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Old 20-09-2012, 03:05 PM
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Default Daily Editorials From BullionStar

Hi Guys,

I am starting this thread to dedicate BullionStar's view on the trend of precious metals and the economy as a whole. Feel free to leave comments or questions so that we can generate some healthy discussion. Will start off with a few editorials that we have written previously and try to update as much as possible on a daily basis.

Cheers,
BullionStar

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Last edited by BullionStar; 27-09-2012 at 11:31 AM.
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Old 20-09-2012, 07:53 PM
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Default Tough To Be A Central Bank

It must be tough to be a central bank nowadays. Taking a glance at the latest statements of ECB President Mario Draghi and the China central bank, you could detect the delicacy in the wording, trying to assure investors of their willingness to do "whatever it takes" (Draghi's words last week) without stoking inflation or hyperinflation fears. One wonders if acclaimed wordsmith Alan Greenspan would have fared any better in these unprecedented times.

Yet for all their attempts to keep bond and stock markets from crashing, central banks worldwide are loading up on that one asset once described as a "barbarous relic": gold. Even with a correction in the prices of gold and silver, central bank buying is at a record high. If they couldn't trust each other not to print currencies to oblivion, they at least recognize where markets will turn to in a worst-case scenario.
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Old 21-09-2012, 10:45 AM
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Default How High Can The Price Of Gold Reach?

How high can the price of gold go? While imagining US$10,000/oz. (S$12,500) gold makes for pleasant daydreaming, no one knows for certain if such a price is attainable at all, or too conservative. The simple answer to the question "How high?" is: gold will go up to the level that it needs to go up.

We don't say this to confuse you. The point we are trying to make is that the price of gold has managed to stay in pace with the decline in purchasing power of fiat money. It isn't so important what nominal level it reaches, but that gold continues to function as this maintainer of purchasing power. Unless some new element springs out of nowhere to claim gold's place and status as universal medium of exchange, investing in gold is your best bet contra central banking currency debasement. And considering recent controversies such as of MF Global and the overselling/overbuying of ETF shares, it's always good to have the actual, physical metal within reach.
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Old 21-09-2012, 04:21 PM
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Default Interesting Video

A Good Video On Money = Debt
http://youtu.be/jSU23KSUqMo
http://youtu.be/1dzwTnP-OPQ
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Old 22-09-2012, 03:53 PM
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Default Gold/Silver Is Money

The US government has recently reached a debt level of $16 trillion. It doesn't look like the accumulation of debt is going to slow down, regardless of which party wins in the November elections.

The consequences of a shrinking US dollar and a bankrupt America will be felt worldwide, in the months and years to come. One of its effects will be that funds will be moved away from US Treasuries, and into more stable assets such as precious metals where debt and deficit could not grow uncontrollably.

But it isn't the demise of the dollar, or the euro, or any particular currency that makes us bullish for gold and silver. Since we understand gold and silver to be money, precious metals are actually a choice of currency. We believe that their value is not dependent on the decisions of policymakers. And even in relatively calm periods, it is more assuring to have one's savings in gold and silver, rather than reproducible bank notes.
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Old 24-09-2012, 10:47 AM
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Default Responses To QE3

The Hong Kong Monetary Authority has ordered banks to limit home loans, in the wake of the US Federal Reserve's latest 'QE3' effort. This is for the sake of preventing a bubble, the officials say.

However, real estate bubbles are merely symptoms of easy-money policies. A bust is the inevitable result of a low-interest rate regime. If it doesn't happen with homes, then it will happen elsewhere, such as commercial property. And the effects are not limited to the origin of the bubble; they encompass an entire economy. Since money is used in every sector, any manipulations to money are manipulations of the economy.

There is one type of money whose value stays intact over time. We are referring to physical precious metals such as gold and silver. Yes, living through an economic crisis is undesirable, but there are ways to minimize the pain, starting with the right investments.
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Old 24-09-2012, 11:38 AM
Adonai Adonai is offline
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Default

Quote:
Originally Posted by BullionStar View Post
How high can the price of gold go?

Unless some new element springs out of nowhere to claim gold's place
Beside gold, we should also talk about silver. How high can the price of silver go? In the history of the human race, for thousands of years gold and silver had been used as money. I don't think new element will spring out to replace gold and silver. If there is, it will appear long time ago. Why wait until now?
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Old 24-09-2012, 11:46 AM
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Default The Day the Dollar Died

Quote:
Originally Posted by BullionStar View Post
The US government has recently reached a debt level of $16 trillion. It doesn't look like the accumulation of debt is going to slow down, regardless of which party wins in the November elections.

The consequences of a shrinking US dollar and a bankrupt America will be felt worldwide, in the months and years to come.
http://www.youtube.com/watch?v=2N8gJSMoOJc
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  #9  
Old 24-09-2012, 04:36 PM
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Default

I agree with you Adonai! We support silver too and in our view, silver has been undervalued as compared to gold.

Great video by the way.
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  #10  
Old 25-09-2012, 10:31 AM
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Default Inflation

The World Bank recently said that food prices jumped 10% in July. While climatic conditions and restrictive government regulations have played their part in reducing supply, and thus bringing up prices, there is another factor at work here: inflation of the money supply by central banks. If money supply was constant, there may be price increases in one sector, but these would have to be offset by reduced demand and prices in another sector. Prices could not be bid up so high beyond what people actually hold as money.

It is only a money supply increase that can cause a general increase in prices. While we see food prices go up, we also see the price of oil, of stocks, as well as gold and silver, rising. This is an indication that no value is being created, in spite of the numbers getting bigger. Everything is just getting more expensive.

If money is to retain its value, it has to be in a form not subject to the whim of policymakers. That's why gold and silver are considered the most definitive forms of money, and why it is a good idea to hold your savings in precious metals. Their value lies in markets, and not governments.
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