Financial topics

[richard5za]

Cool,
Here's some good news:
On 4 November Bitcoin, Platinum and Gold all have an upwards break out from their current price trends. So lets hope that this is not a false break out and that your investment in Bitcoin grows a bit

My thesis is the same, but I personally believe it is a false breakout because something is going to break in the next 4-5 months, which will send markets and even BTC lower.

If you really do believe that Bitcoin is going lower you could sell your current holdings and buy back at a lower price That would be a clever trick!!

[vincecate]

If you really do believe that Bitcoin is going lower you could sell your current holdings and buy back at a lower price That would be a clever trick!!

While I believe there will be a general panic/crash/waterfall and Bitcoin will go down, I also think that at any time Russia could be discovered to have been using much of the extra gas that Europe was no longer getting to mine Bitcoin and then using that to buy things from China, Iran, etc.
Or BRICS countries could announce that they will try to move away from the dollar toward Bitcoin for clearing between their countries.
Or some similar announcement that could send Bitcoin over $100,000 very fast.

So rather than sell my Bitcoin I have puts on the S&P500. If the crash happens and Bitcoin is cheap (as expected) then I can buy a bunch more with the winnings from the S&P puts. But I don't have to worry about Bitcoin suddenly jumping to $100,000 and not having Bitcoin.

[richard5za]

If you really do believe that Bitcoin is going lower you could sell your current holdings and buy back at a lower price That would be a clever trick!!

While I believe there will be a general panic/crash/waterfall and Bitcoin will go down, I also think that at any time Russia could be discovered to have been using much of the extra gas that Europe was no longer getting to mine Bitcoin and then using that to buy things from China, Iran, etc.
Or BRICS countries could announce that they will try to move away from the dollar toward Bitcoin for clearing between their countries.
Or some similar announcement that could send Bitcoin over $100,000 very fast.

So rather than sell my Bitcoin I have puts on the S&P500. If the crash happens and Bitcoin is cheap (as expected) then I can buy a bunch more with the winnings from the S&P puts. But I don't have to worry about Bitcoin suddenly jumping to $100,000 and not having Bitcoin.

Sounds like a good hedging strategy

[richard5za]

Interesting view on gold expressed by tghe Govenor of the Dutch Central Bank:

In essence that with rising interest rates the Central Bank estimates it will incurr interest rates losses in the 4 year period 2023 through 2026.

But current gold prices are higher than original purchase prices on the gold holdings of the Dutch Central Bank, and valued at mark to market, there is a gold revaluation reserve account against which interest rate losses incurred will be written off.

The Bank does not envisage selling any of its gold holdings, rather if the gold revaluation reserve runs out it envisages the gold price increasing to create more revalauation reserves.

This looks like it just might be step one of bringing gold back into the global monetary system? Any views?

[vincecate]

The Bank does not envisage selling any of its gold holdings, rather if the gold revaluation reserve runs out it envisages the gold price increasing to create more revalauation reserves.

This looks like it just might be step one of bringing gold back into the global monetary system? Any views?

If you imagine the dollar getting hyperinflation and over some period becoming worthless, then the only remaining reserves many central banks will have will be gold. At that point the world currencies have gold backing. There will be some huge value changes before things stabilize but a dollar failure could send the world back to gold backed money.

[Cool Breeze]

Inflation can be positive or negative. In economic theory the commonly used term for negative inflation is deflation
The commonly understood way to bring inflation down is to slow down the economy, bring growth rates down, even negative growth rates, as necessary. This is done by increasing interest rates. If the recession is severe it is not uncommon for inflation to become negative, termed deflation.
Yesterday the Bank of England announced that the UK had entered recession. It is anticipated that this will be a long recession lasting until mid 2024
Other countries are expected to enter recession, in fact the whole globe will probably enter recession including USA.
So now lets come back to John's forecast. He forecast deflation based upon generational theory. I am saying that looks like a very good call in current circumstances

Deflation, if using pricing and not the supply of money (so let's put that aside for a second), means a decrease in prices. It does not mean a slowing rate of increasing prices. That's what is happening. Prices are still increasing! How many times do we have to say this?

Also, the "commonly understood" way to bring down inflation is silly and propaganda. Think of how dumb it is to destroy the economy just to get prices to not increase as fast. LOL!

Again, please tell me what you and John are really saying. And use the appropriate language. Note also that inflation has caused such a problem, even if prices start to go down, it will have been what I described. Not John, who was wrong about inflation being the problem, as he said it was transitory and would go down, and it didn't. For a long, long time (and still is persistent).

