Is anybody still buying silver and gold?

Over priced. You can get ASEs for $3-4 over spot. This guy is charging $7.00 over spot.

Granted when he started the listing it might have only been $3.00 over spot as silver has dropped by $4.00/oz in the last couple of days.

The lesson here is: silver is very volatile. As always, you should buy low and sell high. Sounds simple in theory. Much harder to execute in the real world, as I'm sure this seller is discovering.

 

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1. Many people don't have coin shops near them
2. When you buy on EBAY there is no sales tax as there is in many states
3. Some people have disabilities that don't make it easy for them to visit shows and stores
4. If someone wants a particular coin or roll for a collection, they may not consider an extra $3.50 to be a big deal compared to the time and gas savings
5. It may be someone who wants a silver investment and doesn't know that there is a better way.
6. Someone may want to hand them out as gifts so the economics of the transaction are not as important to them

 

So yes, some folks buy all the time, as I did today with another tube of uncirc ASEs and a couple maple leafs for a change of pace. Will I lose money? Maybe. Will I gain value? Maybe. >shrug< I'll count those chickens in 10+ years. At least any 'loss' still leaves me with tangibles, unlike some of my magnificent chapter 13 stock certificates of old.

 

I think 100 dolalrs an ounce might be on the low side downm the road i am buying at every oppurtunity i can I am thinking about cashing out half a gold fund i have and putting it into phyisal metals if there is a big enough dip

 

Do not get too bothered at gold or silver price dips. See it as a buying opportunity before it continues it's steady or not so steady increase. Only bothered when I don't have the resources to act on the dips. For the long range it would pay to take advantage of as many buy opportunities that present themselves.

 

The dips don't bother me it's just part of the ride. I do buy on the dips though.

 

And since the Mint doesn't sell ASE's directly to customers, only to dealers, there's the Mint mark-up and the dealer's mark-up. Everybody in the chain needs to make a buck.

 

All of these brave new folks who don't care about volitility, forecast sky high prices, and intend to buy the dips remind me of the old AOL investment chat rooms shortly before the tech stock crash in 2000. So this is just another datapoint to consider when deciding how close it is to the top

 

There are some big differences between tech stocks and silver.

First, tech stocks were not all made the same-- many were of questionable repute to begin with and quickly fizzled out, while some, like Apple, came out ahead. But 1 ounce of .999 silver is essentially the same regardless of whether it's a silver eagle or a silver maple leaf or a Mexican onza.

Second, tech stocks can be issued in any amount at any time (the dilution factor), and you don't get anything tangible for your investment.

Third, people were buying tech stocks on margin. How many people today are buying physical silver on margin?

Fourth, unlike tech stocks, silver has been considered a monetary medium for millennia. It no longer has the same status vis-a-vis gold, but it is still linked to "hard money", as opposed to the completely fiat money we have today.

Saying that, silver is still very volatile. But at least with physical silver, you are not at the mercy of incompetent corporate management, or stock dilution, or Wall Street's wrath for not "meeting numbers".

 

Apmex is not accepting orders until 6:15pm today due to market uncertainty.

 

is that common?

 

That's a good question.

 

I have never seen them ( APMEX ) not take orders unless they show they are out of a product.
The next bubble could very well be not PMs .
The cost of alternative energy is getting an eye ball, from a cost stand point and large subsidies. People may just not be able to swing good ideas, that are good in theory, but can not float on their own yet. Eighty billion in subsidies over 2007-2010 in tax credits from stimulus is not going to be there. Solar grew 67% in 2010 . Wind grew 40% in 2009.
The jobs are expensive as is the actual product. Clean coal ( sulfur removed) and natural gas may have to do for a few years.
I do not think metals can continue at this rate and may hit a plateau . They may stop there or go down a bit .
Costs are out of sight to dig in South Africa in the ultra deep mines. They need loans to be provided , but paying for loans while reconstruction takes place, takes deep pockets, as well as willing banks.
Banks are only loaning on very safe uncomplicated situations. The reconstruction is for new guidelines for worker safety, and other state regulated upgrades.
Mileage may differ but we do have a bit to explore.
Pep

 

not related and political- come on

 

And no matter what happens to the price per oz in the short term, at the end of the day you still have a safe full of silver.

 

Where you spend your money for investments be they bullion or energy is related. How gold is being extracted and where the bottlenecks are is related.
We have money problems, and PMs look high, that is related.
This was not meant to be political just broad based.
Changes in alternative energy can ,and will have an effect on PM prices.

 

It is over the very long term, but the long term can be pretty long.

Actually, gold's not unlike the stock market. Both go through long-term cycles that last about thirty years. (And, like gold, there are lots of people who'll tell you that the stock market is an accurate gauge of business value...) The last super-cycle for stocks began in 1982, with the market P/E ratio well below 10 and a consensus view that stocks were dead. The top of the cycle was hit in early 2000. Ever since then, stocks have been range-bound over the very long term. The P/E ratio in early 2000 was well above 30. The churning since then can be seen as necessary for earning to catch up to inflated stock values.

Of course, this broad brush misses a lot of twists and turns within. March 2009 was the "buying opportunity of a lifetime." (Doug Kass.) Septemer 2007 was a bad time to get in.

Gold goes through a similar process. The first cycle, distorted by previous price control, began in 1968 with gold at $35. Despite at least one horrendous spill in 1975-6, it continued upwards and peaked at $850 in January of 1980. Note that gold peaked more than two years before stocks troughed. I point this out because the gold supercycle turned up not long after stocks hit a brick wall in 1966. After plummeting to $300 in 1982, shortly before stocks turned around, gold fluctuated between $300 and $500 until the late 1990s. It then took a dive to $250 and troughed there in 2001. Again, the gold supercycle shifted some time after stocks did.

Despite that lack of overlap, the gold supercycle goes roughly opposite the stocks supercycle. If you sold your gold near the peak in 1981 ($600/oz) and put the proceeds in stocks, you would have done all right in the long term. Same with selling stocks near the peak (say, 1999) and buying gold. Sad to say, I missed the turn in '99. I thought the stock market would resemble the '70s, but I didn't think about what that meant for gold.

Stocks and gold have this in common: they're both assets. For whatever reason, asset classes fluctuate widely over the very long term.

 

any discussion of aly energy is political and on the trolling side

 

Thanks for the heads-up, even though I hadn't planned on discussing it myself. Trouble is, gold is a political investment in part.

 

Silver is still subject to supply and demand and economic laws. Commodities tend to move toward the cost of production over the long run, and this is about $20 [give or take depending on a lot of factors] so there is significant downside until you get anywhere close to intrinsic value. Add that to the wildly bullish sentiment that is developing from folks new to the market and you have at least the beginning symptoms of a top.