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We're doomed I tell ya.......doooooooooomed !


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Historically it is quite normal for the main stock indexes to correct by 10% every couple of years or so. We haven't had such a correction since 2011, so it was overdue and not necessarily anything to worry about yet. Although stocks are still expensive when measured on price/earnings, the blue chips are a source of 3% to 5% dividends, so they remain attractive to yield seekers.

 

The oil price is setting up for a real storm. Several sources have reported that the Saudis, although their production costs are low, need $105 per barrel as a fiscal break-even price because they have little tax revenue and they hand out huge amounts to their citizens so they don't have to work. They are running through their sovereign wealth fund at quite a rate, effectively playing a game of chicken with the American shale producers to see who will break first. The FT reported that they have started issuing bonds (an initial tranche of $27 billion) so they must be getting rattled. The Russians have similar problems. If the oil price doesn't rise considerably over the next 12 to 18 months there will likely be some serious turmoil.

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 Several sources have reported that the Saudis, although their production costs are low, need $105 per barrel as a fiscal break-even price because they have little tax revenue and they hand out huge amounts to their citizens so they don't have to work. They are running through their sovereign wealth fund at quite a rate, ..

The great thing is the enormous amount of spending the rich Saudis do.

They sell oil, then spend ALL that money on goods and services supplied by Northern Europeans.

In the long term that's all a win for ... Northern Europeans.

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The last few weeks Oxford Street and Marble Arch has been awash with Saudis. They love it here.

And oddly enough they really like the rickshaws. Also the Saudi women dress less conservatively than many muslim

women living here. Just my obsevations.....

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Dont the Saudi's not come over to London during the summer months habitually to escape the near unbearable middle east temperatures

Yes, and on our holidays we go in the opposite direction where it is ...........unbearably hot.

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The Aussie markets rely on China and commodities, the thing is in Australia they can get commodities out of the ground very cheaply. The other problem you may have is the currency exchange I have been burnt on the £to$aud a couple of times.  

 

So on that note I wouldn't be able to give a firm play on the Aus market apart from to say IMO the currency will weaken before the £.  This is just an opinion!! As far as housing goes who knows the Government is hell bent like the UK Government to prop up the housing market.     

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Has anyone here heard of Mr Robot? BJF is all over it on his blog.

It's about a hacking collective (fsociety) (Anonymous) taking down the financial system and

wiping all the data. And so causing everyones' debts to be 'forgiven'. BJF suggests that this could

be a large dose of predictive programming where TPTB condition the masses, through the form of TV entertainment,

to what lies ahead of them. Anyway, it looks to be a cracking watch. Doom porn for the stackers.

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Has anyone here heard of Mr Robot? BJF is all over it on his blog.

It's about a hacking collective (fsociety) (Anonymous) taking down the financial system and

wiping all the data. And so causing everyones' debts to be 'forgiven'. BJF suggests that this could

be a large dose of predictive programming where TPTB condition the masses, through the form of TV entertainment,

to what lies ahead of them. Anyway, it looks to be a cracking watch. Doom porn for the stackers.

Really good idea. Wipe everyone's debt out via third party 'financial terrorism' or whatever, then the powerful and vested interests get to keep the system as is. The consequences would be unpredictable but I would bet they would try it as a last resort. Makes me wonder if I should take out a small mortgage as a hedge against debt jubilees lol. 

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Has anyone here heard of Mr Robot? BJF is all over it on his blog.

It's about a hacking collective (fsociety) (Anonymous) taking down the financial system and

wiping all the data. And so causing everyones' debts to be 'forgiven'. BJF suggests that this could

be a large dose of predictive programming where TPTB condition the masses, through the form of TV entertainment,

to what lies ahead of them. Anyway, it looks to be a cracking watch. Doom porn for the stackers.

 

I hope they give us a few days warning, so I can max out all the credit cards buying as many sovs as I can find. :)

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Has anyone here heard of Mr Robot? 

 

Just started watching it, (on a "TV service", that would be totally approved of by certain sections of society portrayed in the programme)

 

I must say I'm hooked after the first episode, although it does have a "Fight Club" vibe about it, if you know what I mean.

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Funnily enough, this series features an  Ashley Madison data dump, so already life is imitating art.

And also as in a lot of other Hollywood productions, the numbers 23 and 9 pop up repeatedly.

As an example, one of the protagonists exits a lift on the 23rd floor. Elsewhere a screenshot shows a

Chinese stock market ticker where the first three numbers just happen to be 239. So............be prepared on

the 23rd of this month as it does seem to be somewhat of a red letter day.

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  • 4 months later...

Try looking at the 2000-2003 (Long Term Capital Management Blow up) bear market for a good trend comparison. I'm valuing at those levels so for example Merchants Trust 245.5p March 2003 is a good target buy price. Note: Dec 1999 FTSE100 was 6930.20 fell to 3567.41 by Jan 2003. -48.5% Worst case scenario is 1972-73 post Bretton Woods seeing as the Petro-Dollar seems to have ended 31.12.2015 a possibly fair 44yr innings. Global Free-Float a possible current scenario. It's never been allowed to work and might bring stability instead.

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I use the max price of each - may have nothing to do with it, but it's my thought process.

Gold now is £763, highest is £1178 (x1.54).

Silver now is £9.77, highest is £29.16 (x2.99).

So if both returned to their all time highs, I'd make much more on silver.

Stacker since 2013

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That's an interesting approach. It has merit I suspect because, while I think gold is a better 'safe haven', it doesn't have the industrial demand silver does.

 

Don't forget to add the VAT and premium though... You can't buy (any?, much?) silver for £9.77 / toz... If you buy it at £14.50 delivered, say, then your multiple is only just over 2x. And that assumes you can sell it at spot when everyone else is probably trying to do the same.

 

So the principle still holds, but you are getting less return on your risk. My concern is that, with VAT, silver has to rise >20% before you even break even, and >20% more than gold does in a rising market to be the better investment. But each to their own!

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That's an interesting approach. It has merit I suspect because, while I think gold is a better 'safe haven', it doesn't have the industrial demand silver does.

 

Don't forget to add the VAT and premium though... You can't buy (any?, much?) silver for £9.77 / toz... If you buy it at £14.50 delivered, say, then your multiple is only just over 2x. And that assumes you can sell it at spot when everyone else is probably trying to do the same.

 

So the principle still holds, but you are getting less return on your risk. My concern is that, with VAT, silver has to rise >20% before you even break even, and >20% more than gold does in a rising market to be the better investment. But each to their own!

But let's assume you don't buy at £14.50 and you buy at £11.73 (my stack average) and the numbers look more attractive. It is possible, and achievable by purchasing from STG on the dips.

I don't take the VAT argument unless you are unloading at a dealer. Any other sales avenue and you will regain the VAT by value.

Finally, you won't have an issue selling for spot, ever generally. Even if the price rises hugely, there will be tons of people wanting to jump on the gravy train. I know this, as it happened on the run up to the high £20's.

Nobody knows, let's wait & see.

Stacker since 2013

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