Are gold and silver close to bottoming?

VanHalen

From today's CNN Money:

CNNMoney

HonoluluDude

I think gold already bottomed, not so sure about silver.

CCC2010

What do you think of this ? Link

VanHalen

<< <i>What do you think of this ? Link >>



Buffet said he wouldn't have been a buyer at $800 either. Warren regards gold as a barbarous relic from a time when we couldn't just print as money as we need.

roadrunner

Warren may not be a buyer of gold at $800 but he's already proven to be a buyer of 130 MILL oz of silver around $6-$8/oz. Actions speak louder than words.

OPA

<< <i>Warren may not be a buyer of gold at $800 but he's already proven to be a buyer of 130 MILL oz of silver around $6-$8/oz. Actions speak louder than words. >>



That was years ago & if my memory serves me correctly, he also dumped his load shortly thereafter.

Pokermandude

I think we are. But we aren't out of the woods yet. There are still a few more months of summer to get through.

derryb

Further declines if the bottom falls out of equities. While I forsee a decline in equities I do not let it prevent me from picking up American Eagle bargains.

jdimmick

not done yet

but still a few months away imo

KUCH

There are those that said, gold and silver will be very explosive both up and down. Long term - can PM's hedge against inflation and deflation? I believe PM's are a store of wealth for long term. If you want quick profits, buy and sell something else. JMO - Just my opinion. Never catch a falling sword.

derryb

<< <i>There are those that said, gold and silver will be very explosive both up and down. Long term - can PM's hedge against inflation and deflation? I believe PM's are a store of wealth for long term. If you want quick profits, buy and sell something else. JMO - Just my opinion. Never catch a falling sword. >>


Normally, rising interest rates are not good for PMs as interest bearing investments begin to provide more desired returns. Things have not been normal since 2007, so anything goes.

KUCH

Derryb, when gold went up in the 80's, what was interest doing?

VanHalen

<< <i>Derryb, when gold went up in the 80's, what was interest doing? >>



Fed Funds Rate was around 10% in early 1980.

jmski52

I believe that Fed Funds went as high as 14% in 1980 as Volker took away the punch bowl and as Comex margin requirements were repeatedly raised and only sell orders were allowed (no buy orders), in order to kill the silver bull market and to pressure the Hunt Brothers into selling their margined holdings.

Up until that point, increasing rates didn't bother gold & silver investors too much, because the inflationary pressures had been building for a long time, and the rate increases were mainly in reaction to already-increased price levels.

Volker finally got ahead of the inflation curve, and expectations began to change slowly. A recession was precipitated in 1981 by the tighter money policy, which then produced significant layoffs. When the markets finally realized that the change in policy was real, the bull in metals was officially over. Nevertheless, it took some major hits to kill it.

cohodk

When the markets finally realized that the change in policy was real, the bull in metals was officially over

The markets realized the bull was dead LONG BEFORE investors/speculators did. Thats why it dropped 50% in less than 9 months. They say history repeats.