Open Thread: Ask Me Your Best Questions Here

This weekend, I’ve set up a special “hotline” – an open thread just for reader questions.

Over the next week, I’ll read your submissions, pick out the 10 most insightful questions, and answer them in an upcoming issue of Sure Money.

I’m happy to credit the 10 winners by name.

Go to the comment section to leave yours.

96 Responses to “Open Thread: Ask Me Your Best Questions Here”

  1. Hi Michael,
    Thanks so much for all the great posts and advice.
    There are rumours of an upcoming gold revaluation to offset the current global debt? Do you know how credible these rumours are and if such a thing is possible?
    Thanks

  2. No one can afford to lose money but SMALL investors who can only afford a few hundred shares of a handful of stocks take a tremendous beating when the market fluctuates with volatility. I’ve sold off most of my shares until, at least, the 11/2016 election provides some definitive direction believing that a pittance of interest in a MM is better than losing money. I don’t have enough $$ to risk options or to swing trade. I have invested in several hundred shares of Rangold and have a little physical gold. I’m at a loss as to where I may SAFELY place money and receive a decent return that will grow the principal and provide a decent dividend. Now that REITs are dragging, are any sectors safe? Where can the small investor make money?

  3. HI MR. LEWITT , thankyou for this opportunity , my question is how do you see this all playing out ? for example , a world wide bank holiday followed by a write off/down of all debt and then new money being issued along the lines of $ 1 new for every $100 old . and if i can squeeze in another , do you think there will be something like a 90% tax on gold sales so when it reaches $5000 , and i go to the dealer to sell i get $500 and the dealer has to send $4500 to the gov . thank you , neil silver .

  4. Frank Gaertner

    A debt implosion with over a quadrillion dollars in play would be a financial disaster. Is there any way for the US to reset it’s part I’m this mess? Can it be done with $10,000 gold? SDRs? Trillion dollar platinum coins that our Treasury mints? If you were King, what would you do?

  5. While I find your advice invaluable ,a lot of it is more than I want to institute in my financial plan. As a retiree I want to protect my nest egg as my timeline for recouping losses is limited. I understand asset allocation and diversification and based on my research the safest balance appears to keep the bulk of assets in a bond/stock fund like Vanguard Wellesley. Do you concur or do you have a better suggestion? Thanks for your insightful information.

  6. Mariah Inojosa

    Hi Michael.
    Given the current environment in negative interest rates around the world, would it lead us to believe that sovereign bonds are in a bubble akin to that of the dot coms, only many times bigger. If this is true shouldn’t we be shorting TLT or something like that?

  7. The skull and bones appeared in the S&P on Friday. The last 2 times it appeared was in 2001 and 2008 then the markets crashed. Have you seen this as well and when should this ponsy scheme finally end?? My date was May 28th, and I figured it out before it was mentioned by anyone else.

  8. In light of the global transition toward battery operated vehicles, what might the lag be between the rise of lithium based mines to uranium prices and therefore uranium based mines and/or silver prices and silver based mines? Assuming that to support lithium (or other battery operated vehicles) a means to recharge these automotive systems will be required, and for most part, that will occur within the existing infrastructures and potentially new sources of electric energy nuclear energy production (i.e. uranium consumption) and solar power grids (i.e. silver consumption). Is now the time to start buying low and holding and how long do you think it might take for these to change from a “blip” to a “BLIP” on the radar?

  9. I only have a cell phone link to the internet and it can be really costly. However, here it is, to me it seems after taking into consideration, demand, supply, inflation, years of use, am out being dug out of the earth, that gold should be a lit more expensive. In the range of 108,000.00 an ounce. I think there is a how do I say influence to keep the price low in the markets between Russia and India. Check it out, you might see what I have over the years.

  10. The behavior of the U.S. Government Bond market, especially for the longer term bonds, is a mystery to me.

    I understand the teeter-totter relationship between bond prices and yields but little else.

