Gold Plummets from $1,320 to $1,082 Amid Two Years of Broken Promises
Gold fell from $1,320 in Feb 2014 to $1,082.40 in July 2015. Silver dropped from $19.1 to $14.6 in the same period.
English · Original discussion in Spanish · Published
Gold Promised $1,400, Ended at $1,082
On February 14, 2014, gold was trading at $1,320, 11.2% above December lows of $1,187. A group of savers specializing in precious metals saw the rebound as the end of a two-year decline, talking of bottoms, opportunistic buying, and a long-term bullish trend. Seventeen months later, the same metal peine in Europe at $1,082.40, while silver, then around $19.142, plunged to $14.620. Between these points lies a story of faith, geopolitics, and the fine print on who truly moves prices.
From $1,320 to $1,082: The Full Journey
The price sequence discussed acts like an electrocardiogram. In February 2014, the metal started strong: $1,320 compared to $1,187 in December. The temptation was to think the worst was over. One commentator warned that reaching $1,400 remained to be seen and that the rally was "a bit violent" without new justifying factors.
By September 2014, the scenario shifted. The ECB cut rates to 0.05%—a historic low—and the euro fell nearly 1% to $1.3023, levels not seen in months. Gold, meanwhile, held around $1,268, and silver at $19.142. No one seemed concerned. The stock market celebrated. The Bund rallied and then moderated. The general impression was that metals had ceased to be the safe haven they were once considered.
The blow came in July 2015: gold at $1,082.40 and silver at $14.620. Those who bought at the 2014 peak faced double-digit losses. Those who had been accumulating physical currency for a decade remained in the green, which sustained the sarracena of the veterans. Timing, most admitted, is impossible.
Can We Return to the Gold Standard?
One question running through the conversation is whether a return to the gold standard is antiestéticasible. The prevailing answer is a resounding no, with a recurring figure: it would take 50 times the existing gold just to cover paper currency in circulation. Monetizing currency, as a former Mexican president proposed, is deemed unviable.
Some suggest that the biggest beneficiary of any monetary reorganization would be the United States, with its own reserves and much of the extracted metal held privately, though even this wouldn't be enough to pay a tenth of its debt. Others speculate about a hypothetical global reserve basket where gold could be valued around $2,500 per ounce. Pure speculation, it's warned.
The ECB, the Printer, and the 'Kick the Can Down the Road' Approach
The monetary backdrop dominated the 2014-2015 debate. Central banks were seen buying vast amounts of debt, with stimulus programs amounting, by a common calculation, to $60 billion per month for 19 months: a total of $1.14 trillion. The harshest comment directly labeled it "the greatest plunder of wealth in human history," suspecting the money ended up in derivatives and buybacks instead of the real economy.
The practical takeaway for savers was uncomfortable: holding the fruits of years of work in something someone else can print for free with the click of a button. This led to a shift towards tangible assets. It's not a single-country phenomenon: it's noted that all central banks are doing the same, and the 'currency war' intensifies just as discussions about the yuan joining the SDR basket are underway.
Ukraine, Greece, and Turkey: Geopolitics as Backdrop
In the conversation, gold prices increasingly appeared tied to geopolitics. The Greek crisis was trinc with distrust towards the official narrative: arguments were made about alternative bridge loan offers from Russia or China not reported by major media. The same old point was insisted upon: the debt is unpayable and merely postponed with one kick the can down the road after another.
Turkey entered the discussion regarding its potential EU accession. It was recalled that its army is the second largest in NATO with approximately 250,000 police officers. The dominant interpretation was that its EU entry never truly interested anyone, and Greece joined partly to be able to veto it.
The most tense chapter involved nuclear matters. Russian missiles capable of striking US territory were discussed, along with the electromagnetic pulse as a weapon that could disable a country without contaminating the land for centuries. A staggering figure circulated: 185,000 gold contracts traded in a single session, a volume, it was argued, only those pulling the strings could generate.
