I disagree with the long-term bullish case for gold for a couple of reasons:
1. Real rates are deeply negative, inflation is rampant and we have the largest war in Europe going on since WW2. Yet, gold has gone nowhere in ten years. That's the market telling you that gold just is not a very good hedge against inflation and/or conflict over the long term. Maybe it was in the past, but I find it hard to ignore the last ten years.
2. If Russia sells their gold for dollars (what else would they sell it for?) then this will increase the supply and depress the price.
3. The idea that Russia and China are challenging the dollar is not holding up, in my opinion. Russia isn't challenging anything, they're just looking for a way out of a very bad economic situation. They're even still paying their coupons in dollars, depleting their reserves. That means they are desperate not to lose access to credit markets years down the road. And there's no sign the Chinese even want the Yuan to be a reserve currency.
That's not to say that there might not be a short-term bull case for gold. But I like how you've purchased calls, so you probably have an expiration for your idea in mind 🙂
the one time you’re practically guaranteed to lose money on a position is when all you can find for miles around is everyone you read, see and talk to agreeing with your thesis on the trade. so contrary opinions not only keep you honest and smart by inviting you to reevaluate your position but also give you the reassurance that you’re not stuck in a doomed one way trade. as for me, yes i am heavily into gold, miners and also water resources. and i do subscribe to qrt. NOT because he agrees with my view of the world and the markets. but because he’s smart about them, articulate about them and most importantly not dogmatic and always curious to hear & pressure test the alt pov….
1. You said the "market" is telling us something.......as if that paper bullshit market is real and not manipulated as hell. Gold should be much higher here, and anyne with any sense knows it. The fact that it is not, tells you unequivocally that the paper gold market is rigged.
2. Why in the hell would Russia sell their gold for dollars when they won't sell their oil for dollars. Why would any sovereign nation sell gold for fiat? That would just be stupid. They can print what they need for the exchange.
3. I can't even imagine where to start with that cluster you wrote in 3. Cone back in 90 days and tell us who is in a bad economic "situation."
Your problem is you see everything through the prism of the dollar. That prism no longer works in this new reality.......where the dollar just got its ass handed to it. At the end of the next 180 days, the dollar is going to lose significant amounts of trade and inflation in the US will sky rocket as all the dollars that no one wants or needs comes flooding back to the US market.
The goal is to make money, not to be right. I'm sorry to be blunt here, but your line of thinking is the blueprint for losing money:
1. The claim that a market "should be higher" for what may in theory be a valid fundamental reason.
2. The failure to see that the fundamental reason has not played out over a decade, and the invention of a narrative of conspiracy to avoid having to admit being wrong.
3. Using headlines as catalysts of why things are changing this time while completely overstating the impact of those headlines in terms so depth and length.
4. This cycle is self-reinforcing and repeats every once in a while.
Here's my favourite quote from Jason Shapiro in Unknown Market Wizards that tells you what I mean: "The most powerful word in the markets is 'despite.' If you hear or see a comment like, 'Despite the increase in oil inventories being much higher than expected, oil prices closed higher,' that is the tape telling you what is going to happen. Everyone saw inventories were much higher than expected. Why did the market close up? The tape knows more than anyone else."
That may be your ultimate goal in life, but I wasn't created to "make money." I will never sacrifice my integrity to "make money." There is a very succinct word that describes those that do. I'll let you figure it out.
I have no problem "making money" but the cost does interest me. When the "tape" (whatever the hell that really means and how it gets personified is kind of like living in Alice and Wonderland) "tells" me 2+2=5, then I am not interested in the "money" I might make by agreeing with it.
If someone offered to pay you to say a man can be a woman or a woman can be a man (because people get paid everyday to take that position), would you take the money? Or would you take the money and just pretend you agree with the position?
Either way you choose, one would make you an idiot, the other a liar.
No. For me, the "goal" includes more than just making money.
Nobody cares about gold. When the US slapped millions of normal every-day Russian people with sanctions -- destroying their livilihoods and ability to earn money and all that they had saved and invested -- prompting many to leave the country. What is the ONLY method in which they could flee the country with all of their wealth intact?
Bitcoin in a hardware wallet.
When Russia invaded Ukraine and people need to flee across the border, and their bank, credit cards, and money didn't work. What is the ONLY way they were able to flee across any international border with all of their wealth intact and easily access it ?
Bitcoin in a hardware wallet.
Nobody can carry gold across any international border. Nobody can exchange gold in any currency with anybody in the entire world 24/7 with the push of a button with no permissions needed and no third parties required.
I do not understand why you and others keep beating this gold drum. Gold is fucking USELESS.
