aliveandkicking

Thanks.

Question for the traders please I have traded gold electronically before but not silver. I seem to recall holding a long gold position is the most expensive position to hold so that you lose your profit pips and move to a loss at a certain % rate per annum? I recall 9%? If you hold a short silver position electronically what is the gain per annum if there is one? Thanks

Fair enuf we can observe Iceland. The government which took control of some of the main banks who were exposed to foreign currency in turn got large loans from the IMF and other local nations. Meanwhile the currency which had been in trouble for years was in more trouble. If people owned gold in Iceland and they now have debts are they going to keep the gold or are they going to use the gold to pay down their debts and enable them to import food and essential goods? What about in the USA? If your main assets are your properties and they have collapsed in value and the bank wants you to sell some securities or sell something to reduce your debt overall will you keep your expensive gold or sell your cheap assets? So fresh fruit and vegetables and quality luxury proteins get expensive.........do you buy them or buy what is cheaper? Who here does their own food shopping? Who here observed their mum carefully selecting the cheapest foods and getting the product with the best price to weight advantage and then found that with a busy life they are unable themselves to do what mum did and they simply zoom into the shops and then out again as quickly as possible? But now they take a bit longer? They look at the receipts and wonder where the hell the money is all going? Chicken for example is 2.25 euro per kilo in the local supermarket. ,potato 0.69 Salmon 12, cheese 9.7. NZ roasting lamb, 5.39 cheap sausages 5. Obviously i am going to personally eat more chicken and potato meals - and like it. Presumably the Icelanders are going to be enjoying fish and seal and whale with potatos? For example the biggest wine market for french wine is the UK. How are French wine farmers getting on? Last i heard not so good. Is French wine cheaper? If your family had vineyards for generations are you going to sell the vineyards 'cheaply' or sell some other assets?

How are wages going to rise to enable higher prices to result in buying? Less buying means less demand means less money to pay higher wages. If people see inflation there has to be a mechanism for it. If money is not spent there can be none of this 'inflation is always a monetary phenonema' thing to drive prices higher. Will the government buy all products of all firms in all of the world?

I had the impression Central banks dont hold much gold. And you can reason that providing they can buy gold with their own balance sheet there is no need to hold much gold. If they do hold gold maybe it is because they want to sell it at some point or some countries demand settlement in gold sometimes. I think the Bank of international settlements might be settling in gold for the net differences? Are the Chinese buying so much gold? They are also supposedly buying iron ore. Gold does seem to be an Asian thing i agree. Could be cultural or maybe the area is so unstable it just makes sense to be able to run to the hills carrying some gold? Anyway the Chinese announced on November 9 they would spend 286B USD over the next 2 years to stimulate internal chinese demand. And if the chinese get gold then the gold seller got USD? Or are the chinese as a major gold miner supporting their own mines? What will the seller do with the USD that are being spent? Perhaps he will buy US products. And there are many to chose from, so the US economy, as the largest manufacturing nation on earth gets stimulated when it needs it. The USA and China have long standing relations so not much is going to change there. There actions are likely to support the USA rather than undermine it. Gold is a store of value. If you bury it it will remain like it is for millions of years. If you worry about the future to the point that you believe our current system will break down then gold makes sense. On the other hand if you are wealthy gold is heavy and creates all manner or risks so unless you have a private army and are handy with guns and killing i am not so sure it does make sense. As for the price of gold i was earlier responding to the idea the USD was about to become worthless which seems pretty unlikely to me for the reasons i pointed out. Probably by early 2010 some kind of bottom will be in place for US housing. Meanwhile the financial crisis is spreading into the real economy around the world and all currencies are going to suffer i would imagine. There are actually relatively very few USD in the world. The rest are USD which are owed to other people. Since people are paying what they owe back and some are losing what is owed the relative amount of money that people think of as USD is declining and the real amount is not really rising dispite the actions of central banks. Therefore the USD could rise because the USD is the real thing that backs most of what people imagine is the USD, which is in fact commercial bank money denominated in USD. Very counter intuitive but it reflects the realities of banking. At the end of the day the whole situation is so complex i dont know either way. But when people cant see the complexity and only see certain outcomes then i tend to want to point out they might be missing something in their hurry to create their desired realities. For most of us the future is unknown. And really there is not one future but many depending on what happens today or tomorrow.

Seems like a conversation to me.

Another computer person who thinks the contents of his imagination describes reality.

