[librahall]

I show CGL.C -1.8% while MNT.TO +1.8% today. MNT has a strong pull up this morning. I am glad that I rotated CGL.C to MNT in the past few days (when MNT's discount to NAV touched as low as -2%).

 

[james4beach]

I am glad that I rotated CGL.C to MNT in the past few days (when MNT's discount to NAV touched as low as -2%).

Good job! I wasn't able to catch MNT at a discount, so I haven't placed any trades. I only plan to rotate CGL.C into MNT if I can get MNT at 1% discount or more.

 

[librahall]

I have been watching the Crypto/Bitcoin market fly as of late (most of us probably have) and from my reading it would appear that younger investors see it as superior to gold (physical or paper). I wonder if the chronic manipulation (plague like) of the gold market has driven people out (Cryptos are probably manipulated too, just not the long hx like gold). I do think that physical gold is superior.

However I can see why Cryptos appeal. They are not based on a Fx currency (hedged vs unhedged). They will convert into whatever currency you need at the moment - this does appeal. MNT is a product designed to operate in CAD/USD basically. Cryptos are just so volatile....

If Cryptos take off more I think you will see gold drop more. This is fine with me as I think 'physical gold - is the king' and is the underlying concept that ultimately drives the price of paper gold.

If there is ever inflation in the USA (increasing likelihood at some point) I think you will see physical gold rein supreme. There could however be a competition between paper gold and cryptos (for second place)....

Either way there will be a place for Gold in my portfolio.

* Disclamer - I hold gold 22% GOLD (mix of MNT & CGL.C), I also have 3% SILVER (MNS). I have debated moving gold to 20% and adding bitcoin for 2% - but then I am like, 'am I just chasing my tail ?' What I will do this week is trade my CLG.C for MNT and hold steadfast. Patience is a virtue. (MNT is trading at a discount to NAV).

Interesting comparison between GOLD and BTC. I have been investing in BTC for a few years and it accounts for 2-3% now. Besides buying dip during periods like this March, I think Dollar-Cost-Average is a good approach to overcome its high volatile. You can backtest at Dollar Cost Averaging Bitcoin - dcaBTC.

Example: Even if we started investing at previous all-time-high in late Dec. 2017, the return by now would be 134%.

 

[james4beach]

Interesting comparison between GOLD and BTC. I have been investing in BTC for a few years and it accounts for 2-3% now. Besides buying dip during periods like this March, I think Dollar-Cost-Average is a good approach to overcome its high volatile.

Yeah but dollar cost averaging only works if something goes up in the long term. How do you know BTC won't just go to zero?

What if BTC goes to zero over time, but it turns out ETH is the one that really catches on?

It's safe to accumulate some assets like the stock index, real estate, bond index, commodities, or gold, because we know for certain these things will not go to zero.

 

[librahall]

Yeah but dollar cost averaging only works if something goes up in the long term. How do you know BTC won't just go to zero?

What if BTC goes to zero over time, but it turns out ETH is the one that really catches on?

It's safe to accumulate some assets like the stock index, real estate, bond index, commodities, or gold, because we know for certain these things will not go to zero.

BTC is unlike other alternative tokens including ETH. BTC is betting on the failure of fiat while the other tokens' success relies on the success of their projects. BTC is the only value preserve asset in the cryptocurrency world. BTC will continue to be very volatile but I don't think it will go to zero. When its price goes below $3000, many hodlers like me will rush in and buy.

But I don't expect to convince anyone with a few lines. Investing in BTC is just like investing in gold, it requires some kind of belief. ;-)

 

[james4beach]

BTC is unlike other alternative tokens including ETH. BTC is betting on the failure of fiat while the other tokens' success relies on the success of their projects.
. . .
But I don't expect to convince anyone with a few lines. Investing in BTC is just like investing in gold, it requires some kind of belief. ;-)

One still needs a critical mass of people to accept (and believe) that something has value, no matter how good the story is. Something only has value if a large number of humans believe it has value.

Bitcoin has only traded in large public markets for 4 years. This is an extremely short history. Just compare how long people have thought these things are valuable, with active trading among the general public:

Gold: 5,000 years
Stocks: 350 years
Bitcoin: 4 years

Yes investing in all these things requires belief and a "common understanding" together with other humans. Money is nothing but a figment of human imagination, and created by stories we all buy into. But at this point there is no way to know, or even forecast, whether bitcoin will be seen as valuable a few years from now.

 

[librahall]

One still needs a critical mass of people to accept (and believe) that something has value, no matter how good the story is. Something only has value if a large number of humans believe it has value.

Bitcoin has only traded in large public markets for 4 years. This is an extremely short history. Just compare how long people have thought these things are valuable, with active trading among the general public:

Gold: 5,000 years
Stocks: 350 years
Bitcoin: 4 years

Yes investing in all these things requires belief and a "common understanding" together with other humans. Money is nothing but a figment of human imagination, and created by stories we all buy into. But at this point there is no way to know, or even forecast, whether bitcoin will be seen as valuable a few years from now.

My thoughts:
1) Time is not the only criteria even not the most important one. Consensus is. If we look at the history of things human used for value preservation, there are many things have much longer lifespan >350 yrs e.g. shells, silver, silk and so on. But they are all gone.

2) In terms of consensus of bitcoin, look at how many countries that btc are legal in and how many addresses that holds btc.

3) As you mentioned, stock has a history of 350 yrs. So, how would you convince people to invest in stock 346 yrs ago?

4) Because BTC is at its early stage and the level of uncertainty is relatively higher, you should only put the money you don't mind losing in BTC.

