Analysts say Fundamentals Poor for Silver for Balance of '09

dragon

I read a couple different reports that industrial silver consumption will be considerably lower in '09 due to a worldwide economic slowdown, and that silver production will actually be strong creating a glut. Projected average price through 01/10 $10.20 - $11.75


Agree or disagree?

Cladiator

Who knows. I'll still have mine in posession long, long after 2010 has gone.

cars

But will we be able to purchase anywhere near that price? I think its going to be hard to find silver under $15/oz even if $11 spot.

fc

<< <i>But will we be able to purchase anywhere near that price? I think its going to be hard to find silver under $15/oz even if $11 spot. >>



i do not understand what you mean. I can find several websites at
this moment that will sell you all the silver you want right now at
1.00-1.50 over spot. Spot is 12.83.

I agree with the OP. I have always thought that silver would be
lower then last year and 8-9 bucks an ounce is my target to find
it interesting again. 10-12 is a very reasonable guess in my mind
but is playing the middle ground. Not a very risky out there guess.

cohodk

<< <i>But will we be able to purchase anywhere near that price? I think its going to be hard to find silver under $15/oz even if $11 spot. >>



SLV tracks silver very, very well.

cars

I'm referring to smaller bars, Not 100 or 1000 oz bars.

fc

<< <i>I'm referring to smaller bars, Not 100 or 1000 oz bars. >>



gotcha! those are tougher to find at near spot. you really have to search
and be ready for the deals.

ksammut

The unknown is how much further will the economy tank? If it continues to tank, will it dawn on both the large and small investor that trillions are being spent and their will be a price to pay?

Will foreign governments continue (afford) to buy our debt?

Will our own government then have to purchase our debt with more debt?

Will the dollar and other currencies crash?

Too many questions that even the experts have no way of knowing the answers.

Like any investment, if enough money pours in, silver can quickly jump in price and in the case of silver, the market is so thin that it would not take that much money for it to jump very high.

Silver's price over the next months and few years will move on fear and economic uncertainty (less so on industrial consumption). Now is the time for accumulation and a few dollars up or down should not stop anyone from adding silver to their portfolio.

OPA

<< <i>But will we be able to purchase anywhere near that price? I think its going to be hard to find silver under $15/oz even if $11 spot. >>



don't know about that ... u can buy silver 1 oz rounds right now at $1.29 - $1.49 over spot. I doubt it's going to change to $4 - $5 over spot if silver retreats to $10 - $11 ............ APMEX

roadrunner

The anal-ists have been wrong on silver (and metals in general) since 2001-2002. How many more chances should we give them to get it right. Those same anal-ists are hanging their gold hats on reduction in Indian jewelry demand yet dismiss the investment side of gold which has been growing leaps and bounds.

Since most silver is a by-product of mining other base metals (copper, zinc, lead, etc.), and those mining operations have been cutting back extensively due to lowering demand and lower prices, new silver supplies will also be reduced. I guess those analysts didn't figure on silver getting to $14.50 ounce over the past few months while "demand" slacked off.

SLV tracks silver very, very well.

Yes, but try to get that silver in your hands. Either GLD or SLV as I've read has strict requirements on who can demand delivery of the metal. It takes a huge position on the order of several hundred thousand dollars to make such a request. Not for J6P. Probably easier to get delivery on the Comex. One day, SLV or GLD, or both, will have a major confidence scare on whether they really have all the metal they claim. People may be heading for the exits all at once. Just pray that's not one of the days you happen to be trading in them. Just because HSBC and Barclays are knee deep in all the finanical derivatives suggests things cannot be possibly 100% above board. Remember, these are insolvent firms trying to do anything possible to stay afloat. HSBC along with JPM are the primary kingpin shorts on Gold and Silver on the Comex.

roadrunner

rgCoinGuy

<< <i>

<< <i>But will we be able to purchase anywhere near that price? I think its going to be hard to find silver under $15/oz even if $11 spot. >>



don't know about that ... u can buy silver 1 oz rounds right now at $1.29 - $1.49 over spot. I doubt it's going to change to $4 - $5 over spot if silver retreats to $10 - $11 ............ APMEX >>



But it did exactly this late last year! Sure you can buy it for 14-15 an ounce, but when it was sub 9.00 spot, it was still 14-15 an ounce (OK 12-13 an ounce, but that's still 3-4 over spot).

One thing I think people may not consider, is the amount of money on the sidelines that can go into things like silver/gold when the prices come down. Look at how the savings rate for the US has gone up lately. People who use to live on credit now have found the ability to save cash, even though a lot of us make less money than we did a year ago.

OK rant off....

Norseman88

<< <i>I read a couple different reports that industrial silver consumption will be considerably lower in '09 due to a worldwide economic slowdown, and that silver production will actually be strong creating a glut. Projected average price through 01/10 $10.20 - $11.75


Agree or disagree? >>



I strongly disagree, yes industrial consumption will be down because of the economy but you tell me how will silver production be strong when it is not mined as a primary metal? Silver is primarily mined as a secondary metal from copper, lead and zinc mines and with the price of these metals collapsing below cost of production mines are being shut down (or at the very least production is being curtailed) which ultimately means that silver production can not be strong in this kind of environment.