Silver Will Not Top $20 Again Homies

No, inflation is determined by both supply and velocity. It is also determined by total transactions in that money.

http://www.sjsu.edu/faculty/watkins/infldynamic.htm

 

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It might not make sense for the short term, but he might be able to get shares in silver mining companies for a bargain when they're losing money, and if the price of silver goes up to where they're profitable again, WooHoo!

Too much uncertainty for me though, unless I can lend them money as a secured creditor instead of being a shareholder, since shareholders come dead last when it comes to bankruptcies.

 

You can always lobby for a bailout, then the taxpayers come in last.

 

Only for the UAW automaker bailouts. For all of the financial bailouts, taxpayers made tens or hundreds of billions. Of course, this is not a story very popular with the press.

 

That doesn't mean that the taxpayer didn't come in last. It just means there weren't losses to creditors / shareholders.

 

That is not true either. Many of the US Treasury loans to financial institutions were of higher priority than equity holders of the firm.

Now, I defend it on that point, but I was still against all of the bailouts. I still believe Wall Street needs to understand that they can fail, and have the FEAR of failure guiding their business decisions. I do believe they are lacking that now, and I hate that fact.

So, I am against bailouts, but I simply wanted to point out that what many bandy about on the details of those bailouts are not true. The US was in a higher position than shareholders, we did make tens or hundreds of billions on them, but I still did not like them. If you say the shareholders benefited, that would be true. Those firms would have went bankrupt. However, the US also benefited, since all of the salaries they pay today pay at least a third to the US treasury, so the US also benefits by keeping those firms in business.

 

I bet Silver will hit $20 by September 1st.

 

no way its going to hit the $10 mark this year. thats to low. i see the bottom at no less then $15, if that.

 

We'll see what happens, but we seem to be holding over $19 lately. I hope we get over $20, so that we can let Eminem know, but I am holding off on gloating too much, because it could tank again at any moment.

 

Well the original supposition was silly if not accompanied by a short timeframe. Therefor I thought it was inferred 6 months or a year was the meaning. All assets will eventually be priced at X or above given the mild inflation paradigm preferred by modern economies. Gold will be over $10,000 and silver over $500, it's simply a matter of when, and what the price of everything else is at the time. Silver being $500 an ounce is not a reason to celebrate if a ribeye costs $1,000 a pound, so silver actually loses purchasing power even though nominally increasing.

 

That's exactly why I am never too happy when silver goes up, because that means that everything else we buy has gone up as well. It looks like something has happened lately to make silver go up about 40 cents in recent days.

 

I disagree about the bank bailouts - The FDIC was going to have to payout if they failed anyway. The Justice Department just needed to put more folks than Bernie in prison. Once it is demonstrated to the people in upper, middle and lower management that prison is a viable outcome for their actions - things would straighten out going into the future.

 

Well most of the bailouts were to investment banks, not retail banks, so the FDIC coverage would not apply. Plus, there is surplus funds in FDIC to tap if needed. So, I am not thinking insurance was the major reason. Like I said, these firms DO need to have fear of failure, loss of cushy jobs, and even possible prison terms, as a possibility. Because we bailed them out, they do not think that way, and that is the major reason I opposed the bailouts.

 

If ISIS militant group takes over Baghdad (they are only 100 miles away) and a civil war breaks out in Iraq, I can see a potential increase in PMs in the near term.

 

Why? Iraqi oil is not that important, there are no other important things Iraq provides the world economy. Sudan has been a mess for decades and their oil on or off hasn't thrown the world into a turmoil. Why would civil war in Iraq affect the world economy to such an extent? Civil war in neighboring Syria sure hasn't done anything to PM prices. Russia/Ukraine could have a lot of consequences, but I somply do not see Iraq as having them.

 

All good points, but if a civil war threatened to destabilize the entire region, including the oil rich nations to the south and the US had to intervene again, this may have an impact. The leader of ISIS is a ruthless/educated guy with more than Syria and Iraq in his sights. Also, if the US has to get involved again, this may open the door for others like Putin to take advantage. Of course, I do not want this to happen but we will just have to see how this plays out.

 

Sell your PMs and buy the "armed drones" businesses. More upside

 

This might become a Saigon redux.

 

Things that make you go hmmm:

http://www.kitco.com/charts/livesilver.html

 

I should have said July 1st.