Going Down; Goind Down?!
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Permalink Reply by Buffalo on -
I've had a $32 short term target price since just after the big drop in silver. It hasn't quite hit that yet, but close and I still think there is a good chance we will see it, but just for a short time and for reasons that won't last. IMO, a buying opportunity and silver eventually will go higher than we have seen so far. The last time I went through the supply and demand numbers it appeared to me that new mining supply is lagging actual physical demand by 20% or more, and that spread will probably continue to grow. If 1 out of every five ounces of physical silver needed already has to come from silver someone already owns, and that continues to increase, I believe eventually prices will go much higher. The paper markets and manipulation are different issues, but all the paper in the world doesn't keep a factory in operation that needs real metals to make their products, or satisfy the huge increase in investment demand for physical metals in China, India, and elsewhere.
Good quote I read: "Short term factors rarely predict long term results."
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Permalink Reply by Indentured Servant on -
No worries Bruce. Congratulations on selling high but don't be too disappointed you did not sell more. All of the fundamentals and then some are still in place for continued upside gains. What you are seeing now is silver on sale. I'm still looking for high 20's as lows but think that PM's will languish in the $30-$40 range for most of the summer. There are extreme amounts of manipulation in both Au & Ag and this will continue until B'rock O'bottom gets re-elected or the Comex crashes. I have about 50k sitting on the sidelines waiting for a lower price but I think the wait is about over.
I guess it comes down to why you are buying PM's in the first place. Are looking for short term gains or medium to long term security? Me? I expect to buy and hold PM's at least until whatever replaces the $ arrives but even then I'll probably hold or trade for raw land. I'm not looking to get rich, just looking to safely transfer as much of my wealth from this collapsing $ to whatever comes next with as little loss as possible. Sitting on $50k cash right now is what makes me nervous, not owning PM's!
Bill
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Permalink Reply by abe pickens on -
Well, I have been waiting for quite awhile for Buffalo and IS to come out of hiding. When you have an administration as corrupt as the one we have where they just lie from day-to-day and don't appear to remember what they lied about, with a Secretary of the Treasury who should be in jail, and a fundamental criminal running the Federal Reserve, just put your money in the Stock Market. We have no business and no manufacturing but think that McDonalds will pay for five wars in the Middle East where we don't belong. How many more Ph.D.'s are going to be part of the Obama employment statistics flipping hamburghers at Wendy's ,et. al.? Dam , they are getting more than $5 an hour. Perhaps their greed would put them in the category of the Wall Street crooks, which this administration put in charge of the country's economy.
Bruce Au and Ag (forget platinum it is a loser) are the only way to go. The People will finally wise up to this Marxist administration that is out to destroy this country. The dollar won't even make attractive wallpaper. But this crowd will with the help of the media lie themselves into another four years, putting an end to democracy in this country as they continue to wipe out our Constitution and eliminate our military in favor of a police state.
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Permalink Reply by Buffalo on
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In my opinion, Geithner is little more than a political tool at this point and Bernanke is losing whatever credibility he has had. Again just my opinion, but I think both rely too much on applying beliefs and theories developed under very different circumstances to the current situation, which is truly uncharted territory in many ways. And I think both are too dismissive of serious risks we face and unwilling to seriously consider the "what-ifs" if they are wrong. Lastly, I also think both of them buy into a pretty popular notion that the glass should be presented as half full rather than half empty. For many reasons- many markets are concerned about impacts from negative information and perceptions, incumbent politicians and their appointees wanting to keep their jobs at the next election, many in the media or elsewhere who seem to present information with bias or to further some agenda, the list goes on. Actually, I think a strong argument could be made that most people in positions of power have vested reasons to put a positive spin on what we are told. The problem with all of that in my opinion is that it tends to hide the true extent of the problems we face and makes finding real solutions even harder.
I'm not an attorney but I strongly believe the mandate requiring purchasing healthcare insurance is unconstitutional. Well intentioned or not, I think it is an attempt by the Federal government to take power that it has no right to under the Constitution, and if it is allowed to stand I think we will see more of this kind of thing in the future. I see that as a serious threat to all of us.
I guess I got off topic, but a lot of these things make me less confident we really will find solutions in time, so maybe even more reason to hold gold and silver.
