What da heck, $9!! I would not buy now, not a top yet, but still it will revert to historic prices eventually. I may be a seller here soon. I would love to see this spill into numismatic. You may have seen my other posts, I call a top in late '06 early '07. Place your bets if you are a gambler. http://www.kitco.com/charts/livesilver.html
Silver goes up....silver goes down...this is the time for a up...when will be the down time...nobody knows.... Speedy
well i want it to go back down to $6 for awhile so i can stock up and then it can come back up. :kewl:
I think it was over 9 bucks an oz. last year this time. Probably a high time for jewelry bullion, with christmas right around the corner.
http://www.kitco.com/charts/livesilver.html These charts are worth a look. Has not been here for quite a while.
Back in 1979 when silver was fetching $30/tr oz, my field assistant Mike asked me about investing in silver. I told him not to do so because the price of silver was certain to drop soon. It had been less than $5.00/oz forever, and I was certain that $30/oz was ridiculous and it would fall back to $5.00/oz. I believe that the Hunt brothers were attempting to capture the world silver market about that time. The Saudis were getting frisky also. Anyway, Mike ignored me and bought $10,000 worth of silver. I am not sure how it was done. When he told me, I just rolled my eyes. He kept it for two weeks and sold his silver for $40/oz. This just proves the old adage that it is better to be lucky than good. We called him Buford Pusser, but that's another story.
About 1995 or so, I had a hard time believing that its price well below $3 was realistic. That just seemed incredible. However, the market is always right. The dollar was strong from Reaganomics and Clinton's "era of good feeling" domestic policy. I do not know about the other factors at that time. It is a truth that the market overcorrects around an equilibrium point. So, maybe $8 is the new highest low from now on.
The "OLD" days are gone and so are the prices. It would be safe to say $8 to $9 might be an average from here on out but.....the worlds economies are really a mess right now and as the demand and sell of gold continues you can expect silver to rise as well. Palladium is also along for the ride! In the end, should gold rise to historic levels, expect our poor mans silver to do much better. When you look at the overall picture silver is the better (and cheaper) investment for the little guy. Lets say, as an example, gold doubles this year (2006) and does reach $1000 so what would silver do? Perhaps the $30 level could be obtained? Now what percentage of increase would both precious metals have increased? Gold doubles and silver well the increase would be about 4 times? Looks like to me silver would be the place to be BUT one must sell to capture the gains so is it time, to perhaps, grab a little extra silver and enjoy the ride? Time to do a little speculating and hang on? Nothing like a little gamble to keep things interesting!!!
I still stand by my prediction. Silver will reach $10.00 per ounce by May. After that, the skys the limit.
It is true that "silver is the poor man's gold." However, I am not sure that poor people in America invest in silver the way that rich people elsewhere buy gold. Silver had been historically popular in India and the Middle East, again, as "the poor man's gold." Silver is still nice. (My daughter and wife both actually prefer the look of silver jewelry to the glow of gold, so that make my life easier. ) And silver has not lost its shine in India and the Middle East. It is just that in America, the people who buy precious metals tend to go for gold, though, again, as a poor man myself, silver is usually my personal choice. I think that the global economies are generally strong. The U.S. government has a financial problem with the war in Iraq. It is a fact of life that wars do not pay off. For example, Japan has a tariff on rice. The Japanese government prevent imports because they do not want to become dependent on other nations for food. Fine and dandy, but that is a market inefficiency. The Japanese people lose money -- however, they are losing it to Japanese farmers, so at least that keeps it all close to home. In the USA, we build bombs and bullets and we shoot them off 10,000 miles away. Not only is the investment not recovered -- rice is a crop; explosives do not yield more explosives -- but the money is lost far from home and it never comes back. I mention all of that because you have to look at the price of silver (or anything) in other currencies as well as in dollars. How has the price of silver (or gold) changed relative to the euro or the yen or the rand or the yuan?
I'm also not liking what this is doing to the purchase of silver eagles. If the price of silver hits $10, will the price of SAEs hit $15? Or would it cause another run on silver coins (as in the late '70s)? How many rare dates were lost to the melter then? And people are more "market aware" (I won't say saavy) today.
