Just like I had no idea what a perch was until I looked it up Wiki and it turns out its just a sacalait.
Printable View
Just like I had no idea what a perch was until I looked it up Wiki and it turns out its just a sacalait.
I had the idea that when you become more risk-averse financially (e.g. retirement) you first move to more stable-growth stocks, then bonds, and then you pull out of those markets and move cash into banks. When bank interest rates fall during times of increasing inflation then cash moves into gold, real estate, etc. to slow the rate of "evaporation" of your wealth due to money-printing.
I assumed that an individual would do some combination of those things.
If you have money in 401(k) and IRA plans, at a certain point you are forced to withdraw and pay taxes on the accumulated value. Those Required Minimum Distributions can result in other costs, like the IRMAA cliffs on Medicare premiums. Options such as Roth Conversions can have the same impacts, but can't use RMD monies anyway.
So this cash can be taxably reinvested, stuffed into banks paying dwindling interest, or into gold (and to some extent silver, platinum, etc.) and real estate.
Perhaps aging "boomers'" RMDs are, in part, what is driving gold demand today? Not to make any money but just to avoid bank account evaporation?
"Bluegill" are often just a generic name for sunfish. There are numerous species of sunfish, which I didn't realize until I went to college. Bream is a different name for them. Technically, bluegill is a single species of sunfish. I may have to go back to the ponds of my youth and figure out whether I was actually catching bluegill (probably not), or some other species like pumpkinseed (more likely).
Perch are somewhat simpler, since most people mean yellow perch when talking about perch. There are others, they just aren't as common.
Never heard of a sacalait, but upon looking it up, that looks to be a crappie, not a perch. For that matter, bream is also a misnomer, since actual bream may not exist in the US. The term is used for sunfish, but there IS a fish called a bream and it is European.
It's possible, but I doubt it. Those RMDs begin at 72. If you inherit an existing IRA with an RMD, you have to start taking disbursements immediately, regardless of age, so RMDs can start earlier in certain cases. Still, they tend to start pretty late in life.Quote:
Originally Posted by dilettante
The point of the RMD is that the IRS wants your IRA to expire at the same time that you do. My father has told me that his investments have been doing so well that his IRA has increased despite the RMDs being paid out. If that is common over the last couple decades of relentless stock market growth, then it may be that there are a bunch of seniors looking for somewhere to stash cash, but I still hear more gold hype coming from more youthful, retail investors. Retail investors have driven some impressive market booms over the last few decades. GameStop is probably still elevated. Bitcoin and others are still way up there. Gold is probably just another example, since there are plenty of people talking it up at any given time.
The problem with stocks and bonds, no matter how they are held, is that they are denominated in shrinking IOUs. Some administrations even chose to weaponize those IOUs.
Even crypto fanatics have started dumping it in favor of gold. Not to mention governments and central banks.
So the question is how many people are going to find themselves holding a wheelbarrow overflowing with worthless paper. That's assuming the market bubble doesn't just pop massively before then.
But I don't think the gold FOMO panic has even started. The mass media seem to be downplaying it yet.
That is very much the question. That is ALWAYS the question.Quote:
Originally Posted by dilettante
We can't eat bonds nor live in them (technically, we could live in stocks, but only if you use a different definition of that rather common word). We can't eat gold, either. Given the right scenario, every possible investment would become worthless. Different scenarios for different investments, of course, but for every investment there is at least one scenario that wipes them out. The question is whether or not that scenario ever occurs. Life is a gamble in that regard.
I don't think it WILL start. I think we went through it a couple decades back and folks remember that. This time around, I doubt there will be quite the hype train just because it was a train to nowhere the last time around. Gold was NOT the great investment in 2007-2009.Quote:
But I don't think the gold FOMO panic has even started. The mass media seem to be downplaying it yet.
Once bitten, twice shy, and all that.
Yeah, money/investments is strange that way. The only value you it has is what we say it has and no type of money/investments is an absolute.
Saw a Twilight Zone where these guys stole a bunch of gold. They find a cave and hibernate for like 100yrs. when they awake they kill each other over the gold. The last one alive is found just before he dies. The people that find him can't understand why he was carrying a bunch of worthless metal.
