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Credit deflation and the reflation cycle to come.


DurhamBorn

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UnconventionalWisdom

The Srsrocco report shows central banks buying the most gold in 2018 since Nixon took the world off the gold standard. Almost like they know it's time to cover themselves or they are ditching the dollar. 

https://srsroccoreport.com/central-bank-gold-purchases-hit-a-record-in-2018/

Official gold purchases reached a new record in 2018 as central banks continued to diversify away from the U.S. Dollar. Not only was 2018 a banner year for central bank gold purchases, but it was also the highest amount for more than five decades. Central banks haven’t bought this much gold in one year since Nixon ended the convertibility of the U.S. Dollar into gold in 1971.

 

According to the World Gold Council 2018 Yearend Gold Demand Trends, Russia funded most of the 274 metric tons (mt) of its official gold purchases with sales of its U.S. Treasury holdings. Furthermore, the next two countries with the largest increase in gold acquisitions in 2018 were Turkey with 51.5 mt and Kazakhstan at 50.6 mt.

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6 minutes ago, UnconventionalWisdom said:

I feel the same. I'm wondering whether I should get a job in finance just to speed up the learning. I have a physics/engineering background so tick a lot of the boxes.

I know a couple of tech guys who work at an investment bank and a hedge fund. They know Jack about finance-one didn't know how to buy a share and the other about treasuries. Their decision guys want to educate the tech guys but they don't want to listen. 

I think it's easy to assume this but most of it is just learning the `rules of the game`/deceit that has been created...the rest is then using your life experience to `see` the traps in the deceits.

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9 hours ago, A_P said:

I went with SPGP. No currency costs when buying but obviously performance/value is subject to currency fluctuations. No complaints with the performance thus far

I have SPGP as well and it is showing a better return than GDXJ so far. That might just be down to the fact that the SPGP has the big miners in and not just the juniors.

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12 minutes ago, MrXxx said:

But where do their custodians hold the gold (New York, London) and how `free` is this if there was a currency run?...If the $ `tits up` I can't see you keeping access (or ownership) of your gold for very long in NY, and if it's in London the US lapdog (UK) will `look after it` the same way they are doing for Venezuela!

A valid point for the physical metal ETCs, but both SPGP and GDXJ are funds holding shares in the gold miners so they are just the same as any other share based fund.

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43 minutes ago, MrXxx said:

But you have the risk of someone stealing it (they can't steal your ETCs), and you also have the minting costs...unless you are buying bars!....

Whilst we are talking gold/pm (obviously we all informed watched the Maloney `Hidden secrets of money` videos this weekend!), has anyone `run a sliderule` over the costs of owning gold ETC vs Bullion vault trading account/Royal Mint signature account (these last two offer ownership/trading of partial bars)?...from what I can see they offer the same advantages but the former has more counterparty risk...and you never physically`own` in either!

https://www.bullionvault.com/cost-calculator.do

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36 minutes ago, UnconventionalWisdom said:

I feel the same. I'm wondering whether I should get a job in finance just to speed up the learning. I have a physics/engineering background so tick a lot of the boxes.

I know a couple of tech guys who work at an investment bank and a hedge fund. They know Jack about finance-one didn't know how to buy a share and the other about treasuries. Their decision guys want to educate the tech guys but they don't want to listen. 

Most people who work for banks haven’t a clue outside their narrow niche. It’s a means to an end.

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Yellow_Reduced_Sticker
On 01/02/2019 at 17:35, DurhamBorn said:

Both,silver to $200 minimum,some of the miners will likely 100 bag.The key though is not all miners ,and some will go under.He thinks the miners will be to the next cylce what the .com's were to the last one.If i had £5k to invest id buy £1k in 5 silver miners.If i had £100k id buy £30k in silver and £70k in 10 to 12 silver/gold  miners.It all depends on peoples risk,portfolio,assets,time of life etc.Lots to consider,and the space can crush people quickly.If risk is too much then is simply buy silver and look to sell it around 2027.

