<< <i>Interesting TTown, does the FDIC list what 76 institutions are on its "problem" list somewhere? >>
You noticed that too huh? No and if there small banks like in 1991 then it would be okay but don't count on it. The FDIC has 1.22 cents in reserve for bank failures and one good middle size bank would wipe this out.
It was either the WSJ or the FTimes that reported insuing trouble for banks...including large banks....that the bigger ones are too large to save. I'd rather be in PMs as an insurance hedge... You ain't seen nothin' yet, imho.
"Poets are the unacknowledged legislators of the world." PBShelley
<< <i>The money is from people that buy oil to hedge against the falling dollar. When you have a falling currency, you buy commodities to stay ahead of or equal to inflation. This is Economics 101. People buying commodities now are following basic economic principles, not speculating. >>
True to the point where a rise in commodity values corresponds with the decline of the dollar. If the dollar declines 10%, commodities (apart from other market factors) should rise 11.1% in terms of dollars. Many commodities have risen *far* more than the dollar's decline can explain by itself.
There *is* speculation. What do you think technical analysis traders do when they buy based on the charts? They are buying NOT because they think the asset represents good value at that price, but because their past history tells them that runaway momentum is often hard to stop regardless of the underlying value of the asset. That is a form of speculation -- playing on momentum rather than fundamentals.
To a large degree commodity prices ARE heading higher due to fundamentals. But I see the charts and see what I think is a considerable "overage" in recent returns relative to fundamentals (supply, demand, devalued currencies to name a few). I think that is speculative froth.
<< <i><<<Didn't know the US could control oil prices. It seems to me we're getting most of it from Canada and Venezuela. With the demand from China and India don't expect anything but up>>>
Do you seriously believe that China or India can afford higher gas prices? No way, even in subsidized markets like China, the price is too high for the demand to hold. It is the speculators that are driving the price up, plain and simple and I hope they all get burned big time. >>
The prices aren't escalating there like they are here. Our DOLLAR is collapsing against the Chinese Yuan. That being the case, the price of OIL is not escalating against that currency. You need to be out of the Dollar and into the Yuan or the Yen or the Swiss Franc. Then you won't feel the pinch as much against the price of oil. Holding US Dollars is a losing proposition...imho.
"Poets are the unacknowledged legislators of the world." PBShelley
<< <i>The money is from people that buy oil to hedge against the falling dollar. When you have a falling currency, you buy commodities to stay ahead of or equal to inflation. This is Economics 101. People buying commodities now are following basic economic principles, not speculating. >>
True to the point where a rise in commodity values corresponds with the decline of the dollar. If the dollar declines 10%, commodities (apart from other market factors) should rise 11.1% in terms of dollars. Many commodities have risen *far* more than the dollar's decline can explain by itself.
There *is* speculation. What do you think technical analysis traders do when they buy based on the charts? They are buying NOT because they think the asset represents good value at that price, but because their past history tells them that runaway momentum is often hard to stop regardless of the underlying value of the asset. That is a form of speculation -- playing on momentum rather than fundamentals.
To a large degree commodity prices ARE heading higher due to fundamentals. But I see the charts and see what I think is a considerable "overage" in recent returns relative to fundamentals (supply, demand, devalued currencies to name a few). I think that is speculative froth. >>
The value of the dollar now isn't the real market value since the Middle Eastern countries are pegged to the dollar and most of Asia is pegged to some degree. I believe the pegs will soon be dropped or substantially loosened and the dollar level will justify the commodity increases.
As to communists running Russia, the Communist party still runs China. If you think the current government is any less ruthless than Mao, what they've done in Tibet should change your mind.
Inflation is running much higher than the CPI numbers indicate (they don't include food and fuel). Who the hell uses food and fuel anyway? Better they take out components that none of us use.
Hyperinflation is coming. Maybe not this year or next, but in the next decade it will. It has to. Unless our goverment can maintain trillion dollar budget deficits year after year? How the hell are we going to pay back our debts and fund our liabilities given the debt we have? Hyperinflation!
<< <i>Inflation is running much higher than the CPI numbers indicate (they don't include food and fuel). Who the hell uses food and fuel anyway? Better they take out components that none of us use.
Hyperinflation is coming. Maybe not this year or next, but in the next decade it will. It has to. Unless our goverment can maintain trillion dollar budget deficits year after year? How the hell are we going to pay back our debts and fund our liabilities given the debt we have? Hyperinflation!
the inflation bug is going to hit the entire globe...China may be most resilient, the "Russian corruption" economy?...can't guess on that one, Brazil and SA okay, I guess.
at the moment the dollar's biggest worry has been the strength of the euro...
the euro is starting to see (react to) inflation and it has all the sub-prime stuff going on their, too
soon, inflation will be the biggest topic, not the strength of the USD vs other world currencies....
gold is going no~where but higher over the next 18 months or so. (silver and coal and oil....included)
to the OP....this is the "lost decade"....
the wheels may fall off, not today, not next month....but they may fall off down the road in the too distant future. RIP
<< <i>Inflation is running much higher than the CPI numbers indicate (they don't include food and fuel). Who the hell uses food and fuel anyway? Better they take out components that none of us use.
