...and down she goes!

Great time to sell right now. silver still above 20, and high premiums wont last forever

 

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Hmmm....a really serious stop clearing run???

 

What does that mean?

 

Most reports I've been reading state all-in cost of production for silver at $23-24/oz and $1300 for gold. The longer the price stays below cost of production the more bullish the fundamentals. Plus cost of production only accounts for about 75% of demand. The other 25% is the market ask price which is still above cost of production for good reason.

 

Kind of funny how people are talking like silver's going to drop below $15 and $10 and even $5 just before it actually begins a huge rally.

 

Basically they clear out the trades by eliminating the low end stops, which takes those trades off the table.

 

Good luck. It still looks like most 90% junk is getting 20x FV or better, based on a quick check of completed auctions.

 

Of course they are. They wanted you to buy them out.

I was a youth before Hunt started his silver pyramid scheme, so seeing $8 per ounce is not going to be new to me. Regardless, if it drops there, I will continue to acquire as much of it as I can afford. Quite simply, no one is making any more of that element, but we are consuming it. If it drops to $8 and stays there for a decade, that is okay with me. Silver coins are supposed to be a long time hold. I have silver coins left to me by my Grandmother who started saving them in the 1920s and put them into a piggy bank for me back in the 1950s. Some day it is my hope my own grandson or granddaughter will handle the same coins as well as the ones acquired by me, my spouse(s?) and his or her parents. Rest assured because of industrial demand the price won't and can't stay low forever (barring government confiscation like Roosevelt and Gold coins (my own family had to hand some in back then).

I think with silver coins, you have to break them into two or three categories. Worn, or poor condition coins you picked up at close to Spot price, which you can still trade because they probably aren't counterfeit and won't need assaying because the value is known. And 100 year old rare silver coins such as CC Morgan Dollars which you picked up in the best possible condition you could afford, possibly even certified and slabbed (although to me a cardboarded 63 is just as nice as a plastic slabbed 63 and I won't pay the premium price for plastic around a coin I can't touch) as a rare coin investment. Possibly a third category you won't ever sell such as heirlooms, like the gold eagle my Dad acquired in a card game in Sicily during WW2 and brought home with him after the war ended, then gave me for my coin collection when I was 12.

Point is, if you have been paying top dollar for silver coins of any type, you understood that what goes up, comes down. I have two small things I am thankful today. I don't have a 3 to 6 day old bid sitting around on Ebay which I will be stuck with as a purchase price when the auction ends, and also that I have never paid more than 1% over spot price for any Silver Eagle. The day after silver hits $8 or 9, I will buy 10 more Eagles at that price +1%.

 

Nice bounce back to $22.50 today. I think we may have found a floor. Or maybe not?

 

last i checked was 21.28 so its gone up i dont check it that often any more

 

Categorically false. We are not consuming the element, and while they aren't technically making any more of it, they are mining more, which is essentially the same thing. Above ground supply is increasing all the time, and no silver is consumed on an elemental level.

 

True, but not relevant. Outside of physics labs, we neither consume nor produce any element. But if we dump silver-bearing products into a landfill, or wash them into our watersheds, we're effectively consuming the stuff.

 

Not really. If silver goes high enough, more of it will be recycled and recovered. And my point was this- technically, it is neither created nor destroyed (except in a lab, as you said, in negligible quantities- for now), but effectively, it is both created and destroyed- mined and used up. Mine supply isn't running out any time... ever, but use in industry will decrease as cheaper alternatives are developed. Also, more can be mined as better techniques are developed.

Betting on PMs is essentially betting against technology, which seldom ends well.

 

Unless that technology needs PMs to work...

 

How is it possible for you to buy ASE at 1% over spot?

 

Trying to predict silver is like trying to predict
women. I never could get that right.

 

Haha...me neither.

 

So, question is, what percent of silver is or potentially can be recovered?

 

Man, those are some huge buy/sell spreads. Is that normal for B&M coin stores? I'd think it'd be very difficult for the small bullion investor to make any money buying &/or selling from that store......Talk about "house odds"!

I've bought & sold most of my silver bullion coins on fee-bay the last 10-12 years. I hate paying the 12% when I sell, (9% + 3%), but maybe that's about the best the "little guy" can do.

BTW, I've vowed, if silver goes down to $12, I'll buy as much silver as I can fit in my house. (Gee, what are the odds, that as soon as I do that, silver will go to $8?).

 

We can't recover any nano-silver applications, which are many. Much of it can be recovered from standard electronics and other indsturial uses, but the price of silver is not currently cost effective enough to justify the cost in recycling as much as we could be.

While mining supply numbers are growing, they are still losing ground on total demand each year. Mining covers roughly 75% of demand so the other 25% must fall to either recycling or buying from people who do not want to sell for a loss. If investment demand keeps growing like it has been then mining supply will continue to fall shorter and shorter. I will be eagerly anticipating the 2013 numbers when they come out next year.

So really the question is price. Will silver become profitable enough for us to go get all that metal that can be retrieved from landfills? Will silver become profitable enough for existing holders of metal to want to sell it? This is not going to happen with silver in the low 20s.

If the price rises accordingly then we will never experience a shortage. If not allowed to rise to meet the mining shortfall then we will eventually experience a shortage, but it's anybody's guess how long that could take.

But yes you are correct, we can't consume the element. What we have essentially done is dispersed it to the point where gathering what can be recovered requires additional cost.

I don't know specifically how much it costs to recycle but I would bet that your average minimum wage worker who gets paid $10/hour will not recover 1 oz of silver in 2 hours of rummaging through a garbage heap.