YES please that would be very nice if ya got 'em in ya portfolio - may even happen to that old DOG, New Gold!xD

...talking of 100 baggers, I remember a book i got (YES at the reduced section 1p):Jumping:

Called: 100 Baggers: Stocks that Return 100-to-1 and How to Find Them

Haven't read it yet, so posting a copy here for DB & all the good folks on this thread...

Do let me know ya thoughts on the book, CHEERS!

DL: www.mediafire.com/file/yptdyoixnbz7qne/

CNgC-73WwAAYf8M.png

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On 31/01/2019 at 19:40, DurhamBorn said:

Sprott would be a good buy i think and id gladly own it.My liquidity road map (or should i say my friends road map) says silver $23,down to $8 up to $200 minimum.As he has told me 1 billion times though,the road maps arent trading calls,they are road maps.Where we are going is what counts.This is a person who was in the room several times with Paul Volcker during the early 80s and was top 1 percentile performance in US pension funds from 75 until 89.He is in no doubt.Debt is about to be reset with inflation and only PMs,mostly silver will protect people.Im 100% he is the best macro strategist of our and the last generation.He says this.Western countries will not go down,but the debt will go.Debt deflation followed by full on reflation.He only prices everything forward in gold and silver,and as he says,what is old always becomes new.Fiat wealth is about to be moved to real money.Gold and silver.Lets see if that plays out,but im very very happy so put 20%+ of my wealth onto that trade.Id urge,really urge anyone to get some PM exposure.A few grand in silver miners might deliver a house.A few tens of grands might deliver a farm.If not so be it.Nothing is certain,but a 20% thats cut in half or a 2000%+ profit is good enough for me.

what is old always becomes new - That is an old saying my mother use to say to me, that you do not hear very much today. I have always been attracted to the opposite end of the fashion spectrum and current trends although there are times that I do run with the herd. One item that I am currently running against the trend is Brown furniture and paintings that are wholly out of favour. I am buying a lot good quality furniture/antiques these days, usually because I like them and use them but also an eye on potential future resale value or hand down to the next generation. The craftsmanship in say a mahogany/walnut table or side cabinet can be picked up for between £100- 450 whilst a similar modern piece from IKEA etc is at the upper end and plus of this price scale for a inferior product. Are there any other forum members seeing value in other tangible assets other than the obvious gold and silver etc. If so what are they and would you care to share.

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OK, so now I am really lost/confused on how to secure my future/pension/investments...having watched a number of Sperando and Maloney videos posted on here (and the hidden truths series) the message is that we are in for financial Armageddon, and not just locally/Nationally but worldwide, and we are `talking` months/years rather than years/decades...

OK, I appreciate that some of these are sales pitches (Maloney especially), but they all seem to agree that rare commods (G & S) are the only way to preserve your money...

FIAT=forget it, bonds=worthless promises, equities=assets inflated by QE currency that will disappear as quickly as it appeared, miners=an increase but only in worthless FIAT...

...so the only way to go is pm, and then only if you have them `in hand` and can make sure they aren't confiscated...

...or am I missing an opportunity and just being hysterical?!

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3 minutes ago, MrXxx said:

OK, so now I am really lost/confused on how to secure my future/pension/investments...having watched a number of Sperando and Maloney videos posted on here (and the hidden truths series) the message is that we are in for financial Armageddon, and not just locally/Nationally but worldwide, and we are `talking` months/years rather than years/decades...

OK, I appreciate that some of these are sales pitches (Maloney especially), but they all seem to agree that rare commods (G & S) are the only way to preserve your money...

FIAT=forget it, bonds=worthless promises, equities=assets inflated by QE currency that will disappear as quickly as it appeared, miners=an increase but only in worthless FIAT...

...so the only way to go is pm, and then only if you have them `in hand` and can make sure they aren't confiscated...