Hyperinflation is coming. Maybe not this year or next, but in the next decade it will. It has to. Unless our goverment can maintain trillion dollar budget deficits year after year? How the hell are we going to pay back our debts and fund our liabilities given the debt we have? Hyperinflation!
Tyler >>
"they don't include food and fuel"
Exactly. The nrs. given out are meaningless. >>
Those believing in the hyperinflation scenario can make large fortunes betting against bonds. Bond yields are absurdly low if there is the type of inflation I see talked about on the forum. Even 10 year Mexican government bonds are now below 5% yield. Mexico! U. S. bonds see even lower rates. All these bond holders will be washed away in any inflationary storm. The bond holders will all be long and wrong--either that or the hyperinflation crowd will be disappointed.
Because bond investors tend to have the deepest pockets and the best information in almost all markets world wide, the intelligent money (not the emotional money) would bet with the bond holders and against the hyperinflationary crowd. Folks may play the very tired card, that the U. S. bond market is manipulated, but what about all the other countries? The power necessary to manipulate all those markets is the power to wreck or revive each of those economies.
oldcameoproofsguy, I agree 100%. I was cautioning all the newbs here that were getting all giddy over buying silver at $20 oz. Every other post was about how much silver someone just bought, how much silver should someone buy, or how much higher is it going. There were dozens of "WTB SILVER" posts on BST. Where are they now?
Just diversify. I'm holding a cash position for future deflation in areas like real estate meanwhile holding a silver stockpile bought at 5 bucks, along with numismatic coins, mostly barber and seated stuff, and stocks, some palladium, etc.
I do worry that there will be a crash in numismatic coins, but feel that it's going to be more limited to ultra high end PCGS stuff, and to modern crap and morgans, whereas Barber stuff should stay strong.
If silver gets to 9 bucks, that would be so sweet.. I hope you're right, op. I could stand to double my physical holdings at that price. Get palladium down to $200 too while you're at it so I can increase my palladium holdings by a factor of 10.
If you think silver had a tough time crossing $14.50 on the up side you'd be amazed with how tough it would be on the down side. I doubt it will be tested in any case. There is weak support at $16 that will probably hold.
Inflation is not done. Those who believe inflation won't happen al- so have to believe the enormous debt can be paid in 2008 dollars. The dollar would collapse the day it looks like it can't be paid so the only alternative is to make payments in 2012 dollars and still be mak- ing payments in 2112 dollars in all probability.
I have been messing with commodities for a while now, just as a small player, but one thing I know is that no one makes any money if there isn't volatility. Take wheat for example, it was over 12.00 a bushell a month ago, now it is down to 8.3. Rice was at 18 a month ago and now at 24. The market is being played like a fiddle--------------------------BigE
I have a 167 acre farm that has been producing since the Creek Indians made it into their food plots! That is all it has ever been one mean producing farm!
SILVER: Continued weakness in July silver despite a pullback in the dollar and further strength in crude implied there's been a major change in thinking about this market as an inflation hedge, and maybe the focus has turned to slower demand due to a recessionary US economy and weaker global growth. Of course, opinions on the US economy change quickly and often, and the stock market rally ostensibly presages a stronger US economy and possibly higher inflation and better silver demand down the road. In addition, the dollar could break down. However, it looks like the funds/specs are back in a long liquidation mode. The chart favors a decline to support around 1675. Support (basis July): 1710, 1755, 1710, 1665, 1620, 1575. Resistance: 1800, 1845, 1890, 1935, 1980, 2025, 2070. Turning Points: None.
GOLD: June gold got support from a pullback in the dollar, ending about steady. Weakness in other commodities, particularly silver, implied the funds/specs might be abandoning the inflation hedge argument and are focused on the potential for commodity demand to slow due to a recessionary economy. However, direction in the dollar most likely still holds the key, and it remains close to a breakdown, meaning the odds favor further gains in this market. Support (basis April): 917, 911, 906, 900, 894, 889, 883, 878, 872. Resistance: 927, 933, 928, 939, 945, 951, 956, 962. Turning Points: None.
I was cautioning all the newbs here that were getting all giddy over buying silver at $20 oz. Every other post was about how much silver someone just bought, how much silver should someone buy, or how much higher is it going. There were dozens of "WTB SILVER" posts on BST. Where are they now?
I bought silver high. Then I bought some more as it came down a little. I do know that when it spikes next time, it will be too late to buy - all the way up. You can always brag about market timing, but the fundamentals will dictate what happens when the physical situation can no longer be "managed".
We only got a whiff of what the market sentiment will be when silver disappeared from all of the retail shops a few short weeks ago. Don't say you didn't have a chance to buy in at the right time, because now is a pretty good time, all things considered.
Q: Are You Printing Money? Bernanke: Not Literally
To understand how any commodity is priced, you must understand the relationship of its actual demand for use and how many people are speculating that it will go up or down in value.
