romans holiday

The sub $12 price now has me undecided which way I want to see it go here. Would definitely be a buyer there.

Unwillng to hazard a guess in the dollar? More confident that the pound will strengthen before being toasted?

Ok so we have: Me, $18 Pixel8r, $30 And goldfinger, presumably at $100 plus. Any other predictions?

Oh right. I should have said...."How high can it go on this move up?".... before going to the moon at a later date no doubt.

Silver looking super bullish here. How high can it go?? I think it might take out the previous peak soon and keep going..... 18 anyone?

When the currency is fixed to gold [a certain amount of gold], it is a truism that its purchasing power decreases when prices increase, and its purchasing power increases when prices decrease. "Inflation" in prices has a much less sinister meaning than that which the word is invested with today, due to the fact we have a completely different monetary system. Agree/ disagree? Or unintelligible?

The ratio is doing nicely. I find it more significant than the price in currencies at the moment.

Sub 500 pounds?? If there is a reversal in the markets, which also looks likely, the pound will once again tank. Pounds look expensive at the moment. Yen and dollars look cheap... why not buy them with your pounds if you are waiting for a dip? Sorry, couldn't resist this one... but we'll see. From: http://www.youtube.com/watch?v=-1auRCameVY

Because the currency which commodites are priced in is tied to [an amount of] gold.... not the commodities themselves.... that would be price-fixing. So if goods on the market become more desirable, the price of those goods will rise... which means it would take more gold to buy them. I think it is quite normal for prices to fluctuate even when there is a gold standard. A gold standard does not fix the price of something forever and write it in stone.... it fixes the unit of currency. Goods can still become more or less valued... or should I say desired. Everything is a commodity, goods, money and gold. Gold backed money can "appreciate" against goods if people value money more than goods which reflects in lower prices. The laws of supply and demand still apply. Money can equally "depreciate" against goods with higher prices but I guess with a gold standard these fluctuations would tend back to an equilibrium.... and not degenerate into a self-reinforcing death spiral as with fiat.

If you want to speculate with future trades, buy silver. If you want to put your money into a safe haven and save, buy gold.

Well, to start with I think most here are pretty well loaded up on gold and silver and accordingly can "afford" to wait for possible dips. Even on the chance they do not come back down [more likely with gold than silver imo] then is there really much harm done given you are already heavily invested. But being heavily invested, any reserves you have would want to be kept aside for possible rock bottom prices. I think we could see this again especially with silver.. it would not take much, the financial markets get overheated, a wheel falls off in the the real economy, and then the idiot market runs for the door on the deflation trade. My main trading position is in silver at the moment. I do not have a huge position in dollars... I consider it a speculative trade and personally think it will pay of on a subsequent deflation trade which may come after the summer. I am also thinking of buying Yen as another reserve currency... check out silver against the Yen, the move has been huge; from 850 to near 1400 in six months..... silver could easily go to 1600, 1800. Silver could quite possibly rocket up here with everything else and I would seriously think about swapping silver for both gold and the Yen at the top... if we get one. The ballast to these trades is accumulated ounces of gold, where I consider profits to be taken.

+1

If you are already loaded up, why buy on the rise? Perhaps you feel US dollars are about to self-destruct. If so, move quickly to a deflationist forum and read until you value the dollar.

Yes, mentioned as much in post 25. It is interesting to overlay the USD index with gold and then again with silver. Whereas the inverse relation is holding up strongly with silver... it has weakened with gold. Goldprice.org have an excellent facility for this and all sots of stuff if you just click on "Live gold price" [as pointed out by chris ct]. http://goldprice.org/live-gold-price.html

No, but then I have a fair idea what it is going to say because J Turk repeats the same thing ad nauseum. No disrespect meant, but it just sounds like a broken record sometimes. It is an important part of the picture but there is more in heaven and earth than is dreamt of in the money supply.

I swapped gold to silver nearish the top and bought on the last dips. On the trend down, even when the ratio looked to be reversing, I stuck to my guns convinced that we are in an "inflation mode" at the moment. 50 might be a big call, but the reason I think we might see it is the inflation trade could develop into a full on inflation scare. If that happened, a brief frenzy of buying could easily see the ratio go near 50. I imagine the dollar would go quite low... perhaps to 70 and the Dow perhaps through 10000... before we get the deflationary whiplash in the markets. Lots of ifs and maybes, but hey, if you buy silver when the ratio is high, what do you have to lose?

Well, you are increasing your options which are always a good thing. It might actually turn out easier to trade dollars and silver than trading silver and gold. I do not care which currency I have, investment is war and I will use any tactics available. I do not really buy into the whole anti-dollar moralist thing.

Inflation expectation is one reason people are buying. But the market is also buying everything on inflation expectation here. Another reason, besides an inflation hedge, that people are buying gold is they are buying it outright as a currency given increased concerns about other currencies. Though these reasons may seem similiar, there is a significant difference to keep in mind. Assume for one moment that there was another deflation scare for whatever reason, if gold was only an inflation hedge it would go on one heck of a dive. However, it is more than that now and is becoming "monetized" post QE which should see the price remain relatively stable even if [for the sake of argument] a dynamic of deflation reared its ugly head again. For the contrarian hedge which could see it all turn on a dime. Then you would buy weakened silver with strengthened dollars.

There are a few here looking to swap. When it was last at 50, I was fully in gold. If you look at a long term chart of the ratio it only very infrequently moved between a large range in the ratio. I am now looking to trade this ratio because I believe the volatility will pick up, and as the market becomes confused between inflation and deflation scares the "frequency" in the ratio might increase. Other silver holders will no doubt hold on for a better ratio or stay in silver. I guess it depends if you see inflation or deflation on the horizon... or both.

I thought I recognised that article... it's 2 weeks old.

Yes, i get more excited about the ratio between gold and silver these days rather than the price. Nearing 65 now. 'cos I only consider profits taken in gold. Just checked the dollar index, it is holding up at 77.6... oil also solid so looks like more than just dollar weakness at work today. edited.

I am not so sure that we have a lot of volatiility in gold now in the post QE era. Pog looks to have settled down quite nicely at its near all time high. Many investors are lining up to buy if it does dip a little and in fact I think that is what we have been seeing recently. This could have effectively put a floor under gold. I do not expect it to go ballistic here but track sideways and perhaps incrementaly upwards. A lot depends on the dollar, but I suspect the dollar and gold could be trading places; in the future it might be the dollar that becomes volatile while gold remains relatively stable in an upward trend. So for example, even if the dollar spiked, this might not hardly effect gold because it could well strengthen at the same time [for the dollar to spike here, this would entail dire economic news... good for gold which is becoming increasingly "monetized"] If someone had no gold, or not enough, I do not think that it is particularly good advice that they wait for the price to tank $500. Those with an existing solid position can afford to so wait. It really comes down to how much you own, whether you buy here, regardless of the price.

Silver to gold... with profits considered taken. When/if we get the deflation scare I will re-stock up on silver with dollars held in reserve.

+1 The ratio is under 66 on its way to 50 I will bail out at 50 as am concerned about a deflation scare in the wings. Long term for silver... who knows.

Hmmmm... not really impressed. I mean, isn't it just reflecting dollar weakness here... and we all know the dollar will rebound soon. I think gold will break out perhaps after the summer when the inverse relation between gold and dollar breaks down. Good to see silver going strong today.