The Gold and Silver Thread

[elvis]

[ame=http://www.youtube.com/watch?v=X-HQJXI4nVw]YouTube - U2 - Silver & Gold[/ame]

 

[Toro]

Silver had a negative reversal day today, gapping up in the morning and closing on the lows. This is often associated with topping action, if perhaps only for the near-term. Thus, mid-morning, I blew out all my silver.

I still have my gold position, however. I would expect that if silver is going to go down, gold will too (and vice-versa). However, gold did not exhibit the same toppy action that silver did today, so I continue to hold. If the market starts talking to me, telling me to sell my gold, I'll do so.

 

[Sky]

You guys sound so full of it!!

One ounce of Gold still buys an Armani Suit - Yup!

Those markets are so manipulated - it makes my eyes tear up every five years I look at the prices....

The dollar is now 5c of its value since 1910. What is the argument?

In my book, what counts is how many ounces of the shiny stuff you hold...

 

[Toro]

I sold my gold position this morning when it broke $1450.

 

[Avatar4321]

Anyone who thinks the system is actually going to break down and purchases silver or gold is a fool.

If anything, we should be buying and planting seeds to grow new food and to sell seeds for times of trouble. Heck, even if the system doesn't break down, that would be wise considering the inflation thats hitting food lately.

 

[liebuster]

Silver is about $42/oz. Holy shit!!

 

[Toro]

The melt up in silver is clearly on. A mania is developing. Sentiment is very bullish. A violent reversal cannot be ruled out but it may not happen until silver hits $50. The move in silver has not been confirmed by silver stocks. Take a look at the purest silver company SLW. Nor is it being confirmed by gold or gold stocks, at least not yet.

 

[KissMy]

The melt up in silver is clearly on. A mania is developing. Sentiment is very bullish. A violent reversal cannot be ruled out but it may not happen until silver hits $50. The move in silver has not been confirmed by silver stocks. Take a look at the purest silver company SLW. Nor is it being confirmed by gold or gold stocks, at least not yet.

Corn & Soybeans are melting down & Silver is melting up.

 

[Toro]

I will say this. My son told me that one of his friends fathers was investing in silver, and I was eating in a restaurant the other day discussing gold and silver with a friend when this stranger came over out of the blue and told me he was invested in silver too. So you are starting to see these frothy anecdotes.

 

[KissMy]

I will say this. My son told me that one of his friends fathers was investing in silver, and I was eating in a restaurant the other day discussing gold and silver with a friend when this stranger came over out of the blue and told me he was invested in silver too. So you are starting to see these frothy anecdotes.

I am feeling that also. My mother asked me what the symbol was for a good Silver stock ETF. I have always used her as a bubble gage. She always gets in at the top. I didn't know if it was from my brother & I hounding her to get out of dollars for the past 3 years. She never listens to us.

Another shocker I have came across is farm land at several auctions in the last quarter has sold for over 10,000 an acre.

Midwest land demand , brings soaring prices

The value of Iowa farmland jumped 26 percent since March 2010. According to a survey by the Iowa Farm and Land Chapter No. 2 of the Real Land Institute, it is the biggest annual increase in more than three decades for the state.

Iowa State University reporting 16 percent in November, the Federal Reserve at 18 percent, the University of Nebraska at 22 percent, and Illinois Realtors ranging from 9 to 15 percent.

A bubble is just starting to form from the falling dollar. The question is will the dollar stop falling for the next decade. US Government Deficit = Money Creation. The budget is out of control for a while.

 

[Toro]

However, these are only minor anecdotes. Silver and gold aren't full fledged manias. Yet.

Hulbert's gold sentiment indicator is at a level where historically, there has been a significant correction in gold and silver prices.

 

[FireFly]

I am toying with the idea of buying GLD & SLV straddles & borrowing against my tier 1 asset gold coins to buy another 360 acres of farm land. There is no money in cash renting it but you can make some serious coin farming right now. Plus the land price is starting to rise. I have just got to convince the current 85 year old land owner next to my property that he can't take it with him & he will enjoy that cash right now.

