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*China considering dropping U.S. Treasuries and Buying Gold Instead*Very Important News- Implication

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posted on Jan, 30 2009 @ 07:43 PM
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reply to post by disgustedbyhumanity
 


I have been waiting on the hyperinflation that will most probably happen towards the end of the year or fall.

I also have researched the hyperinflation and then paying off my mortgage.

I can not remember the website, but a financial lawyer had said, hyperinflation will hit - then people he believes will have a small window to pay off their mortgage, before the govt. takes care of that issue for the banks and thus makes a law that increases your mortgage with the hyperinflation.

He said, you will almost have to take it to the banks personally, due to the fact, he does not believe the banks will accept or receive via mail, the "payoff" money. He thinks, they will do everything possible to avoid that scenerio, until some law is passed.

So, I am already been thinking about that issue, and how I would take care of it. I figured, if I offered the bank the payoff in gold or silver, they then might jump at the payoff, compared to a U.S. dollar check,

my two cents on the hyperinflation possible mortgage payoff.




posted on Jan, 30 2009 @ 07:43 PM
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I see today, China and US President Obama might do a little talking. Seems to me China still wants to recover their investments in America, and continue it's sales there too?

Decoy



posted on Jan, 30 2009 @ 07:49 PM
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Originally posted by Rockpuck

Originally posted by Marmota monax
A bit off topic, does anyone have a suggestion as to the best place to buy silver and considerations when buying?

Thanks


While I am very uncomfortable with giving any kind of investing advice on ATS, as it is against the terms and conditions set around the design of the Global Meltdown Forum. I think I should point out a few bits of information.

Generally when purchasing Gold, unless you have a lot of money, is to purchase them in Coin.

Generally when purchasing Silver, because it is much cheaper, it is most common and suggested to purchase a Bar (Ingot).

From 2003-2008 Gold has risen some 90%, Silver well over 200% -- most likely because it is far more accessible given it's price. Silver for someone with a moderate income is far more workable on a budget; basically you can build up a reserve of Silver by purchasing a bar every few months. However, with Volitility you should view this as an INVESTMENT for the Long Term. While Silver at it's height exceeded all the other precious metals, it also has has the steepest decline in price. Still, $929 for a single ounce of Gold, or $12 for an ounce of Silver?

Silver Ingot cost varies widely.. you can by 1oz coins - 10oz bars - 100 oz bars - 1000 oz bars.

(I suggest, only for practicality and for no specific investment purposes, the purchase of 1 Silver 100 OZ bar every other month.)

Roughly $1,300 dollars.

I do not suggest, for practical reasons and for no specific investment purposes, that if one where to purchase Gold, Silver or any other metal, that they NOT purchase in bulk their entire savings.

Metals are NOT Liquid investments, in fact, aside from real estate, it is one of the least-liquid investments.

This is to say, if the price starts collapsing, you cannot sell it on the spot like a Stock, to retain the highest price possible.

If you take your entire savings and purchase metal, then need money, metals are not exchangeable for debt. (in most cases anyways).

Metals ARE NOT MONEY.

Metals are a key inflationary measure.. it is ideal to keep a portfolio of metals because they follow the inflationary trends. As the money supplies grow, the price rises, and as deflation sets in, prices decline. At our Dollars weakest point, the price of Gold was highest. As you see now, in a deflationary trend the price as decreased. As the Fed pumps liquidity into the markets, the prices rise.

Metals are an excellent way to ensure the true value of currency -- if you buy $10,000 in Gold and keep it for 20 years, then sell it, you are retaining the currencies value when you exchanged it for a metal. If you kept the 10k in a bank account, you would have considerably less, especially when compared to the inflation trends.

So I would suggest that any purchase of metal be a portion of your funds that you do not need. That you do not need access to. That you can put away and pretend it doesn't exist. Think "Long term" investment, whenever you purchase a metal.

You should be wary of giving advice because you are wrong.

Market price of gold was $850 /oz in 1980. It is now $920/oz - 28 years later. Up about 8% in 28 years

During that same time the CPI has gone from 76 to 211 today. That equates to total inflation of almost 200%.