    Could you explain what causes long bond prices (and yields) to move:
    > What effects do currencies have on long bonds?
    > What events cause long bonds to be purchased? Sold?
    > What else causes long bond prices to move?

    What effects do U.S Government long bond prices and/or their yields have on everything else:
    > Currencies?
    > Stocks?
    > Corporate bonds?
    > Other?

    I especially would like to understand the relationship between long bonds and the value of the U.S. Dollar on foreign exchanges. (If you should chose to answer only one part of my multi-part question, this is the one I would like answered.)

    And finally, why is the demand for U.S. Government long-term bonds so good right now when, in real terms, they are now a dreadful investment option, not paying any real value in return for ownership?

    Lee Crain

    P.S. Thank you for offering to share your knowledge with us.

  11. Michael, am I missing something?I keep hearing that there is going to be a monetary re-set.That the U.S $ is going to lose a lot of value.If this is correct, then why wouldn’t the government , the treasury or whoever is in charge have the Fed print money and buy gold . Apparently , they have no problem printing money for other reasons. They could buy an appreciating asset with a depreciating currency. How simple is that ? Again , please explain what I am missing here.
    Thank you

  12. Some commentators,are talking about an eventual re-evaluation of gold,similar to what Pres.Roosevelt initiated back during the great depression,due to the immense amount of debt,present in todays system,world-wide. What,if any,is your opinion on the likelihood of such an occurrence?

  13. Why is there such a varied school of thought in how so called “market experts” claiming accurately tracking and predicting
    market trends in stocks, equities and metals? I read several newsletters and lean toward market devastation coming just
    around the corner… very soon. Is it June, October, December? I don’t know, but I have 30% metals and diverse treasuries
    and am waiting for the millstone around the neck of the banks to take them under.
    Do many of your readers share this view?
    Please expand on your views.

  14. Clearly the price of gold is subject to a lot of powerful fundamentals – interest rates, currency moves, geo-political events, risk-on/off sentiment, buying by central banks, plus probably various forms of manipulation, etc. Two questions: 1) Given all that, how do a few vague, non-committal words out of the Fed every month or two move the price so much ? Gold acts more like a thinly traded stock after earnings than the world’s oldest and safest currency. 2) What do you make of the thesis of some (like Agora’s Rickards) of the inevitability of the return of gold-backed currencies resetting the price to $10k/oz ? It seems like the price volatility undermines the argument that its a stable, reliable store of value.

  15. Regarding your recommendation in CZR. Instead of investing directly in the shares, is it possible to buy the 2nd lien bonds (in default), and then get converted to shares. If the answer is yes, are all the bonds equal in the capital structure, as I can see there are 5 issues with maturity in 2018?

  16. Manivannan Sadasivam

    Is there any data available on market breadth for stocks in the China stock market? I see that the volume bars for Chinese stocks such as Bank of China are overwhelmingly (tall) red bars, on yahoo finance. Should I interpret this as high volumes of decline compared to advances? How can a stock’s price advance when the volume bars continue to be mostly red?

  17. Several people, you amongst them, are vocal against current monetary policies and collateral effects they provoke. I must say that I approve. I feel the decadence but decadent reigns can last a long time and we have to live with it. So here is my question. It’s often stipulated that the FED is out of ammo and other CBs as well. Given this assessment, a collapse is soon to happen. The rationale behind that is that as soon as the FED stops pumping, markets will drop and the FED can’t pump anymore because, well, they did enough of it or high inflation will show its ugly head. But when markets drop we immediately face deflationary pressures since most of the activity we see in economy is the result of the inflation in asset prices.
    What makes you think that in these conditions, the FED can’t print more money to boost again the markets, since its intervention will only cancel the deflation they provoked? And how long could this last? In my view, this could last a long time.

