How long should we wait?
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Permalink Reply by Buffalo on -
My thoughts right now are we are close to the lows now. I thought for the last month or so we would see a sudden correction in gold in the $100-200 range, and thinking for quite a while silver could drop to $32 or so. I expected both to be fairly short term and I still do. I think a fair amount of the selloff has been to cover losses, margins, etc elsewhere and some panic selling on top of it.
I also have to say I don't have a crystal ball and there is so much negative going on everywhere you look, and in my opinion a lot of fear in the markets. So just an opinion, trying to predict the future in uncharted territory and there is always risk, but I think prices have reached the bargain level and will recover before the end of the year.
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Permalink Reply by Buffalo on
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Not to jump at some kind of conspiracy theory, but there have also been recent moves to include gold as Tier1 bank reserve capital, possibly gold "loaned" by central banks, and a considerable amount of pressure on especially European banks to raise capital reserves. This is one recent article regarding the LBMA supporting it:
http://www.marketwatch.com/story/gold-inclusion-as-tier-1-asset-wou...
The IMF estimates the European banking reserve shortfall at approx $300 billion, some private sector and business analysts say it is much higher than that. The CFTC has also just backed away from some of the new trading restrictions they were supposed to implement that apparently will allow large long and short positions by the same entities to continue, something that has been accused at times of being used for price manipulation. I'm not saying it is or has been used for that, but some have made those claims. It would seem to me that much lower gold prices now and fairly rapid increases afterwards could potentially reduce the costs to raise these capital levels by as much as 15-20%, maybe more if proposed changes stand, prices move as expected, and banks time their actions correctly. That would put the amount of cost reduction at something around half of the current bailout of Greece, and also would likely reassure markets regarding European banks and reduce lossses elsewhere.
Not making accusations, just pointing out one scenario where a big drop followed by a big recovery could be good for a sector under a lot of pressure.
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Permalink Reply by Gary on -
A little off topic here....but is there still talk of doing the Palladium Mercury Dime...or whatever that was?
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Permalink Reply by Buffalo on
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I don't see anything in this summary of legislation Michael posted.
http://news.coinupdate.com/summary-of-coin-related-bills-introduced...
This article gives some info, apparently just still going thru the process and eventually they will.
http://www.coinworld.com/articles/mint-prepares-for-palladium-coin-...
I hope they do.
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Permalink Reply by Indentured Servant on -
This messsage should be posted in the PM forum but.......
At the end of the day, nothing has changed. The $/Euro is still falling apart although the $ has caught a bounce on more depressing Euro/Greek news. The US is even more in debt than it was last week/month/year/decade. The fundamentals have not changed. The current $/Euro debt based fiat money system is collapsing like a very slow motion train wreck.
I buy every week sometimes three or even five days per week. My average buy price is about $36-$37 since late April. I bought $3k on Thursday and another $3k on Friday. The most important factor is the total number of physical ounces you hold. Those ounces priced in dollars do not mean a thing long term. Owning physical will allow your "money" to maintain its purchasing power.
Many are still predicting a dip early next week down to $24 potentially. My local dealers are closed otherwise I would buy today. I'll buy on Monday regardless of price and play the rest of the week by ear. One thing to keep in mind is that the buying of physical metal has been setting records with many dealers the last three days. When this happens supply tightens, premiums increase and some dealers just say they are sold out and wait for a bounce. You may find that you are ready to buy Monday and find "sold out" signs wherever you go.
I think the worst is over and silver will hang around $30 early next week. There was a margin increase announced today that will potentially stir things up a bit more. I still have not sold or even considered selling even a gram of gold or silver. I still sleep very soundly. YMMV
Bill
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Permalink Reply by Bruce Wiseley on -
Hey Bill, well Silver opened below $30, and all the Dealers are basically shut down. I checked a few sites, and they haven't changed their prices, at least not yet. I would think that they are probably stuck with a lot of $40 Silver due to the selling frenzy of late, with me being one of the frenzied sellers at $45. So I think it's time to re-stock my supply?
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Permalink Reply by Indentured Servant on
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Hey Bruce, My take is that all dealers will be or are currently out of silver right now. There will be a large number of dealers just sitting on their inventory waiting for a recovery. I will attempt to buy more today but I doubt I will find anything for under $34. If you can find it I would buy. I seeing people all over the net now suggesting price may drop all the way to $12-$14. Even if it does I doubt you will find metal for sale at that price.
It seems that JPM & co need to cover their shorts and force out all the longs before position limits are imposed on Oct 4th. Makes sense to me. I doubt that we will be able to buy physical at anything below $25 no matter how low it goes.