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Permalink Reply by jim youker on
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Bruce,
I recently sold some gold and have been passively buying small quantities of silver. I buy PM to hedge against the dollar; should the worst case senario happen to it.
But there is a wild card out there that could strengthen the dollar, (short term), and the prices of PM will drop even further and present an excellent buying opportunity for PM.
I've been waiting to see what happens in Greece. Should Greece further harm the Euro; it will strenghten the dollar. Those people are ready to riot in the streets to protect their entitlements, which the government can no longer afford. It appears a multi-billion dollar loan is inevitable, but they still have yet to address the problem, so it will come to a head further down the road and I believe the dollar will rebound. When this happens BUY, BUY, BUY.
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Permalink Reply by Buffalo on
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I agree with you Jim. And even assuming that Greece receives more loans, the underlying problems still exist. The first bailout did not accomplish the stated goals for it, the situation overall is worse now than it was a year ago. Yet another example of kicking the can down the road and trying to solve a debt crisis with more debt, something that is not just limited to Europe and in my opinion these responses will ultimately fail. The problem is really too much debt that can't be repaid, why markets buy into these "solutions" that simply pile more debt on top of it and/or shift the burden to someone else is beyond me, other than maybe so much fear of the immediate fallout from doing anything else.
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Permalink Reply by Bruce Wiseley on -
Ironically, the Mint hasn't lowered their prices for their products, although they sure seem to increase them at "Light Speed"?! And Buffalo, several the of Euro Countries are going to receive the loans to pay for their "Mooch-A-Meals", oh I mean, social service recepients. What would those people do if they can't or don't get their free Pita Bread? Social Justice works every time, RIGHT?
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Permalink Reply by abe pickens on
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The Mint used to be a place where you could speculate a bit ( perhaps predict is a better word ) and come up with a bargain. An example in 2007 I bought a four coin American gold four coin set for $ 1445. or in other words 1.85 ounces of gold at $ 781 an ounce. Now the price of silver drops 45% and the Mint holds its price at a rip-off level. As I have said before , the gangster former Director Moy has done so much damage to the Mint that it will take years for the Mint to recover, if at all.
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Permalink Reply by george palmer on
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GREAT thing to ask with that on july 15 all paper treads will be stop I think but will things go down or up . I think you have to keep some money on the side but you have to man up and do what you have to do hate to quote poppy but a man got to do what a man got to do let see what happen when QE-3 get some legs it is not on the table as of yet but it is in the door and on the chair let me say when silver hit 28 or 30 you have to buy
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Permalink Reply by Bruce Wiseley on
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Maybe I need more coffee, but I didn't understand much of what Mr. Palmer wrote, except for the buying idea at $28/30. Plus, how will QE3 help when the first two QE programs did nothing but de-value the US Dollar? I'm so confused!
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Permalink Reply by Buffalo on
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From what I understand, the changes due to the Dodd-Frank rules deal with leveraged transactions, derivatives, who can do these things, and specifically exempt transactions where physical gold or silver is delivered within 28 days. It seems to me that will over time reduce the effects on prices of these paper trades that are called OTC or whatever, but typically don't involve any short term delivery of metals. So longer term I think this will play into physical metal supplies having a bigger impact on the markets, something I already believe will happen anyways and especially for silver. One thing though, the precious metals markets are global, so anything the US does on it's own will not prevent something from still happening in other places.
I think we will eventually see QE3. I see little reason to believe in the Fed's growth forecasts even after they were lowered again a week or so back. To hit those targets for US economic growth for the year, the second half of this year would basically have to double the first half growth, and most recent indicators show the economy continues to slump. The Fed will still be reinvesting something between $12-18 billion per month after the end of June, but I think we will see a QE3 by early 2012, after a steady round of telling us inflation has dropped off again. I think more QE pushes PM's higher, and just a guess but I wouldn't be surprised if the effects are greater than we have seen with the last two rounds.
So basically I think both of those factors support higher prices down the road and agree with George that $28-30 silver is a bargain that won't last.
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Permalink Reply by Buffalo on
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This is an article I just saw about economic forecasting. I think it illustrates both the "half full" bias and the inability to adapt outdated ways of understanding it all to what is going on now that I mentioned above. IMO, the experts are wrong at least in part because they "see" what they want or expect to see instead of the reality.
Reuters: Analysis: Bad old habits plague economic forecasting
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