GSR = 99.96 this morning

jmski52

Wow. From what I understand, the only time that the GSR has been this high was about 4 years.

The fundamentals couldn't be much more positive for silver (increasing demand vs. 5 years in deficit supply) and yet silver is being clubbed now for 3 days in a row while gold remains resilient.

What can this be telling us?

psuman08

The silver squeeze was not real.

Higashiyama

“What can this be telling us?”

Silver was demonetized years ago and the gold/silver ratio has little meaning.

pragmaticgoat

Silver price knocked back two months in two days

TwoSides2aCoin

Tells me I can trade a hundred ounce bar for an ounce of gold and not get any change.

DoubleEagle59

Traded in one $20 Lib. at a Canadian coin show today for 100 oz. of silver.

DoubleEagle59

@DoubleEagle59 said:
Traded in one $20 Lib. at a Canadian coin show today for 100 oz. of silver.

Another dealer only worked on an 80:1 ratio, another was at 90:1 but the above dealer was extremely fair to me.

I had another $20 Lib. and was going to trade at 90:1 but I decided to wait as who knows if we'll get to 120:1 by the end of this week??

johnny9434

The yo you affect, up today down Wednesday, jmo ( i wish we had a crystal ball )

jmski52

I had another $20 Lib. and was going to trade at 90:1 but I decided to wait as who knows if we'll get to 120:1 by the end of this week??

I don't know about that, but gold should continue to be strong. However, silver's fundamentals couldn't be much better and I expect a nice move in both metals as money printing will be required in order to rescue the banks & the bond market this year.

jmski52

Gold and Silver are showing relative strength compared to the stock indices. While the GSR did run up over 100, it is now 99.6 which is still historically high.

Overnight, both metals had a relief rally while stocks took another hit. This week might be interesting, then again there is a mass liquidation in progress.

For those who don't think that the GSR has any significance (i.e. Higashiyama), do you think that silver is a good investment at this particular time? Or are you a 60/40 portfolio kind of investor? Your insights are usually pretty good.

DoubleEagle59

Silver is the deal of the century.

Silverstacker

Still 100 GSR as gold and silver fight back on hopeful economic news. Ive been buying both cause I felt the dip wouldn't last. Nobody wants trade interrupted and deals will be made.

Higashiyama

@jmski52 -- I can definitely imagine realistic scenarios where silver does well, but I think it will be driven more by industrial demand than as an inflation hedge. I think that central banks (especially but not only China) will continue to accumulate gold, and silver will be a follower. The global economy is just too big for it to serve as money.

With that said, I think we could see a kind of "high employment stagflation" scenario in the US and many of the post-industrial countries. In this scenario, de-globalization leads to stagnant real GDP, but solid employment. Perhaps silver could be viewed as an attractive alternative to cash and conventional investments in such a scenario.

derryb

Just five years ago $63 oil was $25. Is silver more abundant or rarer than oil?

RedneckHB

@derryb said:
Just five years ago $63 oil was $25. Is silver more abundant or rarer than oil?

Just 5 years ago platinum was 900ish. It's still 900ish. Is platinum more abundant than silver?

Higashiyama

@derryb asked “Just five years ago $63 oil was $25. Is silver more abundant or rarer than oil?”

There’s of course lots more oil then silver, but I’m not sure what you’re getting at?

derryb

@Higashiyama said:
@derryb asked “Just five years ago $63 oil was $25. Is silver more abundant or rarer than oil?”

There’s of course lots more oil then silver, but I’m not sure what you’re getting at?

comparing the two for what they are - consumable commodities.

RedneckHB

@derryb said:

@Higashiyama said:
@derryb asked “Just five years ago $63 oil was $25. Is silver more abundant or rarer than oil?”

There’s of course lots more oil then silver, but I’m not sure what you’re getting at?

comparing the two for what they are - consumable commodities.

That $63 oil was also $63 almost 20 years ago. Your choice of comparable "consumable commodity" supports Higashiyama's thoughts.

