Silver Wheaton (NYSE: SLW) is my silver play. It was down 8.6% today so I opened a position. I have some physical bullion but I'm not a big end of the world type person so I'm content with owning the miners. Maybe I'm trying to catch a falling knife, we'll see.
Let's see how it plays out. I shorted Majestic Silver (NYSE: AG) two days ago at 24$. Now down -12 %.
Topic: Silver undervalued or gold overvalued? (Read 10199 times)
Silver Wheaton (NYSE: SLW) is my silver play. It was down 8.6% today so I opened a position. I have some physical bullion but I'm not a big end of the world type person so I'm content with owning the miners. Maybe I'm trying to catch a falling knife, we'll see.
We do not have to agree. I am short stocks since DJI 12,600, silver since 43$, EURUSD since 1.47 and those trades run well, and I will stay midterm in those positions (probably until 2014-2016); and additionally do some hedging and playing short term bounces.
I don't get your logic (unless you are purely and stubbornly contrarian). It is precisely for this lack of correction that I am bearish gold and bullish everything else heavy.
This is a good comparison, with the exception that this time the metal drop will be more severe. Probably down -80% to -90%, except for Gold, which may only drop -20 to -50% in dollar terms.
When I look at the metals and oil charts I am struck by the huge correction in 2008. Whether crude, platinum, or silver, they all drop by about half their previous price. Except gold.
This is a good comparison, with the exception that this time the metal drop will be more severe. Probably down -80% to -90%, except for Gold, which may only drop -20 to -50% in dollar terms.
When I look at the metals and oil charts I am struck by the huge correction in 2008. Whether crude, platinum, or silver, they all drop by about half their previous price. Except gold.
This is a good comparison, with the exception that this time the metal drop will be more severe. Probably down -80% to -90%, except for Gold, which may only drop -20 to -50% in dollar terms.
When I look at the metals and oil charts I am struck by the huge correction in 2008. Whether crude, platinum, or silver, they all drop by about half their previous price. Except gold.
Industry is turning down production in response to recession. Less people driving, thus demand for all the industry commodities go down (crude, platinum, and silver)
What if the opposite happens this time, since everyone is expecting it? Silver is a small market, and can be easily influenced in both directions.
When I look at the metals and oil charts I am struck by the huge correction in 2008. Whether crude, platinum, or silver, they all drop by about half their previous price. Except gold.
There are people waiting to buy.
I know I am.
I know I am.
Big intraday turn down today. Looks like the start of the Silver desaster.
My opinion was that I do not believe it could be manipulated to go low again (not high). I agree the market for silver is extremely tight. Great input though gives me a new perspective.
Oh, I misunderstood then.
There is only so much silver to go around. Free market structure allowed the price to go to $50. Market manipulation by the US Government is what cause the price to collapse. If they had not intervened, I suspect the price would be at around $100 today.
Yea I see what you mean that manipulation was the cause for it to come down not up.
Also I do not think such a thing can happen again especially with the raising capital needed to hold a silver position.
That's way off. Silver is one the smallest commodity markets on the planet. Annual world silver is 800m or so ounces. Times $40 an ounce = 32bn dollars. Bill Gates could buy up over a year's supply of silver. Lets compare that to the crude oil market. With the price of oil at 92$/barrel, and daily US consumption at 14m barrels a day, Bill Gates can only buy about 25 days of oil production for USA ONLY with that same 32bn dollars!
Or, if you prefer, if 1 million people invest just $32,000, they could buy up ALL of a years silver production. Which of course CAN"T BE DONE because you can't just go out and buy 800,000,000 ounces of silver, it would take 6 months at least. The price would go to the moon. $1000/ounce, easily. It happened with palladium, which started under $100 and reached an all-time high of nearly $1100/ounce. Mostly due to shortages.
Or, if you prefer, if 1 million people invest just $32,000, they could buy up ALL of a years silver production. Which of course CAN"T BE DONE because you can't just go out and buy 800,000,000 ounces of silver, it would take 6 months at least. The price would go to the moon. $1000/ounce, easily. It happened with palladium, which started under $100 and reached an all-time high of nearly $1100/ounce. Mostly due to shortages.
My opinion was that I do not believe it could be manipulated to go low again (not high). I agree the market for silver is extremely tight. Great input though gives me a new perspective.
What's the easiest way to buy Palladium? I know it is a favoured 3rd PM.
I do not see the big deal about the 50$ run up in 1980 since it was being manipulated and that is why i did not see the big deal.
There is only so much silver to go around. Free market structure allowed the price to go to $50. Market manipulation by the US Government is what cause the price to collapse. If they had not intervened, I suspect the price would be at around $100 today.
Also I do not think such a thing can happen again especially with the raising capital needed to hold a silver position.
That's way off. Silver is one the smallest commodity markets on the planet. Annual world silver is 800m or so ounces. Times $40 an ounce = 32bn dollars. Bill Gates could buy up over a year's supply of silver. Lets compare that to the crude oil market. With the price of oil at 92$/barrel, and daily US consumption at 14m barrels a day, Bill Gates can only buy about 25 days of oil production for USA ONLY with that same 32bn dollars!
Or, if you prefer, if 1 million people invest just $32,000, they could buy up ALL of a years silver production. Which of course CAN"T BE DONE because you can't just go out and buy 800,000,000 ounces of silver, it would take 6 months at least. The price would go to the moon. $1000/ounce, easily. It happened with palladium, which started under $100 and reached an all-time high of nearly $1100/ounce. Mostly due to shortages.
"Treat people nice on your way up. You will see the same faces on your way down."