  18. Geno Jorgensen

    Michael,
    Great insight as always. I have a few things I would like your comments on. First issue, this October I believe is when the Yuan will be incorporated into the basket of reserve currencies. I am curious what you think this will do to the U.S. dollar and consequently gold. Second issue, all of my financial accounts are with Wells Fargo, I keep my savings and checking account balances below what is insured by the FDIC, but I also have a trading and a retirement account thru their brokerage. In the event of another banking crisis how at risk are my brokerage accounts? And third, with almost every country actively debasing their currency, I am confused what the end game will be. How do you see the currency wars ending and is it plausible that the world will eventually use the SDR as the worlds reserve currency to solve the Triffen Paradox.
    Thank you for your comments.
    Geno Jorgensen

  19. Hi Michael. I well versed on the state of global economies today, on Central bank interventions in the market and more importantly on the dangerously high debt levels of private, corporate and government debt. I often wonder how all of this will unwind over the coming months and years. During the next crisis selloff, there are a real risk of bank failures. What is your opinion on counterparts risk in the options market? Will I be able to exercise my put options and collect my investment if the market tanks?

  20. Hi Michael,
    Love your work and insight. I have almost all of my investments in hard assets like gold coins and foreign real estate (agricultural land and timber), cash. I also have oil partnerships in Kansas and Oklahoma. My only stock investments are mainly in foreign junior miners and very short term option plays. Am I prepared for the coming Super Crash you are predicting?

  21. if Social Security is the only source of income – what is safest type of “currency” to remain solvent: cash (only paper? or only coins?) , silver “rounds” (can these even be used as currency?), CD’s of a variety of terms: 12 months, 18 months, 24 months, etc.?

  22. Firstly Thank you for your advice and insight, I find it immensely valuable. What is your motivation for helping the little guy, as I don’t see any financial motivation for you or am I missing something. I apologize for the cynicism if you are just trying to stop the entire middle class from getting screwed AGAIN! Secondly what is your opinion on Technical Analysis? I am undecided if its juts a lot of marketing to sell TA platform products or has real merit? It seems to me that Volume doesn’t tell you why the big players are buying/selling. Covering,manipulation, genuine speculation etc and all lagging indicators are just manifestations of price and don’t really tell you anything? Thank you.

  23. Gold and silver had been increasing the past few months in price. Last week, a substantial drop occurred in their prices. Why? For their prices to drop, sellers were selling more at lower prices than buyers wanted to pay. What happened to the sentiment that gold and silver prices might go much higher? Sellers taking profits does not explain this drop, if they believe that gold and silver prices are headed much higher. So, is it a myth that gold and silver prices might go much higher? Sellers taking profits now while believing higher prices will occur in the future makes no sense as they would need to buy back in to profit from such rise.

  24. I really appreciate all the comments and articles I have been reading over the past 6 months or so. This site provides a lot of invaluable information. I am wondering though as a Canadian investor, why there is very little mentioned about the Canadian mint and the ability to purchase physical gold here in this country. I also see very little mentioned about opportunitys in the Canadian oil patch which has been said to have one of the largest reserves of oil in the world. Unlike other countries mentioned, Canada is an allie to the United States and is a peaceful democratic society. It seems to me that investing in Canadian physical gold and oil should be a no brainer, not sure why that is not mentioned much here, am I missing something? I can never understand why people invest in countries who try to destroy our way of life. It seems to be just wealthy people trying to make more money without any thought whatsoever of the long term future of our children and our way of life in the western world. I think that we all need to wake up and invest money in the counties that support our way of life, if people do not wake up and do this soon, it will not matter how much money you have, it will be taken over by a communist or socialist government.

  25. Daniel Sevigny

    Billionaire investor Warren Buffet made headlines this week when news hit the wires that Berkshire Hathaway made a staggering $1 billion bet on Apple Inc. (NasdaqGS:AAPL).

    Why did he do it ?

  26. Hanlon’s razor counsels us to “never attribute to malice that which can be fully explained by stupidity.”

    But is there ANY chance at all the people running the Federal Reserve are simply stupid and not, in fact, carrying out a consciously conceived agenda to destroy savers in their mission to rescue the banks and the rest of the financial house of cards?