The futures GSR is now 103.5.

psuman08

Can someone explain to me why the GSR ratio is a valid metric. Until 50 years ago it was a metric controlled by the government. To me it is very apparent that silver moves independently from gold and this metric is worthless.

Meltdown

@psuman08 said:
Can someone explain to me why the GSR ratio is a valid metric. Until 50 years ago it was a metric controlled by the government. To me it is very apparent that silver moves independently from gold and this metric is worthless.

To my understanding it's more of a value metric and speculation determinate. For instance, gold bought at $1500ish a couple years ago can now net 100 ounces of silver. Those who believe silver is poised to take off can now get quite a bit more for their speculation.

psuman08

I understand what it is. I don't understand why it is valid today. For the first 175+ years of our country the ratio was based on the government, not the free market.

jmski52

Can someone explain to me why the GSR ratio is a valid metric. Until 50 years ago it was a metric controlled by the government. To me it is very apparent that silver moves independently from gold and this metric is worthless.

Historically, gold and silver prices have had a high correlation, not a low correlation. Aside from that, ratio analysis has been a fairly standard approach in financial circles - not just gold vs. silver, but also in terms of stock valuations.

For example, the most classic ratio applied in financial analysis is the P/E ratio which tracks the relative value of stocks in a particular sector vs. the relative value of stocks in a different sector on the basis of price vs. earnings. In the case of the Mag 7, many analysts give weight to the potential for price appreciation rather than the actual profitability.

Does this mean that P/E analysis isn't valid? No, it simply provides a reference point for current and future price movements. The same thing is true of the GSR (Gold/Silver Ratio) - as a reference point. Therefore, I don't consider the GSR to be as "meaningless" as one might believe.

derryb

@RedneckHB said:

@derryb said:
Just five years ago $63 oil was $25. Is silver more abundant or rarer than oil?

Just 5 years ago platinum was 900ish. It's still 900ish. Is platinum more abundant than silver?

Proof that one should also consider the demand side of the price equilibrium equation.

That $63 oil was also $63 almost 20 years ago. Your choice of comparable "consumable commodity" supports Higashiyama's thoughts.

Picked oil out of the blue. Most all other commodities have price cycles especially when inflation is considered. Gold is nowhere near the definition of "consumable commodity" as is silver.

blitzdude

I'd expect the GGR to go even higher, 120-130 perhaps. RGDS!

derryb

@blitzdude said:
I'd expect the GGR to go even higher, 120-130 perhaps. RGDS!

fear will keep GSR high, a lot of fear that greatly decreases the supply of available physical gold will drive the GSR much lower when silver becomes the "go to."

derryb

@psuman08 said:
Can someone explain to me why the GSR ratio is a valid metric. Until 50 years ago it was a metric controlled by the government. To me it is very apparent that silver moves independently from gold and this metric is worthless.

Because it is accurate. It told us to buy silver @ $30 in April of this year, when the GSR hit its peek @ 107. Silver has been going up then whil the GSR settles toward its equilibrium of 60.

jmski52

This past April, as this thread documents - with the GSR at 100, Gold was around $3,150 and silver was around $31.50.

That ratio of GSR = 100 was historically high and indicated that the price of silver was historically low compared to the price of gold.

The historical average is somewhere between 30 to 1 or 50 to 1 - take your pick.

If you think that historical averages are meaningless, then explain why gold is now at $4,195 and silver is at $60.39.

Dividing $4,195 by $60.39 the current GSR is now 69.46.

Silver has increased by 91.7% while gold has increased by 33.2% since that time.

Since April, the GSR has been trending back towards its historical average.

If you believe that historical averages are meaningless, please explain why silver has increased by 91.7% since April while gold has only increased by 33.2% since then.

Thank you for your attention to this matter.

derryb

@Higashiyama said:
@derryb asked “Just five years ago $63 oil was $25. Is silver more abundant or rarer than oil?”

