Silver and Gold falling?

I know silver and gold are still really high, but it seems they've been taking a steady decrease over the past few days. Do you think they will continue to fall, or just take a short dive and climb to new heights?

 

Log in or Sign up to hide this ad.

Don't have a clue, but I hope it goes off a cliff. It's hard to buy when bandwagon investors think they're going to get rich off the stuff.
Guy

 

?

Silver close according to kitco over the last three days;

$29.09
$29.51
$29.49 right now.

Gold, I could care less about, but think it should be valued somewhere around 15x silver, as was historically accurate.

 

Nobody knows. If they say they do, I don't believe them.

 

Metals seem to be trading in a tight band right now.

 

Hopefully the condensed band leads to a break out upwards, but I can't see a detailed bid/ask so I can't even begin to speculate as to where the price of said commodities will go.

 

Platinum and palladium has climbed up quite a bit in the past few days.

 

This seems to be a crucial band for technical traders of gold as the band contains what is called a "triple top", where gold has tried to break out and then went down, so far 2 and 1/2 times. If it hits 1300 before 1400, that is the finished 3rd top and gold is in trouble. If it goes below 1280 , it breaks another technical level and is seen as negative.

edit:
(I should have said that this is using the prices of GLD. Spot gold is higher usually by about 3%, but same indicator shape) /edit

Now this again is technical, and not always factual, but it has been correct enough in the past, that traders almost make it happen because they fear it and begin to sell before it reaches the level they think everyone else will sell.

I hold no gold currently for investment, only my numismatic gold, but even so, this is IMO.

jim

​

 

I saw sites on the internet claiming silver will rise over $50 by March, but i can not see how they could ever guess that. I also am hoping that wilver and gold will fall so it wont cost near what it doesto invest, because my theory(I seem to be getting more and more of them) is that silver will eventually run out and we will have to use what was already mined, which will lead to a rise in price. Again, this is just a theory, so who knows.

 

I believe Patrick Heller is the one predicting $50.00. Coin Update publishes him a lot, but I think he is a gold-bug with ulterior motives, (motives he is probably blind to, to give him credit). Now, you may disagree with Paul Krugman politically, but Krugman's reputation rests on being correct. He says that people are overestimating the influence of the United States on gold and silver, (and other commodities). The reason for the prices, (in his opinion), is the burgeoning economies of China and India.

http://www.nytimes.com/2010/12/27/opinion/27krugman.html?_r=3&ref=opinion

If Krugman is right, then the prices of gold and silver should remain around the price band they've been in. And in the long term, 5 - 10 years say, gold and silver prices should increase.

But as far as silver running out? I believe this hits on the concept of "Peaks". Peak oil, Peak copper, etc. When speak of such a thing you have to bear in mind that the real meaning is "Peak under the current technology".

As silver, (or other commodities), gets more scarce, the price goes up. Which leads to more money being spent on technologies to mine it in less accessible places.

This is what is going on with deep water drilling for oil.

 

Good point about peaks, they always assume current technology and current pricing. That is the fallacy, as decreased supply spurs technlogy and advances never believed possible. Peak oil was first predicted, as far as I remember, in the 70's as occuring in the 1990's. Funny how all of these predictions always fall far enough away that the authors have retired, but close enough to scare us into buying their books, no?

 

Here's the easiest way to predict tomorrow what PMs will do. Watch the nightly news. If there is bad economic headlines, gold and silver will go up. Good economic reports or soaring stock prices, watch the metals fall a bit. If you want long term, buy a Farmer's Almanac and a dice cup. The odds are just as good as all the speculation you have time for.

 

Some people in the '70s were predicting oil shortages in the '90s, but the some of the predictions I read had their sights on 2050. Petroleum is a limited non-renewable resource, and now with increasingly intensive use of petroleum from huge population centers like India and China (together they have 6-7 times the population of the USA), it will only speed up the inevitable depletion.

