Silver getting crushed today

See, and I was going to check out some of your posts titles, but you limit who can see your profile!

 

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Broad term that could apply to a significant portion of elected officials.

 

thought it was a fluke spike up this morning but it went back up!

 

No such thing as a fluke. Everything is by design.

 

Ah, many hear the siren's song, but which side is singing it?

 

If it were a free and open market I might actually get excited about that rising wedge pattern. Although I'd rather see a falling pattern, because I'm not done buying yet. I'm not sure I ever want to be done.

 

Gold and silver have gotten some good bumps this week. At the same time, the yield on the 10-year Treasury has fallen from 2.5 percent to 2.37 percent, indicating strong buying activity. Also, the stock market has done some sputtering the last couple of days.

One day or even one week does not a market make. But I'm keeping an eye on this pattern.

 

Lets see how this plays' out...

http://www.coinworld.com/news/preci...&utm_source=Lyris&utm_campaign=PreciousMetals

 

Should be interesting ....

 

Yeah, but I'm sure the "manipulators" will all soon dump their silver and drive the price back down to $4.00/oz
LMAO, okay, not really.

we like seeing the charts and Silver's Growth ... or receeding ... or spiking, or crashing ..Edited. LOL

 

While I may be registered as a "corporate criminal", I work for the "union thug" party.

 

Stocks and PMs are up for the past couple of weeks...a great set up for a selloff...watch out!

 

A selloff of what? stocks or pm's? or pork bellies?

 

Orange Juice!!

any time there's a large move up one can always expect profit taking at some point. And one can always say there's going to be a sell off.

The part that isn't answered is .. how much of a sell-off. Dooms-day type sell off, or just a small correction ... or any where in between?

I read about market corrections coming all the time ... and they rarely do in large amounts. I love them when I read "I expect it in the next year". Duh ...

 

I like your avatar, even better than mine :]

My take on this uptick is due to the Fed finally getting around to raising interest rates. Gibson's Paradox states that contrary to conventional wisdom that high interest rates result in higher prices, not lower prices. This is because price inflation is not necessarily the result of monetary inflation (low interest rates), and price is correlated to the interest rates themselves as a result of the wholesale price index. Monetary inflation increases potential monetary velocity, and actual monetary velocity causes price inflation, but that is an indirect correlation and is independent of the forces in play regarding Gibson's Paradox. That is if you want to believe Keynes. I think Keynesianism is the definition of insanity (printing money to combat the negative effects of money printing), but his observations regarding Gibson's Paradox were based on real data albeit while a gold standard was in effect so the scenario is not identical to today either. In any case, it makes sense from the very basic perspective that if you are paying higher interest then you're paying a higher price.

 

Well we can immediately dismiss all of that garbage because Keynesianism isn't about the money supply or money aggregates at all. It's about incomes, not money.

Quoted material below:
Superiority of the Keynesian Theory over the Traditional Quantity Theory of Money:
The Keynesian theory of money and prices is superior to the traditional quantity theory of money for the following reasons.

Keynes’s reformulated quantity theory of money is superior to the traditional approach in that he discards the old view that the relationship between the quantity of money and prices is direct and proportional. Instead, he establishes an indirect and non-proportional relationship between quantity of money and prices.

In establishing such a relationship, Keynes brought about a transition from a pure monetary theory of prices to a monetary theory of output and employment. In so doing, he integrates monetary theory with value theory. He integrates monetary theory with value theory and also with the theory of output and employment through the rate of interest.

In fact, the integration between monetary theory and value theory is done through the theory of output in which the rate of interest plays the crucial role. When the quantity of money increases the rate of interest falls which increases the volume of investment and aggregate demand thereby raising output and employment. In this way, monetary theory is integrated with the theory of output and employment.

As output and employment increase they further raise the demand for factors of production. Consequently, certain bottlenecks appear which raise the marginal cost including money wage rates. Thus prices start rising.
Monetary theory is integrated with value theory in this way. The Keynesian theory is, therefore, superior to the traditional quantity theory of money because it does not keep the real and monetary sectors of the economy into two separate compartments with ‘no doors or windows between the theory of value and the theory of money and prices.’

Again, the traditional quantity theory is based on the unrealistic assumption of full employment of resources. Under this assumption, a given increase in the quantity of money always leads to a proportionate increase in the price level. Keynes, on the other hand, believes that full employment is an exception.

Therefore, so long as there is unemployment, output and employment will change in the same proportion as the quantity of money, but there will be no change in prices; and when there is full employment, prices will change in the same proportion as the quantity of money. Thus the Keynesian analysis is superior to the traditional analysis because it studies the relationship between the quantity of money and prices both under unemployment and full employment situations.

Further, the Keynesian theory is superior to the traditional quantity theory of money in that it emphases important policy implications. The traditional theory believes that every increase in the quantity of money leads to inflation.

Keynes, on the other hand, establishes that so long as there is unemployment, the rise in prices is gradual and there is no danger of inflation. It is only when the economy reaches the level of full employment that the rise in prices is inflationary with every increase in the quantity of money. Thus “this approach has the virtue of emphasizing that the objectives of full employment and price stability may be inherently irreconcilable.”

 

I seldom believe people who make claims of accuracy of prediction after the fact, as is common, we all know it is usually luck. As I mentioned above, I believe precious metals are at an unstable balance point at the moment, but I believe changes will occur and quickly from this cost area, but which way??? So to play the fact of change rather than no change, I can use a 'straddle' option, where I lose if my option is close to the point I purchase after the expiration date, but I win if it is higher or lower outside of the lose or break even point. I used the options for GDX straddle @ $24 ( currently @ 24.13 ), and I paid for about a month to be in. Not recommending at all if one is not experienced in paper.
Jim

 

I will try to contact the Llama.

 

He doesn't bother with economics.

 

That,s probably a good thing.