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<p>[QUOTE=&quot;SilverSurfer, post: 804568, member: 21603&quot;]If you tear yourself away from the spot prices for the time being, this could be something interesting to talk about. But, I have noticed that people usually don&#039;t want to talk about the topics I bring up. I&#039;m not sure why. But, lets consider this.</p><p>&nbsp;</p><p>The price of PMs are related to the dollar index.....or so we are told. As the dollar index goes down, the prices go up and vice versa. So, taking this logic, the dollar index multiplied by the price of PMs should remain a constant. Let&#039;s examine.</p><p>&nbsp;</p><p>Three weeks ago, on January 14th, the dollar index was 76.75. The price of gold was $1138.25, and silver was $18.58.</p><p>&nbsp;</p><p>Gold works out to be 87,360 indexed dollars.</p><p>Silver works out to be 1426 indexed dollars.</p><p>&nbsp;</p><p>So, to get the appropriate price of gold and silver, all one needs do is divide the indexed dollars price by the new index, to get dollars.</p><p>&nbsp;</p><p>The current dollar index is 79.40</p><p>&nbsp;</p><p>Gold works out to be $1100.25</p><p>Silver works out to be $17.95</p><p>&nbsp;</p><p>It is obvious to me that something else is influencing the markets, and not just the dollar index. I don&#039;t have any proof, but I believe that the liquidity has run out. Banks were given a lot of money to correct people&#039;s housing mortgage loans, and to lend to new private business&#039;. However, many mortgages weren&#039;t refinanced and banks aren&#039;t really loaning out the money.</p><p>&nbsp;</p><p>I&#039;ve speculated where that money has gone, and I said, bankers are investing it in the stock market, artificially propping up prices, like a crippled man on crutches. What I suspect is happening, is that money given to them by taxpayers is now running out. There isn&#039;t any more money to invest, and so nothing to prop up the prices. Since no new money is being invested the price has only one way to go, or it could trade sideways. But in order for it to trade sideways, there has to be fundamentals to support it.....like jobs and consummer confidence, which at the moment is lacking.</p><p>&nbsp;</p><p>Many investors have stops. When the price goes below a certain value, they sell to avoid taking any further losses. As they sell, this drives the price down even further, which triggers more people to sell since the price has now dropped below their stop. This drive the price lower, which caused more people to sell since the price has now hit their stops, which causes the price to go.......................</p><p>&nbsp;</p><p>Discuss.[/QUOTE]</p><p><br /></p>

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