You can buy it and task somebody else with storing it (maybe they'll even give it back to you if you ask nicely) or you can buy it and store it yourself -- but you'll NEVER be able to take it anywhere so you better fucking hope they don't shut down the gold shops and say you can't transact in it for example.
Meanwhile -- look at Nigeria. The second biggest users of Bitcoin in the world outside of the United States.
Yet it's "illegal." They also have the only working, 100% rolled-out CBDC...nobody uses it.
I just got back from Nigeria and EVERYBODY uses Bitcoin -- making it illegal did nothing. Nobody even uses the CBDC (people laugh about it when you ask them saying they forgot it was even released).
They say "Getting Bitcoin is easier than getting dollars and running an online business and transacting internationally is easier with Bitcoin than anything else. "
I'm telling you man you're missing the mark -- nobody gives a shit about gold. Nobody can use it effectively. It does nothing.
Nigeria is one of the most important emerging markets on the planet. Their demographics are supreme among any other country in the world. While the rest of the ENTIRE planet are about to experienced a complete and utter demographics meltdown (worse than what has happened in Japan) over the next 10 to 20 years, Nigeria (and its neighbors) will have more people in the country by 2050 than mainland China does today.
With no previous, aging infrastructure to update or build on top of, they will enter the new century with a ground-work of the most advanced technologies the world has to offer.
So to discount a location like Nigeria, which has the most perfect demographics pyramid on planet Earth, where EVERYBODY is using Bitcoin, which has pioneered the most important financial technologies on earth even beyond China, is to be incredibly foolish.
Nigeria and other African countries are no longer backwaters. And dismissing Nigeria outright is like dismissing China in 1995 or Japan in 1965.
Unfortunately QTR is short #₿itcoin but long Gold!
All the points made above apply more to #₿itcoin than Gold. I can't believe even after Russian sanctions people are harbouring hopes that Gold will come into prominence once again. It might but not for long.
Just to store value, you want to dig up earth & deforest and again spend to store it away. But when it's time to flee the country, you can't take it with you.
QTR is enjoying the technological innovation that allows him to write this blog & reach millions of people while at the same time belittling the greatest innovation in finance. Talk about blind spot. #₿itcoin is Internet of Money.
The fact that you think nobody cares about gold pretty much disqualifies anything else you have to say.
Comes time to flee the country? Really? That day you'll be worried about a lot more than digits on a flash drive. The only reason BTC has any validity is because of cult followers like you that are clueless once you are away from a computer screen.
The 50year suppression of gold by the Comex and western bankers is about to end. Paper and derivative controls are waning and facing overwhelming challenges. Continuously stealing central bank reserves sounds the death knell of dollar-based reserves. When Russia sets a high price for gold in energy the game will be over.
The way these clowns are effing everything up world wide, I dont buy gold as a short term investment. It is long term, likely to be an inheritance for sombody else... i buy it in case the manure hits the rotating oscillator..... if i need to cash it in, things basically suck. Good to get large and small denominations so you can make change 😎.... storage food and ammo too.. also have 16.8 kW solar on the roof and two tesla batteries... woods out back and a chain saw for my stove... mini split heat pumps and oil baseboard heat (two oil tanks)... river nearby and waterfilters... ev next year... see you all in hell boys! Si vis pacem, para bellum
That's why I kind of prefer silver. A) It's not quite as pricey for us commoners and B) It can be broken down more easily in smaller denominations for possible future exchange purposes or bartering. I think we are getting nearer to the Gold, Guns and Grub phase of things!!!
I think Russia would love to have a currency backed by commodities. The U.S. could match any currency backed by commodities. This would not by any means eliminate the Dollar but it would give alternatives. This should slowdown Dollar printing and possibly put a speed limit on currency devaluation. Sometimes the craziest things happen at the strangest times. My question is why wouldn’t you buy GDX?
I don't think the US could match any currency backed by commodities such as gold. Because, for one thing you would actually have to have the gold on hand, which we may or may not have depending on which source that is sited. We can never get a true audit of our actual gold reserves. Then again, we are notorious for stealing other countries' gold.
We couldn't back it with silver, we currently don't have enough for the mint to produce Eagles. What other commodity could we use? Corn? That all goes to food and ethanol. Uranium? Hillary sold it to the Russians a few years ago. The only excess commodity we have left in this country anymore is "BS" and when the 6uild 6ack 6etter people take over with their new green deal and climate restrictions on cows, we won't even have that left!!!!
Thank you. It was used in a blog by The Good Citizen on his substack page. He writes great blogs. Not sure if he came up with that one or if he saw it somewhere else as well. Thought it was appropriate and I even incorporated it in my image for the day on 03/19/22 @https://nothingnewunderthesun2016.com/ using that expression.