You can read John’s theory and posts on this website for yourself

I did, I'm not sure you have, or at least understand the clear fact that he was wrong, proven at this point (regarding deflation). He himself has admitted as much.

[Cool Breeze]

If you really do believe that Bitcoin is going lower you could sell your current holdings and buy back at a lower price That would be a clever trick!!

While I believe there will be a general panic/crash/waterfall and Bitcoin will go down, I also think that at any time Russia could be discovered to have been using much of the extra gas that Europe was no longer getting to mine Bitcoin and then using that to buy things from China, Iran, etc.
Or BRICS countries could announce that they will try to move away from the dollar toward Bitcoin for clearing between their countries.
Or some similar announcement that could send Bitcoin over $100,000 very fast.

So rather than sell my Bitcoin I have puts on the S&P500. If the crash happens and Bitcoin is cheap (as expected) then I can buy a bunch more with the winnings from the S&P puts. But I don't have to worry about Bitcoin suddenly jumping to $100,000 and not having Bitcoin.

This is my point. I don't need to try and time, or risk it, when I'm already a believer for 5-10 year holding. I'll just buy more. And if I'm right, and the world doesn't go to total shiznit, I'm FIRE.

[Higgenbotham]

The 3 phases of a bull market. So far as I know, the credit for this concept goes to the late, great Richard Russell. Russell has been gone a long time and I was unable to find his description of this, so I took a different description and modified it close to how I remember Russell describing it. This describes stocks, but it can be applied to any market.



Phase I is the Accumulation Phase, where farsighted investors sensing that prospects although now depressed, are due to turn up. They are willing to pick up all the shares offered by discouraged investors and distressed sellers. The public is disgusted with the market and has now exited. Activity has trailed off and becomes dull. Price action normally undergoes a prolonged sideways movement and becomes immune to bad news. Most remaining investors have a general disposition to expect worse things ahead. It is now that stocks have sunk to below "Known Values" and under these conditions informed, serious investors begin their accumulation, therefore this phase is named the Accumulation Phase. Competition is at a minimum as the public is disinterested, careful and controlled purchases take place as a long base is established. The uninformed public is incapable of recognizing the bargains as they don't look for value.

Phase II may be called the Mark-Up Phase. It occurs as the improved tone of business and rising price action begin to attract public and institutional attention. This second phase is the longest phase and most deceptive of the three phases. It is characterized by a steady advance building on increasing activity reflected in growing volume. It will be punctuated by secondary reactions when investors become convinced lower prices are out of the question. When the bull chorus is the loudest a secondary reaction often strikes to the downside which is unusually violent compared to the other phases. The advancement in prices during phase II is in response to the known improvement in earnings. Stocks are marked-up because belatedly the public becomes aware that pessimism or necessity had forced prices too low.

Phase III is termed the Blow Off Phase or Mania Phase. It is labeled this as the market undergoes a character change. No longer are stocks bought in due consideration of intrinsic value or earnings power, but instead the crowd buys on prospects only with no regard for values. Certain stocks take on a religious component as their future seems certain and the masses flock to them. The market boils with activity, financial news is all good, price advances are spectacular, IPOs dominate the financial headlines and grab everyone's attention. It's in phase III where your obnoxious brother in law reminds you how he scored huge by flipping the latest fad stock, oblivious of course to the fact that it had been going up for years and has zero earnings. In phase III the market has been going up for so long it seems to actually take leave of its senses. General confidence has allowed price to discount not only present values, but future dream like possibilities.

[aeden]

https://gdxforum.com/forum/viewtopic.php?p=11999#p11999
https://gdxforum.com/forum/viewtopic.php?p=12001#p12001
The H observations are over the target on the phase.
I spent midnight oil reading J, H amd G who I miss very much.
The march sweeps will be who survived. We seen this before many time.
This is their first bear market for many and my first one was devasating beyond words
in the seventys. Currently the decieved, decieving many is painful to witness.

https://www.youtube.com/watch?v=nn8a8Mwyz08

[richard5za]

If you imagine the dollar getting hyperinflation and over some period becoming worthless, then the only remaining reserves many central banks will have will be gold. At that point the world currencies have gold backing. There will be some huge value changes before things stabilize but a dollar failure could send the world back to gold backed money.

I think that this is where our opinions differ. I recognise the possibility of dollar hyperinflation but believe that a solution will be found prior to hyperinflation. There is nothing of sufficient size to replace it, not even a basket of assets or currencies. Can you imagine the global economic devastation, the debt crisis, wars and human starvation with hyperinflation on the worlds reserve currency?