 

[james4beach]

My thoughts:
1) Time is not the only criteria even not the most important one. Consensus is. If we look at the history of things human used for value preservation, there are many things have much longer lifespan >350 yrs e.g. shells, silver, silk and so on. But they are all gone.

Those things aren't gone. Maybe not shells, but the other two you mention (silver and silk) are still very much valuable, and legitimate stores of value!

Silk remains a valuable fabric. There are also people who collect silk rugs, notably Persian and Turkish silk rugs,which are extremely valuable and retain value quite well over time.

I would bet that Persian rugs, which have been valuable for ~ 2400 years, are likely a safer way to store wealth than bitcoin.

 

[m3s]

BTC is finite, easily verified, and widely accepted. Persian rugs are not finite/scare, not easy to verify, and not even easy to trade

Global stimulus in the form of printing fiat is driving unprecedented amounts of wealth into digital assets this year. We should be measuring value with something finite rather than something that is constantly growing in number. Only 1 country benefits from the petro dollar so we should embrace this change

While there's no guarantee that anything keeps its value - BTC has all the required qualities and the momentum now

 

[librahall]

Those things aren't gone. Maybe not shells, but the other two you mention (silver and silk) are still very much valuable, and legitimate stores of value!

Silk remains a valuable fabric. There are also people who collect silk rugs, notably Persian and Turkish silk rugs,which are extremely valuable and retain value quite well over time.

I would bet that Persian rugs, which have been valuable for ~ 2400 years, are likely a safer way to store wealth than bitcoin.

Ray Dalio is hosting an AMA at Reddit now. I am quoting his opinion on Bitcoin below. Check it out.
https://www.reddit.com/r/IAmA/comments/k9b4g8/_/gf3i271

 

[librahall]

I would bet that Persian rugs

Good luck on keeping all the silks and rugs.

 

[hfp75]

advantage that gold silver have is you can carry them physically and throw them down if needed... harder to do with cryptos. You at a minimum have to have a working phone....

Its really just theoretical end of the world, end of a currency, talk.

MNT works just fine. Its exchangeable for physical, Its a Crown Corp, Its based in the current world trading currency, its easily accessible.

* I do think diversifying is good but if I were to add BTC to my allocation it would get set at 2-3% and my MNT would decrease by the same, in effect do I like BTC enough to drop some gold to have a small allocation... I am not committed either way. Plus at all time highs, now is not the time.

 

[librahall]

No, for cryptos you only need to remember the seed phrase with your memory, even without a paper. And how convenient is it to carry physical gold around the world these days? How to cash out MNT without a working phone?

With interest rate close to zero and bond priced at 75x yield, many equities/stocks are at all time all, not just gold and BTC. I show many funds started to buy bitcoin as small portion of their portfolio.

 

[james4beach]

Something strange happened. The number of units outstanding of MNT just dropped by 6 million. This happened some time between December 11 and January 5.

So it appears that someone has redeemed 6 million units, or perhaps the Mint themselves decided to reduce the size of the program.

Here's the history of the number of units based on my own records:

2016 - started at 29.5 million units
2017 - roughly 27.2 million units
2018 - roughly 25.7 million units
2019 - roughly 24.9 million units
2020 - steady at 24.9 million units
today - down sharply to 18.9 million units

 

[m3s]

People are moving assets to "gold 2.0"

 

[Tostig]

Isn't this how paper money started? Pay the $25 to have the certificates mailed to you then you can barter them in exchange for goods or services. Better than gold and silver stackers and backed by real assets. Good for when the shtf?

 

[hfp75]

Wonder why the mint is winding down the program ?

Maybe they found that storing enough gold to support 30 million units was just to much commitment as they only need to store enough for 15 million units to meet production demands.... ? plus aren’t they storing gold there for kilo ?

wonder if kilo is asking for more space from a fixed storage area ?

On an interesting note.... if there are less & less of these.... the chance of there being a premium goes up & up.... so I’m happy with that thought...

 

[james4beach]

Wonder why the mint is winding down the program ?

Maybe they found that storing enough gold to support 30 million units was just to much commitment as they only need to store enough for 15 million units to meet production demands.... ? plus aren’t they storing gold there for kilo ?

wonder if kilo is asking for more space from a fixed storage area ?

On an interesting note.... if there are less & less of these.... the chance of there being a premium goes up & up.... so I’m happy with that thought...

Well I don't know what to make of that large reduction in units. Does anyone know what it means?

It could be the result of investors redeeming their units, in which case it would not be the Mint's decision.

I really have no idea what's happening there. But I looked at the share during the trading day and saw they were around 2% to 3% premium.

 

[hfp75]

But in theory if there was a large redemption, they would recirculate the units and replace the gold, so they are purposely letting it shrink.....

I have a few thoughts.... ethical and efficiency based....

Ethically they see people buying in at a 20% premium and then selling at neutral, at a 20% loss and there is negative feedback on why the govt is running a program like that, where prices are not reflecting market value. The mints program was created so the govt didn’t have to own gold.... We do, they just store it, use it and replace it.... but price distortions are probably seen as problematic for a govt agency.....

Also.... the mint has to have a certain volume of gold on hand at all times to validate unit prices... if there is a supply prob.... they are short, they might have been repeatedly forced to buy physical gold at a premium to maintain the program... another irritation... less units means less panic buying of physical gold... creates a better buffer for supply chain issues.

Those are just my 2 hunches...

 

[james4beach]

I am really curious, all we can do is guess.

I bought more gold today. I still have a position in MNT but didn't want to buy more due to the premium. Instead, I bought more CGL.C