i heard some stuff on CNBC about it. These were just theories 1. There is a whiff of deflation in the air. Strange that is going on with all the money printing though. A lot of commodoties are dropping (oil, some grains, copper, etc) 2. A lot of hedge funds owned gold as disaster insurance, and there seems to be less fear about the worst happening, so some funds are selling their insurance 3. Gold and Silver did not rally this year (like stocks did). so Hedge funds are dumping their gold and silver and buying stocks with the money. Sort of like money seeking out what is hot 4. The cyprus bailout wasnt big enough so there were rumors that Cyprus had to sell their gold to make up for the short fall. However later I heard it's not allowed for countries in the EU to do that (for some reason) 5. Selling begets more selling. As the price falls more people panic and sell. This happened in the financial crisis of late 2008 and early 2009. When almost all assets were dropping like rocks (I think Gold went from $1000 an ounce in early 2008 down to $600 an ounce in early 2009 -- Silver as I recall dropped to $9 an ounce in 2009. 6. This winter and early Spring ... Silver and gold could not rally though their old highs set in 2011, even though there were lots of reasons for them to rally. Sometimes this shows that an asset class is tired and due for a fall. 7 Goldman Sachs downgraded Gold earlier this week, perhaps that caused some people to start selling 8 Gold and silver had a 10 to 11 year run of upward trending prices ... in 2001 silver was $4 an ounce and gold was $250 an ounce (I think) ... No asset class just goes up forever. So after 11 years, perhaps silver and gold are due for a multiyear rest with flat or falling prices. Interestingly Stocks were basically flat from the peak in early 2000 to early 2013. So the stock market went nowhere for 13 years (while silver and gold was rising 700%). So it could be time for stocks to become the asset of choice for the next 12 years??? (Remember Gold and Silver went nowhere from 1981 to 2001 (almost 20 years of flat prices). Most asset classes go through these sort of up down and flat cycles.
Well there was a report that Cyprus had a plan to sell off 40 tons of gold but Cyprus denied that report. It could have spooked a few folks, not sure.... I really think the question should be Why WOULDN'T gold and silver crash. Both commodities are still expensive and selling for a large premium over the cost of production, the dollar is getting stronger, folks are getting more confidence in equities and we have low inflation. It is just not a good time for the shiny stuff.
Howdy, I think that in addition to whatever impact Cyprus has, wingedliberty spells out the myriad of reasons for the drop. They're all valid. http://www.kitco.com/reports/KitcoNews20130412NC_2.html http://www.kitco.com/reports/KitcoNews20130412NC_2.html Silver closed at 25.85 and gold at 1477. We'll have to see come Monday what sort of technical damage has been done. One never knows but I'm looking at a rebound. Whether it lasts and holds . . . ? During this bull run - 2002 to present - every pullback/correction has been shorter and less severe than predicted by one and all. This has been due to the breadth and depth of demand. How many folks around here are going to use this as a buying opportunity? How many countries? How many survivalists? Hockey pucks are looking good, but nothing direct from the mint unless they drastically reprice. peace, rono
I am expecting gold to go down to right around $1400 and silver to settle at right around $22 or less come this July. It's not any secret, money watchers have been talking about the economy getting better and as it does PM's will fall. Don't anyone panic as long as you know the secret then you have first hand information and you should simply sit it out. PM's go up and they go down, everyone knows that. After the prices settle in July, at the end of the year they are expected to go up to right around $1800. That's the plan and everyone knows it, now all we gotta see is if it goes as planned. I suggest you stay in for the long haul after all, you gotta have faith. :thumb: http://www.businessweek.com/videos/2012-09-02/gold-expected-to-rise-above-1-800-in-2013 http://money.msn.com/top-stocks/post.aspx?post=c423e9a2-ecb2-4c44-b2d4-4b1497f956bf
