2012 Silver Crash?

Unless you are talking about buying issues directly from the mint - I suspect most of the coins you would be interested in are going to stick in people's business inventory at close to the price they were acquired.

 

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I am not making the case that it's not so bad, merely pointing out why the dollar is stronger and having a greater impact on prices here than over there. For the record I have no vested interest in promoting precious metals aside from not wanting other peoples' wealth to be stolen thus requiring them to be more dependent upon people like us who do have precious metals.

I am making the case that the current price action is due to the European situation (Greece's bills due tomorrow and they are going to have a hard time) which is doing two things, bolstering dollar strength as the safe haven currency of choice when people flee the Euro, and also creating a liquidity crunch as everything is sold off to free up cash (evident in stock markets as well), both of which create headwinds for metals.

I'll requote my original post since we are veering off point from what I was shooting for, and I feel it is important to note how far metals dropped in 2008. We have not yet experienced that magnitude of a drop since the highs last year. It has happened before without impacting the bull market, so I don't see why it can't happen again.

 

I will say again. You can't time anything now in the short term. The rules about strong currency vs weak currency are now meaningless as it doesn't matter which dead person is printed on the nice fiat linen. The finance industry as we know it is unraveling and because of that you just can't try to time the market. Investment in physical silver & gold should only be for the long term and you better darn well make sure that you hold it.

I'm watching a fascinating piece on Sky News about the currency mechanisms in which Greece will leave the Euro. This would have been unthinkable by most just 12 months ago, yet it's looking very likely now when such a mainstream news outlet starts to openly discuss it. What does this mean? Who knows, but I'm of the opinion that it's good for PM.

 

Not with time sir, but short term you are right. It would take time to force dealers to reprice their coins if PM goes down. The last time this happened was in the 80's, and many dealers held on to their "cost" pricing for a few years until sales just shrivelled up and they were forced to lower the price. On a price slide, bullion and junk will be quickest to get repriced, and even that could take a while. Dealers like to say either "the price is going back up" or other reasons to justify why the don't reflect lower PM. Sometimes they are right, and its just a dip. They were right the last time, with most dealers refusing to sell silver based on $10 or below silver. They sure bought it on that basis though.

I don't begrudge any of them their pricing decisions, its their business, just describing what happened the last time there was a longer term price correction.

 

I'm a big fan of a strong dollar. But everyone has to play the hand that is dealt to them.

 

@Inflexion, I understand man, it just seemed salesman talk. Everyone talks about what silver pricing has done and use on the basis of USD, so to now bring up what gold is doing on a Euro basis this year is simply muddying the waters and sounded like what a dealer would say to concerned clients.

That's all man. I never thought you had any financial interest in anyone buying pm.

 

Won't be surprised if Silver will soon test its $25 mark and Gold $1500.

 

Everyone is entitled to their opinion, I just happen to disagree with yours. Gold and silver are very relevant to each other, however that point (which was not my main point and I'm left wondering why we keep getting side tracked on something of lesser importance than my actual point) was merely in relation to Euro buying power. In my opinion you are the one muddying the waters with side talk. I give out all the information I can for free, the opposite of what a salesman would do. If we're going to be calling it like we see it, I feel like you're trying to distract from the rest of my post which was exceedingly more relevant than the one line you honed in on.

 

It's down to 28.227 now.

Must...

Not...

Pull...

Trigger...

Yet...

I am holding out for even lower prices for my next purchase. I don't know if I'll be able to hold off all the way to $25 though. If I can, then I'm buying EVERYTHING! :yes:

 

I unfortunately bought some at $30 i had feeling it was going to drop but i believed that it will raise to 35 before that happens it didn't pan out...

Anyway stealing a quote from Storage Wars, Cash is King.

 

Your point of having a repeat of 2008 I don't believe is valid since we do not have the same situation at all.

Regarding the dollar being stronger, it may be slightly due to Greece. You claim it will lose its luster after the current political crisis in Europe. It could soften, you are right.

I just don't think the price of gold is solely a function of dollar strength or weakness. Its high versus any currency in the world versus a few year ago. The current price of PM is not high solely because of the dollar, its high overall versus the previous decade. Could it gain 5-10% due to dollar weakening, yes, but I think PM could weaken further if the US changes to an administration they believed would honestly try to lower the deficit.

Sorry that I challenged an assertion in your post. I simply did not wish such a declaration, (which in my mind sounded like salesman excuses), to stand unchallenged. I wasn't meaning to completely derail the thread. Words are weird, if someone posts something like that, and no one calls them out on it, other readers have a way of repeating the same saying.

 

My recommendation is that if you have access to foreign news, you should start watching it. Especially news from Europe. This would be BBC News (not BBC America), RT, Sky News. Watch all 3, understand their underlying motivations, and put together the pieces. You will learn more about OUR economy and the current global currency situation than you will ever learn from anything in the American mainstream press. (did you think that anything ending in NBC is worthwhile?) What you won't hear is if Obama and Romney think Gays are OK or that we are in a "recovery".