...or am I missing an opportunity and just being hysterical?!

the americans even jailed people in the great depresion if they refused to hand there private bullion over

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Inoperational Bumblebee
19 hours ago, A_P said:

I went with SPGP. No currency costs when buying but obviously performance/value is subject to currency fluctuations. No complaints with the performance thus far

I see the currency fluctuation as a good thing tbh...

2 hours ago, Agent ZigZag said:

what is old always becomes new - That is an old saying my mother use to say to me, that you do not hear very much today. I have always been attracted to the opposite end of the fashion spectrum and current trends although there are times that I do run with the herd. One item that I am currently running against the trend is Brown furniture and paintings that are wholly out of favour. I am buying a lot good quality furniture/antiques these days, usually because I like them and use them but also an eye on potential future resale value or hand down to the next generation. The craftsmanship in say a mahogany/walnut table or side cabinet can be picked up for between £100- 450 whilst a similar modern piece from IKEA etc is at the upper end and plus of this price scale for a inferior product. Are there any other forum members seeing value in other tangible assets other than the obvious gold and silver etc. If so what are they and would you care to share.

I don't, but I'm interested where I might buy decent furniture like that. Any sources you're willing to share? Or is it just local shops?

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13 minutes ago, MrXxx said:

OK, so now I am really lost/confused on how to secure my future/pension/investments...having watched a number of Sperando and Maloney videos posted on here (and the hidden truths series) the message is that we are in for financial Armageddon, and not just locally/Nationally but worldwide, and we are `talking` months/years rather than years/decades...

OK, I appreciate that some of these are sales pitches (Maloney especially), but they all seem to agree that rare commods (G & S) are the only way to preserve your money... 

FIAT=forget it, bonds=worthless promises, equities=assets inflated by QE currency that will disappear as quickly as it appeared, miners=an increase but only in worthless FIAT...

...so the only way to go is pm, and then only if you have them `in hand` and can make sure they aren't confiscated... 

...or am I missing an opportunity and just being hysterical?! 

Yeah, your getting hysterical!

Things might get bad, but the economy should still function, the lights will still be on and food will still be in the supermarkets.  Capitalism is actually a pretty resilient system, even with enemy Bombers paying a visit every now and again.

If things get as bad as the doom mongers say they would, what you really need is a gun and ammo.  Physical Gold in 1945 Germany was pretty worthless, farmers were swapping it for food as people were that desperate, it was not a favourable exchange rate!  Maloney might have forgotten to mention that.....

Investing in companies with low debt and reasonably reliable cashflow is my plan, if that fails i will likely have bigger problems.

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32 minutes ago, stokiescum said:

the americans even jailed people in the great depresion if they refused to hand there private bullion over

I think that if the famous 1933 order was issued now, the provision of gold in private hands back to the state would be very, very minimal indeed.  It would, at a stroke, criminalise millions of Americans.

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6 minutes ago, Majorpain said:

Yeah, your getting hysterical!

Things might get bad, but the economy should still function, the lights will still be on and food will still be in the supermarkets.  Capitalism is actually a pretty resilient system, even with enemy Bombers paying a visit every now and again.

If things get as bad as the doom mongers say they would, what you really need is a gun and ammo.  Physical Gold in 1945 Germany was pretty worthless, farmers were swapping it for food as people were that desperate, it was not a favourable exchange rate!  Maloney might have forgotten to mention that.....

Investing in companies with low debt and reasonably reliable cashflow is my plan, if that fails i will likely have bigger problems.

Yes.  

 

I think you can healthily look at doom scenarios in a variety of phases and have your wealth set accordingly.  The mistake many TOSSERs and DOSBODDERS made was to assume that a HPC would happen soon, and would be nationwide, and would be unstoppable.  So when there was a crash but house prices were largely unaffected, their plans were shown as being way too conservative.