I hope you’re right but I’m not as sanguine about the process. I think we may see quite a long period of choppy price action with no strong directional bias as competing narratives fight it out
The Gold chart is exhibiting a pretty remarkable fractal cup and handle pattern. There's a decade-long mega cup from 2011 to 2020, and the 1.5-year handle of that mega-cup is itself a mini-me version of the decade-long mega-cup and handle pattern. This recent Q1-2022 gold spike and pullback have completed the mini-me cup and handle formation. They say to buy when a chart is smiling at you. This one is smiling twice. I will also note that the linear-scale Gold chart resembles the log-scale BTC chart, whatever that means. Muh dick says "bullish".
The recent gold selloff might have something to do with option expiry.
I don't understand why Russia would (ever) sell gold for US$ especially now and going forward. Their model has been for years to get out of US$ and fill the vault with gold, just like so many other central banks around the world.
The G7 breached their contract with their sanctions (payment cannot be made and those funds cannot be used by Russia) when they continued to accept product for the last month. There is no reason to not pay in Rubles or gold, the G7 is just saying no we won't - they might soon find out what it means when Russia decides to no longer deliver.
Bernanke said they vault gold because of "tradition" - this is the biggest "tell" ever.
Russia must sell their gas somewhere. The infrastructure to pipe it eastward doesn't yet exist. If Russia stops supplying Europe, they may wait until the fall, when they have more leverage.
But short term even the BASF CEO recently talked about rapid collapse if the gas is shut off. Now that all gas deliveries have been halted via the Yamal-Europe pipeline we will find out.
Unfortunately it’s the common folk who lose for which we pray the most.
I disagree with the long-term bullish case for gold for a couple of reasons:
1. Real rates are deeply negative, inflation is rampant and we have the largest war in Europe going on since WW2. Yet, gold has gone nowhere in ten years. That's the market telling you that gold just is not a very good hedge against inflation and/or conflict over the long term. Maybe it was in the past, but I find it hard to ignore the last ten years.
2. If Russia sells their gold for dollars (what else would they sell it for?) then this will increase the supply and depress the price.
3. The idea that Russia and China are challenging the dollar is not holding up, in my opinion. Russia isn't challenging anything, they're just looking for a way out of a very bad economic situation. They're even still paying their coupons in dollars, depleting their reserves. That means they are desperate not to lose access to credit markets years down the road. And there's no sign the Chinese even want the Yuan to be a reserve currency.
That's not to say that there might not be a short-term bull case for gold. But I like how you've purchased calls, so you probably have an expiration for your idea in mind 🙂
Appreciate your thoughts. Love hearing the other side of the argument.
Love hearing the other side of the argument.
Huh. That's a very weird thing to say... lol
not at all @charlie -
the one time you’re practically guaranteed to lose money on a position is when all you can find for miles around is everyone you read, see and talk to agreeing with your thesis on the trade. so contrary opinions not only keep you honest and smart by inviting you to reevaluate your position but also give you the reassurance that you’re not stuck in a doomed one way trade. as for me, yes i am heavily into gold, miners and also water resources. and i do subscribe to qrt. NOT because he agrees with my view of the world and the markets. but because he’s smart about them, articulate about them and most importantly not dogmatic and always curious to hear & pressure test the alt pov….
1. You said the "market" is telling us something.......as if that paper bullshit market is real and not manipulated as hell. Gold should be much higher here, and anyne with any sense knows it. The fact that it is not, tells you unequivocally that the paper gold market is rigged.
2. Why in the hell would Russia sell their gold for dollars when they won't sell their oil for dollars. Why would any sovereign nation sell gold for fiat? That would just be stupid. They can print what they need for the exchange.
3. I can't even imagine where to start with that cluster you wrote in 3. Cone back in 90 days and tell us who is in a bad economic "situation."
Your problem is you see everything through the prism of the dollar. That prism no longer works in this new reality.......where the dollar just got its ass handed to it. At the end of the next 180 days, the dollar is going to lose significant amounts of trade and inflation in the US will sky rocket as all the dollars that no one wants or needs comes flooding back to the US market.
The goal is to make money, not to be right. I'm sorry to be blunt here, but your line of thinking is the blueprint for losing money:
1. The claim that a market "should be higher" for what may in theory be a valid fundamental reason.
2. The failure to see that the fundamental reason has not played out over a decade, and the invention of a narrative of conspiracy to avoid having to admit being wrong.
3. Using headlines as catalysts of why things are changing this time while completely overstating the impact of those headlines in terms so depth and length.
