LGP Political Discussion Thread

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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sat Sep 14, 2013 3:23 pm

It's definitely a speculation, rather than an investment. Which proses at least two questions:

1. What leads the speculators to believe that they will guess correctly?
2. Whom do they intend to sell it to, under the presumably very desperate (for all) "Plan B" scenario?
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Re: LGP Political Discussion Thread - Latest news at top

Postby ExPatriatePen on Sat Sep 14, 2013 4:22 pm

columbia wrote:It's definitely a speculation, rather than an investment. Which proses at least two questions:

1. What leads the speculators to believe that they will guess correctly?
2. Whom do they intend to sell it to, under the presumably very desperate (for all) "Plan B" scenario?

There certainly are people who use gold for a speculative investment. Played properly, it can make you a lot of money. But like all "high Beta" speculative investments, you could lose a ton as well.

But that's not why you should be investing in gold. Gold is a hedge against a complete meltdown of the financial system. The odds of hyperinflation are low, but *if* it happens, you'd better be able to whether that storm. Gold provides the insurance policy that you'll have a "currency" with a recognized value to trade for basic food and shelter.
That's what gold is for. Consider it as the same as flood hazard insurance policy for someone in Boulder Canyon. They'll probably never need it. But if there's ever a hundred years flood, they'll be happy they did.
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sat Sep 14, 2013 4:29 pm

Who exactly is going to buy your gold under that scenario and why would they do so (if they themselves are also scrambling for food and shelter)?
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Re: LGP Political Discussion Thread - Latest news at top

Postby ExPatriatePen on Sat Sep 14, 2013 4:33 pm

No one is going to "buy your gold", just as no one buys your dollar bills.

If you have goods and services, your not going to take Monopoly money for it.
You'll want a universally recognized currency that has a limited finite ability to be inflated.

One that, can in turn, be traded again for goods and services.

Viola.
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sat Sep 14, 2013 4:37 pm

Yoi. Good kuck with that as a retirement strategy.
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Re: LGP Political Discussion Thread - Latest news at top

Postby ExPatriatePen on Sat Sep 14, 2013 4:42 pm

columbia wrote:Yoi. Good kuck with that as a retirement strategy.

Where are you getting that anyone said it was a retirement strategy?
Yikes!
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sat Sep 14, 2013 4:44 pm

Image
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Re: LGP Political Discussion Thread - Latest news at top

Postby Shyster on Sat Sep 14, 2013 9:38 pm

columbia wrote:Good luck with those gold investments. :wink:

That is exactly what that chart should look like. For most of that timeline, the United States was on the gold standard, which meant that there was a defined ratio between gold and dollars. Therefore, the purchasing power of gold would be more-or-less constant. But because gold is always being mined at a small pace, one would expect that if the supply of gold slightly increases, the worth of gold would fall slightly over time. I believe that's what the arrow is indicating. Nothing wrong there; that's basic supply-and-demand; at more-or-less fixed demand, the more units there are of something, the less each unit is worth.

Note that the huge movements all occur after approximately 1970. I can pin it even more precisely than that: August 15, 1971. That is the day President Nixon issued Executive Order 11615, which signaled the end of the post-WWII Bretton Woods financial system and closed the "gold window" under which other nation's has the option to come to the United States and convert their dollars into gold. Closing the gold window finally and fully unlinked the dollar from any notion of being based on anything tangible (like gold) and made it a fully floating fiat currency that the government could print and inflate at will.
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sat Sep 14, 2013 9:50 pm

You're SOL if no one wants (and who would?) your gold, when society collapses.
Since that's not going to happen, you'll have more wealth in the long run, by avoiding speculation in gold...unless you're one of those people who think that they can (predict and) beat the market?
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Re: LGP Political Discussion Thread - Latest news at top

Postby bh on Sat Sep 14, 2013 10:50 pm

Gold would a holder of value not in a complete collapse of society but more in the case of the collapse of the dollar. It would be more like Germany after WW1. I think in that scenario gold would be very beneficial. So basically as EPP pointed out, you're hedging against the dollar. If society as a whole goes down the tubes... then gold prolly wouldn't get you much.
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Re: LGP Political Discussion Thread - Latest news at top

Postby PensFanInDC on Sat Sep 14, 2013 10:57 pm

columbia wrote:
BurghersAndDogsSports wrote:Are we playing "random fact"?


Aren't people who blame Obamacare for their increased insurance costs doing the same (and much more loudly)?

As for the people you mentioned, they probably didn't have insurance in the first place and will actually have that opportunity once the AHCA is implemented.

I didn't think it was the best solution, but people should actually wait for it to be implemented before complaining about it.


I think the issue is that hours are being cut and that equals less money earned. Free healthcare? Maybe. But what would you rather have? 35-42 billable hours a week or 28 and free healthcare? Healthcare doesn't pay the mortgage.

I know a lot of people in the food service industry. Not just the 22 year old college dropouts living at home. I'm talking about the 35 year old career bartender/server. They are being hit hard.
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Re: LGP Political Discussion Thread - Latest news at top

Postby Shyster on Sat Sep 14, 2013 11:39 pm

columbia wrote:You're SOL if no one wants (and who would?) your gold, when society collapses.