There’s of course lots more oil then silver, but I’m not sure what you’re getting at?

Supply. It is a major contributor to price equilibrium. We are now seeing how big a contributor it is.

derryb

@blitzdude said:
I'd expect the GGR to go even higher, 120-130 perhaps. RGDS!

So much for that forecast.

toadstrangler

@derryb said:

@blitzdude said:
I'd expect the GGR to go even higher, 120-130 perhaps. RGDS!

So much for that forecast.

All indicators, if one bothers to search them out, forecasted this …

derryb

@softparade said:

@derryb said:

@blitzdude said:
I'd expect the GGR to go even higher, 120-130 perhaps. RGDS!

So much for that forecast.

All indicators, if one bothers to search them out, forecasted this …

GSR is based only on the current spot prices of gold and silver. Indicators as to where those prices are going are open to interpretation. Blitz wrongly interpeted them or simply pulled a guess out of the space between his two back pockets.

carew4me

Several board trolls are eating excrement sandwiches now. While the 'triple threat' evangelist' feast on the silver bounty.
ENJOY!

jmski52

Current GSR = $4,273.30/$63.85 = 66.93

Down from 69.46 one day ago. A regression towards the mean continues........

In the meantime, Gold has increased by 1.9% and silver has increased by another 5.7%.

As they both climb, silver is climbing about 3X faster than gold.

Of course this is only one day, just after a Fed decision to lower rates by 0.25% and may not be representative.

Silver is killin' it.

dcarr

@derryb said:

@blitzdude said:
I'd expect the GGR to go even higher, 120-130 perhaps. RGDS!

So much for that forecast.

.

Wow, that was bad.
About a year ago, on this forum, I predicted a GSR of 60 (short to medium term).

.

BruceS

So does mean we should be buying gold with our AG profits?

derryb

@BruceS said:
So does mean we should be buying gold with our AG profits?

buy the dips, sell the highs.

toadstrangler

@derryb said:

@BruceS said:
So does mean we should be buying gold with our AG profits?

buy the dips, sell the highs.

buy the dips and NEVER sell

jmski52

So does mean we should be buying gold with our AG profits?

My interpretation is that we should be buying silver with our gold profits, until the declining GSR reverses and begins climbing.

And that's what I've been doing.

bigjpst

@jmski52 said:
So does mean we should be buying gold with our AG profits?

My interpretation is that we should be buying silver with our gold profits, until the declining GSR reverses and begins climbing.

And that's what I've been doing.

I thought it would be the opposite? When GSR is at 100, if you sell gold, you can buy 100oz silver, then when GSR is 60, you can trade 60 oz of that silver back for an oz of gold, and in theory, still have 40oz of silver? Maybe that is not using the same reasoning.

jmski52

When GSR is at 100, if you sell gold, you can buy 100oz silver, then when GSR is 60, you can trade 60 oz of that silver back for an oz of gold, and in theory, still have 40oz of silver? Maybe that is not using the same reasoning.

Your reasoning is correct up to the point that the GSR stops declining, but it's fairly likely that the GSR isn't done declining. The historical norm for the GSR in modern times has ranged between 30 to 50 on a nominal basis. Prior to that, the GSR was even lower, around 15 or 16 for many years.

So, if you expect the GSR to continue declining to 50, or 40 or 30 - you can expect silver to continue rising faster than gold as it has been doing recently (and gold still has every reason to continue rising).

Lastly, the true ratio of Gold to Silver in nature is closer to 7, in other words there are about 7 ounces of silver mined for every ounce of gold mined. This could mean that the GSR could decline all the way to 7 or below. In that case, silver could be several multiples of its current price.

If someone has a different interpretation or a nuance, please let me know.

bigjpst

Thanks for explaining your reasoning. I can see how the larger percentage increase in silver may make it the better option as the GSR falls.

