Reasons for 2008 Boom and Bust?

CaptHenway

Who here has a good (and of course infallible) memory?

In 2008 metals exploded around St. Patricks Day, with $1000 gold and $21 silver. By Fall gold was down around $700, and silver around $9.

What was happening in March to make it go crazy? I was laid up with my broken leg that month, and missed a lot of the fun. I know that the housing market collapsed in 2008, but thought that that was later in nthe year.

By Fall gold got down to around $700, and silver around $9. Again, what caused the drop? I know there have been allegations that the big banks drove silver down to protect their short positions, but is there anything finite, such as the housing market collapse sucking up too many people's discretionary funds?

Did silver drag gold up in the Spring, and down in the Fall, or did other forces move both?

Thanks.

TD

derryb

March 21, 2008 NY Times

jmski52

As I recall, I bought a green monster box and a 1 oz. PCGS MS-69 Plat from Fatman that March - like I always do at market tops. This immediately caused the international banking cabal to take note and they all piled on their short positions in an attempt to force me out of my new positions.

cohodk

In March Bear Stearns went belly-up. Well not quite. Stock went from 60 to single digits in about a week. It received a buyout from JPM at $2 which was later revised to $10 when shareholders cried foul. I was short 2000 shares at 58, covered at 56. Made 4 grand in about 5 min. Sometimes (usually) my trigger finger gets too itchy.

CaptHenway

<< <i>March 21, 2008 NY Times >>



Kewl! Exactly what I needed!
Thanks!
TD

CaptHenway

<< <i>In March Bear Stearns went belly-up. Well not quite. Stock went from 60 to single digits in about a week. It received a buyout from JPM at $2 which was later revised to $10 when shareholders cried foul. I was short 2000 shares at 58, covered at 56. Made 4 grand in about 5 min. Sometimes (usually) my trigger finger gets too itchy. >>



So, did that cause the spike up, or the correction?

DrBuster

Isn't that right around the time this 'recession' started kicking in? Folks selling everything to keep cash around??

Justacommeman

Captain I have to ask..............Did you break your leg while landing on the darkside of the moon?

MJ

cohodk

<< <i>

<< <i>In March Bear Stearns went belly-up. Well not quite. Stock went from 60 to single digits in about a week. It received a buyout from JPM at $2 which was later revised to $10 when shareholders cried foul. I was short 2000 shares at 58, covered at 56. Made 4 grand in about 5 min. Sometimes (usually) my trigger finger gets too itchy. >>



So, did that cause the spike up, or the correction? >>




The anticipated failure of Bear Stearns caused the spike higher. Silver had already been trending higher, but spiked 20% in the 2 weeks before the NY FED and JPM stepped in. Silver hit its high--and reversed lower--on the day the FED offered $25 billion to Bear, this was a Friday. Over the weeked the NY FED decided it would be better to give the money to JPM and have them acquire Bear. That Monday silver dropped over a buck (5%). By Thursday, silver had dropped over $4 or 20%.

So to answer your question---both. The fear of Bear's failure caused silver to rally and the apparent "fixing" of the problem caused it to drop.

To add..the failure of Bear started a massive wave of deleveraging that resulted in the collapsed of silver over the next 6 months as spot silver dropped 60%. Copper dropped 70%. Gold faired much better dropping 30%.

timrutnat

I believe it was all engineered by GS. Create fear and cause panic selling so the gov can give the banksters bailout money. I'm sure GS was busy buying at the bottom.

roadrunner

It's worth noting too that by early June 2008 silver and gold were back to $990 and $19. It wasn't enough that JPM now had Bear Stearns' massive silver short
position. They then doubled the amount of otc silver derivatives from $90 BILL to $190 BILL during June. That amount was equivalent to about 14 yrs worth of
world silver production. Something similar, though not as large was done with gold derivatives. To add fuel to this June-July fire the price of oil had continued to
rise from the March hit ($113 to $99) all the way to $147 by June. While not proven, the US oil reserves were probably tapped at this time via swaps and oil
flowed in quantity to dump the market. The commodity sector had already been hit in March but these 3 events were final daggers.


roadrunner

CaptHenway

Another good point! Thanbks.
TD