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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: carranza2 who wrote (13523)	10/26/2008 10:04:23 PM
From: Wyätt Gwyön	1 Recommendation Read Replies (4) \| Respond to of 71407

i don't understand about the physical and paper gold disparity and if it is really as meaningful as people make out. yes, you have to overpay to get a single golden eagle on Ebay, but is that the same as saying there is no physical gold to be had? if GLD issues more shares, there must be physical gold to back it. so, since they are still selling shares close to spot, it seems they can easily get all the physical gold investors demand. i am no expert on the gold market so maybe my idea is totally off base, but maybe there are other reasons coins are in short supply? like, maybe there is increased demand for coins relative to the minting capacity for the particular issues? i don't know, just throwing out ideas. in any case, if no bullion were available, i think GLD would have to stop issuing shares. any of the many more knowledgeable people on this issue are welcome to correct me here if i am wrong. btw, i don't consider GLD to be paper gold, the way futures are, but unlike bullion you hold in your hand, probably 99% of GLD shares are in custody at brokerages, and a goodly portion could be in margin accts subject to margin calls. so, you could have distressed GLD selling just as you have distressed futures selling. but as a more knowledgeable friend has told me, gold futures market is extra huge compared to GLD (or, presumably, coins and other physical). so maybe Privateer and others say that POG should be high due to Ebay coin prices. however, if the futures market is 20-100x bigger, maybe that says more about gold than physical (it certainly says more about the state of trader accts). without a doubt, is that the dollar will plunge as deleveraging ends i think we all expect countertrend rallies, but deleveraging may go on for years and the bottom may be decades away (for the stock market). look at Nikkei--it is almost at a 30yr low! here's an idea: US market may never recover while most baby boomers are alive.