So basically if you bought Gold at $850 in 1980, You can buy only a third of what you could buy today.

More and more gold is mined and put to market every year, thus increasing its supply. As supply rises prices fall, at least according to current economic theory. That is why Gold does not keep up with inflation. If the supply of gold was constant then you may be right. But it isn't sowe don't know. All we know that in comparing trough and peak to trough and peak gold has been a very, very poor hedge against inflation.

Also keep in mind that most folks think the Government has been understating inflation for years, so the outcome for gold was probably worse.

CPI- St Louis Fed

Gold prices 1980




posted on Jan, 30 2009 @ 08:28 PM
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reply to post by disgustedbyhumanity
 




Market price of gold was $850 /oz in 1980. It is now $920/oz - 28 years later. Up about 8% in 28 years


Your looking at a peak time frame where inflation was at an very high level.. interest levels for instance where in the double digits.

If you had taken the time to read it and comprehend my friend, you will see that as inflation sets in, the price rises, as deflation sets in, price declines. Thus the metals will be volatile in this sense.

You have to understand that the price of Gold HAS TO BE compared to the VALUE of a Dollar in that given time frame.

Example, if you bought 1oz in 1980 for $850 -- how much was $850 back then? When 30k a year meant that you where Middle Class?

Today $929 an oz .. considerably less per ounce in relation to the money supply, due to the late 70's and 80's had a much higher inflation rate.

If one took the time to comprehend the relation to dollar value, you would understand, and not make a fool of your self.

Anyone who invest in Metals, MBU, St. Udio, OBE1 or anyone else who has knowledge will understand that when looking at a metal for long term investment, you don't just look at % returns. It's not a stock, your essentially hedging against inflation.



posted on Jan, 30 2009 @ 08:38 PM
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America must get in line with current globalisation trends,and China is the colossus that shall pluck America from the jugular of humanity!Good luck facing the Red Army whilst fighting Israels wars elsewhere!



posted on Jan, 30 2009 @ 08:44 PM
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They de-stabilize us, we de-stabilize them, welcome to modern warfare, gentlemen.
Has always been and will always be about the money.
Does anyone really think that the Chinese are so stupid as to unhinge from the American dollar?
We own alot more of their "debt" than they own of ours, we cannot go under without taking them down too.
They're are already riots in China, unheard of in last 15 years, since Tianamen Square, don't be afraid.
Unless you're a Chinese National.....



posted on Jan, 30 2009 @ 08:45 PM
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Liquidity

While technically not "traders", some investors are considered aggressive. They have an elevated risk tolerance, and choose play the volatility that the Gold market provides. Strategy; sell an allocated % of your core position on breakouts, and repurchase at the trough. Aka: Sell the Rhino Horn...Buy the Fishing Line. Market timing is difficult enough for the pros, so I'm definitely not advocating this as a strategy for the average investor. My point is that many reputable PM dealers accommodate aggressive investors. They will lock-in buy/sell orders at a quoted price over the phone. I can call my dealer with a sell, lock-in a price, ship by overnight carrier.....the funds will be available in my bank account via wire-transfer the following day. If time is really critical, anyone can walk into a neighborhood coin shop and sell on demand. Have you hugged your local coin dealer today?

St Udio...several dealers have Gold/Silver, all forms, available for immediate overnight delivery @ prices much reduced from those you quoted. * Most do require a min purchase, e.g. Gold 10/20 0z lots.

IMO, no-one should commit a serious amount of their hard earned $ to Gold/Silver without having done extensive personal research first.

Edit for clarification: Anyone can call my dealer, or a similar dealer and buy/sell...overnight delivery/next day deposit.

[edit on 30-1-2009 by OBE1]



posted on Jan, 30 2009 @ 09:34 PM
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Anybody remember when I said that China will be dumping their USD reserves for Gold and other hard assets? Anyone remember when I said that the bond market will likely collapse this year?

I'm not tooting my own horn here, at least that's not my intention. But every piece of economic news just keeps confirming this, and I still get a gang of pseudo-economists telling me how wrong I am..

