lardoon

I'm pretty confindent that 910 will break sometime in the next 20 mins.

I forgot to add that I was surprised not to see Gold jump much higher on the news of the vote..

Seems to be happening right now

Looks like the resistance at 910 is about to pop.

Not quite...

Could it be the PPT?

I was expecting Gold to go down today to mark the success of the bailout (and helped/managed by the PPT)

Maybe they are trying to limit the collateral damage from the failed bailout?

At Coininvestdirect:

 

A £52 spread on a 1 Oz coin... whoa...real gold is disappearing...

How much was a decent spread - say last year - when the market did not show these retail physical shortages (in %)?

I was under the impression that 5-10% is the norm??

So is the ban on short selling will help the juniors or is it going to stay confined to Financials.

Apparently the SEC is going to seriously look into this:

SEC Pushes Hedge Fund Oath in Manipulation Probe

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Hi L- Thanks for posting Marc Faber's article, he is always good to read . As to silver, you seem to have done a lot more homework on it than me. What I have picked up from some running commentary [Hoye] is that it may not perform due to it being perceived more a commodity than money. I feel this is wrong, for the reason posted above; this time round with the dollar debased, silver's monetary qualities may perform well.

 

Other commentators give arguments that silver will do extremely well and will outperform gold.

 

Personally, I am not as sure about silver, as I am about gold, because I am less familiar with it. I think a good way to approach it is as yet another hedge. Rather than just having one currency, that of gold, why not have two! And if you are less comfortable with silver, just hold a smaller proportion of your worth in it. If it does not perform it does not matter too much. If it does perform, and goes further than the moon to Mars, then it will pay off handsomely.

 

I am hoping to put a chunk of change into silver in a few months time [i am hoping the price stays done]. I am looking at it as not my core position but an investment that could do extremely well.... [similiar to how many invest in mining stocks and juniors].

 

Just my take on it....

Regards.

If you follow Bob Hoye you probably know that he expects the GS ratio to be headed to 100...

So you might want to wait fpr that or scale in your purchase? just a thought...

Edit: of course you believe he (Hoye) is wrong (duh! I should read better) so ignore this..

I would suggest you hedge your future silver purchase at today's prices.. but that involves some form of "paper silver"...

I think "inflationists" need to wake up. We are in a huge bust... the crack up stage... the FED is doing everything they can to avoid the yawning abyss of a deflationary depression. They are obviously going down the road of hyper-inflation... maybe they will succeed... what a pyrrhic victory that is... maybe they will fail... most probably they will eventually destroy the currency.

 

It is kind of child like to think we must either subscribe to the inflation camp or the deflation camp... and the twain never meet.

 

Edit: In a classic hyper-inflation it would be a very good strategy to get into debt... inflation will make it so easy to pay it off.

But I do not think many are thinking of this option this time round because it is so different.

 

Edit edit: Gold is good.

The latest from Marc Faber regarding this deflation/inflation:

However, we should not forget that the current financial crisis and credit growth slowdown is unprecedented in the last 30 years or so and that the through of the Kondratieff down-wave, which lasted in real terms from 1974 to 2001, was incomplete because it was not accompanied by a massive debt-liquidation.

 

As a result, a deflationary bust originating from debt liquidation should not be ruled out entirely before highly inflationary monetary and fiscal policies around the world bring about very high inflation rates. But that may only happen after 2012 and in the meantime, “all asset markets could continue to suffer badly as credit contracts and liquidity evaporates”

whole article at

http://ftalphaville.ft.com/blog/2008/09/08...hat-comes-next/

Well, for what it is worth, I think it is going to the moon. I am hoping to put my next chunk of change into silver... only got gold at the moment.

 

Edit: What persuades me on silver, is that there will be a scarcity of real money after the dollar falls over. In the last depression, the dollar was backed by gold.... so it was as good as gold... which is why the dolar survived as money.

 

This time round the dollar is backed by........ a debt riddled economy. mellow.gif so the monetary qualities of silver are likely to perform well.

As for Silver vs. Gold, I am not so convinced that silver's performance will not be "tainted" by its "closer" affiliation to the commodities / industrial metals family if we are headed for a deflation first - and hence gold could outperform (disclaimer: I own only Silver and no gold - but this is my current worries and I am considering diversifying into Gold).

Also I think one of the main uses/advantages of Silver as money used to be a better practicality for lower nominal transactions (ie you cant buy a latte or your groceries with 1oz of gold ;-)

But I think if gold regains a more important place in monetary matters, it could be used to back financial transactions in an electronic form and therefore would allow for lower unit divisions (ie this is actually one of P. Schiff's point in his Crash-Proof book: a Debit Card linked to a gold account). In this instance we dont need Silver for lower cost transactions.

Also I believe in Dr A. Fekete's argument that one of the main reasons Gold is good as money is because the above-ground stockpiles are comparatively much larger than the annual production which make the physical/industrial/jewelry supply/demand equation less (not?) relevant to its price. Whereby Silver being much more industrial (than Gold) would not fulfill its role as money as well..?

