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 Replies: 17 / Views: 2,689 |
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Pillar of the Community
United States
931 Posts |
The same people that listened to their brokers the last time the stock markets plunged are wiser this time. They are getting out while the gettin' is good and protecting their retirement funds. There may not be another phony recovery this time and they are afraid and bailing out. With these multiple loss days in the market it is obvious that hedge funds, the big banks, and all of those little guys are selling and wishing like crazy that they had NOT listened to their brokers and PM haters. Those of us who sat back and took the time to really examine what was happening in the world are being rewarded for having the courage to take the path less travelled. I really like hanging out with so many smart people and you all deserve a pat on the back for doing what you believed even when people looked at you like you were crazy. Edited by junior e
08/08/2011 5:13 pm
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Pillar of the Community
United States
830 Posts |
Well said JE  |
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Pillar of the Community
United States
1450 Posts |
If this unravels as quickly as I think it might,the ETFs may be the next casualty! From all I have been hearing today,if there is a run on ETFs they will collapse for lack of backing. All of the leveraged BS is coming home to roost and a lot of people are gonna get burned. I don't think ANYONE on Wall St. can believe the speed this drop is taking. I have to laugh when those guys are all trying to blame the downgrade but the people are finally waking up worldwide. Greed and dishonesty have their price,and I believe it is about to be exacted!
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Pillar of the Community
 United States
931 Posts |
A lot of people are going to sit back and enjoy their paper gold, only to find that they are wrapped in the biggest cover-up since Enron. 10% will take possession of physical gold if they're lucky. Probably a lot of Sovereigns and other super common gold types with no guarantee of condition. I hope not too many people on here are riding on ETF metals. I can only imagine what this is going to sort out to be. There may be some ETF managers jumping out the window. I really like opening my safe and knowing that it's all right here at home.
Edited by junior e
08/08/2011 3:34 pm
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Valued Member
United States
397 Posts |
 I think a lot of people are going to be in for a very rude awakening. |
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Pillar of the Community
United States
830 Posts |
Hocking, what ETFs are you talking about? Equity ETFs or PM ETFs?
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Pillar of the Community
United States
3670 Posts |
Well said Junior, I agree 100%!
Is a recession a real possibility now, I would think so?
I fear the day of 10 dollar bread, milk an gas....
Edited by Silverhawk74
08/08/2011 5:09 pm
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Pillar of the Community
United States
931 Posts |
I was talking about GLD, SLV, etc. I was specifically talking about GLD holders that want to take physical possession. Thunder, I know that you were able to cash in, but could you take physical possession? You know a lot more than I do, but I've read about PM ETF's holding 10% of the gold that they're selling. And I think we've been in a recession since 2007 disguised by a falsely pumped up stock market.
Edited by junior e
08/08/2011 5:22 pm
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Pillar of the Community
United States
1064 Posts |
When you're right junior, you're right!
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Pillar of the Community
United States
830 Posts |
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but could you take physical possession? I'd say that generally people that invest in GLD don't want to take possession, if they wanted possession they would buy coins and bars. But that's just speculation on my part  I hold it in my IRA because its too expensive to hold physical in an IRA. That said I have been moving more and more into physical and out of paper. |
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Pillar of the Community
United States
4008 Posts |
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Those of us who sat back and took the time to really examine what was happening in the world are being rewarded for having the courage to take the path less travelled. I really like hanging out with so many smart people and you all deserve a pat on the back for doing what you believed even when people looked at you like you were crazy. Mega dittos, Junior... very well said, indeed. Quote:I'd say that generally people that invest in GLD don't want to take possession, if they wanted possession they would buy coins and bars. But that's just speculation on my part Well, if it is, it is PDG speculation! This is exactly why some people hold their PMs in ETFs and funds. These vehicles are ideal for trading. One can buy and sell them much more quickly and easily than one can buy and sell physical metals. Fortunately, this is not an either / or deal. One can own PMs in both forms for different purposes. My physical metal is not for trading, so its slow buying and selling speed is not an issue.  Quote:
