http://www.marketwatch.com/story/silver-gains-favor-as-an-investment-asset-2012-12-07?pagenumber=1 Very emotional and heated exchange here. IMHO this is all about deflation vs. inflation. Current pricing reflects the latter. Which one will win ?
I think it might be all about india. India controls the gold price. And silver is mostly a function of the gold price. I.E. India controls the silver price. Its a national past time in India to collect gold. Instead of a savings account, they will buy little 1 gram pieces of gold or something. Saw on 60 minutes. If nothing changes, gold/silver prices might be more a function of the growth of India wealth than anything else.
================= Well as one local metals dealer said; sell silver @32 and less. Both metals[silver/gold] have a nice 4,000+ year uptrend; that only useful/wise with an understanding of long term ternds. None of this is a prediction.
With the system as blatantly corrupt as it is now with history showing honest governments and few and far between, the chance of a sharp return in the US dollar is not very likely. The current political trends are showing the state exercising massive force to maintain power and keep their system of wealth distribution intact. Sadly, there isn't much hope for the west returning to free-market principles or some type of sound monetary-system backed by physical assets. The FED is simply functioning as a mechanism for banks to dump bad debts and avoid having to deal with the consequence of making poor business decisions. While demand in places like China and India are increasing, part of the issue with the precious metals market is the blatant manipulation by these banks of prices relative to US dollars; however, if you look at purchasing power you will find the truth. An ounce of gold will still buy you today what it did 3000 years ago - a nice suit, a new shirt and a new pair of shoes and dinner at a fancy restaurant for you and the lady of your choice. 1 dollar will not buy you what it did yesterday, let alone 20 or 30 years ago. Long term - the systemic corruption evolves out of the fiat currency system. That's why they've never been stable and never will be. paper is simply too easy to manipulate. prices can be held down temporarily but over the long-term the prices are going to go up relative to the USD. The purchasing power says it all. $1 in 1964 silver coins buys you about 5-6 gallons of gas. It's not the demand that's driving prices up. It's the constant devaluation of the dollar. Boy do I feel bad for the average working Joe once the repercussions of the Fed's policies make their way into food, gas and other commodity prices. Silver and Gold will benefit and likely become even more rare as our economy turns into something reminiscent of the Soviet-Union in the early 1990's.
" Silver and Gold will benefit and likely become even more rare as our economy turns into something reminiscent of the Soviet-Union in the early 1990's." please explain what you mean by rare?
What is interesting is that there is less silver on earth than gold. It's all about perception of value, Or maybe it is because there is about 90 trillion in derivatives around that can be used to manipulate/control/price ceilings/floors in markets. regardless... The Market always gets the final word.
emotional debate on precious metals ? I don't know of any other market that is more emotional than the gold and silver market . And frankly if someone is emotional and gets all worked up when you question their positions I would rather be on the other side of their trade .
For that very reason I was reluctant to buy gold and silver back in '02 but we saw a strong correlation with crude so with trepidation did 20C of all 3 selling years later when they reached big numbers. IF silver holds long term support here I will buy a lot more physical... Woody