What Happens To Gold And Silver Next? Look Out Below?

Gothic and Ceylon both make points to ponder but leave out so much for lack of balance...
Recently, the budget deficit has been shrinking under Obama. Good for him. It started out big and grew with Obama because that's what happens in a super recession as the government spends more to make up for consumers not spending. It is to keep the economy from getting even worse and it was recommended by both Bush and Obama's top economists. Allowing the banks to be more risky like selling insurance, offer derivatives, and credit default swaps is problematic if not regulated properly. Can a government regulate that has been influenced and entertained through campaign donations? Without campaign finance and lobbying reform they will not be able to put the countries' interest ahead of the donors. The conservatives are most against campaign spending reform. Liberals need to understand the government can't fix everything. So pick and choose.

Reagan certainly raised the deficit and taxes but gets a pass because he is "conservative" in so many other ways, like charming talk and perception. I voted for him once!

There needs be a different playbook for each investment bankers and traditional main street bankers. But the rulebook has been blended due to outside influence.

Gothic, Ceylon, et al.,

Interesting viewpoints on current and historical political influences on the economy. Since this thread is intended to aim at gold and silver, though, and many of us aren't able to stick with you at that depth level, would any of you like to translate your comments into what you think it may mean for current or future gold and silver prices?

Well it's Fed Reserve meeting week, so that often does not bode well for the relics, short term.

Both USA political parties have had a hand in the current state of gov't. finance. At some point monetizing debt and the level of debt may turn investors away from t-bonds and the US dollar and toward alternatives. So far not, though. Effects of hot money creation are being felt in the periphery--BRICS, etc. As I've mentioned in the past, the proliferation of ETFs exacerbate market moves. This is easily seen in precious metals and their producers. It works both ways.

Since 2008 many investors have shunned stocks and invested in bond funds of all kinds, because they think they are "safe", or they are reaching for yield, or both. If the creation attributes of bond ETF's (demand creates more ETF shares thus forcing ETF's to buy more bonds) turn into destruction (redemption that destroys ETF shares and forces underlying asset sales) , it could get very interesting at some point with investors jammed into these supposedly liquid funds.

No prob Yup--have a nice rest of your week off.

Staff Edit

I know you have your opinion and thats fine, I have no issue with that. You can believe in whatever floats your boat.

However, when you are wrong and you enter my area where I am experienced and deal with everyday,specifically financial markets, I am going to call you out and point where you are wrong... and I trust you know I am doing that not to put you down but to make sure that you aren't spreading misinformation :)

As you know, it is totally fine to disagree. It is also totally fine to point out where someone may be incorrect and to try to help them find correct information. However, this is borderline becoming an obsessive wierd trolling of another member and that part needs to stop here. Help educate, help with correct info, but do not put down another member doing so. The above is how I would expect a reply; the other post I removed and the part of this one need to be re-worded with the above in mind. Thank you very much.

Gold is forecast to go down (taking silver, platinum, and possibly palladium) with it during the first half of the new year. Then it's thought the value will increase to silver selling at the >$18 mark by year's end. Waiting to rock bottom prices...hope I didn't miss out 15 days ago. (Bought a little too high the last time, need to lower my average price per ounce)

http://www.bloomberg.com/news/2014-...-record.html

http://cnsnews.com/mrctv-blog/teren...pay-old-debt

The Lew here is US Treasury secretary:


The Daily Treasury Statement that was released Wednesday afternoon as Americans were preparing to celebrate Thanksgiving revealed that the U.S. Treasury has been forced to issue $1,040,965,000,000 in new debt since fiscal 2015 started just eight weeks ago in order to raise the money to pay off Treasury securities that were maturing and to cover new deficit spending by the government.

During those eight weeks, Treasury took in $341,591,000,000 in revenues. That was a record for the period between Oct. 1 and Nov. 25. But that record $341,591,000,000 in revenues was not enough to finance ongoing government spending let alone pay off old debt that matured.

Record Revenue through Nov. 25, 2014

The Treasury also drew down its cash balance by $45.057 billion during the period, starting with $126,568,000,000 in cash and ending with $81,511,000,000.

The only way the Treasury could handle the $942,103,000,000 in old debt that matured during the period plus finance the new deficit spending the government engaged in was to roll over the old debt into new debt and issue enough additional new debt to cover the new deficit spending...


In testimony before the Senate Finance Committee in October 2013, Lew explained why he wanted the Congress to agree to increase the federal debt limitâ€"and why the Treasury has no choice but to constantly issue new debt.



"Every week we roll over approximately $100 billion in U.S. bills," Lew told the committee. "If U.S. bondholders decided that they wanted to be repaid rather than continuing to roll over their investments, we could unexpectedly dissipate our entire cash balance."

"There is no plan other than raising the debt limit that permits us to meet all of our obligations," Lew said.

"Let me remind everyone," Lew said, "principal on the debt is not something we pay out of our cash flow of revenues. Principal on the debt is something that is a function of the markets rolling over."

Just some reading on the bond market operations over the past year, some very recent. Relates to gold and PM related investments directly if there is some interruption in repayment or "rolling over" as Lew says.

Understood-L