We'll see. And I will say what I always say. Quote me on it later.



posted on Jan, 30 2009 @ 09:37 PM
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reply to post by OBE1
 

In a SHTF scenario, I want more lead than gold.
I want to be prepared for a total societal melt.
I'll laugh at the people that listened to the Glenn Becks and put their money into gold, only useful for ammunition .
Keep a well stocked larder and be healthy in the life


[edit on 1/30/2009 by LAUGHING-CAT]



posted on Jan, 30 2009 @ 09:37 PM
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Originally posted by questioningall


China led all foreign official investors in September by posting a net increase in U.S. Treasuries for the sixth month in the past seven, bringing its total ownership close to $600 billion. Japan was a net seller of Treasuries for the fourth month in the past six.


another article:
www.iht.com...


China has bought more than $1 trillion in American debt, but as the global downturn has intensified, Beijing is starting to keep more of its money at home - a shift that could pose some challenges to the U.S. government in the near future but eventually may even produce salutary effects on the world economy.


I hope you fully understand what the original article would mean for the U.S............ we ........ well ......... lets put it this way...... I don't think the money printing presses, can print as much money per day, as what the U.S. spends. That would basically be the only way to pay our troops and govt. personel - then lets go further...... the amount of "printed money" would flood the world.... what do you think would happen after that......

one word: Zimbabwe

Strange bookkeeping, isn't it?

Zimbabwe?
When China was an orthodox commie state, the USA fought the Vietnam war, financed sightseeing trips to the moon, and the state became generous to the poor and needy lower-middle class. But the Zimbabwe after-effect never came. Why?

Even with the slightly underweight workforce, an average $200 yearly tax increase would cover all the Chinese and Japanese debt buying combined. The problem is that given the economic situation, this tax increase would be inconvenient to the task of making the economy recover faster. That's why the Chinese, who are becoming dependent on the US economy, will wait hording gold, as they said.

The USA has been holding the world by the balls for some time and it's going to stay that way for some time.
















[edit on 30-1-2009 by questioningall]



posted on Jan, 30 2009 @ 09:45 PM
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reply to post by stander
 
In spite of the doom and gloomers, we, in th U.S., own most of the worlds gold. So it is as worth as much as we say it is.
Keep your eye on the ball, m'friend.



posted on Jan, 30 2009 @ 09:51 PM
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That is exactly what I did. To equal inflation since the peak in 1980 you would have to about $2500 to have the same purchasing power than did back then. Instead you have $920.



You have to understand that the price of Gold HAS TO BE compared to the VALUE of a Dollar in that given time frame.

Example, if you bought 1oz in 1980 for $850 -- how much was $850 back then? When 30k a year meant that you where Middle Class?


Anyone who understands inflation knows who is the fool here.


If one took the time to comprehend the relation to dollar value, you would understand, and not make a fool of your self.


The evidence shows that your assertion is simply not true.


Anyone who invest in Metals, MBU, St. Udio, OBE1 or anyone else who has knowledge will understand that when looking at a metal for long term investment, you don't just look at % returns. It's not a stock, your essentially hedging against inflation.


I think what you are trying to say that in time of inflation, then gold tends to go up. Maybe so. But it also falls quickly down to a base and trades there for a long time when there is no inflation In that you case you would not want to be a long term holder of gold, but instead trade it on paper instead of paying the steep cost of taking physical.

I wish you luck, but those who bought gold in the last bubble during the early 80's, know exactly what I am talking about it. Gold is a dead man walking.

edited to correct quotes



[edit on 30-1-2009 by disgustedbyhumanity]



posted on Jan, 30 2009 @ 10:13 PM
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Has anyone considered that this may be a conspiracy to rob the Chinese of their wealth?

Doesn't the US have a secret stash, a monstrous unknown amount of gold? Fort Knox maybe?

If the Chinese buy up a big whack of gold thinking and believing the gold to soar in price when all of a sudden the US says OH ya, we have 2 Quadrillion worth of that medal.

Then what happens to the Chinese gold? ROTFLCOPter


They'll wish they kept the US dollar.

This whole shenanigan could all be by design with the ultimate goal of getting rid of the Chinese money threat, space threat, global power threat etc all in one huge scam.