  27. Curious to learn about your thoughts on sprint. It seems to be the poster child for an over leveraged company selling a commoditized product. How are you so confident about its future?

    Thanks for all your thoughtful insights.

  28. I agree wholeheartedly with your urgent super crash report and all comments on the coming collapse as with many other independent experts who know that a solid, hard hitting depression & monetary collapse is imminent. But please answer one question Micheal that no finance expert is telling us – won’t this coming collapse of the credit system and world-wide closure of all ATM’s cause a massive and tsunamic sized shortage of food and therefor the collapse in all Western countries of the food supply system as we have seen in Venezuela. I beg you to
    be honest and give us all a head’s up on this probable scenario from the viewpoint of a guy who has a way deeper understanding of how our financial/business system operates.

  29. Stephen Brennom

    Recently, you have suggested direct purchase of T-bills as a reasonably safe alternative to holding cash in banks. What do you think of BIL as an alternative to direct purchase, recognizing that there is a small cost for the convenience of buying and redeeming shares within an existing brokerage account (ECN-based).

  30. Hi Michael,

    Just wanted to get more insights on the credit markets and how you process information. My specific question: when you fire up your Bloomie in the morning, which are the first 3-4 indicators/markets you look at to get the feel for the general market and why?

    Thanks!

  31. Hello Michael, I want to read all of your e-mails and reports I can make time for. Today, one l clicked on a “Special Bonus Report”. Interisting. I think, it would work if one’s account had options and a margins account attached . Time restraints, work, illness prevented my applying for .

  32. Hello Mr. M(essiah),

    Love your insight…!

    With all the instabilities in the world that could be the catalyst to crash the global market (i.e. Japan’s ZIRP and possible downgrade of bond market to junk status, China’s real estate bubble, commodity overload, and currency overvaluation, European ZIRP, Deutsche Bank’s corruption and over-leverage, refugee mass migration, US car loan and student debt bubbles, re-occurrence of the US housing bubble, 9 key US banks over-leveraged, incompetent political leadership in US, Europe, China, and Japan, peak debt levels in US, Europe, China, and Japan, incompetent Fed, foreign, and IMF coordination, turmoil in the middle east, and so on), would it be possible for the Saudi’s move on the Sovereign Wealth Fund to be another plan to de-peg the Petro Dollar and become the world monetary leader?

  33. Alex Avner Herzfeld

    Thanks for letting us know your invaluable insights on the insanity of the situation. But let us think for a moment out of the box and then raise a question which makes me feel rather uneasy. We all know the story of “the kings new clothes”, where a child screaming the truth destroys the illusion and ends that unsustainable situation. But we could think of a different outcome. People could say to the boy: “shut up, we have eyes ourselves, but why not let the game go on?” Passing from the story to our reality, I’m asking: what would hamper the FED (and other central bankers) just to “print” enough money to abolish this whole debt bubble. They created four trillion out of thin air. Why can’t they create twenty? I.e. they would take the whole debt into their books. Who cares? After all are they accountable to anybody? Can the FED go broke in any sense? Please tell us, what I’m missing here. And then: how (with what instrument) could we bet against the FED, ECB etc. and make a killing?

  34. Hello Michael, what are your thoughts on platinum, it is precious and not ‘overpriced’ like gold currently, China demand seems to be picking up, Byproduct of copper (mines closing). High gold/platinum ratio…

  35. Stephen Goodell

    Michael: I value your insight and recommendations. I hope all your predictions come true, and I’m watching for the big turn on June 20th..

    This is a very specific question: I jumped on your recommendation for DB put options buying the October puts at $.75. They dropped immediately and are $.35 today. Do you still expect DB to tumble in the next few months to make this recommendation profitable vs. a 53% loss? You’ll recall that there was confusion in the original option quote.

    Thanks.

  36. The effective world financial unit (the SDR) is going to “change” it’s valuation on Ocotober1 of this year, with the Euro, Pound and Yen decreasing in value contribution respectively. What convexity benefits, if any, are you expecting with the US dollar and gold?