"Vou invadir o Nordeste, "Seu cabra da peste, "Sou Mangueira......."
Once the Olympics are over, expect China to decouple the Yuan from the Dollar. Bet on it.
NO, Silver and gold aren't going to drop 40%, that's absurd.
Just wait a year or less and we'll see silver, in particular, and gold increase to new highs.
Gold is easy to find, most of the shops are stuffed with it.
Silver, OTOH, simply isn't there to be had and when the few pieces do come in, they are selling for as much as $2+ over spot on 100 ounce bars.
The actual shortage worldwide that we have all seen coming for years is now upon us. Industry stockpiles are at all time lows, so something is going to have to give fairly soon.
The shorts are trembling and trying to save their worthless hides and those who own paper silver are going to take it in the shorts.
Hold onto your PMs and keep your powder dry.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Some here have hinted to one of the most powerful driving forces in the price of PM’s and one that is not often discussed here… emotion.
Sure there are the typical driving forces for PM pricing:
1. Its correlation to the price of fossil fuels. After all, transportation of goods determines the price of nearly all consumable products. 2. The strength of the dollar compared to the euro or the Chinese yaun. 3. Industrial demand. 4. Good old fashioned avarice… jewelry. 5. The list goes on and on.
PM prices are in a large part driven by emotion. There are some very intelligent people on this board; we see the fecal pie beneath the sugar coating. The media is now claiming that the economy is making large strides towards recovery. The stock market is rebounding. There are claims that the sub-prime mortgage dilemma is miraculously rectifying itself. Yet, we have our doubts and trepidations. However, the average American is starting to believe that the economy is rebounding; just look at recent articles, they seem kind of optimistic.
The emotional state of the typical person in the last couple of months has been to dump all their PM’s. They have sold their jewelry and dug up their uncle’s grave for the gold fillings in his teeth so that they have even more PM’s to sell. The higher gold goes the more trepidation it will cause to become bullish in PM’s even for countries attempting to create a stronghold position in PM’s.
Emotion is driving people away from commodities and towards other means of attempting to make the quick dollar; recent gains in the stock market point towards a reinvestment in the stock market. Gold has been a little stagnant in the $900 range for a while. Emotionally, people will start to hesitate in creating a huge position in PM’s if there are no quick gains to be had.
Many of the people who got into the recent commodities fever are not in it for the long haul. They are short term speculators who are caught up in the excitement of the moment. Now that the price is somewhat stagnant, I’m sure a great deal of them are thinking, sell now before I lose my shirt (a very emotional response… fear). Many are probably thinking that they should relinquish their PM holdings and get back into the stock-market , real estate or some other venture.
I’m holding onto my PM’s because I am in it for the long haul. If gold does go up to $1500 an ounce I will win. If it drops to $500 an ounce I will start buying double eagles again. Either way it will be OK.
The Gallop Poll reported that 89% of the voters in Pennsylvania that they interviewed were of the belief that we are currently in a recession and no longer believe any Government figures, nor do they trust the media.
The media may try to tell us one thing, but the average American now knows better than to buy into it.
Doesn't appear that the rosy picture being painted by the media is having much effect.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
For gold to be at $900 or higher right now would suggest some period of Weimer hyperinflation occured. I don't recall this happening. Granted the price of fuel has risen quickly, that still would only reflect a price of gold in the neighborhood of $500/oz.
Rather than a 40% decline in gold over the next few yrs expect a 40% min. increase. The Weimar type inflation you speak of is slowly coming at us. That's why gold is already at $900. It's not going away just because you'd like to see "reasonable values." Personally I think that $100 MILL sports deals for pro athletes, $550 TRILL in derivatives, and $50K per year for college are all unreasonable numbers. But you won't be seeing those backing down 40% anytime soon because they look too big to us.
Emotion is driving people away from commodities and towards other means of attempting to make the quick dollar; recent gains in the stock market point towards a reinvestment in the stock market. Gold has been a little stagnant in the $900 range for a while. Emotionally, people will start to hesitate in creating a huge position in PM’s if there are no quick gains to be had.
Many of the people who got into the recent commodities fever are not in it for the long haul. They are short term speculators who are caught up in the excitement of the moment. Now that the price is somewhat stagnant, I’m sure a great deal of them are thinking, sell now before I lose my shirt (a very emotional response… fear). Many are probably thinking that they should relinquish their PM holdings and get back into the stock-market , real estate or some other venture.
Emotion is part of it, for sure. I sold out of all my stock positions and liquidated half of my retirement accounts, paying the penalty and early withdrawal out of emotion. I'd call it anger - at seeing what the government-engineered inflation and expropriation of my money was doing and will be doing to my longterm savings. I didn't make the move in a hurry, but only after considerable reflection. I don't like what's going on in Washington DC. I really don't. I voted with my feet to protect my family. If it keeps on going the way it's been going, I'll vote with my feet again with the other half. I have no concerns about buying silver at $20.00, because the last time I bought a bunch, it was in the $6.00-$8.00 range. At either price range, it will hold it's value or spike hard to the upside. I can live with either scenario. I trust myself alot more than I trust those thieving bastiges in DC.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>I have no concerns about buying silver at $20.00, because the last time I bought a bunch, it was in the $6.00-$8.00 range. At either price range, it will hold it's value or spike hard to the upside. I can live with either scenario. I trust myself alot more than I trust those thieving bastiges in DC. >>
Bravo! Excellent and dead on point of view.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Cannot imagine such a retreat. This isn't about charts and manipulation. The economic factors and the usefulness of the PMs cannot be divorced from the pricing and neither are going to depress the price that much.
