Silver Decline: What Is Your Trigger Point?

So, directly at odds with "a tailspin", like I said.

 

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What is your definition of "success"?

 

Once it breaks resistance at 30 SLV could test the Dec lows at 26 IMO. Once again silver is an industrial metal the current drops are due to its link with Gold as investment vehicle but if Chinese industrial outputs slows all bets are off.

 

I think we are going to test a $30 floor and then bounce back to the mid $30s. It will hold there through the summer and begin to accelerate towards $40-$50 as we approach the election. I have no solid evidence to back this up and it is entirely my gut feeling.

On a side note, on of the guys I buy from has told me that he will pull his ASEs if silver falls below $30. My main guy sold out of all his junk silver the other day. He had about $300 face in the bin and he got wiped out on Tuesday's dip.

 

Many dealers did sir. I knew may dealers who either pulled their junk when it was falling in the 80's, or simply charged 20x face when the market price only justified 15x or less. I am simply pointing out what a dealer does does not prove what the market will do. Dealers have been very wrong in the past.

 

if you are going to sell it back to a dealer bullion, to barter silver dollars.
inflation has to set in with goverment spending,
grain prices are going thrugh the roof
farm land prices 10,000 to 20,000 per acre that's good ground

 

The economy is in the dumpster. Unemployment/Underemployment is high, inflation is upon us, fuel prices are high, the government owes more than ever before. I think what we're seeing is the big holders of PMs dumping to lower the price, possibly to stabilize the dollar I dunno, but it will begin its march up again. The government and Fed are attempting to stave off the inevitable, at least until after the election.

 

Don't forget to throw in the Eurozone issues, which are probably far from over and also the Iran/Israel tension. It would be nice though, if the current "illusion" everything is getting better would last a little longer, so the prices of precious metals would be driven down further, theoretically. Then we could add to our holdings and wait for reality to rear its ugly head.

 

How exactly would selling PM stabilize the USD? The USD doesn't react to the price of PM, but the price of PM ( because it is priced in USD ) does react inversely to the strenght of the USD, which precipitated todays action. As I mentioned, socio-political scenarios are black swan events outside of predictibility. But even if Euro, China gets worse economic news, and perhaps further mid-east tensions, the common reactions lately through the crises was not to go to PM, but to go to the USD instead. But that is just my outlook. Find a time that you feel was a "good economy" for the US and look at the prices of PM then.

Jim

 

Not so much a single trigger point with silver, but with prices today it looks like I'll be buying more silver that gold the next few weeks. But tomorrow could change that plan completely around. It's all about potential to climb, personalty I think both will climb around the end of the year when the political winds start to blow. Either that or it could be one of the best buyers market we've seen in a while. Either way I'll be stacking or selling all depending on what's going on. I don't try to predict the market, I just want to ride it whatever direction it takes. I think we will know when the time to sell arrives.

 

Pushing silver down to what?

 

I`ll gladly go on the record and say that sometime around Sept. silver will be between $45-$55.

I will say that nothing involving the PMs would surprise me though. (especially silver) That said, I think that the trends that We have seen since roughly 04 will continue. (Dept. of Defense selling their silver stockpile to the Treasury Dept., mint shortages, promotion and popularity of the A.S.E. program skyrocketing, an increasing amount of silver held in ETFs etc)

We can discuss the economy and the countless factors which might affect silver, but I have always taken a simplistic approach to it.....I believe the attraction to gold and silver (not platinum or palladium) is in Our dna. One does not have to be religious to see that the book of Genesis refers to those two metals as having value. How many quests were (and still are) launched in the hopes of finding gold? When the word treasure comes to mind We think of gold. (and maybe silver to a lesser extent) Ever held a good chunk of either in Your hand? (10 ounces+) Words simply don`t do it justice.

Nope, I`m not worried at all about silver dropping back down to $6-$7. Even the average person who is out of touch with current events can feel that something "just aint right these days." And as Our current president once said that people in hard times will gravitate to their God & guns.....I would like to add the PMs to that as well.

 

I think first there has to be a definition of what constitutes a "good economy". People will use this phrase, which can mean almost anything, and then the topic gets lost because it devolves into arguments over what this means.