I don’t typically use the GSR to stack gold or silver, but I’ve always just understood it as a way to gain the most ounces of each as the GSR changes.
If I trade my 60 oz of
Silver for 1 oz of gold, and silver was still rising faster than gold and GSR goes to 40, I could then trade that 40 for a second ounce of gold.

jmski52

If I trade my 60 oz of Silver for 1 oz of gold, and silver was still rising faster than gold and GSR goes to 40, I could then trade that 40 for a second ounce of gold.

I believe that's correct. In my own case, I tend to use the fact that the GSR has been declining as a good justification for buying additional silver until the GSR reaches a nominally low level. At a lower level, I would begin to lighten up on my silver unless there are no better options.

blitzdude

@jmski52 said:
Current GSR = $4,273.30/$63.85 = 66.93

Down from 69.46 one day ago. A regression towards the mean continues........

In the meantime, Gold has increased by 1.9% and silver has increased by another 5.7%.

As they both climb, silver is climbing about 3X faster than gold.

Of course this is only one day, just after a Fed decision to lower rates by 0.25% and may not be representative.

Silver is killin' it.

Hopefully it gets to 1:1 so we can dump all this gutter trash for THE real deal Metal Of Kings! Halleluiah!! THKS!!!!!

toadstrangler

@jmski52 said:
If I trade my 60 oz of Silver for 1 oz of gold, and silver was still rising faster than gold and GSR goes to 40, I could then trade that 40 for a second ounce of gold.

I believe that's correct. In my own case, ** I tend to use the fact that the GSR has been declining as a good justification for buying additional silver** until the GSR reaches a nominally low level. At a lower level, I would begin to lighten up on my silver unless there are no better options.

If there is cash in me pocket, there is justification.

jmski52

If there is cash in me pocket, there is justification.

That makes sense to me. I do think that silver is a "buy" until the ratio declines to the area between 30 and 50. I've sold some gold in order to buy more silver twice in the past month.

I might sell a little silver if the GSR reaches 30, but I won't sell silver to buy gold until the ratio approaches 15 or 20.

derryb

While silver has outperformed gold for the year, GSR is telling us that gold is ready to outperform silver.

toadstrangler

History says the ratio should be around 15 to 1

Silver needs to be in the high 200’s to meet that 15/1 assuming gold stays put. Which it won’t lolz

blitzdude

@softparade said:
History says the ratio should be around 15 to 1

Silver needs to be in the high 200’s to meet that 15/1 assuming gold stays put. Which it won’t lolz

History says? LOL that's the most absurd thing I believe I have ever read on the internet. SMH. MND BLWN!

toadstrangler

@blitzdude said:

@softparade said:
History says the ratio should be around 15 to 1

Silver needs to be in the high 200’s to meet that 15/1 assuming gold stays put. Which it won’t lolz

History says? LOL that's the most absurd thing I believe I have ever read on the internet. SMH. MND BLWN!

You are so lazy

CLICK CLICK!

blitzdude

@softparade said:

@blitzdude said:

@softparade said:
History says the ratio should be around 15 to 1

Silver needs to be in the high 200’s to meet that 15/1 assuming gold stays put. Which it won’t lolz

History says? LOL that's the most absurd thing I believe I have ever read on the internet. SMH. MND BLWN!

You are so lazy

CLICK CLICK!

Hmmmm, looks like history says gutter metal is currently overpriced. Dealers and refiners appear to agree. RGDS!

toadstrangler

@blitzdude said:

@softparade said:

@blitzdude said:

@softparade said:
History says the ratio should be around 15 to 1

Silver needs to be in the high 200’s to meet that 15/1 assuming gold stays put. Which it won’t lolz

History says? LOL that's the most absurd thing I believe I have ever read on the internet. SMH. MND BLWN!

You are so lazy

CLICK CLICK!

Hmmmm, looks like history says gutter metal is currently overpriced. Dealers and refiners appear to agree. RGDS!

YAWN bruh, NO THEY DON'T. They are scared lolz