This is options Thursday, the PMs were manipulated down the last few days to assure the calls fell out of the money. The classic Cartel move. The price will move up in the next few days.
Of course we might take advantage to buy some silver at the 16.70 level, if only all the major dealers weren't sold out. But you can buy all the "paper silver " you want. You will pay more up front to go long than the shorts pay but thats also part of the manipulation. Most likely you will even get paid some day, that is If you sell before the huge shorts declare "force majeure" and walk away.
Read some Ted Butler if you want the whole story. Silver will never see 9 bucks an ounce again. (Maybe 9 Amero some day)
the huge short positions held by JPMorgan , Goldman Sachs et al are just a gamble to them. They "wait around" and "hope" the price falls just before they have to cover. Seems like they are always lucky so why should they do anything to "influence" the market. "Luck" is how Goldman Sachs managed to make 36 Billion $$$ last year.
Heres someone elses take:
Using open interest statistics from close last night would leave a paltry 63 call options in the money and a whooping 10,644 put options in the money,..
This is staggering when one compares this to what the position would have been if May Gold had closed over $950/oz today, a level it was at only 6 trading sessions ago,..
At May Gold over $950/oz: There would have been 6,031 call options in the money and a miserly 458 put options in the money!..
This gives a combined swing of some 16,154 contracts!?! The short side has made a killing,..
You can see why it merited the shorts to crank down the price by $60,.. And sort of answers those questions about why the precious metals flowed so negatively against the oil and currency tides this last week,..
<< <i>Cannot imagine such a retreat. This isn't about charts and manipulation. The economic factors and the usefulness of the PMs cannot be divorced from the pricing and neither are going to depress the price that much. >>
Here's one usefulness of the silver PM: the Japanese announced they have the technology to replace platinum in catalytic converters with silver. Bad for the plat players, but great for silver holders. Just another demand that will be created for silver that will result in an unabated climb upwards. I don't know if the Chinese or Indians require catalytic converters in their vehicles, but if they do, silver might hit $100/oz a lot sooner. than anticipated.
the huge short positions held by JPMorgan , Goldman Sachs et al are just a gamble to them. They "wait around" and "hope" the price falls just before they have to cover. Seems like they are always lucky so why should they do anything to "influence" the market. "Luck" is how Goldman Sachs managed to make 36 Billion $$$ last year.
Heres someone elses take:
Using open interest statistics from close last night would leave a paltry 63 call options in the money and a whooping 10,644 put options in the money,..
This is staggering when one compares this to what the position would have been if May Gold had closed over $950/oz today, a level it was at only 6 trading sessions ago,..
At May Gold over $950/oz: There would have been 6,031 call options in the money and a miserly 458 put options in the money!..
This gives a combined swing of some 16,154 contracts!?! The short side has made a killing,..
You can see why it merited the shorts to crank down the price by $60,.. And sort of answers those questions about why the precious metals flowed so negatively against the oil and currency tides this last week,..
I hesitate to reply, but the above looks like some really bad options analysis. I feel it is a disservice to repost that stuff here, because it serves mostly to confuse or build fear of conspiracies. Options rarely if ever drive the price, and when options do play a role, it is often small moves of 1% or less near expiration, not big moves.
Most option positions are hedged with other options or futures. Looking at open interest numbers by themselves will reveal only tiny slivers. The players that tend not to hedge are the small time punters looking to hit a home run on a big directional move. The small timers can't drive the price--they don't have the money or the smarts to do so.
The options are NOT driving the price they are cashed out based on the price. If you have huge option positions ready to expire out of the money it is easier to move the spot price through futures contracts long enough to bring them into the money, then you can reverse your position in a few days after you cashed on the options. This is why we always get such huge swings just before options Thursday.
Of course this takes huge amounts of capital to manipulate these markets but thats just the sort of capital these guys have. Why else would they hold 80% of the short positions in the market. These are not hedges as they have no mines to deliver product. They are simply manipulating the markets through leverage.
Can't fight city hall coynclecter. You can't lead a horse to water.
Just remember that most of the naysayers here have had a terrible record of calling an end to the metal's markets or major downturns. This 40% downturn call can be tossed in the rubbish with the other wild negative calls. It soothes the masses however.
<< <i>Can't fight city hall coynclecter. You can't lead a horse to water.
Just remember that most of the naysayers here have had a terrible record of calling an end to the metal's markets or major downturns. This 40% downturn call can be tossed in the rubbish with the other wild negative calls. It soothes the masses however.
roadrunner >>
Based on the 200 DMA, gold is still due for some trimming, however, it certainly isn't in the 40% category, nor would it bring gold to sub $800 levels.
