Silver and Gold will move in opposite directions in 2011

I agree strongly with Cloud on this! Contrary to what many on the forum thinks, the general public and the market makers are not in love with the metals per se as they are as an investment vehicle. I respect Cloud's view that silver may go to much higher levels as he has the knowledge necessary to make a reasonable decision, but I disagree myself, so that is how a market is made. He seems to be an investor rather than just an accumulator of the metal itself as many are under the guise of an "investor", since they have stated they will not sell or they won't sell for x number of years. Gold today is getting closer to a lower support level with a 3 day weekend coming, so keep an eye on it . IMO , Jim.
​

 

Log in or Sign up to hide this ad.

Howdy folks,

As for the historical ratio numbers, that's what I've read from every source for years. Granted, everything I've ever read may be wrong, but 'all us chillin gots to go with sumptin'.

Does the ratio have an investment decision impact on big money players? Lots would say that JPM and GS have been playing the silver mkt for years. Othes call them simply market makers. I would assume that they're aware of the g/s ratio. To what degree they use it in decision making, I don't know. What does matter, is that some people use them and even if they're not the big money, everything that I'm talking about is on the margin.

And cripes, I'm just a john doe but it's one of many metrics that I consider when making an investment decision. My reasons for overweighting silver in my portfolio are fundamental in nature. It's like technical analysis or chart reading vs. fundamental analysis. I'm one of the latter, but I still like pretty charts. Cripes, look at the chart for gold, XAU, silver, whatever, over the past 10 years . . . and it's a pretty picture. Is that a reason to buy it? Not by itself.

And to be honest, I'm a collector for 50 years but not anything special; I have a core investment holding of bullion as part of my wealth portfolio. I also have some speculative pm investments in various ways - etfs, mutual funds and invidual stocks [SLV, GTU, GDXJ, TGLDX, CEF, SLW, FVI]. Where does one begin and another end? feh. I have no idea. Would I sell my set of IHC in XF+? I can't imagine it but WTF knows?

I watch the gold silver ratio and have for years. Do I let it run my life or investments? Good God no. At the same time, I've been watching it and my investments over this past 8-9 years and enjoying having been very particular about being long silver for fundamental reasons.The demand equations of gold and silver are insanely convoluted. Jewely for both but silver rising as gold becomes to expensive for the masses. Industrial for both but really dominated by silver to the degree that they really are in different markets for different reasons. As a store of value - heavy gold but silver starting to rise. Same/same for money. Gold is the standard, but silver is starting to monetize around the edges . . . poor man's gold, what.

Another point was made about attempting to play the ratio and that it was like rebalancing. Yeppers, it is exactly. Welcome to the casino. You buy a stock and it doubles. Do you sell half and recoup your original investment OR do you let it ride? Sh*t, I wish I knew. I've done both. Recouping your investment means that you're thereafter 'playing with house money'. I like this much better than selling and I hate selling on the way up. That's when you increase your play - on the rise. When it's falling you pull back.

I digress.

I follow the g/s ratio, but it's like a chart - I use it to reinforce the decisions that I've made for fundamental reasons.

peace,

rono