Sorry, I'm abrasive by nature.
Why sell your silver at $7 when you bought at $15? That's not a fault of the silver market. And it certainly wasn't the Hunt's fault. The blame lies with the US government for the Hunt debacle. The same government that is now backing the dollar that everyone holds so dear. The USD will be shit soon, and its been a long time coming.
I bought at $15 and had to sell at $7
Never again!
Wow. this goes way back.. So you buy in at $15... ride it all the way to over $40 - almost 300% gain. But when the thing crashed, you couldn't get out in time and got out when it bottomed at $7?? Didn't the crash took several days?
He probably had to sell all his 3 ounces.
"Treat people nice on your way up. You will see the same faces on your way down."
http://en.wikipedia.org/wiki/Silver_Thursday
http://en.wikipedia.org/wiki/Nelson_Bunker_Hunt
http://en.wikipedia.org/wiki/Cornering_the_market#1970s:_The_Hunt_brothers_and_the_silver_market
http://en.wikipedia.org/wiki/Silver_as_an_investment
I bought at $15 and had to sell at $7
Never again!
http://en.wikipedia.org/wiki/Nelson_Bunker_Hunt
http://en.wikipedia.org/wiki/Cornering_the_market#1970s:_The_Hunt_brothers_and_the_silver_market
http://en.wikipedia.org/wiki/Silver_as_an_investment
I bought at $15 and had to sell at $7
Never again!
Wow. this goes way back.. So you buy in at $15... ride it all the way to over $40 - almost 300% gain. But when the thing crashed, you couldn't get out in time and got out when it bottomed at $7?? Didn't the crash took several days?
LOL! I was feeling big and bold and was going to ride it out a little more and planned to buy a new car. Counted them chickens long before they hatched. Back then in the Bahamas we tracked the price of stuff in the newspaper. IIRC it was 10 in the paper but by the time I got the silver out of the safety deposit and to the dealer he offered me 7 and I sold it all.
I bought at $15 and had to sell at $7
Never again!
Wow. this goes way back.. So you buy in at $15... ride it all the way to over $40 - almost 300% gain. But when the thing crashed, you couldn't get out in time and got out when it bottomed at $7?? Didn't the crash took several days?
He probably had to sell all his 3 ounces.
http://en.wikipedia.org/wiki/Silver_Thursday
http://en.wikipedia.org/wiki/Nelson_Bunker_Hunt
http://en.wikipedia.org/wiki/Cornering_the_market#1970s:_The_Hunt_brothers_and_the_silver_market
http://en.wikipedia.org/wiki/Silver_as_an_investment
I bought at $15 and had to sell at $7
Never again!
http://en.wikipedia.org/wiki/Nelson_Bunker_Hunt
http://en.wikipedia.org/wiki/Cornering_the_market#1970s:_The_Hunt_brothers_and_the_silver_market
http://en.wikipedia.org/wiki/Silver_as_an_investment
I bought at $15 and had to sell at $7
Never again!
Wow. this goes way back.. So you buy in at $15... ride it all the way to over $40 - almost 300% gain. But when the thing crashed, you couldn't get out in time and got out when it bottomed at $7?? Didn't the crash took several days?
Fully disagree and we can at least agree to disagree :-)
What you are saying is what 99.9% of people believe. Hence, it is too late now, and the opposite will happen. I will bet 5 BTC with you that Silver will drop below 30 $ by Jan 12 and another 5 BTC for a drop below 10 $ somewhere between 2012 and 2015.
And by the way, you do not show the full (and most important) chart history: The previous Silver high of 50 $ in 1980. This means that Silver did not gain at all vs. this high, and when accounting for inflation, Silver today is down massively vs. 30 years ago..
I am glad we can discuss this without the usual shit talking of this forum.
I do not see the big deal about the 50$ run up in 1980 since it was being manipulated and that is why i did not see the big deal. Also I do not think such a thing can happen again especially with the raising capital needed to hold a silver position.
Silver prices have skyrocketed this year mainly behind speculation, which is not justified by the industrial value. This speculation is largely via leveraged tools, and in the current and more severe upcoming crash/crisis, people need to sell stuff to pay their bills, and this includes leveraged Silver derivatives. And Silver is not alone, as all assets will plummet in the midst of this historic crash.
I agree with you in the sense that we can go into a dip but I do not agree on how low you speculate. Because people are actually starting to accept silver as payment for goods (instead of dollars!!). Maybe not for paying bills but I have been to a number of privately owned grocery stores that accept silver.
And even if the current price seem to be justifies because of industrial use, this will also change as the economy falters and Silver demand shrinks..
Agreed but not to single digits IMO
Overall, midterm, over the next couple of years, this will drag Silver down.
Longterm I am relatively bullish Silver. It will be the first indicator that the crash is over. It is wise to keep some physical Silver even if it goes doen in dollar terms. If Silver rises again strongly from low single digits, then a new bull market starts. But based on my longterm time studies, this will not be before 2014.[/color]
Longterm I am relatively bullish Silver. It will be the first indicator that the crash is over. It is wise to keep some physical Silver even if it goes doen in dollar terms. If Silver rises again strongly from low single digits, then a new bull market starts. But based on my longterm time studies, this will not be before 2014.[/color]
My only concern is I think you underestimate how "crazy" people can get if they do not feel safe with cash (fiat) (paper) w/e you want to call it and may start to throw their millions into gold/silver. (millionaires silver , billionaires gold lol ) That is why I feel silver even with weak demand from industry might continue going high even when we go into this second recession (depression) [another thing we both agree will happen]
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