Will silver ever be cheap again?

Well, I'd say investor A was wrong if he sold a performing stock and his vacation ended up costing twice the actual value, but that's not your point. Fair enough. We are drifting though.

"PM's have had their run" IF the economy recovers. As I mentioned in a prior post IF that happens I will take my lumps with a grin on face, happy as a lark that I lost this money because it will mean I have opportunities to earn much much more in a thriving economy. IF the economy does not recover the bubble will have long to go before it pops, and I will evaluate my position on the other side.

 

Log in or Sign up to hide this ad.

I tend to agree that deflation would be temporary and that inflation would follow. But I'm beginning to think that deflation must occur prior to the inflation, so people should adjust their investment plans accordingly. For example, if the US Treasury starts selling all of its debt to the Fed, this will happen because nobody wants the debt and they refuse to roll it over. This will be highly deflationary, at least for awhile and maybe a fairly long time because people can liquidate and default on debt faster than the government can get the money back into circulation. I have no idea when this might occur. Things usually take longer than I expect.

 

If Armstrong said this then he is pretty clueless. There have only been two reserve currencies in the last 350 years. Gold & Gold backed paper which was replaced by the full fiat $ just 41 years ago.

 

This theory is incorrect because value depends of upon demand AND supply. It's not just dependent upon demand. The failure and inherent fault of fiat central banking is that supply is unlimited. Because so much capital has to be redirected towards paying the interest on the debt created, that central bankers are forced to increase supply far beyond that of demand and value falls.

This is why the value of the dollar has been deflated from $1.00 when the Federal Reserve was formed to just $0.02 now. This while the debt has been increased to unprecedented levels. Most of that decline has occurred in the last 40 years. These results speak for themselves.

 

I'm not an Armstrong defender. Someone asked for the case, and I provided it.

 

If you believe deflation is an impossibility, you should invest with that base case in mind. There is no doubt that it is possible for the Fed to hyperinflate by just printing and circulating trillion dollar bills in response to infinite federal government borrowing. The point is whether it is likely that they will increase the money supply faster than debt is liquidated and defaulted. I don't think hyperinflation is a certainty so I'm keeping my options open in my own investment program.

 

Yes.

 

You are overlooking the fundamental premise of acquiring gold and silver -- it is not done on its own merits, but to simply preserve the purchasing power of your current assets, which for most of you -- means ummm, paper dollars.

Acquiring PM's happens to be more convenient and more liquid than buying farms or paintings or stamps or ammunition or Swiss francs. If I personally didn't believe that significant inflation (or less likely, hyperinflation) were coming, I wouldn't buy junk silver; I'd use that money to buy (gradually) a knockout 19th Century type set, HT and CW tokens, and other items of numismatic interest. I wouldn't have sold 20% of my collection to buy junk silver for my clueless heirs.

I won't be here to see it happen; NO ONE, however, can point to any nation's fiat-money scheme of the past 200 years and find anything other than massive inflation, a bad end-game, and trashed dreams.

We were blessed with abundant resources, relatively low-cost energy until the early 70s, a relatively low rate of population growth, and a physical geographical location secure from the horrors of World Wars I and II, other than Pearl Harbor. All those advantages and benefits have been squandered and pimped by the morons in Washington. The new standard of living will require some painful adjustments by the middle class. Having PM's in hand - helps.

Even if you buy Midas Mufflerettes, those rounds also good for a free oil change, you are waaaaay ahead of the optimist who buys nothing. You won't need as many oil changes when the crunch comes -- gas will be $12 a gallon. Not possible, you say? It's already $9.75 in Norway, highest among the developed countries.

 

You are aware that this thread is several years old and some of the posters you replied to are no longer active members?

 

No, not aware of that - thanks. But what I wrote is TRUE. Mischievious xGAJx's "Yes" threw me off-track; that "Yes" was posted this morning. And what I said, some of you need to hear again.

 

I don't believe any of those members are here or have even read this thread. It's not my fight so you may post to yourself if you like. :>)

 

It's not a fight. I look forward to xGAJx's next 1-word post.

 

I think silver may be cheap now, but it's hard to tell. It's been hanging at around this price for so long that we are used to it.

 

I don't think silver will be easy to get ahold of if it goes below $18. I've got a good feeling the stamped out bullion inventory is getting thin due to apparently low demand. I base that on nothing but a hunch. Seems since we had the big blowout on 4/15 last year, the big down days since have seen the shelves cleared in minutes and the shortages last a few days, by which then the prices have rebounded or stabilized off their bottom.

 

It looks like silver is going to be in the 18's at days end. I think the price will go down for bullion as well. I bought a bunch on Friday and Saturday, so you can blame it on me. The price tanks right after I buy things.

 

For the past 3 months, regardless of price, there has been plenty of junk silver available in Columbus, but few if any ASEs, rounds, or bars.

This is not a scientific survey, as it relates only to Craigslist, not to coin shops or auctions.

 

Silver closed over $19 and is now about $19.01, so we are barely holding over the magical 19 number, but how long can it hold out? I have a feeling we are testing a bottom, but there might be another bottom below...

 

I have seen more junk available lately as well. I also saw a pretty large group of 2012 ASE's come on the market around here. These are simply a reminder of an important fact, "the market can remain illogical longer than you can remain liquid". This person probably bought them for about $40, and had to liquidate at about half value. Maybe this person was right that long term silver will be higher than $40, it very well could be. However, the danger of investing too much money in any particular asset is that when you need to sell because of life, the market for that particular asset might be down. This is another reason diversity is a nice tool, it gives you a better chance to not have to sell some assets near a bottom when the time comes that you need the money.

 

Silver is cheap today! Down below $19, and it looks like it's going to close there.

 

Nope. It popped up right at the end to close over $19 after all.