The longer we go, at or around the $900 level, the higher that 200 DMA becomes.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Comments
<< <i>
<< <i>Interesting TTown, does the FDIC list what 76 institutions are on its "problem" list somewhere? >>
You noticed that too huh? No and if there small banks like in 1991 then it would be okay but don't count on it. The FDIC has 1.22 cents in reserve for bank failures and one good middle size bank would wipe this out.
Here's the FDIC spin if you want to believe it:
Managing the Crisis: The FDIC and RTC Experience >>
It was either the WSJ or the FTimes that reported insuing trouble for banks...including large banks....that the bigger ones are too large to save. I'd rather be in PMs as an insurance hedge... You ain't seen nothin' yet, imho.
<< <i>The money is from people that buy oil to hedge against the falling dollar. When you have a falling currency, you buy commodities to stay ahead of or equal to inflation. This is Economics 101. People buying commodities now are following basic economic principles, not speculating. >>
True to the point where a rise in commodity values corresponds with the decline of the dollar. If the dollar declines 10%, commodities (apart from other market factors) should rise 11.1% in terms of dollars. Many commodities have risen *far* more than the dollar's decline can explain by itself.
There *is* speculation. What do you think technical analysis traders do when they buy based on the charts? They are buying NOT because they think the asset represents good value at that price, but because their past history tells them that runaway momentum is often hard to stop regardless of the underlying value of the asset. That is a form of speculation -- playing on momentum rather than fundamentals.
To a large degree commodity prices ARE heading higher due to fundamentals. But I see the charts and see what I think is a considerable "overage" in recent returns relative to fundamentals (supply, demand, devalued currencies to name a few). I think that is speculative froth.
<< <i><<<Didn't know the US could control oil prices. It seems to me we're getting most of it from Canada and Venezuela. With the demand from China and India don't expect anything but up>>>
Do you seriously believe that China or India can afford higher gas prices? No way, even in subsidized markets like China, the price is too high for the demand to hold. It is the speculators that are driving the price up, plain and simple and I hope they all get burned big time. >>
The prices aren't escalating there like they are here. Our DOLLAR is collapsing against the Chinese Yuan. That being the case, the price of OIL is not escalating against that currency. You need to be out of the Dollar and into the Yuan or the Yen or the Swiss Franc. Then you won't feel the pinch as much against the price of oil. Holding US Dollars is a losing proposition...imho.
<< <i>Bank failures...it's already in the news. >>
Thanks MH. This was the link I read this morning....and yes, it's happening. UBS is bust....who's next, RBS or Citicorp?
<< <i> Our DOLLAR is collapsing against the Chinese Yuan. That being the case, the price of OIL is not escalating against that currency. >>
Oh, really? Here's a chart of oil priced in yuan:
<< <i>
<< <i>The money is from people that buy oil to hedge against the falling dollar. When you have a falling currency, you buy commodities to stay ahead of or equal to inflation. This is Economics 101. People buying commodities now are following basic economic principles, not speculating. >>
True to the point where a rise in commodity values corresponds with the decline of the dollar. If the dollar declines 10%, commodities (apart from other market factors) should rise 11.1% in terms of dollars. Many commodities have risen *far* more than the dollar's decline can explain by itself.
There *is* speculation. What do you think technical analysis traders do when they buy based on the charts? They are buying NOT because they think the asset represents good value at that price, but because their past history tells them that runaway momentum is often hard to stop regardless of the underlying value of the asset. That is a form of speculation -- playing on momentum rather than fundamentals.
To a large degree commodity prices ARE heading higher due to fundamentals. But I see the charts and see what I think is a considerable "overage" in recent returns relative to fundamentals (supply, demand, devalued currencies to name a few). I think that is speculative froth. >>
The value of the dollar now isn't the real market value since the Middle Eastern countries are pegged to the dollar and most of Asia is pegged to some degree. I believe the pegs will soon be dropped or substantially loosened and the dollar level will justify the commodity increases.
As to communists running Russia, the Communist party still runs China. If you think the current government is any less ruthless than Mao, what they've done in Tibet should change your mind.
Hyperinflation is coming. Maybe not this year or next, but in the next decade it will. It has to. Unless our goverment can maintain trillion dollar budget deficits year after year? How the hell are we going to pay back our debts and fund our liabilities given the debt we have? Hyperinflation!
Tyler
<< <i>Inflation is running much higher than the CPI numbers indicate (they don't include food and fuel). Who the hell uses food and fuel anyway? Better they take out components that none of us use.
Hyperinflation is coming. Maybe not this year or next, but in the next decade it will. It has to. Unless our goverment can maintain trillion dollar budget deficits year after year? How the hell are we going to pay back our debts and fund our liabilities given the debt we have? Hyperinflation!