What else would you use as a medium of exchange? Nuka-Cola bottle caps?
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sun Sep 15, 2013 3:39 am

Shyster wrote:
columbia wrote:You're SOL if no one wants (and who would?) your gold, when society collapses.

What else would you use as a medium of exchange? Nuka-Cola bottle caps?


I would expect the new currency to be bullets.
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Re: LGP Political Discussion Thread - Latest news at top

Postby tifosi77 on Sun Sep 15, 2013 9:08 am

ExPatriatePen wrote:No one is going to "buy your gold", just as no one buys your dollar bills.

If you have goods and services, your not going to take Monopoly money for it.
You'll want a universally recognized currency that has a limited finite ability to be inflated.

One that, can in turn, be traded again for goods and services.

Viola.

If the SHTF and we aren't using paper money for things anymore, the only thing people are going to accept for their goods and services are other goods and services in return. It will be a true barter economy.

The whole idea of buying gold to stockpile in the event of a systemic collapse is comedy.
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Re: LGP Political Discussion Thread - Latest news at top

Postby Gaucho on Sun Sep 15, 2013 9:16 am

I prefer my martini dry and with a little gold in it.
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sun Sep 15, 2013 9:41 am

tifosi77 wrote:The whole idea of buying gold to stockpile in the event of a systemic collapse is comedy.


Indeed.

I't also a terrible "investment":

1.) It has no internal rate of return, aka dividends or interest. If you put 10K in the stock market and gold on the same day and they are somehow both at the same price 10 years later, your gold will still only be worth 10K. The dividends on the stock will make it far more than that. Even at just 1% quarterly dividends, you'll make ~ 11% return. As Tomas has pointed out the average annual return for any given 30 year period is about 9%.

2.) There's no inflation protection, unlike say TIPS, if that's what you're after.

Letting ideology stand in the way of facts (and common sense when it comes to the SHTF scenario) is the incorrect decision.
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Re: LGP Political Discussion Thread - Latest news at top

Postby tifosi77 on Sun Sep 15, 2013 10:50 am

There's a financial planner dude out here that has a radio show every few months to shill for new clients. He took a call one time from a guy who was talking about his gold investments, expecting to be applauded for his wisdom. You could almost see the planner's head explode as this caller guy went on about this stuff. After a few minutes, he chimed in and said something along the lines of 'if you have more than 2% of your portfolio comprised of gold or other precious metals, you're an absolute fool'.

The last time there was a 'gold rush' was the late 70s. After that, the price of an oz of gold dropped in value for something like 230 consecutive months, and didn't regain its 1980 high point until mid-1999. That's nearly three decades just to get back to the starting point.
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Sun Sep 15, 2013 8:21 pm

Larry Summers withdraws name for Fed chair job
http://money.cnn.com/2013/09/15/news/ec ... ?hpt=hp_t2
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Re: LGP Political Discussion Thread - Latest news at top

Postby DelPen on Mon Sep 16, 2013 6:24 am

bh wrote:Gold would a holder of value not in a complete collapse of society but more in the case of the collapse of the dollar. It would be more like Germany after WW1. I think in that scenario gold would be very beneficial. So basically as EPP pointed out, you're hedging against the dollar. If society as a whole goes down the tubes... then gold prolly wouldn't get you much.


Lead will be worth more than gold in the short term if you know what I mean :wink:
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Mon Sep 16, 2013 6:27 am

DelPen wrote:
bh wrote:Gold would a holder of value not in a complete collapse of society but more in the case of the collapse of the dollar. It would be more like Germany after WW1. I think in that scenario gold would be very beneficial. So basically as EPP pointed out, you're hedging against the dollar. If society as a whole goes down the tubes... then gold prolly wouldn't get you much.


Lead will be worth more than gold in the short term if you know what I mean :wink:



columbia wrote:I would expect the new currency to be bullets.
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Re: LGP Political Discussion Thread - Latest news at top

Postby tifosi77 on Mon Sep 16, 2013 1:14 pm

Nina Davuluri became the first woman of Indian descent to be crowned Miss America. The Internet duly exploded.
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Re: LGP Political Discussion Thread - Latest news at top

Postby eddysnake on Mon Sep 16, 2013 1:19 pm

tifosi77 wrote:Nina Davuluri became the first woman of Indian descent to be crowned Miss America. The Internet duly exploded.


not surprised by that at all, but wow, those comments are both hilarious and terribly sad.
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Re: LGP Political Discussion Thread - Latest news at top

Postby columbia on Mon Sep 16, 2013 1:19 pm

I swear I'm not racist but this is America.
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Re: LGP Political Discussion Thread - Latest news at top

Postby KennyTheKangaroo on Mon Sep 16, 2013 1:20 pm

how many people own actual gold bars compared to buying GLD or some mutual fund or some fund that buys into gold futures anyway?

Kenny the kangaroo does buy into the "gold will be good when doomsday comes" but quite frankly speculating in an ETF that is backed by gold wont solve very many problems in that case anyway. the number of people can that afford to buy and store actual gold in a safe or bank or whatever is very low.
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