If you decide the future you can create any reality you want. Once you take out all of the guesses that you assume are tomorrows facts what have you got? Gold will only become the asset that people use as 'money' again if we no longer type on computers that need a vast range of other valueable materials and very little gold and people decide not to use copper or any other metal as 'money'. And the USD will crumble when my viewsonic LCD is not made for a California company and my Finnish Nokia cell phone is no longer made by an American owned company and my operating system is not made by an American company and when most of the worlds computer patents are not held by another American company and when German and it seems the rest of the worlds production does not collapse because the USA is having some problems. Reality will probably record a few adjustments and the recession will end and life will trundle on somehow. In reality the logical mind selects what it thinks is important and then creates theories and then builds abstractions which it perceives as being true. But you already know that part.

There is some evidence the stones for the pyramids were split with iron wedges and hammers provided by the Hittites although in modern times the academics say the stones were sawn with copper. Neither iron or copper would have been cheap in those times. Iron might have been the most expensive of metals even because the secret of iron was only known by the Hittites. And you can sort of imagine the Hittites potentially had the nuclear weapons of their day because no other group of solidiers would dare to fight them unless they were numerically superior or had nothing to lose Currencies can come and go. Rulers may yet one day demand taxes in gold but unless we go back to these medieval type thought patterns why would they?

If you make stuff and have a pile of useless stuff that is expensive and useful stuff is cheap and you expect inflation would you accumulate useless stuff that is expensive or useful stuff that is cheap? Seems a no brainer so far. Now if you add in the fact that the markets you sell your useful stuff to are in a bit of trouble and they tend to produce or have ownership interest in the cheap stuff you need to buy to make the stuff you sell to them it makes sense to stock up on cheap stuff to support those markets. And if you can ramp up the price of the expensive stuff you can then buy more cheap stuff.

If there is a relationship between stocks of copper and silver this seems relevant? http://www.commodityonline.com/news/Chines...-18296-3-1.html Clearly, with input costs declining and the copper price soaring, most copper miners can make a nice profit, and this has recently seen Glencore scrap plans to close its Mopani Copper Mines unit in Zambia and the imminent restart of First Quantum's Bwana Mkubwe processing plant in Zambia. This can only be bad for a market that clearly needs to cut more production, because if it had not been for Chinese restocking, LME copper stocks could clearly be threatening all time highs. Copper Outlook The copper price rally still has room to go higher, but the damage wrought now could dampen prices ahead, as surplus metal builds. However, we doubt it will again challenge December lows of $2,820/t -- at least not in the near-term.

If there is no demand for copper there will be no demand for silver either. Silver is an industrial and jewellers metal.

I confess to some ignorance of the properties of Silver regarding its metal working properties and i began to get enthusiastic for it in my reading. But from the silver association that Icarus quoted i found: http://www.silverusersassociation.org/silver/facts.shtml More than 2/3 of the silver produced worldwide is a by product of lead, copper and zinc mining. So i am not sure about the limitations to mining more silver that people are claiming here. Maybe one third of silver comes from unique deposits that are no longer viable in a few years but 2/3 just arrives anyway from the demand for the other 3 metals. Given the massive demand for these other metals you can imagine that there is relatively a massive amount of silver coming on line also due to that other metal production.

My 9.99 was just because if it can fall from 21 to 8.47 in such a very short period then volatility is probably going to be there in the future too and it was only at 8.47 a few months ago when deflation was a higher priority than now, but as the market correction wears off, if it does, then deflation will be back again on the radar for more people and probably a little more entrenched into peoples minds. But i cant really see why silver should be today a precious metal since other metals now rank along with gold as precious i would have thought. Silver today seems like an industrial metal to me. And its use in photography is going to be history soon?

Betting is not normally my thing. I see the recent low was 8.47 on October 26th? 9.0 could be missable but 9.99 not. 8.47 must have really hurt after 21 so 9.99 could be safe either way inside 5 years and give a loser time to come to terms with their loss humilation and depression while providing widespread entertainment and amusement in a difficult time in history.

if it goes to 9 i will be buying i think.

Georges video makes you realise why so few people are going to be trading silver anytime soon as currency. 1. The guy taking the silver had to be a coin expert to be confidant the dimes were 90% silver. 2. He had to be accurate with a calculator 3. He had to have the ability to offload the silver to a collector like the food purchaser without making a loss 4. He had to factor in his accountant like abilities to be accurate and work fast to do what he was doing while actually working as a till operator in a food store.