Tyler >>
"they don't include food and fuel"
Exactly. The nrs. given out are meaningless.
at the moment the dollar's biggest worry has been the strength of the euro...
the euro is starting to see (react to) inflation and it has all the sub-prime stuff going on their, too
soon, inflation will be the biggest topic, not the strength of the USD vs other world currencies....
gold is going no~where but higher over the next 18 months or so. (silver and coal and oil....included)
to the OP....this is the "lost decade"....
the wheels may fall off, not today, not next month....but they may fall off down the road in the too distant future. RIP
<< <i>
<< <i>Inflation is running much higher than the CPI numbers indicate (they don't include food and fuel). Who the hell uses food and fuel anyway? Better they take out components that none of us use.
Hyperinflation is coming. Maybe not this year or next, but in the next decade it will. It has to. Unless our goverment can maintain trillion dollar budget deficits year after year? How the hell are we going to pay back our debts and fund our liabilities given the debt we have? Hyperinflation!
Tyler >>
"they don't include food and fuel"
Exactly. The nrs. given out are meaningless. >>
Those believing in the hyperinflation scenario can make large fortunes betting against bonds. Bond yields are absurdly low if there is the type of inflation I see talked about on the forum. Even 10 year Mexican government bonds are now below 5% yield. Mexico! U. S. bonds see even lower rates. All these bond holders will be washed away in any inflationary storm. The bond holders will all be long and wrong--either that or the hyperinflation crowd will be disappointed.
Because bond investors tend to have the deepest pockets and the best information in almost all markets world wide, the intelligent money (not the emotional money) would bet with the bond holders and against the hyperinflationary crowd. Folks may play the very tired card, that the U. S. bond market is manipulated, but what about all the other countries? The power necessary to manipulate all those markets is the power to wreck or revive each of those economies.
over buying silver at $20 oz. Every other post was about how much silver someone just bought,
how much silver should someone buy, or how much higher is it going. There were dozens of "WTB
SILVER" posts on BST. Where are they now?
I do worry that there will be a crash in numismatic coins, but feel that it's going to be more limited to ultra high end PCGS stuff, and to modern crap and morgans, whereas Barber stuff should stay strong.
If silver gets to 9 bucks, that would be so sweet.. I hope you're right, op. I could stand to double my physical holdings at that price. Get palladium down to $200 too while you're at it so I can increase my palladium holdings by a factor of 10.
you'd be amazed with how tough it would be on the down side. I
doubt it will be tested in any case. There is weak support at $16
that will probably hold.
Inflation is not done. Those who believe inflation won't happen al-
so have to believe the enormous debt can be paid in 2008 dollars.
The dollar would collapse the day it looks like it can't be paid so the
only alternative is to make payments in 2012 dollars and still be mak-
ing payments in 2112 dollars in all probability.
``https://ebay.us/m/KxolR5
Knowledge is the enemy of fear
Sound the retreat
Buy up them widgets, boys !
``https://ebay.us/m/KxolR5
<< <i>Cheney will be leaving office soon enough, maybe then Big Oil will see that the gravy train has left the station >>
No one is exempt since we've packaged and sold our debt to everyone.
Man I just have to
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Why would you hold if you hink its gonna adjust? Take your profit and get in cheaper.
essentials to life as we know it. It is time to expand
Americas' ability to grow food. By this I mean Grain ,such
as rice, wheat, corn. Stop using corn for fuel and start using
waste organics to make alcohol.
I would have listed air as one of the essentials, but no Nation
has a monopoly on that yet.
Camelot
SILVER: Continued weakness in July silver despite a pullback in the dollar and further strength in crude implied there's been a major change in thinking about this market as an inflation hedge, and maybe the focus has turned to slower demand due to a recessionary US economy and weaker global growth. Of course, opinions on the US economy change quickly and often, and the stock market rally ostensibly presages a stronger US economy and possibly higher inflation and better silver demand down the road. In addition, the dollar could break down. However, it looks like the funds/specs are back in a long liquidation mode. The chart favors a decline to support around 1675. Support (basis July): 1710, 1755, 1710, 1665, 1620, 1575. Resistance: 1800, 1845, 1890, 1935, 1980, 2025, 2070. Turning Points: None.
GOLD: June gold got support from a pullback in the dollar, ending about steady. Weakness in other commodities, particularly silver, implied the funds/specs might be abandoning the inflation hedge argument and are focused on the potential for commodity demand to slow due to a recessionary economy. However, direction in the dollar most likely still holds the key, and it remains close to a breakdown, meaning the odds favor further gains in this market. Support (basis April): 917, 911, 906, 900, 894, 889, 883, 878, 872. Resistance: 927, 933, 928, 939, 945, 951, 956, 962. Turning Points: None.
-----------------BigE
the bad news is still out there, although sugar coated so the public can swallow it just a little better,
the dollar will continue to deteriorate
we are in a recession.....
real inflation is probably in the 7-9% range......
as long as these problems still plague or economy, gold/silver have nowhere to go but up.....
i start getting a little worried once gold approaches/reaches it's inflation adjusted high
<< <i>
<< <i>Now if only we could talk oil down 40%, too... >>
Cheney will be leaving office soon enough, maybe then Big Oil will see that the gravy train has left the station >>
The margin for a big contract was just LOWERED to 5400, and for a mini down to 1800-------BigE
Mitsui Mining
over buying silver at $20 oz. Every other post was about how much silver someone just bought, how much silver should someone buy, or how much higher is it going. There were dozens of "WTB SILVER" posts on BST. Where are they now?