 

It will deplete, of course, its just that it will not be as quick as most predict. Same as metals, there will be a point in time where mine production goes down, but money will discover a lot more oil, as well as metal, so price increases will further this "peak oil" timeframe further and further out. You can bet if there was $200 a ounce silver production would double relatively quickly, (4-5 years or so). That's all I am saying. At least metals have the option of stronger recycling options, unlike gasoline.

 

It's not really that easy to double silver production, since there aren't that many working silver mines any more and new silver is mostly a by-product of the mining of copper, lead, zinc and gold. The opening of a new silver mine is a costly and time-consuming process that involves pre-feasibility studies, feasibility studies, reconnaissance, exploration, lab analysis, environmental impact assessments, infrastructure and mine development-- in short, it's a capital-intensive undertaking that takes years to make a return on investment. So even if silver is $200/ounce at the time reconnaissance begins, what are the price predictions for 4-5 years down the road when production might commence? And could those prices be sustained to the point where a new mine would not only recover the initial investment , but also start to make a profit?

 

As such with "speculation" items are only worth what people are willing to buy. If people are still willing to buy silver it will continue to go up. Just because it has gone down a couple days doesn't mean anything. If you look on coinflation's graph it clearly shows a steady incline. Silver won't fall. Diamonds won't fall. Gold won't fall. Unless the US lies in waist unless the vast majority find that the price is inflated ie (its not worth its price) You should never look at the short term in any investment that involves speculation.

So, do you think its worth 29.60 per ounce?

This by no means is financial advice.

 

I think both gold and silver will hang in there with high prices for a few years to come. That said, there will be times when the price will go down a bit for adjustments but don't let that fool you. I think silver may go up a bit higher than anyone ever thought possible, maybe even $50 an oz. We'll just have to see.

 

I agree with "quartertapper"( I wonder how he come up with that name? I like it) Anyway, he is right about watching the evening news. When it is bad news regarding the economy, gold and silver go up.

I would like to add though that "I feel" that the economy is still in much worse shape than we "are allowed to know" and we are not going to crawl out of this mess overnight. It will take a long while from now. We have not even started yet. It's only a matter of time until the truth comes out as to what is really going on with this economy. I don't think that will be too much longer. Because you can't fool all the people all the time. And as "elijahhenry10" said, "Again, this is just a theory, so who knows."
Even at todays silver spot, many feel it's still cheap. I guess everyone just needs to read, listen, learn and study all they can afford time to, and make their own decisions. I know I have. Lotta work doing that, but it can be fun to. All of this is only my opinion. Not trying to pawn it off onto others.

 

The economy is just like the stock market: People hear "oh crap, economy is down" then they save their money. IE people buy less. Manufacturers produce less because people are buying less. Manufactures are hurting so they lay people off. People without jobs are going to save their money. They buy less. Manufacturers have even less intensive to produce. It's an endless cycle till people start spending money. That's why I hate to hear "the economy is in poor condition" All it is, is hype keeping us there. And technically by the governments standards we were out of the recession a year ago as of Sep 20, 2010.

This being said Gold and silver traditionally level off and follow a more gradual trend after the recovery from a recession.

 

IMO, I dont think that silver will go to $50 because the Chinese are not buying it like they were in the 80's. I also think that it will float around the $27-33 range this year, but everytime I predict something it does the other, so I wouldnt take my advice. I think that when the stock market crashed many people, mainly investors and hedge funds and what not, got into PM's to hedge against thier losses. So far this year i am very impresses with the stock market, and I think that people and funds will pull out of PM and get back into stocks in Q2 of this year. I remember buying silver at 11 bucks an ounce last year or the year before, I think that silver is running out of steam, but once again what do I know. I still think that silver is a great long term investment, even more so than gold, but at the present moment I prefer to be in the market with stocks priced where they are. A lot of companies spent the last few year balancing budgets and fixing credit to debt ratios and are not over priced like they were seveal years ago. Can the dow go back to 14000? and when? I dont know, will gold and silver fall back, maybe. Its all speculation, and everyone has an opinion.