the next few months, I think gold will be volatile and I'll be in and out of new positions along the way.


  • I don't think we quite to phase III yet, but we're getting closer.

    I'd tend to believe your father keyed in on this event because you two have discussed it before, he understands your geopolitical views, and knows you are investing in it.

    Joe 6-pack is still out buying houses w/ interest only mtgs and maxing out his credit cards. He won't begin to get a clue for another year or so. BTW: Joe 6-pack rarely listens to talk radio or anything intelligent outside the mainstream.

    Example: folks I work with have called me doom & gloom for the last 2 years, as I discussed housing bubbles, future decline of the dollar, outsourcing, deficits, future massive gold price increases, etc...

    Only now (after seeing proof confirmed through the mainstream)are they even starting to ask me intelligent questions.

    These are folks who I see & talk with every day... They now know I was right back then, but feel far too uncomfortable in gold now because everyone in the mainstream says we are at a top...

    Oh well, they won't jump on the bandwagon until Fox news tell them to... WHEN THAT HAPPENS, WE WILL BE IN PHASE III.

    By Blogger contrarian2day, at 9:23 PM  

  • You're right. It was just weird to hear it from dad. The next day, we talk again and he wants me to buy $10K of gold for him since the radio tells him it's going to $1000/oz.

    I visited my parents and they had the TV on until dinner was served. I was forgetting what many people watch each day. It was interesting to see all new ads that I hadn't already been subjected to dozens of times. Once those things start mentioning gold, Phase III can begin.

    CNNMoney had two articles: "$600 Gold, Want In? Think again." "$700 Gold, Want In? Think again." They couldn't even be more creative with their title. Will they use the same title at $800?

    By Blogger Out at the peak, at 3:58 AM  

  • The every day guy is getting wind of copper prices. I 3 weeks the cost of copper tubing for water services has double.

    By Blogger Dogcrap Green, at 7:12 PM  

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    By Blogger Dogcrap Green, at 7:12 PM  

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