Physical Coins, Premiums, and Silver 'Duros'
The most practical part of the debate focused on what to buy. Against paper assets, physical coins were advocated: silver 'duros' from Amadeo I or Alfonso XII, weighing 25 grams with 900/1000 fineness, one-ounce bullion, series like Pandas, Kookaburras, Koalas, or Lunar II.
Useful details for beginners emerged. It was noted that current mintages for Kookaburras and Koalas are around 500,000 units, and Lunar IIs about 300,000, reducing their future numismatic appeal. The 'proof' premium can easily exceed 25%. Personal experience served as a warning: some bought silver at $30, while others continue buying ounces at what they consider reasonable rates.
A repeated warning loomed over physical titles: a growing difference exists between the price of paper and tangible silver and gold. This gap, it was said, is the signal many have been waiting for.
German Gold and Mismatched Reserves
One episode that generated much discussion was about German gold held in the United States. The question "What's the point of having gold scattered around?" received no reassuring answer. It was recalled that Germany finished paying the €69.9 million in reparations for World War I in October 2010, according to the 1953 London Agreement, and was a supervised country after World War II.
The Swiss referendum on gold reserves was trinc with skepticism. The prevailing reflection was that Switzerland is no longer the refuge it once was, having lost much of its banking secrecy, and its tax advantages have diminished. The underlying conclusion is that no state reveals its hand: reserves are kept out of circulation, "hidden in vaults."
What About Silver vs. Gold?
Silver attracted considerable interest due to its dual nature. Some highlighted its age-old monetary character; others, its growing industrial applications. The common warning was that it amplifies gold's movements: it rises more and falls more. Those who bought at the 2014 peak learned this the hard way.
The advice repeated to newcomers combined patience and modesty: cheap bullion based on price, some premium pieces if one enjoys collecting, and no short-term speculation. The problem, they admitted, is the mind, not the chart.
Closing: In August 2015, with the metal stuck at $1,082 and spirits low, the conversation was cut short by a technical failure. Instead of a collapse, participants peine a new chapter and continued talking. The metal may plummet. Faith, for now, does not.
On February 14, 2014, gold was trading at $1,320, 11.2% above December lows of $1,187. A group of savers specializing in precious metals saw the rebound as the end of a two-year decline, talking of bottoms, opportunistic buying, and a long-term bullish trend. Seventeen months later, the same metal peine in Europe at $1,082.40, while silver, then around $19.142, plunged to $14.620. Between these points lies a story of faith, geopolitics, and the fine print on who truly moves prices.
From $1,320 to $1,082: The Full Journey
The price sequence discussed acts like an electrocardiogram. In February 2014, the metal started strong: $1,320 compared to $1,187 in December. The temptation was to think the worst was over. One commentator warned that reaching $1,400 remained to be seen and that the rally was "a bit violent" without new justifying factors.
By September 2014, the scenario shifted. The ECB cut rates to 0.05%—a historic low—and the euro fell nearly 1% to $1.3023, levels not seen in months. Gold, meanwhile, held around $1,268, and silver at $19.142. No one seemed concerned. The stock market celebrated. The Bund rallied and then moderated. The general impression was that metals had ceased to be the safe haven they were once considered.
The blow came in July 2015: gold at $1,082.40 and silver at $14.620. Those who bought at the 2014 peak faced double-digit losses. Those who had been accumulating physical currency for a decade remained in the green, which sustained the sarracena of the veterans. Timing, most admitted, is impossible.
Can We Return to the Gold Standard?
One question running through the conversation is whether a return to the gold standard is antiestéticasible. The prevailing answer is a resounding no, with a recurring figure: it would take 50 times the existing gold just to cover paper currency in circulation. Monetizing currency, as a former Mexican president proposed, is deemed unviable.
