OT Gold price

The price of gold & silver keeps going up. Who is paying those prices? If you had gold to sell, who would buy it. The pawn shops won't pay that for it. The banks won't take it either. Is that the price they are getting at the mines?

I think it trades just like stock in a company. Anyone can buy it if you have the money as an investment. The advertizements you see on TV for your unwanted gold is stuff laying around the house and I'm sure they pay less than the value or they wouldn't make any money.

Can always sell it on Ebay. Dealers will usually buy it at spot minus ten percent or so...

It's a commodity. Your question ,"Who pays these prices" , presupposes that it is an unneeded luxury. That's not true. Gold is used in electronics , dental work etc. Who pays that is anybody who must have gold now. When's the last time you saw a silver wedding ring?The buyers are on it because the price is up. Simple economics and supply and demand. Nothing mysterious about it. Also with traditional investments in the dumper , investors are buying gold which has held its value over thousands of years.

In 1985, I went to buy some puzzle rings in Ankara, Turkey and asked the jeweler if he would take two 1 oz Krugerands for payment. He just weighed them on his scale and asked if I wanted my change in German marks, Swiss francs or US dollars. Acted like it was an everyday occurance.
Also bought a rifle from a friend with a 1 oz Krugerand in the late 80"s.

Gold isn"t always a good investment, but it seems to be now.

Some of the people buying it are simply idiots that are positive the price will continue to go higher until it reaches the sky, then they'll cash in for huge profits.

Many of them will not sell when the price comes down but will hold it to sell until the next high----perhaps sold by their heirs instead.

The term is buy low, sell high. Not buy high and hope for higher yet.

> Who is paying those prices?

The same people who are buying cropland for $9,000/acre. They are all expecting inflation (or hedging against it).

Hi teddy52: Google gold bug forums and/or some of the investment forums. You have to look at the upcomming high population areas of the world like India and Asia and they'er buying lots of gold. The more unsettled the normal finance around the world gets, the higher gold prices will go. The current price, in American dollars, shows how poorly we are doing compares to decades past when America dollar was a "real" power in finance. ag

Gold is not a commodity no matter how much the talking heads want you to believe it.
Bad money drives out good money,the bad money being fiat currency,the good being gold.
Gold is the only real money,not a barbaric relic as Greenspan once called it.
99.9% of all the gold ever mined is still around.40 years ago there were hundreds of millions of silver ounces above ground;now it's all used up and now is actually more rare than gold. There are over one thousand uses for silver in the U.S. military alone,never mind the rest of the industrialised world.
The percentage of silver to gold in nature is about thirteen to one.
Gold is the canary in the coal mine, when there is currency trouble as there is these days everyone flocks to gold-it is the ultimate safe haven as it has no counter parties.
Gold is rare and hard to find; worldwide gold production has been decreasing in the last few years.
And lastly,why has the U.S. not let anyone audit their 35,000 tons of gold for the last forty years-- maybe 'cause its gone?

the price of gold has been manipulated since nixon went off the gold standard in 1971.it allowed the US to print at will...gold has been kept artificialy low to prop up the dollar,by the big banks in NY,[jp morgan,gs,ect]....[look up browns bottom,where tony brown sold half of englands gold into the market..also the paper gold and silver markets[etf,gld, ect..], have helped in the manipulation.. being the reserve currency gives us tremendous advatage[petrol dollars].... nothing but confidence and military have backed up the dollar since..now that we have so much debt[in the trillions,we can never pay this back and our creditors are realizing this], the weakness of the dollar is showing through...people around the world are losing confidence in our fiat money and wanting to get out of dollar denominated assets..china,india,russia and smaller countries around the globe have been net buyers of gold to back up their currency..china is also buying up natural resourses around the world...china,for the first time in their history,is telling their people to buy gold and silver..,russia,china,japan,korea,ect are all slowlly selling their US bonds..soon the dollar will be worthless... all currency is measured against gold..[read allen greenespans essays on gold]...for the past 40 years or so, people have been told gold is not worth having and not a good investment,,they fooled alot of people..gold IS money..allways has been, for 6000 years, gold has been money.....the paper we all hold, soon will go to its intrinsic value of zero... all currencies will soon....for years central banks around the world were net sellers of gold and are now buying gold by the ton,that alone, tells you something is up...gold is not in a buble,,, yet,,if you think gold [silver],is expensive now,you havent seen anything yet...in the end, we were never really off the gold standard..pg

Fear of inflation drives gold prices up. Simple as that. No, the published price of gold isn't what you or I can buy or sell it at, just as market grain prices aren't the same as the price at the elevator.

I've bought Gold and Silver at the going spot rate price off Craigslist.Stick with commonly known coins to avoid getting ripped off.As more US
Dollars are printed or more accurately conjured up on computer screens Gold and Silver values stay the same its the money thats worth less.US Dollar is the 'commidity'

I've bought a a pile of silver coins, mostly Peace dollars from the 1920s and 1930s. I buy what many consider "junk" with a lot of wear - not collector items as all. Two years ago I could get them for $15-$16 each, now you have to pay at least $20.

If you are planning for the SHTF situation I think having a specie currancy that people recognize would be much handier than trying to assign a value to small peices of gold. People recognize the US Silver Dollar and have an idea of its value - and its more acceptable since it is similar to the fiat based currency they had used their entire life.

The price of gold is kind of like the canary in the mineshaft. It really is an indicator of the health of the fiat currency known as the dollar. Whirly Ben and external_link are printing money and running up deficits like it is going out of style, which it really is. We will see infaltion, currency change, and devaluation. Jim Sinclair predicts $1,600.00 gold by next year. I do not advocate holding gold, simply because the US government has in the past confiscated gold at and arbritary price. One is better off buying silver coins. Never buy long term investments if you really can't afford to hold on to them.

Do a google search for bigger fool theory. You can't eat it, you can't wear it, and you can't live in it. You have to store it and keep it safe and hope no one steals it.

But when we get hyper-inflation and you're trying to figure out how to come up with a wheelbarrow load of dollars to buy a loaf of bread, I'll be buying mine with one thin silver dime.

Even if that never happens, there's enough folks thinking like me that the price keeps creeping up, and is certainly doing better than the stock market.

Speaking of that, how do stock shares stack up in your "can't eat it", etc. criteria? What are you investing in?

You're not really thinking of inflation. You're thinking more of a "run" on the dollar which is still the world's "safety" currency based on exchange rate trends.

A failure of confidence could cause a run on the dollar regardless of the fundamentals but there's nothing in the fundamentals to indicate that inflation is coming. We have lots of people really looking for work in addition to all the ones that don't want to work. We also have a lot of excess capacity in the US.

I am invested in real estate, so if we get deflation, which is looking a whole lot more likely, I lose money.

I'm mostly in real estate, as well- plan was to sell all but where we're going to live, pay off everything and have a good nest egg left over.

Plans have changed- could sell, I suppose, if we lowered the price enough, but why? Just trading dollars, nothing left to live on. I just turned 62, so will keep working until R/E values go up, or we give up on it and just punt. One property is a big enough farm to raise food for us and the kids and grandkids- that may be where we end up.

I had a similar plan but my properties are rental homes and I have depreciation recovery problem to work out first. I have a decent level of equity, or perhaps not depending on prices when I sell. I am about to turn 62 as well, and no, we can't quit working until we have Medicare.