  37. Michael, what are your thoughts on seasonal trading as a strategy as presented for example by jeffery A Hirsch, Stock Trader’s Almanac thru fidelity.com learning centre or by another persons on Equity Clock

  38. I hope not to be banned for asking 2 questions. Why did the supreme court consider the bank of America loans to the gov spon entities not fraud? Everyone keeps forgetting about the 2 billion dollars the bank had invested in countrywide before all this started. You would think that the audditors of bank of America would have seen issues of the company before investing in it. That was the primary factor for buying countrywide so they didn’t lose that money. I am sure that the CEO of the bank was informed of the failure to comply with loose regulations of its own bank before they sold those CDO’s, to the GSE’s.

  39. Robert Gaffaney

    Hi Michael, we have communicated a bit on twitter; I am gormack0.

    Thanks for the World Currency report – insightful and well written as always! In the report you mention the Chinese “defending their currency”.

    I see Chinese citizens spending any amount of money on tuition at our universities, and they buy a lot of real estate, and do whatever else they can to get money past the capital controls.

    But this is private sector money, and it isn’t clear to me the mechanisms by which governments and central banks “defend their currencies” and how this relates to exchange reserves, etc.

    Can you elaborate?

    Thanks and Regards,

    Bob Gaffaney

  40. QUESTION: What can the ‘common’ man and woman do to prepare?
    We do not have, nor can we afford, gold, we have a total income in the $60k range, annuities and maybe $15k in credit card debt, not much left to pay on the house, and a car loan of $20k. I retired early in Dec. 2015 at 64, my wife just turned 54 and is a long-time school teacher. I appreciate anything you can tell us. Thank you!

  41. Please tell me why LNG is a bad stock when it has 10 to 20 year commitments for natural gas exports with signed delivery pay even if they don’t use the gas? With gas as low as it is about $3.00 in the USA , and world wide it is about $8 to 10 dollars it seems it should be profitable.
    I has the first export facility to be approved with it’s own way to freeze the natural gas for shipment. How much better can it get?
    I would appreciate your comment.

  42. Hi Michael. Thanks in advance for your invaluable insight. One of your prior recommendations was to purchase DB P 20JAN17 10.00. I understand the reasons for your recommendation given DB’s horrendous financial condition. What are your current thoughts on those Puts and what are your thoughts on the DB P 21OCT16 11.00? Is that latter to soon in your opinion? Thanks in advance!

  43. Amanda Arroyo

    As a new investor it’s overwhelming with all the phrases and terms like “Puts” and “Short/Long” “Options” among many others. Articles describing these terms in basic language would be great!

  44. Several hundred persons including who hold an intrinsic and honest understanding overview of the current economic madness and coming super crash/collapse/currency reset have tried to desperately warn people of the problems ahead. Please give us your views on the likely effects the collapse will have on the world import/export system and whether you feel that most Western countries are definitively heading the way of Venezuela because afterall every Western country is dependent on importing a variety thousands of food/building items and the like.

  45. Marvin Klemow

    You want to make money.. Bet on Hillary. The bookmakers in Vegas and London have NEVER been wrong in picking the Presidential winner. Hillary today is the odds on favorite with Trump around 2 1/2 to one. I made thousands of dollar betting on Obama in 2012 even thought I didn’t like his policies. I think both candidates suck, but winning bets from dumb conservatives who are true believers is better than the stock market.

  46. Michael Cochrane

    So what do you think of the investment banks like Goldman Sachs, JP Morgan, Morgan Stanley as investments? They are all trading around book value or less. Seems like in five years one will look back and wish they had invested. On the other hand are they so over regulated that they are like modern day utilities and basically dead money? Appreciate your thoughts…Michael

  47. Bonnie McCain

    Politically, WHY should we trust a man who TRUMPETED the fact that the US dollar is in for a gigantic COLLAPSE in the near future, and he invests in gold and precious metals instead? Yes, he did make that little….blooper. His house is paved in GOLD, the fixtures are made of GOLD, I’m sure being the absolute….NARCISSIST? That Donald Trump IS (said with utter…sarcasm)….he will have a plan to feed the American people for the next four years with HIS personal wealth. WHAT?? Are you KIDDIING? OMGoodness…the US citizens (and we poor dedicated Redoublicans?). Have just BOUGHT INTO one of the biggest….PONZI schemes ever! Yikes!!!! Pullleaaazzzee? Get that guy outta there? I cannot vote for him on….moral grounds. And I will never be a democrat. Yuck….

