the decoupling of gold and silver

Depending on who you believe, there's anywhere between 7,000,000 ounces and 14,000,000 ounces of palladium mined each year. I found that surprising; that's not much compared to other PMs. Over half of all palladium mined mined each year is used by the auto industry in catalytic converters...that doesn't leave much for the proposed Winged Liberty bullion coin. Demand for cleaner emissions (especially in China) will likely make palladium a good investment for some time to come...even at these levels.

One point of caution...high prices also makes it economically viable to come up with alternate clean-air solutions or fuel alternatives (natural gas or electric). The supply/demand dynamic could always change in the future. A change could come rather quickly with the right invention.

 

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interesting info yakpoo ... but who was talking about palladium? Your post was good, but seems sort of off topic??? (unless i missed something above)

 

Sorry...I was commenting on Medoraman's Post #19.

You're coins are nice!! ...the only thing that would make them nicer would be if they were First Spouse coins. :whistle:

I would store them in airtights, though...but that's just me.

 

Well what got my thinking about palladium more was a conversation with a chip chemical engineer who said demand at his firm for palladium has skyrocketed with new anti-lead laws. He said they are using quantum leaps more palladium than they ever used to. Palladium itself was a replacement for platinum in converters, I agree at some date new technology could supplant its use there.

 

Yak, you are right about post #19 ... i missed that!

AirTites huh. I might do that.

Yes, first spouse .... I have 18 of those (16 in the liberty subset).

 

Ahhhh....the "Liberty Subset"!

 

That's double-booking. Either you made a big profit on the silver, or you got a low cost basis on the gold, but not both. (I'm guessing Uncle Sam, were he aware of both transactions, would insist on the former interpretation.)

If you don't mind, what were the AGEs going for this morning? I'm still kind of kicking myself for selling my one and only last month...

 

You are right, it was a trade and not a separate buy and sell ... the AGE's were going for $1826 this morning

I think we are bound to have a good pullback in gold soon -- it's run so far so fast.

 

it dropped 50 dollars in period of an hour or so

 

WingedLiberty relaxing at home...

 

that's hilarious! i wish.

 

yes, and yet gold still managed to finish up $21 on the day

silver was down close to $2 (5%)


I wonder if tomorrow gold will have a big $50 to $100 down day ... that's overdue. just another opportunity to get in

 

This is an interesting chart that plots the price of Silver vs. the Silver/Gold ratio. If these two metals were "coupled", I would expect to see the two plots to move along in tandum...or nearly so.

 

These two charts are the best way to see the coupling that I was talking about.
Compare from January 2001 through April 2011 ... coupled.
After April 2011 ... decoupled

 

Your charts definitely show similar price trends, but they don't really show the relative magnitude of the moves since they're not drawn to the same scale or have the same starting point. The Y-Axis of the Silver chart is about a 10/1 ratio whereas the Y-Axis of the Gold chart is about a 6/1 ratio.

Take the period from about Nov2009 to Nov2009, Silver goes from about $10-$20 (100% increase) and Gold goes from about $800-$1200 (50% increase). The "trend" seems coupled (likely due to movements in the dollar), but the magnitude of the moves of each metal (and the ratio between them) isn't coupled at all.

The "Blow-off" of the Silver chart in April of this year and the subsequent "Break-down" is likely due (imo) to all the hype surrounding the COMEX's ability to meet potential demands for physical delivery on their contracts. I even remember someone on CT making the argument that silver is fairly valued at $134/Oz...that's just crazy! The markets stepped in with their little "Margin Requirement" pin and popped the Silverbugs' bubble...pop, pop, pop. Chances are that many of those Silver speculators are now going after Gold or Palladium...or Zinc (who knows?).

 

I don't think gold was overlooked, gold maintained a good steady rise, it was more of a case of silver being over-played. But if gold continues to perform over an extended period as it has for the last couple of days - I see a margin adjustment in its future.