And I think we've been in a recession since 2007 disguised by a falsely pumped up stock market. I do not believe that we are in a recession. This is a depression, which is a DEEP recession coupled with persistently high long-term unemployment. Sounding familiar yet? It should. It is where we are. To a lot of Wall Street types, a recession is only getting a million dollar bonus instead of a 10 million dollar bonus. A depression is not getting a bonus. Here on the streets of America, a recession is when we are squeezed by lower incomes and higher prices while the powers that be all agree that we are not in a recession. They're right about that but none of them has the courage to call it what it is. Quote:
There may be some ETF managers jumping out the window. Dramatic moments like that are only found in the movies. In the real world, the ETF manager would be hiring a large truck to take most of the bullion to a chartered mid-night Air Brazil cargo plane for a flight to a life of absolute luxury in a place with no US extradition treaty. Quote:
Greed and dishonesty have their price,and I believe it is about to be exacted! Indeed it is, Hock. And good on 'em, too! I feel sorry for the folks they conned out of their hard earned money, though. They will get a share of this as well, even though they do not deserve it. In the movies, they call this "collateral damage". Edited by Ed_B
08/08/2011 6:48 pm
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Pillar of the Community
United States
1450 Posts |
From what they were talking on CNBC today,because of the "things"that are leveraged in the PM ETFs.if there is a run on them there will be no way to liquidate the holdings. First,let me say,I don't own any ETFs because I don't understand how they work but what I read on one prospectus made my gut say"stay as far away as you can from these things!"(and that is a DIRECT QUOTE from my gut.) So,I don't claim to know how they work but they were talking about many of the metal ETFs being double and triple derivatives(whatever that means).
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Pillar of the Community
United States
860 Posts |
If you read the "Trust" papers for GLD and SLV, unless you are a principle of the trust like MS or JPM, etc. you can not demand payment in gold without a time consuming and expensive process, involving baskets of over $1 million plus delivery and storage fees. If you do accomplish this, you will received London "Good" bars 100 OZ. and lesser partial in cash. If you own outright over 50,000 shares of GLD you might be able to pull it off, otherwise, you will get cash.
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Pillar of the Community
United States
830 Posts |
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but I've read about PM ETF's holding 10% of the gold that they're selling I'm not sure about those, but GLD and SLV are holding almost 100% metal to valve of the shares. Here's the prospectus for SLV: http://us.ishares.com/content/strea...lication/pdfIt is covered starting about page 20 I think where some people get 10% is because on GLD the share price is about 10% of 1 oz of gold, in other words in takes roughly 10 shares to equal 1 oz of gold...for example today the share price of GLD hit $168 and 1 oz of gold was $1700. That's not to say there are no risks, for example if some of the gold held by GLD was found to be tungsten bars instead of gold bars the share holders would be the ones holding the loss.  But buying fake gold could be a problem with other ways of owning gold too. Edited by GoThunder
08/08/2011 10:27 pm
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Pillar of the Community
United States
4008 Posts |
If a PM ETF were discovered to be buying fake gold bars but not covering losses incurred by their clients because of their ineptness, it would end their business. ALL other clients of theirs would liquidate their holdings immediately upon hearing that announcement. No one would ever buy another share of that ETF again.
In the mutual fund market, very few money market funds have ever "broken the buck" for the same reason. Those that did, quickly replaced the losses from the custodian's own cash reserves. They simple cannot afford to be the 1st money fund wherein the NAV drops below the standard 1 dollar per share and costs their clients part of their savings. If that were to happen, clients would leave that custodian in droves.
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Pillar of the Community
United States
830 Posts |
Yeah I'm very confident in ETFs, I really don't understand why people are so uncertain about them. I think they are far better the mutual funds and I can't remember the last time I bought an individual stock.
Even the ETFs that have closed, its not like everyone loses their money. I've never been in one that closed but as I understand it they just stop trading on them and liquidate the holding and distribute the money to the investors minus the costs. They usually close due to lack of interest in them, not enough investors to support the administration. So it would be the thinly traded ETFs that would fail...GLD and SLV have mammoth volume, not a chance of them closing IMHO.
That's not to say there aren't some great advantages to holding physical over paper in some SHTF event.
Edited by GoThunder
08/09/2011 6:50 pm
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Replies: 17 / Views: 2,689 |
Posted 08/08/2011 3:16 pm