I bought silver high. Then I bought some more as it came down a little. I do know that when it spikes next time, it will be too late to buy - all the way up. You can always brag about market timing, but the fundamentals will dictate what happens when the physical situation can no longer be "managed".
We only got a whiff of what the market sentiment will be when silver disappeared from all of the retail shops a few short weeks ago. Don't say you didn't have a chance to buy in at the right time, because now is a pretty good time, all things considered.
I knew it would happen.
"Seu cabra da peste,
"Sou Mangueira......."
NO, Silver and gold aren't going to drop 40%, that's absurd.
Just wait a year or less and we'll see silver, in particular, and gold increase to new highs.
Gold is easy to find, most of the shops are stuffed with it.
Silver, OTOH, simply isn't there to be had and when the few pieces do come in, they are selling for as much as $2+ over spot on 100 ounce bars.
The actual shortage worldwide that we have all seen coming for years is now upon us. Industry stockpiles are at all time lows, so something is going to have to give fairly soon.
The shorts are trembling and trying to save their worthless hides and those who own paper silver are going to take it in the shorts.
Hold onto your PMs and keep your powder dry.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
``https://ebay.us/m/KxolR5
Sure there are the typical driving forces for PM pricing:
1. Its correlation to the price of fossil fuels. After all, transportation of goods determines the price of nearly all consumable products.
2. The strength of the dollar compared to the euro or the Chinese yaun.
3. Industrial demand.
4. Good old fashioned avarice… jewelry.
5. The list goes on and on.
PM prices are in a large part driven by emotion. There are some very intelligent people on this board; we see the fecal pie beneath the sugar coating. The media is now claiming that the economy is making large strides towards recovery. The stock market is rebounding. There are claims that the sub-prime mortgage dilemma is miraculously rectifying itself. Yet, we have our doubts and trepidations. However, the average American is starting to believe that the economy is rebounding; just look at recent articles, they seem kind of optimistic.
The emotional state of the typical person in the last couple of months has been to dump all their PM’s. They have sold their jewelry and dug up their uncle’s grave for the gold fillings in his teeth so that they have even more PM’s to sell. The higher gold goes the more trepidation it will cause to become bullish in PM’s even for countries attempting to create a stronghold position in PM’s.
Emotion is driving people away from commodities and towards other means of attempting to make the quick dollar; recent gains in the stock market point towards a reinvestment in the stock market. Gold has been a little stagnant in the $900 range for a while. Emotionally, people will start to hesitate in creating a huge position in PM’s if there are no quick gains to be had.
Many of the people who got into the recent commodities fever are not in it for the long haul. They are short term speculators who are caught up in the excitement of the moment. Now that the price is somewhat stagnant, I’m sure a great deal of them are thinking, sell now before I lose my shirt (a very emotional response… fear). Many are probably thinking that they should relinquish their PM holdings and get back into the stock-market , real estate or some other venture.
I’m holding onto my PM’s because I am in it for the long haul. If gold does go up to $1500 an ounce I will win. If it drops to $500 an ounce I will start buying double eagles again. Either way it will be OK.
The media may try to tell us one thing, but the average American now knows better than to buy into it.
Doesn't appear that the rosy picture being painted by the media is having much effect.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Rather than a 40% decline in gold over the next few yrs expect a 40% min. increase. The Weimar type inflation you speak of is slowly coming at us. That's why gold is already at $900. It's not going away just because you'd like to see "reasonable values." Personally I think that $100 MILL sports deals for pro athletes, $550 TRILL in derivatives, and $50K per year for college are all unreasonable numbers. But you won't be seeing those backing down 40% anytime soon because they look too big to us.
roadrunner
I'm long on PM's, I'm not worried about a swing here or a swing there.
Most of the silver I purchased was 4-8 bucks an oz.
China and India will continue to grow, consuming oil, driving PM's upward, IMHO.
Many of the people who got into the recent commodities fever are not in it for the long haul. They are short term speculators who are caught up in the excitement of the moment. Now that the price is somewhat stagnant, I’m sure a great deal of them are thinking, sell now before I lose my shirt (a very emotional response… fear). Many are probably thinking that they should relinquish their PM holdings and get back into the stock-market , real estate or some other venture.
Emotion is part of it, for sure. I sold out of all my stock positions and liquidated half of my retirement accounts, paying the penalty and early withdrawal out of emotion. I'd call it anger - at seeing what the government-engineered inflation and expropriation of my money was doing and will be doing to my longterm savings. I didn't make the move in a hurry, but only after considerable reflection. I don't like what's going on in Washington DC. I really don't. I voted with my feet to protect my family. If it keeps on going the way it's been going, I'll vote with my feet again with the other half. I have no concerns about buying silver at $20.00, because the last time I bought a bunch, it was in the $6.00-$8.00 range. At either price range, it will hold it's value or spike hard to the upside. I can live with either scenario. I trust myself alot more than I trust those thieving bastiges in DC.