 

[Toro]

That graph won't end well. Farmland going up 35% in two years is unhinged.

 

[Gadawg73]

Gentleman, gold mania is speculative. That is what is happening now. Let me appeal to your reason and investing common sense in commodities trading, especially gold:
1. Gold is going high because of investors. Folks, demand for gold is cratering and declining fast. Jewlery, which accounts FOR MORE THAN HALF of the demand for gold worldwide, has fallen sharply with a bad economy.
2. India purchases more gold than any other country. When the price is very high they can not afford to purchase as much to make the jewelry.
3. Then we have price pressure from the demand side. Higher and increasing prices of gold means gold miners have to work over time. The supply of gold worldwide has jumped over 10% in the last 15months. With high prices they plow up as much as they can and then we get an over supply. And guess what happens then? The slightest decrease in demand sends prices plummeting as extraction per ounce costs are rising high.
4. High prices of gold also brings out the sellers and re-sellers and sellers of resellers! All of a sudden now every spare piece of old gold whatever is being soldby everyone everywhere. Everywhere you go there is some dude with a sign "We buy Gold". This further floods the market with an over supply of gold which, again, will drive down the price fast swith the slightest decrease in demand.
5. No one knows how long hedge fund bets are. Often times gold lies in futures, as the ownership is never even taking delivery of the gold itself.

If you have extra $$$ then go for it with a small % but watch gold fall to the $800 range within the next 20 months and stay there for a while.

 

[Jos]

Would you rather be holding Gold & Silver or paper & ink?

 

[Mad Scientist]

Would you rather be holding Gold & Silver or paper & ink?

This. Gold has appreciated in value because the Chairman of the Federal Reserve has seen fit to try to destroy the value of the dollar through QEI and QEII soon to be followed by QEIII.

 

[Gadawg73]

Would you rather be holding Gold & Silver or paper & ink?

Well, no one holds any gold unless it is in your hands and many do not know that what they are getting are futures or funds, not the metal.
You own metals and land and invest in stocks and bonds.
You can not eat gold or paper or ink.
But I agree with you now, weprint damn $$$ and soon inflation will rise again. But long term that will not stop the pressures of demand on metals.
If I bought low and sold high, and selling is getting out, it does not matter what I own or invest in.
If you bought gold at $900 and it goes to $2000 and you are holding it you have made no $$.
You have to sell to profit.
Watch the supply rise with higher prices and the second demand goes down the price will drop like a sack of rocks.
Metals are a great hedge against inflation but as a ling term hold as an investment they do about half as well as the market.
I would sell 20% now and 20% every quarter. American corporations are sitting on over a trillion dollars in cash now. When they start spending that that will also pressure the commodities market down.

 

[Toro]

It is getting stupid in silver. I've seen this many times before. It will end badly.

But that doesn't mean it won't get stupider before it ends, as I expect it will. But it feels to me like a frenzy right now.

 

[Mad Scientist]

It is getting stupid in silver. I've seen this many times before. It will end badly.

But that doesn't mean it won't get stupider before it ends, as I expect it will. But it feels to me like a frenzy right now.

But has the Fed printed a massive amount of dollars before? Gold and silver isn't going up in value merely from speculation like the Hunt Brothers did years ago. It's going up because the value of the dollar is going down. People are beginning to realize this and are bailing from the dollar before their life savings are wiped out.

At least if you have gold or silver you can then trade that into whatever our handlers install as the new currency after the dollar is destroyed.

 

[Toro]

There are always rationales behind manias. In housing it was they aren't building any more land. In tech it was the Internet was going to change life. Both were true and both destroyed a lot of wealth for people.

I've been trading gold and silver for nearly a decade now. I don't think it's over. Generally manias end when money is tight. Right now money is loose. But currently, it feels like a frenzy to me. That doesn't mean silver can't go to $50 in a hurry but I think it's dangerous right now so I've stepped aside.