I'd go with a 5x20 rule.  20% of your wealth set to grow well if nothing changes.  20% of your wealth set to grow if there is a wholesale collapse.  And the rest in similar bands.

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22 minutes ago, Majorpain said:

Yeah, your getting hysterical!

 

If it all goes that badly wrong there are steps to be taken, but any kind of investment apart from weaponry, support, command structure, food supply and water would be superfluous.

Instead of buying gold coins I'd suggest getting to know the local drug dealers, they're the men of violence you're going to need.

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41 minutes ago, Inoperational Bumblebee said:

 

I don't, but I'm interested where I might buy decent furniture like that. Any sources you're willing to share? Or is it just local shops?

Auction houses and trade fairs. Usually held during working hours that is a pain for most. Google local auctions rooms close to where you live. Go to their viewing usually a weekend and if you cant bid in the room bid on line or phone. 

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1 hour ago, stokiescum said:

the americans even jailed people in the great depresion if they refused to hand there private bullion over

Hardly anyone actually handed anything in. Most lost bullion if they had been stupid enough to keep it in bank vaults etc.

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1 hour ago, MrXxx said:

OK, so now I am really lost/confused on how to secure my future/pension/investments...having watched a number of Sperando and Maloney videos posted on here (and the hidden truths series) the message is that we are in for financial Armageddon, and not just locally/Nationally but worldwide, and we are `talking` months/years rather than years/decades...

OK, I appreciate that some of these are sales pitches (Maloney especially), but they all seem to agree that rare commods (G & S) are the only way to preserve your money...

FIAT=forget it, bonds=worthless promises, equities=assets inflated by QE currency that will disappear as quickly as it appeared, miners=an increase but only in worthless FIAT...

...so the only way to go is pm, and then only if you have them `in hand` and can make sure they aren't confiscated...

...or am I missing an opportunity and just being hysterical?!

What kind of wealth are you trying protect/secure (rheortical question as it's none of our business)? Act and set accordingly. We can't win them all, all of the time. You sure as hell can lose if you only go one way. And sometimes there's nothing you could have done, no matter what. Chill out and relax.

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46 minutes ago, Errol said:

Hardly anyone actually handed anything in. Most lost bullion if they had been stupid enough to keep it in bank vaults etc.

So basically unless you can hide your asset it can be confiscated (or taxed to death)...can't see the attraction of BTL properties as an investment, I can't even fit it under my matress! :-)

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35 minutes ago, A_P said:

What kind of wealth are you trying protect/secure (rheortical question as it's none of our business)? Act and set accordingly. We can't win them all, all of the time. You sure as hell can lose if you only go one way. And sometimes there's nothing you could have done, no matter what. Chill out and relax.

Just threw the idea out there to see what others came up with, based on the normally accepted dogma that wealth protection is achieved through diversification/allocation (I.e x% equities, x% gilts/bonds, x% cash). This theory however assumes that what these allocations are `measured` in (I.e FIAT) is actually worth something...in a world hyperinflation scenario would this still be the case?

I think your last statement wraps it up well...despite what any financial expert states (and their bias), sometimes in extreme scenarios there is nothing that you could have done/never a right answer until you are `looking in the rear view mirror`....

Now chilled :-), so lets get back to discussing how to make even more (soon to be worthless?) FIAT :-)

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reformed nice guy
2 hours ago, wherebee said:

I'd go with a 5x20 rule.  20% of your wealth set to grow well if nothing changes.  20% of your wealth set to grow if there is a wholesale collapse.  And the rest in similar bands.

Clever! I like your thinking

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2 hours ago, wherebee said:

Yes.  

 

I think you can healthily look at doom scenarios in a variety of phases and have your wealth set accordingly.  The mistake many TOSSERs and DOSBODDERS made was to assume that a HPC would happen soon, and would be nationwide, and would be unstoppable.  So when there was a crash but house prices were largely unaffected, their plans were shown as being way too conservative.