Surely governments and central bankers have more understanding of matters than the rest of us. If it is so worthless in the long run why are they scrambling to hoard it now?
My guess would be that the proxy relied on for so many years (US Treasuries) is not expected to last much longer as the world's value reserve.
But I'm getting more serious than I intended to in this thread.
I don't think anyone is saying gold is going to be worthless in the long run. But it is possible that it could lose it's value. Why are some governments and central banks increasing their gold purchases? Because of decreased faith in the US dollar.
Edit:
As I said before, gold is just another commodity. If you would have bought it when it was peaking @ 1980, it would have taken you @ 26yrs just to break even. Much longer than that considering inflation.
https://www.macrotrends.net/1333/his...100-year-chart
Is it peaking now? I have no idea.
What do you call "peaking?" It has been over $3300/ounce for a month and spot is now well above $3500.
Peaking would probably be noted in retrospect if it dropped considerably from the current high.
If we could peek into the future and note a peak, we'd be rich, so to speak, which would cause a few fits of pique.
I pretty confident you know what the word "peaking" means. So I don't understanding what your asking.Quote:
Originally Posted by dilettante
As for what the current price means, it means as of right now people are willing to pay more for gold. Will that continue, as I've said, I have no idea.
Since this became topical when dedollarization took hold I started looking at it off and on.
What I found was that gold/Dollar (and other currencies) has not ever peaked unless you cherrypick very short time windows.
Silver is another case altogether, but silver is mainly an industrial commodity with only a secondary role as a monetary metal. Silver has indeed peaked and fallen back for many years more than once.
So when you speak of gold "peaking" I'm not sure whether you mean something else, since it doesn't do so in the conventional sense.
I think "the story being told by gold" right now is that the buying power of the Dollar is falling more rapidly than ever. Its valuation curve as exceeded the Dow.
My only interest is in whether us plebes on the outside have made a mistake.
All that said, a price correction to $2800 or so does seem plausible after the September feeding frenzy subsides.
I wouldn't be willing to bet on it. Investing is always something of a gamble. I feel less certain than ever as to what the market is going to do. Bad news can be good news for certain sectors, while good news is bad news for other sectors.
Still, I've never liked commodities investing. I can understand people wanting to take a "moon shot" gamble, such as GameStop or Bitcoin. If it hits, you make a bundle. If it doesn't...well, that's likely, so don't put too much on it. Meanwhile, commodities never seem all that great. When they hit, they don't hit all that big. When they don't hit...it's a loss.
For example, you mention a price correction to $2800. That would be a significant price correction, yet as a percentage, it isn't all that high. It just feels like a lot of volatility risk with no chance of getting a large win. That may not be a fair perception, or correct, but investment is often about emotion, and I'm not feeling commodities.
Well I see a bit over $3600/ounce the last couple of days. I think $2800 would feel like quite a price drop to somebody sitting on a tube of 20 Gold Eagles right now.
It certainly would, especially if you are buying in today. I just feel like commodities do that. I guess a swing of 25% is a pretty big one, especially if it happens quick. Commodities seem to do jumps like that, though not all that fast, usually. If you feel like it's a good investment, then wouldn't the thinking be to wait it out?
I feel like one would get into a metal because they think that either the market is going to cause demand to soar (and for some reason supply won't keep up), or because it's gold. Gold is weird as a commodity since it is so often used as an investment vehicle rather than a commodity consumed in industry. If a person buys because they think demand will soar, then a drop in the short term might not bother them all that much, even if it's as much as 25%, since they'd be expecting an increase of a few hundred percent in a longer term. I feel like commodities (other than gold) are bought on the expectation of increases much greater than 25%, so that drop might not be meaningful.
Don't like those investments, though, so I don't dwell on them all that much.
Consider lithium or copper. Something like EVs cause demand to soar, which causes prices to soar. If you were to get in before that, all is well, but if you get in late because the price is soaring...well, supply followed the demand and the prices headed back down. If you look at lithium now, you can find recent articles both talking about prices soaring and that over supply is causing prices to plummet. You need a strong stomach to take a ride like that one.
hello :)Quote:
Originally Posted by Shaggy Hiker