For what it is worth, my definition is that it's an economy that provides a living wage for working people without government involvement. IMO, a completely free market will provide for this, but we have hardly had this in America for more than 50 years. Heavy governmental and central banking intervention in the free market does none of this and instead creates the illusion of a good economy by the creation of vast amounts of currency, unprecedented amounts now, which ends up enriching a few and subjecting ever increasing numbers into some sort of governmental dependence.

On the other hand, if you are a bankster, a wall streeter, a CEO selling off generational assets for short term gain, or someone who likes to gamble on this, or have a taxpayer financed job, you may consider the economy to be a "good economy". For some, there is a potential to make a lot of cash off the cash being created in the process. Who cares if the generations to follow are left with crushing debts.

This is why I say "good economy" has to first be defined. Then we can make our judgements.

 

To me, the economy being directly at odds with a tailspin would mean it’s climbing. With high unemployment, record home foreclosures and a staggering national debt, most indicators are bad. There are things coming down the pipe which have passed Congress but are not fully enacted yet that are going to pile a massive amount of more debt onto us, and I mean trillions. It’s not good. We may not be in a full tailspin yet, but if something really big isn’t done, and soon, we will be.

 

A plane taxiing down the runway is neither successfully flying nor is it in a "tailspin". Reality is more useful and productive. Tailspin is out of control, crashing down. The economy is not, at this moment. Saying there is "slight improvement" means it's not "tailspinning". Overreacting just hurts yourself. No one is saying it's great, but it is improving.

 

So the fact that unemployment is coming down, some cities like Phoenix, (one of the worst hit), are recovering and housing is rising, and random facts like China having to raise wages and make their good less competitive have no affect? I see our ag products the cheapest in the world right now, which means we have further to rise in ag profit.

Just reminding everyone that while its prudent to prepare for the worst, you shouldn't always assume that is where we are headed. I like to prepare for the worst AND for a potential recovery. My stocks that many here have pilloried me for owning have been doing quite nicely lately thank you.

 

If your point of responding to me is to simply troll my posts then sorry son, you don't have a dance partner. If you are actually here to debate the topic as an adult then I welcome it but you have to at least demonstrate it with some action. If you don't believe me then simply state it and move on or better ignore it. You don't need to be my nursemaid so don't worry about my overreacting and you don't need to try and discredit me if you have something relevant to say. As I told you before, if you think I'm breaking the rules then report me.

 

It's not.

Unemployment is difference between the number of employed against the stated size of the labor force. What is never reported with Unemployment is the size of the labor force nor the number of employed. The unemployment rate is the simply unemployment divided by the size of the labor force X 100.

So to put it in very simple terms. If the labor force is 10 and 6 are employed. Unemployment = 4 and the rate is 40%. So lets reduce the labor force by 2 people and layoff another. This means labor force is 8 and 5 are employed. Unemployment = 3 and the rate is now 37.5%. Congratulations. You just reduced the unemployment rate by 3.5% and the economy is getting better declares the media. Never mind that only 5 have jobs now.

Between 2008 & 2012 the government reduced the size of the labor force by ~6,500,000 people (less than 4 years). How can this be in an economy that is supposed to be growing and getting better? Population increases alone says the labor force should be growing just to keep its head above water. It's done simply to make the rate look better because it makes people feel good. The math doesn't lie. If you are interested you can check it yourself.

BTW the employment rate is calcuated as follows. They do phone interviews and other surveys to between 1000 - 10000 jobs. The rest are calculated by the birth/death rate. That is they assume that if so many babies are born and so many people will are stuck in the ground, the difference will automatically create X number of jobs based on their formulas which they change each month. Then if this wasn't enough, they also seasonally adjust using non-concrete factors such as weather, schools, etc.

In a normal world, where interest rates were not being held below inflation rates, housing prices would be collapsing.

 

The unemployment rate is affected by people who self-report as in the labor force. Those who have stopped looking for some reason are not counted. As job hirings pick up, the unemployment rate often increases as people who previously stopped looking for work re-enter the labor force. That necessarily means that overall unemployment is diminishing.

 

Yup.....can`t forget about those whose unemployment has run out too. Can`t forget those who for one reason or another are working under the table as well.....they still purchase goods with their tax free income....which are taxed in most states. It`s not easy getting an accurate reading on the subject of unemployment....and yet that still does not stop politicians from putting certain reports in the spin cycle for their benefit.