However, if we still think that resources are going to be stretched and demand will pick up later, Silver prices could go up comparatively to "real" money (ie Gold) on a longer-term horizon.

So: monetary and debt crisis: Gold outperforms Silver because it is less impacted by a commodity slump and fulfills a better role as money

Followed by a pick up in demand for industrial commodities once the crisis has been "absorbed" and economic activity re-accelerates notably in India-China. Silver prices go up (in Gold terms).

That's just my current hypothesis and I still need to do lots of research to refine my point of view but I would be interested to hear yours..

Oh dude! That will propel miners to the Mars. See other thread where I made this remark some days ago.

Do you think that will have any impact on Canadian-traded miners (ie I am not sure if the SEC can impose any rules there...)

Does anyone else have an iPhone?

 

I have recently been using the new iGold app for the iPhone or iTouch. It's very good way of getting up to date prices and charts.

 

http://www.sollico.com/igold.html

 

Here's what it looks like,

 

WOOW, it predicts tomorrow's price too!!

Are we looking straight in the face of the birth of a wave 3 move here?

 

WAVE 1 = 250 -> 1030 +300%

WAVE 2 = 1030 -> 735 -28%

WAVE 3 = 735 -> 2000-3000? +300-500%??

 

Whats amazing is that the equities are still soooooo cheap in relation to the metal. HUI is up 13 XAU is up 10 only just out pacing the bullion!

My personal interpretation (FWIW) is that Gold's rally today is mostly driven by a flight from "safe" haven (Money markets) that are broken to "real" safe haven such as GOLD.

http://www.bloomberg.com/apps/news?pid=206...&refer=home

So the cause of GOLD going up is at the same time potentially negative to the miners with cost of financing going up also - hence the "divergence" between stocks and physical

Another reason to hold physical (although I dont...)

That's great! However, just for the record, I have actually three "normal" (and smaller) pension schemes myself. They are not in gold. All my other savings are in physical gold and silver, and I try to keep the pension contributions small. But they are some sort of diversification, along with my future lifetime income, that is also not in gold obviously. Since I am VERY far from retiring, I am therefore possibly less exposed to gold/silver than I would like to be, although being 100% invested besides the comparatively small pension schemes.

I think you should hedge that with some Gold Futures. What do you think? :P

Bullion in ones possession has no counterparty risk - all else is fools' gold. Those who ignore this warning and are dazzled by products from the usurers will one day weep at their losses.

Bullion in ones possession has burglary risk...

Not much of a fan of rocket imagery, but +$81 (so far) in one day, that pic is totally warranted.

I was looking for John Nadler's commentary from Monday "mocking" gold forums predictions of a +50$ or +100$ on Sunday night while the Lehman bankruptcy was going on but guess what? kitco keeps archives from every author.. except for Mr Nadler... He must be eating his hat right now

Anyway, I still find it hard to get over-enthusiastic at the moment (although I am very heavily (relatively) invested in Silver) as for all we (I) know it could all be going back down tomorrow with the huge volatility we have seen recently...

Below is David Morgan's tentative at explaining what kicked today's rally:

Members Only Alert from David Morgan to you

September 17, 2008

Silver and Gold are both up 7% as this is being typed. The move up is based upon a number of factors but two of the main ones are linked below. Before you read these two stories it is important to point out that BOTH Silver and Gold are reacting to political and financial news. Some in the precious metals community adhere to belief that only gold is a safe haven, so far this has been proven FALSE!

When the Twin Towers were hit, Silver soared 11% and gold soared 7%. Both the metals have been reacting to financial and political turmoil. More will be coming in our monthly report.

First the political news...

16 Die in Attack on U.S. Embassy in Yemen

http://www.nytimes.com/2008/09/18/world/mi...amp;oref=slogin

Now as even the mainstream press is referring to the credit crisis that myself and several others have forecast for so long, we see a whole new "sales force" has been deployed to sell the debt of the U.S. Government. You might consider asking your friends and associates what makes them feel more secure gold and silver coin in their hand, or a piece of paper backed by the government being able to extract payment from their neighbor?

Here is the financial news.

Treasury announces debt auctions for Fed

http://ap.google.com/article/ALeqM5jnS9Vm8...DNm4iAD938H19G0

Soon I will be off to the Silver Summit, and it will be difficult to reach me but our support is available by email or phone.

Get Real, Buy Real

The Silver Investor

silver weak trading activity today indicates we are going lower, breaking 10.00 support. (just when i bought physical, damn)

FWIW - I see a potential double bottom at 9.5 (bottom of correction in 06).

It is crazy (to me anyway) to think that anybody that bought Silver in the last 2 years (and has not sold) is now sitting on a loss!!

I went into more detail on this on the 'watch silver' thread. Basically, if I sell coins, I use eBay where they are nearly getting double spot. paper prices are becoming more meaningless to me personally as each day goes by (applies to gold but to a lesser extent eg. krugs selling at £490 last week

 

edit - and I'm sure I get some stick for this but as everyday goes by, kitco and coininvests silver inventory is decreasing. fact.

Interesting, so you are in effect selling the spread between kitco and ebay?