  48. Michael Cochrane

    What do you think of the big banks like Goldman Sachs, JP Morgan, Morgan Stanley as investments? It seems like they are all trading at or below book value. One might look back in five years and think I should have. On the other hand, do you think they are so over regulated that they don’t have chance to be profitable again? Looking forward to your thoughts…Michael

  49. From a UK perspective having gold as a form of insurance has been the mantra of many pundits, but not which country to trust for storage.
    What is the chance of inter country collusion to confiscate gold in the future? Also which is the next best asset to hold to protect ones life savings ?
    As a senior pensioner I have been thrifty all of my life, I would like to ensure that my wife is financially secure after my demise, any suggestions that
    Would give her a decent income from a safe investment for her longer term ?

    Such great questions from your readers can’t wait to read your replies.

  50. Thank you for your work and time I appreciate it greatly. I have come to the conclusion that the FED,ECB,BOJ.BOE etc think they can pull of what Japan has done over the last few decades, i.e. perpetual stimulus in what ever form necessary to keep markets from correcting. I think Japan had a few caveats that allowed them to pull that off. 1. Chinas exponential growth 2.EM growth due to China 3. EU and the USA somewhat stable from 1989 with a few big bumps thanks to the FED (Relatively) 4. A subservient by modern standards populous. 5. Assistance form the FED directly. I don’t think this model is possible globally as the whole world economy must surely be in deflationary spiral now by the data available. That being said they have managed to pull it off for 8 years so do you think possibly they can pull a Japan and keep this up for decades? And also can you PLEASE explain to me why the YEN is considered a SAFE currency asset. I can not compute why this is the case? Many Thanks.

  51. I have already posted here above a similar question. Could FED, ECB etc. intervene indefinitely, by just fluctuate the markets with newly “printed” (i.e. created) money? After all money is virtual, just a fiction, in any case. It solely depends on people “believing” in its value and agreeing to accept it as payment for value. The last time some banks were “to big to fail. This time central bankers and governments might step in order to prevent the necessary and due meltdown as “to big to crash”.

  52. Also do you think that if the central planners at last get in coordination with fiscal planners i.e. the government of the US in particular, deploy helicopter money in the form of major works programs, infrastructure etc, this will be sufficient to get them the 2% inflation(does this lead to 4% actual growth they need to accommodate this massive global debt level) they require and send the SP 500 on a tear? Or do you think this leads to runaway hyper inflation?

  53. After the precipitous fall in Gold prices this past week from nearly $1,300 per once to $1,212, there hasn’t been a word from Jim Rickard or yourself to explain it’s fall.
    I’d very much like to here what you and the Bill Bonner Partners have to say about the recent movement in Gold.

  54. What’s your opinion on this timeline: Donald is elected; to make America great again we issue $1T in long-dated T bonds to spend on “Infrastructure”; Janet buys the bonds to keep the rate low; we get some inflation, BUT we get to put money in a lot of pockets and we kick the can down the road for a few more years. Just because Road Runner has run off the cliff doesn’t mean he’s got to look down anytime soon.

  55. Karl Bergklint

    Question for you Michael related to the price of gold: With the increasing chance of a “Brexit” and the possibility of an interest rate rise, what do you think will happen with the price of gold during the next 6 months? Thanks!

  56. Karl Bergklint

    Michael: With the increasing chance of a “Brexit” and Yellen making noise about a rise in interest rates, what do you think will happen to gold and silver prices and related miners over the next 6 months? Thanks!

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