Silver is volatile today

Is it caused by the Fed's rate hike?

 

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What rate hike? The Fed said No to raising rates.

 

Cost of production is closer to $20 so you're still getting a steal at $15. Silver is a longterm investment that will not reward investors until the dollar is replaced by a more trustworthy currency. As it stands, what we call dollars (which are not dollars by the letter of the law) are debt backed and are not even adequately defined by any active law (since the gold window was closed). Precious metals are a bet that this debt bubble is unsustainable. Metals are the true definition of a dollar, and they will need to return to that role in order to grow your buying power, because as long as currency can be printed from thin air it will be used to control markets to make precious metals look like an unattractive investment. Consider it a buying opportunity, and start measuring your wealth in ounces instead of debt if you want to be ahead of the curve.

The lack of a rate hike means a few things.

1) Interest rates are staying at zero for the time being. Cheap money is still on the menu. The lower the interest rate, the more money that intermediary banks can make on re-loaning (arbitrage), and the less that existing debt costs to pay back. The punchbowl is still being spiked, and as long as that is the case people are happy to keep betting in the casino to drive prices up.

2) The Fed is admitting that the global economic slowdown was cause enough not to raise rates because their targets have been met for unemployment (which is cooked, unlike the population to employment ratio) and inflation (also cooked, not true CPI numbers like in the 1980s). This tells the rest of the world that the global economy is not stable, and bolsters the fear trade in gold in silver.

3) The Fed is losing credibility by not raising rates when they said they would, and continuing to postpone. The whole fiat currency experiment they are running is dependent on their credibility, because in the absence of being able to repay your debts in gold, credibility is the only thing backing your currency. This bolsters precious metals which are real money (and thus in competition with fiat currency) as the Fed is eroding confidence in the USD by not keeping their word, and this also adds to the fear trade.

 

Maybe, but what's happening lately? Silver is down, and so is gold. I hope they perk up, but it's hard to tell if it will happen any more...

 

Predictions are hard, especially when they're about the future. - Yogi.

 

2 days ago silver was over $15. Yesterday it dropped about $.50. Today it's even. The longer it stays low, the more I can buy and when it goes up, I'll make more when I sell. Don't try to time the market, you'll get clobbered.

 

3% daily moves up and down are becoming fairly common. That is serious volatility. Some market heavyweights are obviously throwing haymakers.

 

You better believe it! If I only knew the day the dam was going to break, then I'd....Well you know the rest.

 

On the other hand, everyone might settle down, keep calm, and get over their bad seffs. Who am I kidding? We're talking coin people here! We have no humility when it comes to what we believe.

 

I missed a great opportunity on Sunday, but I am trying not to kick myself too hard over it. If I had the money ready I would be a lot richer, but c'est la vie!

 

I just had a dealer ask me, a stacker, to sell him some ASE's...wow!

 

Some places I buy from have a 3 month back log. Supply and demand?

 

Everyone in my area (Milwaukee) is giving me that same line, 8-12wks out. Everytime I go to purchase, the premium is a little higher. Seems to me everybody thinks 14-15 dollar silver is a great buy (including me) so demand is killing supply in this case.

I was talking with a local dealer a few weeks back and I was trying to rush a sale with him because I had to meet with another guy to buy a few rolls of ASE's. He was curious to what I was paying; I told him the number and he offered to pay me $2 over what I paid a piece. We laughed and I left. That was the moment I realized it was getting tight in my area.

 

I find it a bit odd that supply hasn't caught up with demand yet. My belief was the supply bottle neck would've been cleared by now, being about 9 weeks since it first started tightening. I'm not sure why retail demand is still outpacing production, even at these inflated premiums. You'd think that would point to higher spot prices, but thinking can get one in a lot of trouble in this market...

 

I don't think the dealers are trying very hard to get any supply in. SD Bullion has a 15% sell/buy spread on ASE's. Apmex is even higher. If demand was that high, they could tighten that up a little. If the secondary dealers are getting charged $4 from the allocated purchasers, why not offer the same to the private sellers?