2012 Silver Crash?

Spot on, Oh Great One. ;-)

I've always been a silver bug, if you will, rather than a gold bug. And I used the sale of 90% silver to help finance my education back in the late 70's when I was finally finishin up. This absolutely taints my vision and I freely admit it.

However, I have yet to meet anyone, anywhere, that is not 'speaking from position'.

The important thing as an investor is that you try your level best to keep your emotions out of the buy/sell decision.

peace,

rono

 

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Howdy,

The problem is that everyone continually tries to simplfy the demand for both silver and gold and this myopia is not good if you want to be a successfull investor. Silver and gold both have very distrinctly different demand functions. However, they also have enormous overlap and they are both multifaceted. I've been following the gold/silver ratio for years, but it is only one of many factors that has caused me to slightly overweight silver relative to gold in my holdings.

As for the g/s ratio being worthless - don't be so dogmative as to confuse what is true and what people believe to be true. This is huge folks. If everyone believes a lie to be true AND ACTS ACCORDINGLY - it might as well be true. Good God, look at the campaign ads and spin we witness daily from all media sources.

And here's the real issue with regard to silver demand and its relation to gold. If sufficient numbers of people around the world see them as related, that the gold/silver ratio is important and silver is a poor man's substitute for gold. Well, than by golly, by gum, it will have some impact on the market.

peace,

rono

 

I think you're dreaming. There's too many people in the game now and the world economic situation continues to get worse. Not better. I'm afraid there's nothing on the horizon to tell me that everything's going to improve and magically be fixed this year. If silver hit $15-$20 again, there'd be so many people backing up trucks that it couldn't stay that low for long. I think what we're seeing is the new norm.

I'd like to be able to buy a candy bar for 10 cents and a bottle of pop for a quarter like the old days too but that aint gonna happen again.

 

Reason why they turn to gold rather than silver even though it is cultural it is actually based on fact that gold is harder to fake, jewelers in villages have use density tests for long time to validate the authenticity of a jewelery and it is still works today for gold.

 

How true. That's why certain features of technical analysis, moving averages and trendlines work. It's a self-fulfilling prophecy.

 

Exactly. Why do they use 50 and 200 DMA (day moving averages)? Because they do. They could have just as easily used 60 and 300. However, because they have imputed meaning to 50 and 200, 50 and 200 matter.

There are a lot of survivalists that have hoarded gold AND silver bullion and particularly 90% silver coinage. Are they correct in their anticipation of financial system collapse? I don't believe so but it really doesn't matter because they're ACTING upon their beliefs with their dollar votes and that's having an impact on the market.

peace,

rono

 

Fyi as i said before if financial system collapse it is not like everyone would switch to trading gold and silver you think your store clerk can tell what is silver?, history has shown that we will typically still switch to another currency or barter system (good luck trading silver coins for food).

 

I agree sir. I find most technical trading is based upon the fact that everyone does it. Does this make it less real? No, but theoretically I do not think the technicals have much predictive value over anything except for the fact that everyone views them, and acts on them like you say.

 

The store might not take a silver dime for a handful of tomatoes but I might if I had an excess of them. You miss the point. Maybe people wouldn't even bother going to stores because they wouldn't have anything? I won't try to guess whether people are right or wrong hoarding 90% silver. But, I would imagine you'd have an easier time trading 90% for whatever new form of currency shows up as opposed to a failed USD. Which is why people do it.

 

Or it could be simple case of Monkey See, Monkey Do. These averages only tell you where you have been, not where you are going. There is one thing that you can count on with these charts. They will never tell you what the investment will do tomorrow or anytime in the future.

 

Too many people are trying to predict what silver and gold will do. Nobody knows but everyone sure can speculate. If I say silver will be $50 by April and I want to sell, it's more a wish than a prediction. If I say it will drop to $25 by April because I want to buy more so I can predict $50 so I can sell is pure speculation. I've heard that there is only an 11 month supply above ground of silver. If that's right, it would have to go up. But if it hits $50, that's going to cause a sell off and that 11 month supply will probably go up. Whoever said there's only an 11 month supply probably owns a lot or needs to sell a lot. I predict silver will hit $45 by May 1st because that's what I want so I can sell bullion and make a little $. I don't set stock by anyones predictions. Buy low sell high, I reckon so.

 

Suppose to be a recession this year. My banker said they is suppose to be but not %100 sure.

 

Hi Jack,

I probably didn't express myself well. I don't disagree with you. Unless things went completely into the toilet, I also doubt we'd see gold and silver coins used for commerce (although, tradesmen have been assaying gold and silver coinage for several thousand years and I'm sure they could do so today if needed).

My point is that while what you're stating is true - it doesn't matter if enough folks (e.g. survivalists) believe that fractional gold and 90% silver will be the coin of th realm and they go out and buy it on the open market. Their purchases reflect demand and will impact prices.

When I'm investing in something, I want to know as much about the demand and supply functions as possible. If I own bullion as a speculative momentum play, what do I care why the POG is being supported by dowry purchases in India or bling being bought by the nouveau riche in China or CB purchases by various countries around the world. All I care about is that they are buying and that's helping the price of my investments.

peace,

rono

 

My point is if there is anarchy there will be little need for gold or silver and rather there will be demand for food, fuel etc, trading in general whether it is facilitated via paper or pm's occur when there is law & order.

That's true but i think people are mainly buying PMs because of paltry interest rates' given out by their banks and fear of run on the bank scenario. At least that why i am, it just doesn't make sense to hold $$$ in cash.

 

Mr. Obvious, can you give us any examples in recorded human history where people, who had gold & silver, went hungry or needed anything for daily living? I agree with you BTW that we are unlikely to see anarchy and the real reason for investing in gold & silver is what you said. But I'd thought that I see if you knew anyway. I can't think of any.

 

Well in places like Iraq,Russia, Zimbabwe etc or even during Soviet control of Eastern European bloc or in other situations when there is political upheaval the people with wealth (gold & silver) simply lost it because of looters or was taken away by the new government. History has shown that it is usually the savers that are often in wrong end of stick when society falls apart.

 

Tell your banker we've been in one for a while now. That's 100% sure.

 

Official U.S. government reports have stated that the recession ended in the middle of 2009???

 

sh sh sh its a secret!!!

 

That is correct recession is prolonged 3 or more quarters of GDP decline, our economy has actually grown last couple quarters. Also unemployment rate and growth rate are not 1 to 1 correlation unemployment can sky rocket but our economy can grow (if for example the top 10% who make more than 50% of the US economy continue getting $$$)