tag:blogger.com,1999:blog-1527840491496268397.post2702336925151221586..comments2024-03-08T11:20:30.095-07:00Comments on Credit Bubble Stocks: Review of Traders, Guns and Money by Satyajit DasUnknownnoreply@blogger.comBlogger2125tag:blogger.com,1999:blog-1527840491496268397.post-25161892674361946802014-03-02T18:58:28.351-07:002014-03-02T18:58:28.351-07:00Yep, exactly.Yep, exactly.CPhttps://www.blogger.com/profile/12701174164478027499noreply@blogger.comtag:blogger.com,1999:blog-1527840491496268397.post-34871301812589091782014-03-01T20:13:16.236-07:002014-03-01T20:13:16.236-07:00Another funny observation is that in the late 90&#...<i>Another funny observation is that in the late 90's, the "central banks sold off their gold reserves, forcing the gold price lower.</i><br /><br />As a person who owned gold from 2004 to 2006, I find this topic quite interesting.<br /><br />I have been asked (in the past) why I no longer want to own gold <b>especially now that central banks around the world are buying gold</b>.<br /><br />My answer is always the same. If the best time to buy gold was when central banks were selling (which is definitely true using hindsight), then it stands to reason that the best time to sell gold is when the central banks are buying.<br /><br />It is not rational to use central bank buying and selling arguments any other way in my opinion.<br /><br />Put another way, if someone claims that we should be buying gold because central banks are buying, then in order to be consistent that same person must claim that we should have been selling gold when central banks were selling.<br /><br />Since we know for a fact that we should <b>not</b> have been selling gold when Gordon Brown was selling gold in the late 1990s, the whole argument falls apart.<br /><br />Nothing ruins an investment idea more for me than arguments that don't make logical sense. I can see valid arguments for owning gold but central bank buying is definitely not one of them.<br /><br />In any event, I no longer wish to own gold. I told myself that when I bought in 2004 I'd only be selling once. I sold for a 50% profit in 2006. In hindsight, it was a reltively low risk "low lying fruit" trade (although it did not feel like a low risk trade at the time). I'm done. In order to want to buy it again, I'd need to see it come down in price substantially (compared to toilet paper and aluminum, two items relatively speculator free).<br /><br />All rising gold prices can do for me now is inspire me to hoard more basic necessities (ones that do not require a greater fool to make them useful to me). These relatively lower gold prices of late don't even get me to do that these days (at least not like I was). I'm leaning disinflationary/deflationary. ZIRP is looking more and more like a long-term situation (with little to no hope of escape). Sigh.Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.com