The Silver America Eagle is a bullion coin, so whatever happens to silver spot, happens to Silver American Eagles, as well as to silver crowns from other world mints (pandas, kookaburras, maple leafs, etc., etc., etc.) As for whether or not you "like" it, that depends on your market position. If the price were falling constantly, down to the $1 parity price, would that make you happy? It might make you happy. Other people would be dismayed. The change in the price of silver seems to be caused by general market forces, not the caprice of 1979. The general increase throughout the 70s was caused by the previous 30 years of inflation. The events of 1978/79 were something else. In truth no rare dates went to the smelter. However, when things were craziest, dealers did sell Mint sets, Proof sets, and even common commemoratives. It has been suggested that the once-common Washington Quarters are now much rarer now. I am not sure that the market agrees with that clamin. People sell (or buy) in groups. Some people are individuals. Most are not, by definition. If the price of gold went to $10 million per ounce, then the 1933 Double Eagle would be mere bullion. However, not everyone is foolish at the same time. While some dealers did toss anything silver into the shipment just to make the quickest buck possible, a few others sold a little bit less and held on to a little bit more. It becomes a matter of philosophy at that point. Should you melt a rare coin if you can use the money to buy another like it later? In any event, SAEs are not rare and cute as they are, they have no historic importance. Even the obverse design was cribbed, and copied from a copy, at that. If you like collecting them, that's fine, but you do not need to worry that you will not be able to buy one when you want it. If the price of silver went to $30 per ounce, would you not profit from the SAEs you already hold?
With the price going up, checking antique stores might prove wise. Many times the prices are placed on the items and while it may have been in-line w/the market then a bargin or two should be out there now... Bone
I'm not sure why people keep referring back to the 1979-1980 silver price spike as if it had some relevance to today. It reminds me of many stock market articles that explained how the market would fall back in price when the DJIA rose above 1,000 around 1983 because that's what always happened since 1966. There is no doubt that silver was overpriced back then at $30-$50. But a lot has changed. Silver is now selling at single digit prices. It has basically gone nowhere in 25 years. How many things can you buy now for the same price as 1979? I purchased a brand new 1978 Ford Mustang for $2,900. Most of the silver that is available to melt for less than $20 per ounce was melted long ago. World stockpiles of silver were measured in the billions of ounces. Now the Comex has about 100million ounces, roughly half of it not available for delivery. Since the 70s, the central banks of the world have flooded the economy with paper, and practically everything costs more, except silver. Check out growing demand from Asia, which has traditionally had an affinity for silver even greater than they do for gold. Check out the futures markets. There are more ounces sold short than exist in the world for delivery. I think I know how that story will end, the only thing in doubt is the timing. Sometimes it's easier to determine what will happen than when. So times and conditions change. The expectation that silver will return to $5 and stay there is unbelievably unrealistic in my opinion. And I freely admit it is just an opinion, backed by analysis of the silver market. Only time will tell, but in my opinion single digit prices for silver will disappear over the next few years, perhaps forever. Five years from now, people waiting for $5 silver will be thought of in the same light as the people waiting for the return of $.35 per gallon gasoline. If you want silver or more silver, now might be a good time to get it. If you need that one Morgan to complete your collection, but it looks $10 too high in price, now might be a good time to get it instead of waiting until the price comes back down to "normal" levels. If you intend to buy 2006 ASEs, now might be a good time to pre-order them. If you bought silver coins at cheaper prices and are thinking of selling them because you can make a profit of $1-$2 per coin, put them away for a few years. Selling silver at single digit prices might be the mistake of a lifetime!
I have seen the future and it works! I would not argue with a single assertion, you made, Cloudy. I can only add more facts in support. It is true that the biggest use of silver THEN was photography. Not only has that gone the way of the dinosaur, but even x-rays require less silver, have gone to digital imaging, lower rad levels, etc., etc. On the other hand, the world is probably glued together with 2% silver solder. If you go to OANDA.com (www.oanda.com) and use the historic price tables, you will see that we are at $8/oz for silver a year ago. I have a table that compares currencies, gold and silver that I built from this data. Basically, the US Dollar has been in a slide against stronger currencies. (Many currencies are pegged to the dollar. Many are weak because their governments are weak.) Against, gold, the dollar has been falling steadily. However, silver has been -- will be -- more volatile: up and down in large swings. The bottom line, is that silver is not a bellwether, it is just a commodity, like cocoa and coffee and hogbellies -- all of which, admittedly, cost more than they did in 1980.
Mike, What you say about photography is true. But something like 85%-90% of the silver used by photo labs gets recycled anyway, so as photography decreases as a USE for silver, it also decreases as a SOURCE of silver by almost as much. And even if silver use in photography is no longer growing, I'm not sure how much it is actually declining on a worldwide annual basis. All investing involves estimating probabilities. Since nobody is running around counting ounces produced and consumed around the world, everything is an estimate. I've read several Wall St assertions that silver inventories will rise automatically in response to price increases, but this is just stated as a general observation that the writers probably learned in college in their macroeconomics course. It isn't analysis. I haven't read any detailed in depth analysis by any writer that didn't conclude that there is a production deficit that is unlikely to be filled unless and until the price rises high enough to destroy demand. Increasing supplies just don't seem to be available. Anyway, I wouldn't want to be a seller of any kind of silver coins these days unless it is part of a normal, ongoing, profitable business [i.e., a dealer is excused from selling silver coins because it's what they do. A collector is not]. It might turn out to be one of those major regrets in life a few years from now.