I'd go with a 5x20 rule.  20% of your wealth set to grow well if nothing changes.  20% of your wealth set to grow if there is a wholesale collapse.  And the rest in similar bands.

Taleb calls this a 'barbell' investment strategy, with small %'s of your overall wealth on either end of a spectrum in order to take advantage of extreme circumstances one way or another (I'd argue that 'growing well if nothing changes' is also an extreme scenario given the current economic climate).

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3 hours ago, MrXxx said:

OK, so now I am really lost/confused on how to secure my future/pension/investments...having watched a number of Sperando and Maloney videos posted on here (and the hidden truths series) the message is that we are in for financial Armageddon, and not just locally/Nationally but worldwide, and we are `talking` months/years rather than years/decades...

OK, I appreciate that some of these are sales pitches (Maloney especially), but they all seem to agree that rare commods (G & S) are the only way to preserve your money...

FIAT=forget it, bonds=worthless promises, equities=assets inflated by QE currency that will disappear as quickly as it appeared, miners=an increase but only in worthless FIAT...

...so the only way to go is pm, and then only if you have them `in hand` and can make sure they aren't confiscated...

...or am I missing an opportunity and just being hysterical?!

I like Maloney and find his videos very informative, interesting and educational albeit you soon learn every year is THE year for gold and silver and the end of the world is nigh, call it enough times and you'll eventually be right. After 10 years of watching Schiff, Dent, Maloney (even reading Armstrong from time-to-time) et al. you do become at risk of dulled receptiveness to the underlying message. But what you can rely on is is that for every quarter of continued growth we are a quarter closer to a technical recession so the probability they will call it right is increasing. And this far into an expansion it is prudent to be ever more cautious (it just makes sense IMO). I believe in the case for gold (and silver especially given its current price level relative to gold) as much as most here but I also wouldn't bet too heavily on any one outcome due to past experience of being burned and I don't lose much sleep over it either way. I think we're due a big correction in house prices in the SE (so localised crashing), moderate corrections elsewhere, large spike in business failure and temporary high unemployement for a while due to highly leveraged companies...so a significant recession but not as bad as 08 when the banks were in worse shape. I do believe fiat currencies will have their day eventually but I don't see any immediate threat to the dollar just yet so my guess is plates keep spinning on that score. China has to have a severe recession/depression of its own like the States  has had multiple times before it gets the next leg up (I simply don't believe any economy, let alone a planned economy can rise in a straight line without malinvestment eventually bringing the cards down). Could be a couple of decades away IMO before dollar hegemony is genuinely challenged. 

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5 hours ago, Agent ZigZag said:

what is old always becomes new - That is an old saying my mother use to say to me, that you do not hear very much today. I have always been attracted to the opposite end of the fashion spectrum and current trends although there are times that I do run with the herd. One item that I am currently running against the trend is Brown furniture and paintings that are wholly out of favour. I am buying a lot good quality furniture/antiques these days, usually because I like them and use them but also an eye on potential future resale value or hand down to the next generation. The craftsmanship in say a mahogany/walnut table or side cabinet can be picked up for between £100- 450 whilst a similar modern piece from IKEA etc is at the upper end and plus of this price scale for a inferior product. Are there any other forum members seeing value in other tangible assets other than the obvious gold and silver etc. If so what are they and would you care to share.

I'm very much with this. I picked up a twin pedestal antique desk whose home was once upon a time the Bank of England (complete with emblem on the leather). I paid £400 for it. When I look at what £400 buys you for a large desk these days it is nothing really. I got a (relatively) matching leather cushioned chair for it for £40 from Gumtree. Had to drive 60 miles there and back for it but well worth it. Nothing particularly special about the chair but has a lovely worn look, is of great workmanship and quality and has aged beautifully. What would £40 get me at Ikea? Just looking and I am not impressed. I'd say my taste is quality, price is actually less of a concern but just so happens you can find quality for a better price than you can buying new these days...largely overpriced Chinese tat.

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