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<p>[QUOTE=&quot;V. Kurt Bellman, post: 1988124, member: 71723&quot;]Well of course a good part of what you write here is good analysis, that is, your if/then logic is unassailable. The problem I have is with a few, not all or even most, of the &quot;if&quot; statements.</p><p><br /></p><p>First, you write that technical analysis is used by basically everyone. That is pretty close to true, but it says nothing about its validity. There are things that are false even when &quot;everybody&quot; believes them, and things that are true even if &quot;nobody&quot; does. But to add to that, we also have, in finance and economics particularly, the law of self-fulfilling prophesies. If enough people believe and act upon even a fundamentally untrue thing, their actions will actually CAUSE the market to move as if the analysis is correct, at least for the near term. In my learned opinion, that in particular explains why technical analysis EVER works. I believe it therefore can be &quot;useful&quot; without being true. In fact that is PRECISELY what I believe about technical analysis. Useful due to self-fulfilling prophecy ONLY, and fundamentally bogus. There IS NO SUCH THING as an efficient market. That&#039;s a goal and a pipe dream, not an accomplished fact.</p><p><br /></p><p>Parabolic charts indicate a real world phenomenon - a shared psychological mania. When ANY asset&#039;s demand accelerates as its price goes ever higher, it is violating the core assumptions of classical economic thinking, that which requires demand curves and supply curves to be shaped a particular way. Higher prices cannot long result in an inverted demand curve, and that is exactly what is happening when an asset goes parabolic.</p><p><br /></p><p>Now, keeping in mind I still agree with MOST of your post, you later wrote, &quot;Unless the amount of silver extracted from 2008-2012 was enough to satisfy consumption for a decade, we&#039;re unlikely to see an extended bear market.&quot;&nbsp; Wow, you&#039;re not merely well educated, you MAY be clairvoyant! That is precisely what I think happened, AS LONG AS you define &quot;consumption&quot; the way I do, that is EXCLUDING silver rounds and medals and new issue coins. Many writers do consider that consumption, but I do not. That to me is inventory overhang. I have been INTIMATELY watching silver and its uses for 4 decades now, not just as one asset of many, and I see a slow COLLAPSE of properly defined consumption. Even one firm&#039;s demand, Fuji Photo Film of Japan, has never been replaced with newer demand unless you count medallic stacking, which again I do not.</p><p><br /></p><p>To me, the term &quot;consumption&quot;, when applied to a metal, means it has been dispersed to the point of economically problematic recovery and recycling. Aluminum is already self-sustaining, as an example. It is now recycled and being useage replaced so well and thoroughly that literally we need to mine no more bauxite. Silver may very well be headed to the same status, in my view.</p><p><br /></p><p>Summary: Technical analysis is useful to learn about only because enough people incorrectly believe it, and not for any other reason, and silver is a PM because some people stack it, and others see a paper opportunity to profit from the beliefs of stackers, but at its core fundamentals, silver should be, has been, and very well may again be, considered a &quot;junk metal&quot;. I need no other theory to explain the 5-year silver spot chart I see on various sites.</p><p><br /></p><p>I also believe education is about answering questions, but wisdom is about questioning answers. I willingly accept extraordinarily little of what I read online, especially when it&#039;s posted by those with a sales interest in the material.[/QUOTE]</p><p><br /></p>

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