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frankkarl
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Commodities Run In Supercycles

- Peter Schiff - Europac

I enjoy the articles about cycles and fundamentals in the commodities market but a cynical person resides in the recesses. Is there truth in the assertion that there are 100 ozs gold trading for each real oz? When we look back on past cycles how much pretend metal was playing in the market? If we simply look at money supply in 1980 vs gold $850 and compare to today money supply:gold $1,650 then something seems out of balance. Unless the inventory of metal has grown fifty fold. How much pretend gold was trading in 1980 vs current.
And when we postulate on future fundamentals why does it matter when one who owns no gold, sells it to one who doesn't have the capital to purchase it and then pays itself a commission for doing so? Tomorrow the reverse. The one who has no capital sells the commodity that it doesn't own back to the one which didn't have it to sell in the first place. We'll just have 200 pretend ozs for every real oz and the price will continue to be manipulated to suit the objectives of those who trade no real gold.
How can any commodity trade on fundamentals when there are no fundamentals in it's underlying trading?

Commented 4503 days ago

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Beginning of the headline :Commodity prices can be very volatile, oftentimes more so than just about any other asset class. These large price swings, which have been particularly evident in recent years, have given commodities their reputation for high risk. Those investors who lack a large buffer of disposable risk capital are repeatedly advised to steer clear... Read More

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