With silver tanking here lately, and a lot of short term memories (including mine) I had to take a look back for some perspective on this. There's no doubt many newcomers were not involved in this market, even in 2008 or before. All the hype brought a lot of people in. Not saying that was good or bad but it happened. I found the results rather surprising. Before everyone panics..... In 2008, you could still buy silver for under $10 for a good part of the year! That was a surprising to me. In early 2010, you could still buy at under $16! It wasn't until late 2010 when things really took off and everybody started getting used to the current levels. These shockingly low prices right now, were shockingly new highs in late 2010. Not saying I ever predicted anything of value here. Just saying at a mere 2 years later, what's happening now probably should not be a surprise to anyone and is not as shocking as some may try to make it out to be. If it goes back under $10, then it might be time (albeit too late) to let the panic set in because that was the real bottom in 2008. $23.42 right now is still a relatively high price in recent history. Probably not good news for a lot of people. Many people did think this was coming though. It's never had a real severe pull back since hitting all these new higher levels and it always seems to happen at some point. What's causing this is debatable. Is this warranted at this time? Debatable. As small time collectors, were reminded that we really only have a hold of a large animal by the tail and we're going along for the ride (again). Not determining what should or shouldn't be happening. Personally, I think many people are not going to want to sell physical at these levels and will maintain higher prices for as long as they can. This downturn will have to have lasting power before people see much benefit from it. May be new deals to find from the large bullion suppliers if you want to buy direct and if they have it. It's an interesting time. Silver will probably skyrocket again when everybody just gets comfortable and least expects it. It's a silly market.
I wonder how much physical silver actually traded hands today. I believe it is all paper contracts and derivatives making these wild price gyrations. In the physical market, some sellers got cleaned out today: http://www.monarchpreciousmetals.com/ In any case, I agree with your analysis. 2008 was an especially interesting year for the metals. Gold dropped from $972 in February to $732 in October, and yet along the way, new records were set for coin prices, especially foreign coins. The bullion market then kicked right back in by early 2009 and was quickly making new highs. The savage nature of today's sell-off is actually preferable to a slow water-torture decline. The plunge represents a huge increase in volatility, and if world events precipitate a rally in the next fey days, an increase in price equally swift isn't out of the question.