What sort of volume do you achieve daily?

please see post 818

 

however, I should of perhaps put more emphasis on silver in my penultimate post

post 818 refers to ebay??

I think spot and futures price are very close for Silver (ie no disconnect)

yes, but........... paper price may fall given the bullsh1t market we find ourselves in at the mo - physical price should continue with its dis-connect

Is Physical price (i.e Spot) not currently sitting very close to "Paper" price (ie nearby Futures contract)?

The funny thing is, and as Peter Schiff has pointed out recently, China tries to keep the game going by giving us a seemingly eternal unlimited credit facility.

 

I really, really wonder at what stage they will let us go bust. Because I can't believe they want to work like our slaves forever. Something has to give.

I have just read the Foreword to the second edition of Tomorrow's Gold by Marc Faber (this foreword was written before the US elections of 2004). I found the foreword very interesting, it basically tells how the hypothetical future economy history of our times could be.

His vision includes:

- Great monetary collapse and the introduction of a Precious Metal backed monetary system (in 2015)

- End of fossil-fuel power generation (replaced by solar and wind)

- The complete deflation of the derivatives bubble

- The return of Austrian School of Economics as mainstream current of thoughts (hardly surprising prediction coming from Mr Faber!)

- Thirld World War

But more to the point, it includes a description of the relationship between the US (aka Leisure Island) and China (dubbed as Diligence Island) and how one of China's main strategies is to keep subsidising the US consumption by providing Credit. This in turn would keep export demand and industrialisation (for Chinese) with transfer of technologies and know-how.

Another strategy that would be used by the Chinese is propping up the dollar - at least temporarily - to avoid US exports become competitive again and keep weakening their industrial base. The added benefit for the Chinese would be the possibility of buying "cheap" Gold and Silver.

Finally using to their insider position on commodity markets they could manipulate the markets (increase/decrease local industrial demand for example) and profit from the price shocks that this would generate (accumulate commodities when prices are low or push prices up and weaken the Financial industry of the West).

So to answer your point GoldFinger (finally) I guess it depends when the Chinese decide that the US are weak enough to be able to "bring them down as a house of cards" and switch from a position of "relative weakness" to a position of "relative strength".

It might not all happen as he predicts but it still makes for an entertaining read..

PS: For those interested, This foreword is included in the 3rd Edition of the book as an appendix

Assuming you are serious.

 

It is possible but the outlay costs are prohibitive. I have bought a few fuel tanks over the years (for commercial use, I don’t have them in my garden). They cost around £5 per litre of storage. Example, a 2,000 litre tank costs £10,000.

 

It probably makes more sense to lease / buy a petrol station and use its tanks for your storage. I’d guess a fuel tanker will hold around 25,000 litres of fuel, so most petrol stations should have over 100,000 litres of fuel storage.

 

When you lease / buy your petrol station, make sure it has operational tanks. It will cost you a fortune to re-commission mothballed tanks because of the constantly changing environmental standards.

Yes you could buy a whole petrol station and get 100,000 litres of petrol storage... Or buy one 100 oz bar of physical gold (and have the same £ exposure)...

mmmh, not sure whats the most economical... even if the gold/oil ratio drops quite a bit...

This gold thread is very inspirational.

After thought, I am interested in storing physical oil.

I'll be curious to know if it is possible to stock physical oil in a major city?

Where would you go to store larger and larger quantities, without getting

into troubles?

Are u serious?

Anyone know what is happening to Oil ???

I dont see it move too much.. at 114.6 right now

I am soo going to buy silver tomorrow!

 

I mean what is this? Is it Christmas already?

I think I too..

But to be honest I am bit scared!

Whats your take on this sudden drop?

PPT again?

There is a discrepancy between USAGold and Kitco at the moment. The Kitco charts are still >800 and >14. In doubt, I trust USAGold more.

I have noticed that.

I use my broker (OANDA) and NetDania and they both have Silver <14 and Gold ~800 now after having dropped at 13.4 and 795 respectively

What a freaking drop for Silver since 19.40 a few weeks ago. Its back to Sep 07 levels!

WOW

Silver did not hold 14! (at 13.50 now)

Will gold hold 800?

DrBubb,

I understand your theory and thanks for sharing it but are these 2 bits not contradictory:

I do think that we have only seen the A-wave of an A-B-C correction in Oil.

And I believe that we may have seen the end of the C-wave in Gold. so in then next little while.

they can both up together.

The first thing people need to realise is that Gold moves are being driven by Oil moves. Now fundamentally that makes

some sense. But I am basing this comment on charts, not fundamentals. Gold has been following oil for some weeks

and Oil has been following Oil service stocks. So in thinking about Gold, I have turned my attention to Oil and OIH.

I am assuming that the C wave would drive Oil price to a lower low (and Gold).

I am not trying to criticise but I personally feel (worried) that Oil could easily fall further (maybe after a wave B/rebound) and this could drive Gold even lower than 800. Or do you think that Oil and Gold will somehow "decouple" before the Oil C wave - which would therefore not drive prices lower?

I think Oil at 80 is a possibility (and so do you if I am not mistaken) and am worried that this could translate in Gold at less than 800..