Some suggest that the biggest beneficiary of any monetary reorganization would be the United States, with its own reserves and much of the extracted metal held privately, though even this wouldn't be enough to pay a tenth of its debt. Others speculate about a hypothetical global reserve basket where gold could be valued around $2,500 per ounce. Pure speculation, it's warned.
The ECB, the Printer, and the 'Kick the Can Down the Road' Approach
The monetary backdrop dominated the 2014-2015 debate. Central banks were seen buying vast amounts of debt, with stimulus programs amounting, by a common calculation, to $60 billion per month for 19 months: a total of $1.14 trillion. The harshest comment directly labeled it "the greatest plunder of wealth in human history," suspecting the money ended up in derivatives and buybacks instead of the real economy.
The practical takeaway for savers was uncomfortable: holding the fruits of years of work in something someone else can print for free with the click of a button. This led to a shift towards tangible assets. It's not a single-country phenomenon: it's noted that all central banks are doing the same, and the 'currency war' intensifies just as discussions about the yuan joining the SDR basket are underway.
Ukraine, Greece, and Turkey: Geopolitics as Backdrop
In the conversation, gold prices increasingly appeared tied to geopolitics. The Greek crisis was trinc with distrust towards the official narrative: arguments were made about alternative bridge loan offers from Russia or China not reported by major media. The same old point was insisted upon: the debt is unpayable and merely postponed with one kick the can down the road after another.
Turkey entered the discussion regarding its potential EU accession. It was recalled that its army is the second largest in NATO with approximately 250,000 police officers. The dominant interpretation was that its EU entry never truly interested anyone, and Greece joined partly to be able to veto it.
The most tense chapter involved nuclear matters. Russian missiles capable of striking US territory were discussed, along with the electromagnetic pulse as a weapon that could disable a country without contaminating the land for centuries. A staggering figure circulated: 185,000 gold contracts traded in a single session, a volume, it was argued, only those pulling the strings could generate.
Physical Coins, Premiums, and Silver 'Duros'
The most practical part of the debate focused on what to buy. Against paper assets, physical coins were advocated: silver 'duros' from Amadeo I or Alfonso XII, weighing 25 grams with 900/1000 fineness, one-ounce bullion, series like Pandas, Kookaburras, Koalas, or Lunar II.
Useful details for beginners emerged. It was noted that current mintages for Kookaburras and Koalas are around 500,000 units, and Lunar IIs about 300,000, reducing their future numismatic appeal. The 'proof' premium can easily exceed 25%. Personal experience served as a warning: some bought silver at $30, while others continue buying ounces at what they consider reasonable rates.
A repeated warning loomed over physical titles: a growing difference exists between the price of paper and tangible silver and gold. This gap, it was said, is the signal many have been waiting for.
German Gold and Mismatched Reserves
One episode that generated much discussion was about German gold held in the United States. The question "What's the point of having gold scattered around?" received no reassuring answer. It was recalled that Germany finished paying the €69.9 million in reparations for World War I in October 2010, according to the 1953 London Agreement, and was a supervised country after World War II.
The Swiss referendum on gold reserves was trinc with skepticism. The prevailing reflection was that Switzerland is no longer the refuge it once was, having lost much of its banking secrecy, and its tax advantages have diminished. The underlying conclusion is that no state reveals its hand: reserves are kept out of circulation, "hidden in vaults."
What About Silver vs. Gold?
Silver attracted considerable interest due to its dual nature. Some highlighted its age-old monetary character; others, its growing industrial applications. The common warning was that it amplifies gold's movements: it rises more and falls more. Those who bought at the 2014 peak learned this the hard way.
The advice repeated to newcomers combined patience and modesty: cheap bullion based on price, some premium pieces if one enjoys collecting, and no short-term speculation. The problem, they admitted, is the mind, not the chart.
Closing: In August 2015, with the metal stuck at $1,082 and spirits low, the conversation was cut short by a technical failure. Instead of a collapse, participants peine a new chapter and continued talking. The metal may plummet. Faith, for now, does not.
Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (8573 replies).
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