I knew it would happen.
<< <i>I have no concerns about buying silver at $20.00, because the last time I bought a bunch, it was in the $6.00-$8.00 range. At either price range, it will hold it's value or spike hard to the upside. I can live with either scenario. I trust myself alot more than I trust those thieving bastiges in DC. >>
Bravo! Excellent and dead on point of view.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
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Of course we might take advantage to buy some silver at the 16.70 level, if only all the major dealers weren't sold out. But you can buy all the "paper silver " you want. You will pay more up front to go long than the shorts pay but thats also part of the manipulation. Most likely you will even get paid some day, that is If you sell before the huge shorts declare "force majeure" and walk away.
Read some Ted Butler if you want the whole story. Silver will never see 9 bucks an ounce again. (Maybe 9 Amero some day)
the huge short positions held by JPMorgan , Goldman Sachs et al are just a gamble to them. They "wait around" and "hope" the price falls just before they have to cover. Seems like they are always lucky so why should they do anything to "influence" the market. "Luck" is how Goldman Sachs managed to make 36 Billion $$$ last year.
Heres someone elses take:
Using open interest statistics from close last night would leave a paltry 63 call options in the money and a whooping 10,644 put options in the money,..
This is staggering when one compares this to what the position would have been if May Gold had closed over $950/oz today, a level it was at only 6 trading sessions ago,..
At May Gold over $950/oz: There would have been 6,031 call options in the money and a miserly 458 put options in the money!..
This gives a combined swing of some 16,154 contracts!?! The short side has made a killing,..
You can see why it merited the shorts to crank down the price by $60,.. And sort of answers those questions about why the precious metals flowed so negatively against the oil and currency tides this last week,..
Read a little
http://www.gata.org/
http://www.investmentrarities.com/tb-archives.html
<< <i>Cannot imagine such a retreat. This isn't about charts and manipulation. The economic factors and the usefulness of the PMs cannot be divorced from the pricing and neither are going to depress the price that much. >>
Here's one usefulness of the silver PM: the Japanese announced they have the technology to replace platinum in catalytic converters with silver. Bad for the plat players, but great for silver holders. Just another demand that will be created for silver that will result in an unabated climb upwards. I don't know if the Chinese or Indians require catalytic converters in their vehicles, but if they do, silver might hit $100/oz a lot sooner. than anticipated.
Vietnam Vet 1968-1969
<< <i>Right Griv,
the huge short positions held by JPMorgan , Goldman Sachs et al are just a gamble to them. They "wait around" and "hope" the price falls just before they have to cover. Seems like they are always lucky so why should they do anything to "influence" the market. "Luck" is how Goldman Sachs managed to make 36 Billion $$$ last year.
Heres someone elses take:
Using open interest statistics from close last night would leave a paltry 63 call options in the money and a whooping 10,644 put options in the money,..
This is staggering when one compares this to what the position would have been if May Gold had closed over $950/oz today, a level it was at only 6 trading sessions ago,..
At May Gold over $950/oz: There would have been 6,031 call options in the money and a miserly 458 put options in the money!..
This gives a combined swing of some 16,154 contracts!?! The short side has made a killing,..
You can see why it merited the shorts to crank down the price by $60,.. And sort of answers those questions about why the precious metals flowed so negatively against the oil and currency tides this last week,..
Read a little
http://www.gata.org/
http://www.investmentrarities.com/tb-archives.html >>
I hesitate to reply, but the above looks like some really bad options analysis. I feel it is a disservice to repost that stuff here, because it serves mostly to confuse or build fear of conspiracies. Options rarely if ever drive the price, and when options do play a role, it is often small moves of 1% or less near expiration, not big moves.
Most option positions are hedged with other options or futures. Looking at open interest numbers by themselves will reveal only tiny slivers. The players that tend not to hedge are the small time punters looking to hit a home run on a big directional move. The small timers can't drive the price--they don't have the money or the smarts to do so.
Of course this takes huge amounts of capital to manipulate these markets but thats just the sort of capital these guys have. Why else would they hold 80% of the short positions in the market. These are not hedges as they have no mines to deliver product. They are simply manipulating the markets through leverage.
Just remember that most of the naysayers here have had a terrible record of calling an end to the metal's markets or major downturns.
This 40% downturn call can be tossed in the rubbish with the other wild negative calls. It soothes the masses however.
roadrunner
<< <i>Can't fight city hall coynclecter. You can't lead a horse to water.
Just remember that most of the naysayers here have had a terrible record of calling an end to the metal's markets or major downturns.
This 40% downturn call can be tossed in the rubbish with the other wild negative calls. It soothes the masses however.
roadrunner >>
Based on the 200 DMA, gold is still due for some trimming, however, it certainly isn't in the 40% category, nor would it bring gold to sub $800 levels.
The longer we go, at or around the $900 level, the higher that 200 DMA becomes.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
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