2011 GOLD high $1,500.00, SILVER high $24.00

Thank you for that link, especially that part about "Access by others". Although it's from 1997, I think it is still pretty valid.

 

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Yikes! I just read the article you linked to.. Doesn't sound too good to me. I'm going to have to rethink the s d box now. And I'll probably be over there today, just to take a peek. The more one learns, the more complicated it gets.. (ignorance is bliss??)

 

Thanks Jim. There's a lot of good common knowledge in this report that many don't seem to understand, but instead brood and fear about when certain terms are mentioned. As a proponent of SDBs, there are steps one should take to insure and protect contents beyond paying a monthly/annual rental fee and turning the key for security. Managing one's SDBs is one's own responsibility. Operate within the legal system and the terms of rental/insurance contract and your costs for security and risk of loss are minimal.

 

Do you know the name of the company? It doesn't sound right because that's more gold than any company in the world currently produces. Barrick Gold produces less than 8 million ounces per year from its 25 mines.

 

For info, 10,000 put options on GLD for a 122/115 spread ( betting GLD is between 115 and 122 on April 15 traded today. About $110 below this level ( GLD doesn't exactly match 1/10 oz). Rather large bet, maybe just a big guesser

Jim

 

Good luck with that! I never really figured out options.

A few days ago I put $10,000 in a stock called Silver Wheaton (SLW), a silver mining company, in my IRA. We all pray a lot when we make these sort of "investments".

 

Maybe 1 million dollars of production. As an aside I was watching the gold mining show the other night and they said Alaska has had its biggest year gold mining last year in almost 100 years.

High prices eventually bring high production, then high production drops the price when demand wanes. Same as all raw material/farming/etc.

 

Yes, some people have more money than they know how to use. It cost him or some speculating group about .33 a share on the trade and expecting ( praying) GLD drops to at least 122, but no lower than 115, if so, he would earn about $4 a share mas o minos ( options have several factors making hard to predict for sure) . 10,000 put contracts consists of 1,000,000 shares. so $330,000 ventured to earn maybe $4 Million. Could be a different strategy of course.

Jim

 

There is so much bad information circulating on the internet that it pays to double check. It becomes like a game of telephone.

Regarding higher production, sometime it happens and sometimes not in the resource sector. Take oil. Production has not been rising for the past 5 years or so despite higher prices. What I always try to do is base decisions on fact and not on general rules that work most of the time. The exceptions can lead to losses.

 

As I had noted on a prior post that I had got out of PM and into copper, I thought I would update with the info ( for those interested), that I have sold my copper holdings on a good morning gain. I know this is contrary to some people thoughts to let it ride and ride, but I like to keep most of the profits. The gains were like adding $8 + to the price of the silver holdings I sold to buy copper holdings. I am at 50%-55% cash as the market is getting odd ( to me , it isn't shakey enough, needs to retreat a little (IMO). Now that rare earths is not getting as much air time as before, I might see that as a long term investment, it is still an extreme commodity need, IMO.

Jim

 

D>Now that rare earths is not getting as much air time as before, I might see that as a long term investment, it is still an extreme commodity need, IMO.

how are you buying rare earth? Interesting play.
​

 

Here's a link for direct Web purchases.

It is, indeed, an interesting play.

 

Or invest in the US miner that mines them, Molycorp. I did.

I am not making a stock recommendation, especially since I own it. Just posting pertinent info.

 

http://www.adn.com/2009/11/08/1005008/alaska-gold-production-highest.html#

From Anchorage Daily News. Maybe you consider this source bad, idk. It is a year old, I wish I found a newer version.

Regarding oil, the peak was predicted in the early 90's if you recall Cloud. I haven't seen it yet, and in fact US production is starting to boom with the new horizontal drilling technology. There was a good article in the Journal recently about this.

 

Many who have a survivalist mentality keep PM's as insurance against socio-economic collapse. Safe deposit boxes could become inaccessibe overnight. That's why some prefer to keep it near at hand. It really isn't good insurance if you can't get it when it's needed most. IMHO

gary

 

This makes more sense - to produce 1M ounces per YEAR. That's a lot different from 1M per week.

Regarding peak oil, the largest production on record was 2005. It hasn't exceeded that level since. Maybe it's becaue of the world-wide recession or maybe that was the peak. We won't know for a few years. I'm not a strong believer in the peak oil theory, but there is no doubt that with decline rates of 5%+ for existing fields, it takes massive investments into exploration and production facilities to overcome this and grow production, and that just isn't happening. The first 4M of new production each year just goes to offset the decline elsewhere.

http://www.eia.doe.gov/aer/txt/ptb1105.html

 

I agree Cloud, we always almost agree. However I would say oil has political problems. Think of the countries with declining production, Mexico, Venezuela, Indonesia, Iran, these countries are declining simply because of a malfunctioning government stealing all of the oil revenues and not reinvesting in production. This couple with Iraq, formerly the 3rd largest producer in the world, makes me think that with political change oil production could surge again. Of course there will be a peak, but I do not think we are near it yet.

This is applicable to PM's since long term high prices like the article noted will provide capital to explore and open up new mines. I am long term bullish on metals to at least keep up with inflation and maybe do better in the US due to declining dollar, but in a 5-10 year time frame I believe we will see lower prices again. I will use this opportunity to add to my holdings if I see it again, as 30+ year timeframe I am bullish.

 

I would add that the decline rate applies to PMs as well. Much of the new production just goes to replace the depleted mines, so even a fairly successful mining industry effort might not increase production significantly over any timeframe.

 

I believe we are already beginning to see the tie to oil prices as Silver is doing it's thing again. I still believe the Silver will outperform gold as an investment for some time to come. IMHO

gary

 

That is my guess too since silver inventories are depleted while gold is not. But gold is accumulated by central banks and silver is not, so it's still a close call. Owning some of both is a good compromise.