What? You can't get it because your cable company doesn't have it despite the high bills? Cancel it and go to Walmart and get a Roku.

 

On the contrary. We are still in the situation that began in 2008. The only difference is the government & federal reserve have created $7T of debt and used it to prop up dead businesses, "stimulate" endless misguided projects, and most importantly, used it to prevent any TBTF bank from having to deal with the mess their management created. And, as MF Global and this weeks mess with JP Morgan proves, nothing has been fixed either.

The same lies that have been told about Greece being fine are being told here as well. The only difference is the scale is much larger and will take more time to pan out.

 

After all of the balance sheet enhancements done the last 4 years, and the tiny scale of a 2 billion loss, I stand by my assertion that today bears no resemblance to 2008. The scale is simply vastly, vastly different. JP Morgan can handle that loss without a bailout, and should be forced to. The problem IS the bailouts. Firms need to be perfectly clear that if they manke bad decisions, they fail. Period.

 

Let me ask you this would you let GM get bought up by Chery or Tata primarily for its Chinese operations and turn around liquidate the US assets? It is acceptable IMO but most people who claim to be for Free market believe that it always achieves the best for America.

 

You act like the assets will go away. They will still be there, and something else, (maybe cars for another company), will be produced there. Protecting high wage, horrible union contract, extremely high benefits jobs at the expense of tens of billions of taxpayers dollars is simply unfair in my eyes. My should my tax dollars go to save an inefficient, overpriced job somewhere else?

If a company cannot make it, its better for it to be allowed to fail. Other firms will see that and not take such huge risks, or will be forced to deal with union contracts, or make efficiency gains, etc. Bailouts like GM is simply corporate and union welfare on a massive scale. GM has been deficient in management AND labor for decades now. If they fail they deserve to fail. Why didn't Ford need a bailout? How fair is it that GM and Chrysler get to use taxpayer money to compete against Ford. Ford is being punished for being well run.

 

How do you know? They don't even seem to know if you believe anything their own chairman says. If there was proper regulation $2B would not be lost and no doubt written off for the taxpayers.

The fact that it happened at all, because taxpayer backstopped banks are not supposed to be taking risky bets, speaks volumes as to where we are.

 

Ford actually did get a bailout (it is lending arm) and primarily got lucky because it was able to finance its debt months before the crisis hit it is all timing. Any sale would have decimated the assets of GM (remember Visteon or Delph?) and would have taken let massive job loses of white collar work force if Toyota, Ford bought up the left overs of GM.

Anyway the reason i brought up Tata and Chery is because both companies have recieved minor bailouts from India/China before even Fiat was bailed out of Bankruptcy years before it bought up parts of Chrysler. I remember when American autos complained about Skorea pumping cash to save Hyundai in late 90s and the pressure US gov put allowed GM to buy Daewoo cheap the irony

What my point is countries are in it to preserve their own self interest not to promote free market because that doesn't always serve in the countries best interest.

 

Bu way of full disclosure, I am not an advocate of global free trade. Sometimes the assets and jobs go away - permanently - like the textile industry. Thje US now has a permanent underclass that formerly worked in a variety of industries that are dead in America. I laugh at the people who see high wage, high benefit jobs as something to get rid of. In saner times, the US used wage equalization tariffs to protect the high and rising standard of living of its citizens. Now, corporations rule and are moving the nation toward subsistence level jobs to maximize corporate profits. I know it is popular to believe that lower consumer prices are the ONLY economic indicator that matters. But people forget that you can't have consumers without producers. And consumers are also the same people earning the high wages with high benefits that are supposedly bad for the nation. There is no way to tell, of course, but Alexander Hamilton would probably have protected the US auto industry as strategic, and no bailout would have been needed. Since you are financially secure, it may be difficult for you to see it that way. But the view from the bottom of society is that capitalism isn't working for them, and if the elite don't start paying attention to the needs of these folks, it might bring down the whole system with or without bailouts.

 

I don't disagree one iota with tariffs if foreign nations are "cheating". If China pirates our stuff, then every single item imported from China should have a major tariff imposed to compensate our firms lost sales.

However, you cannot look at the total picture of GM and say foreign firms are cheating. GM is just way too inefficient, work rules and old benefit promises are just way too costly for it to be a decent producer. If Toyota is not "cheating", and is fairly competing with our firms and our firms lose, then we should not take my, yours, and every taxpayers money to help them unfairly compete. Where does it stop? Why doesn't every company in the US not get bailed out if they are failing?

I do strongly believe we really should impose massive tariffs on India and China. Not just because our firms suck, but India steals our patented medicine freely, and China basically ignoring patents and copyrights and blantantly violates all laws in this category. To not impose massive tariffs on Chinese goods to compensate movie studios, engineering firms, etc. for this massive global theft is just wrong. Equally wrong, though, is giving taxpayer funds to massively inefficient and poorly managed firms in the US.

Just my opinion.