How is he going to make a living by sitting on inventory? You can wait for years before the price comes back up to your buy price. (Some people who bought in 2011 are still waiting.) You can only stay in business if you can turn items over. If you're waiting for the price to go up, you're speculating, and that's a risky model.
Twoshadows volunteers at a coin shop. I'm not sure he's fully learned the economics of the business model yet. Coin shops need to sell CONSTANTLY to stay in business. They make their living on their buy sell spread. They need to be buying an ounce of silver for 50 cents under and selling it for 50 cents over that same week, ideally. A coin shop that prices bullion significantly over spot and rips you off when buying from you won't get any of my business. Lower profit on high volume is always better than high profit on low volume, for the simple reason that having more customers is always better than just a few. Not to mention, selling on low margins at high volume will make more customers happy. Isn't that what any business wants?
I understand turning your money over but was trying to explain no one, including the small coin shops, can afford to sell at a loss. The highly collectable coins usually are turned over very quickly as everyone wants them but buying gold or silver bullion when silver is up cannot be sold at a loss. Now junk silver, well that is bought and sold by market prices each and every day. The ten, fifty and one hundred ounce bars are a different story. (silver) Now gold is not as tough as it doesn't move much and hasn't for a while so prices don't fluctuate as much.
I believe PM's are not for investors looking for a profit someday that may be far away but for a hedge against inflation that is always around the corner.
No. Although PMs will trend with equities in certain situations, PMs more often than not reverse trend to the US Dollar Index. With larger trade concerns the US Dollar Index will typically strengthen dependent upon the total situation, which will typically lower PMs excluding all other possible indicators. In this case the US Dollar Index is rising which is pushing PMs down (excluding other demands, impact items). Now, if the general market has a pull out of funds .. ie they get scared, they general go to "safe havens" which PMs are a safe haven. So .. this downward PM trend may change quickly, irregardless of the US Dollar Index. If this is a one day blip though, there maybe a surge tomorrow in equities .. so we could have a see-sawing effect of equities and PMs. Or equities could drop in the morning and rise as the day continues. It all depends upon the trending indicators throughout the day. In other words, If you are biased towards PMs then a down market will be a buy signal if you think spot is at a good spot.
Subsequently, you are now seeing a pullback of the US Dollar Index, a clawback of the DOW from -500 to -275, silver is see-sawing around and gold continues down a bit and the VIX is slowly scaling back - showing you how frantic ppl are. Large VIX sways may equate to larger PM fluctuations. (I'd worry if it approaches 20). of course, YMMV time to buy Amzn if ya' got the $$ if the Bond market starts selling off with equities ... then that's different.
Wish the Silver to Gold ratio would change to like about 50 to 1,would be real nice. One site says demand for silver is more than supply in last 4 yrs. miners don't make any money when silver is this low. I think something will have to change, get rid of derivatives and I think things for silver would look a lot better
Silver is always in demand, but most people do not want to pay what it is offered at by the price setting boards, they want it at the price the mining companies show on their balance sheet, which is of course much less. Think about it, the people pushing/selling silver are always willing to accept " Useless paper they keep pushing" rather than keep their own silver..........Gee, how could they be so dumb? I like such US paper myself, maybe I should write a bullion column. Follow the money. Jim