Congratulations on selling high. You are probably one of the few. If I had the knack for making accurate calls like that I'd be trading paper to raise cash but I'm not that bright.
Bill
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Permalink Reply by Indentured Servant on
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I should add that I think silver will languish here for awhile. Maybe the rest of the year. Gold may have better upside during that time.
Bill
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Permalink Reply by Clair Alan Hardesty on -
It's too bad that the mint is not set up to respond to rapid drops in spot prices for either silver or gold. If they were, they could really be moving inventory right now. The ATB pond skippers would sell out in a day, the September 11 National Medals would move and raise the maximum money for their cause, and Eagles would fly off the shelves. Clearly, the major dealers are either holding onto stock in hopes of a near term return to price increases or they have simply sold out. They are starting to charge higher premiums for silver products but gold margins seem to be holding fairly tight for now.
If we are really lucky, the spots will stay low for the rest of the month and mint will feel obligated to introduce the anniversary set at a bargain price. It will be interesting to see what happens on the Wednesday mint price adjustment. Gold could be as much as $200 below last weeks point, making the Buffalo drop from $2060 to $1860. That sounds like a lot but that was the price just two months ago. Silver however hasn't seen its current spot since January. Last year, when the proof SAE was introduced for $45.95, silver was at about $24 and it seems to have stabilized today at about $28, which makes the current price of $68.45 pretty steep.
The mint should push whoever they need to push to get the power to reprice whenever they feel the need to do so, on all of their products. They ought to be allowed to run the numismatic coin and medal sales like a for profit business (with very narrow margins enforced). Their bullion business pushes so much material (~90 thousand ounces of gold and ~3 million ounces of silver per month) that they can assume that any numismatic coin being sold has today's spot worth of metal in it.
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Permalink Reply by True Money on -
Sorry. My phone is playing games. This was meant for a different discussion. I cannot delete. Sorry!
-True Money!
True Money said:Again, what really matters if these coins have been switched as long as they are the coins contained in the set? After all, this is the nature of numismatics - interchangeable parts. If someone wants a matched set of PR70DCAM coins from 1999 graded by PCGS, you are not getting the same coins from an original single set. If you want a set of Kennedy Halves in PR69DCAM, you have to pull coins from these sets to create this set. In numismatics, there are collectors in specific areas. When it comes to a graded coin of a certain type, these numismatists try to collect in uniformity. A special label actually is a hinderance to a collector of a particular issue. After all, the object in numismatics is the coin, not a special label. How many complete sets of Silver Eagles exist for the entire run from 1986 to current in "First Strike" or "Early Release" holders? You can't make a set! Special labels have no clout and actually deter many buyers. You want the grading industry to remain uniform for each specific issue.
Special labels should be used on problematic coins to alert the collector of a problem and no grade is assigned. It simply becomes a generic holder for problem coins that a collector may want to conserve. I offered many suggestions in my article with COINAGE MAGAZINE. However, they seem to think that since I don't have an established name as a numismatic author, their readers may not take my article seriously. I asked them to offer my article to people like Scott Travers, Tom DeLorey, and others for editing as a co-author to add some "credit" to the article and help establish my name as a numismatic author. The editors were quick to sign me to a contract, but don't want to publish any of my work. It is simply politics! Unfortunately, I just don't feel confident in doing all of this work for an article just to have it shoved to the side and never used. Perhaps COINWORLD would be more-appreciative of my ideas. In many ways I feel like Dave Redmon from Ice Road Truckers who went to the north from the south and beat them at their own game. They can't have a little "nobody" from the south come in with credible information for their market. Apparently we don't have any money to spend on coins in the south. That's why even Whitman (located in Atlanta) no longer has a show in Atlanta. What a shame! We are one nation - united we stand, divided we fall. This is what is happening in this issue of special labels.
-True Money!
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Permalink Reply by Buffalo on
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On the CFTC position limits issues, I'm seeing a lot of reports that rules proposed now will be considerably weaker than originally expected. Also some recent reports claiming "whistlebowers within the CFTC" have asked for investigations by outside authorities. My understanding from what I have been reading is that rules proposed now will be weaker than had been expected with regard to aggregation of positions under "common ownership" and aggregation of total holdings across exchange traded funds and over-the-counter swaps. That would seem to make it easier for entities to continue holding or moving between large long and short positions using different business divisions with ostensibly different trading goals and/or independent management. Here is one recent article and there are many others out there on other aspects.
http://www.reuters.com/article/2011/09/22/us-quotebox-financial-reg...
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