4. This cycle is self-reinforcing and repeats every once in a while.
Here's my favourite quote from Jason Shapiro in Unknown Market Wizards that tells you what I mean: "The most powerful word in the markets is 'despite.' If you hear or see a comment like, 'Despite the increase in oil inventories being much higher than expected, oil prices closed higher,' that is the tape telling you what is going to happen. Everyone saw inventories were much higher than expected. Why did the market close up? The tape knows more than anyone else."
That may be your ultimate goal in life, but I wasn't created to "make money." I will never sacrifice my integrity to "make money." There is a very succinct word that describes those that do. I'll let you figure it out.
I have no problem "making money" but the cost does interest me. When the "tape" (whatever the hell that really means and how it gets personified is kind of like living in Alice and Wonderland) "tells" me 2+2=5, then I am not interested in the "money" I might make by agreeing with it.
If someone offered to pay you to say a man can be a woman or a woman can be a man (because people get paid everyday to take that position), would you take the money? Or would you take the money and just pretend you agree with the position?
Either way you choose, one would make you an idiot, the other a liar.
No. For me, the "goal" includes more than just making money.
What’s the succinct word?
The market gives everyone what they want from it, so even though our opinions differ we’re both satisfied in our own ways.
Nobody cares about gold. When the US slapped millions of normal every-day Russian people with sanctions -- destroying their livilihoods and ability to earn money and all that they had saved and invested -- prompting many to leave the country. What is the ONLY method in which they could flee the country with all of their wealth intact?
Bitcoin in a hardware wallet.
When Russia invaded Ukraine and people need to flee across the border, and their bank, credit cards, and money didn't work. What is the ONLY way they were able to flee across any international border with all of their wealth intact and easily access it ?
Bitcoin in a hardware wallet.
Nobody can carry gold across any international border. Nobody can exchange gold in any currency with anybody in the entire world 24/7 with the push of a button with no permissions needed and no third parties required.
I do not understand why you and others keep beating this gold drum. Gold is fucking USELESS.
You can buy it and task somebody else with storing it (maybe they'll even give it back to you if you ask nicely) or you can buy it and store it yourself -- but you'll NEVER be able to take it anywhere so you better fucking hope they don't shut down the gold shops and say you can't transact in it for example.
Meanwhile -- look at Nigeria. The second biggest users of Bitcoin in the world outside of the United States.
Yet it's "illegal." They also have the only working, 100% rolled-out CBDC...nobody uses it.
I just got back from Nigeria and EVERYBODY uses Bitcoin -- making it illegal did nothing. Nobody even uses the CBDC (people laugh about it when you ask them saying they forgot it was even released).
They say "Getting Bitcoin is easier than getting dollars and running an online business and transacting internationally is easier with Bitcoin than anything else. "
I'm telling you man you're missing the mark -- nobody gives a shit about gold. Nobody can use it effectively. It does nothing.
Nigeria? Well, hell's bells! Sign me up.
Nigeria is one of the most important emerging markets on the planet. Their demographics are supreme among any other country in the world. While the rest of the ENTIRE planet are about to experienced a complete and utter demographics meltdown (worse than what has happened in Japan) over the next 10 to 20 years, Nigeria (and its neighbors) will have more people in the country by 2050 than mainland China does today.
With no previous, aging infrastructure to update or build on top of, they will enter the new century with a ground-work of the most advanced technologies the world has to offer.
So to discount a location like Nigeria, which has the most perfect demographics pyramid on planet Earth, where EVERYBODY is using Bitcoin, which has pioneered the most important financial technologies on earth even beyond China, is to be incredibly foolish.
Nigeria and other African countries are no longer backwaters. And dismissing Nigeria outright is like dismissing China in 1995 or Japan in 1965.
Get yourself educated.
Blah blah blah ....
I'll do fine without the next digital whatever. Especially a digital currency.
Unfortunately QTR is short #₿itcoin but long Gold!
All the points made above apply more to #₿itcoin than Gold. I can't believe even after Russian sanctions people are harbouring hopes that Gold will come into prominence once again. It might but not for long.
Just to store value, you want to dig up earth & deforest and again spend to store it away. But when it's time to flee the country, you can't take it with you.
QTR is enjoying the technological innovation that allows him to write this blog & reach millions of people while at the same time belittling the greatest innovation in finance. Talk about blind spot. #₿itcoin is Internet of Money.
The fact that you think nobody cares about gold pretty much disqualifies anything else you have to say.
Comes time to flee the country? Really? That day you'll be worried about a lot more than digits on a flash drive. The only reason BTC has any validity is because of cult followers like you that are clueless once you are away from a computer screen.