[edit on 30-1-2009 by Wormwood Squirm]



posted on Jan, 30 2009 @ 10:27 PM
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Originally posted by Wormwood Squirm
Has anyone considered that this may be a conspiracy to rob the Chinese of their wealth?

Doesn't the US have a secret stash, a monstrous unknown amount of gold? Fort Knox maybe?

If the Chinese buy up a big whack of gold thinking and believing the gold to soar in price when all of a sudden the US says OH ya, we have 2 Quadrillion worth of that medal.

Then what happens to the Chinese gold? ROTFLCOPter


They'll wish they kept the US dollar.

This whole shenanigan could all be by design with the ultimate goal of getting rid of the Chinese money threat, space threat, global power threat etc all in one huge scam.



[edit on 30-1-2009 by Wormwood Squirm]


Actually, we have discussed the Fort Knox earlier in the thread, the problem with Fort knox, is there may not acutally be any gold there.

That has been a problem for years, the U.S. has not done a formal inventory since Eisenhower was President, though various groups have demanded an accounting of the gold that is suppose to be there, the Govt. has never given one.

Many say, the U.S. does not have any gold any more.

Do some research on it, you might find, we would be up the creek without a paddle...... if China does stop buying our treasuries.

Look at NYC, they might layoff 23000 city workers, including fire, police and teachers (14000) of them. That is before the offical SHTF - wait til the rug is pulled out from the whole U.S.

I started a thread about NYC earlier this evening.

link:www.abovetopsecret.com...

[edit on 30-1-2009 by questioningall]



posted on Jan, 30 2009 @ 10:58 PM
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reply to post by questioningall
 


Time to trade that gold for Rice and lead!!!



posted on Jan, 30 2009 @ 11:16 PM
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Originally posted by projectvxn
Anybody remember when I said that China will be dumping their USD reserves for Gold and other hard assets? Anyone remember when I said that the bond market will likely collapse this year?

I'm not tooting my own horn here, at least that's not my intention. But every piece of economic news just keeps confirming this, and I still get a gang of pseudo-economists telling me how wrong I am..

We'll see. And I will say what I always say. Quote me on it later.


Lots of people have been saying it for a long time and it never comes to fruition. Just because some folks spread a rumor so that they can sell you gold at higher prices doesn't mean it is true.



posted on Jan, 30 2009 @ 11:31 PM
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reply to post by disgustedbyhumanity
 


We are in a DEFLATIONARY PERIOD.

When Inflation comes back to replace the period of economic deflation we are experiencing, the price of Gold will correspondingly rise in relation to the inflation that we see.

If we experience a period of double digit inflation, then we can then compare the highest prices in the 1980's and the prices we see at that point.

What you will see is the price of gold shoot through the roof, following the rate of inflation -- I would expect the price of Gold to be near $2,000 oz at the rate the Fed is pumping money into the economy.

But again..

You are comparing a period of inflation with deflation and I fail to see the point your trying to reach? .. Hanging onto pride at this point to remain "right" is not working for you.



posted on Jan, 30 2009 @ 11:38 PM
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There is one reason why China buys up worthless treasuries...

because they have to.

So does everyone who can.

Why else would they buy ponzi scheme paper?




posted on Jan, 30 2009 @ 11:43 PM
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Originally posted by LAUGHING-CAT
In a SHTF scenario, I want more lead than gold.
I want to be prepared for a total societal melt.
I'll laugh at the people that listened to the Glenn Becks and put their money into gold, only useful for ammunition .
Keep a well stocked larder and be healthy in the life


Hey, to each his own

If I had a silver shekel for every time I've heard that macho argument, I could treat the entire ATS community to an autographed, 1st edition copy of Rambo; First Blood.

For the past six and a half years, I've done ok on my physical Gold/Silver investments...PM stock trades.

How many people have you had to shoot across the same time frame?

Ammo generating income is it?

RMC


*No law against owning both



posted on Jan, 30 2009 @ 11:50 PM
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NOT AGAIN!!!

I think I've seen this thread before here on ATS, it's already been posted here somewhere, but nothing has happened since then. I hate remakes of threads.... and my two cents are China won't leave the dollar because it didn't do it before and won't do it in the future.




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