The 50year suppression of gold by the Comex and western bankers is about to end. Paper and derivative controls are waning and facing overwhelming challenges. Continuously stealing central bank reserves sounds the death knell of dollar-based reserves. When Russia sets a high price for gold in energy the game will be over.
What do you mean by "high price for gold in energy"? Do you believe they are going to price their gold holdings in oil or gas? Why would they do that?
Give a listen to this if you have the time.
https://mobile.twitter.com/ttmygh/status/1502591117027848198
The way these clowns are effing everything up world wide, I dont buy gold as a short term investment. It is long term, likely to be an inheritance for sombody else... i buy it in case the manure hits the rotating oscillator..... if i need to cash it in, things basically suck. Good to get large and small denominations so you can make change 😎.... storage food and ammo too.. also have 16.8 kW solar on the roof and two tesla batteries... woods out back and a chain saw for my stove... mini split heat pumps and oil baseboard heat (two oil tanks)... river nearby and waterfilters... ev next year... see you all in hell boys! Si vis pacem, para bellum
That's why I kind of prefer silver. A) It's not quite as pricey for us commoners and B) It can be broken down more easily in smaller denominations for possible future exchange purposes or bartering. I think we are getting nearer to the Gold, Guns and Grub phase of things!!!
i didnt mention scrap silver!
I think Russia would love to have a currency backed by commodities. The U.S. could match any currency backed by commodities. This would not by any means eliminate the Dollar but it would give alternatives. This should slowdown Dollar printing and possibly put a speed limit on currency devaluation. Sometimes the craziest things happen at the strangest times. My question is why wouldn’t you buy GDX?
I don't think the US could match any currency backed by commodities such as gold. Because, for one thing you would actually have to have the gold on hand, which we may or may not have depending on which source that is sited. We can never get a true audit of our actual gold reserves. Then again, we are notorious for stealing other countries' gold.
We couldn't back it with silver, we currently don't have enough for the mint to produce Eagles. What other commodity could we use? Corn? That all goes to food and ethanol. Uranium? Hillary sold it to the Russians a few years ago. The only excess commodity we have left in this country anymore is "BS" and when the 6uild 6ack 6etter people take over with their new green deal and climate restrictions on cows, we won't even have that left!!!!
Will be linking the Raven's article today @https://nothingnewunderthesun2016.com/
i like the 666 reference 😎
Thank you. It was used in a blog by The Good Citizen on his substack page. He writes great blogs. Not sure if he came up with that one or if he saw it somewhere else as well. Thought it was appropriate and I even incorporated it in my image for the day on 03/19/22 @https://nothingnewunderthesun2016.com/ using that expression.
Did you read this? Skip to the Q&A.
https://news.alphastreet.com/rh-rh-q4-2021-earnings-call-transcript/
7 ways to Sunday is my new and all-time favorite disclosure.
I hope you’re right but I’m not as sanguine about the process. I think we may see quite a long period of choppy price action with no strong directional bias as competing narratives fight it out
Chris, all this change will take time. Your thesis will play out, but for heaven’s sake we are only a month into the war.
The Gold chart is exhibiting a pretty remarkable fractal cup and handle pattern. There's a decade-long mega cup from 2011 to 2020, and the 1.5-year handle of that mega-cup is itself a mini-me version of the decade-long mega-cup and handle pattern. This recent Q1-2022 gold spike and pullback have completed the mini-me cup and handle formation. They say to buy when a chart is smiling at you. This one is smiling twice. I will also note that the linear-scale Gold chart resembles the log-scale BTC chart, whatever that means. Muh dick says "bullish".
The recent gold selloff might have something to do with option expiry.
I don't understand why Russia would (ever) sell gold for US$ especially now and going forward. Their model has been for years to get out of US$ and fill the vault with gold, just like so many other central banks around the world.
The G7 breached their contract with their sanctions (payment cannot be made and those funds cannot be used by Russia) when they continued to accept product for the last month. There is no reason to not pay in Rubles or gold, the G7 is just saying no we won't - they might soon find out what it means when Russia decides to no longer deliver.
Bernanke said they vault gold because of "tradition" - this is the biggest "tell" ever.
Russia must sell their gas somewhere. The infrastructure to pipe it eastward doesn't yet exist. If Russia stops supplying Europe, they may wait until the fall, when they have more leverage.
Yes longer term I agree.
But short term even the BASF CEO recently talked about rapid collapse if the gas is shut off. Now that all gas deliveries have been halted via the Yamal-Europe pipeline we will find out.
Unfortunately it’s the common folk who lose for which we pray the most.
I agree