Any predictions for August 2011?

[jim4silver]

I will give it a try. I think if/when a debt ceiling deal is made, there might be a short (very short, as in weeks) term correction in PMs. Presumably the most recent run up in silver and gold is unease about the financial situation here, and probably in Europe too.

If there is any short term correction, I personally feel it may be the last time to buy silver at 30s or so for a long time (until the bubble in PMs bursts at the end of this bull market which eventually will happen-maybe in several years).

It seems like the public is still pretty much asleep with respect to gold and silver. Yes they are selling what they have in jewelry and silverware to get some $$$$, but you don't see people running to buy it as the next hot investment to own (maybe that is because the general public is one or two paychecks away from being broke and cannot afford any PMs?). Usually a bubble doesn't get near bursting until everyone who can is buying in, like the tech stock bubble in the late 90s, housing bubble from a few years ago, etc.

Jim

 

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[Yagershots]

I think this is very true... When this small correction happens it should be a "bye now or forever hold your fiat" situation for people in the know and have been watching this whole situation unravel.

 

[dazoff]

I think the US is in for a long rough ride one that may change the nation for good. With both political camps far apart on the direction forward there are only bandage solutions.
Cut programs to deal with the debt say's one 14.3 trillion on the backs of those who can least afford it how is that good for America.
No tax increases, the amount of down loading on states is already more than most can bear not to mention cities.

August is nothing more than a sniff of what will come if folks don't wake up and accept that everyone is part of the problem and will be part of the solution.
Federal & State pensions alone 3 trillion dollars in the red, how much paper do you think can be printed without devaluing currency answer 0 .

The US holds the most gold of any nation and the US dollar continues to fall, the nation has a problem folks, cut some programs increase some taxes and hope for the best.

China never has to go to war with the US they hold 3 trillion dollars of your debt.

Gold & Silver, Gold& Silver, and yes the EU has huge problems as well but at least the member countries can pressure them for change.

something needs to change.

 

[Cappy Z.]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

 

[FreedomUIC]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

I am in this for at least 15 more years. I collect coins as well as bullion. I foresee silver @ $100.00 within that time frame. My buy is below 38 and my sell will be around 89 - 91 dollars. It will supplement my retirement quite nicely.

 

[mts]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

I've read that it costs less than $300 to build an iPad2. Yet people are willing to pay $500-$700 to get one. The same can be said for many items that we consume daily. What something costs to produce/mine is not a major indicator of what people will pay for something. It only limits the downside of the price. Not the upside. An iPad2 will never be priced less than $300. And gold will never again go below $1000 per ounce if your quoted costs are correct and remain the same.

 

[jim4silver]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

What something costs to produce/mine is not a major indicator of what people will pay for something. It only limits the downside of the price. Not the upside. An iPad2 will never be priced less than $300. And gold will never again go below $1000 per ounce if your quoted costs are correct and remain the same.

MTS,

While logically sound, your position is not wholly correct. The cost to produce an ounce of gold, silver, etc, does play into the price people pay not because the buyer is aware of said costs of production, but because cost of production plays into how much is mined, and thus the total supply available either now or in the future, which is tied to the price you pay for it. For many years between the 1990 and 2000 many silver mines shut down because the cost of production and market price of silver. If hypothetically gold did drop in price relative to the cost of production and stayed there long enough, it would affect mining companies' production level and thus the output of newly mined gold.

And it is possible (although highly unlikely nowadays) gold could sell for less than it costs to produce if for some reason demand fell fast enough. There were times around the early 2000s when gold was selling for less than it cost to produce. Cost of production does vary by country and each particular mining operation is different. Thus, there is no set amount or uniform "cost of production" that can be applied across the board. But such situations rarely last long because if the gold price did fall below the cost of production, the miners would shut down until the price went back up.

What is amazing to me that if with such high gold and silver prices, some of the well known mining companies are not producing much of a profit, and some none at all. The explanation I have heard for this is that the cost of fuel, equipment and lack of easy to find gold is the cause. Much of the easy gold is gone they say.

Jim

 

[mts]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

What something costs to produce/mine is not a major indicator of what people will pay for something. It only limits the downside of the price. Not the upside. An iPad2 will never be priced less than $300. And gold will never again go below $1000 per ounce if your quoted costs are correct and remain the same.

MTS,

While logically sound, your position is not wholly correct. The cost to produce an ounce of gold, silver, etc, does play into the price people pay not because the buyer is aware of said costs of production, but because cost of production plays into how much is mined, and thus the total supply available either now or in the future, which is tied to the price you pay for it. For many years between the 1990 and 2000 many silver mines shut down because the cost of production and market price of silver. If hypothetically gold did drop in price relative to the cost of production and stayed there long enough, it would affect mining companies' production level and thus the output of newly mined gold.

And it is possible (although highly unlikely nowadays) gold could sell for less than it costs to produce if for some reason demand fell fast enough. There were times around the early 2000s when gold was selling for less than it cost to produce. Cost of production does vary by country and each particular mining operation is different. Thus, there is no set amount or uniform "cost of production" that can be applied across the board. But such situations rarely last long because if the gold price did fall below the cost of production, the miners would shut down until the price went back up.

What is amazing to me that if with such high gold and silver prices, some of the well known mining companies are not producing much of a profit, and some none at all. The explanation I have heard for this is that the cost of fuel, equipment and lack of easy to find gold is the cause. Much of the easy gold is gone they say.

Jim

Jim, I agree with everything you've said. I didn't mean to imply that the cost of mining gold doesn't somehow play into the pricing. What I meant to show is that you can't come to conclusions about prices based solely on costs of production. As you have shown, gold can also sell for less than what it costs to "produce it". And as I have shown, the cost of production does not always indicate how much someone is willing to pay for certain "premium" items.

In the last six months I've been on a mission to weed out the facts from the fiction in the common claims that people use to justify gold/silver going up or down. These include claims about production costs, mystical gold to silver ratios, and other such tidbits that bulls and bears tend to throw out there with no real supporting evidence. It is way too easy to latch onto these claims to try and justify our own positions. I've seen it time and time again out here by silver bulls who are "absolutely certain" that silver will be $100 per ounce in the next few months (or should have been by now). To me, this is very dangerous and we need to take such claims with a grain of salt.

 

[mts]

With the S&P US credit downgrade I'm thinking there will be enough fear to push the price of gold up even further. But perhaps that fear is already baked into the price at $1660.

 

[LukeTHr]

I wouldn't be surprised to see $2000.00 gold and $50.00 silver. by end of September

 

[Cappy Z.]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

Has the Great Gold Bubble began its Burst?

 

[diggummup]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

Has the Great Gold Bubble began its Burst?

The pop is only temporary.

 

[hombre_de_plata_flaco]

I 'predict' that after Congress passes the budget bill....there will be a rush to cash in those gold stocks (profit taking) and that gold will DROP NEARLY $150 per ounce... I've read reports where it only cost $1000 per ounce to mine, process, and store. Thus...the great casino action...will have a major adjustment.

We'll see. Timing the market drop is everything.

Has the Great Gold Bubble began its Burst?

It's tanking this AM, that's for sure.

 

[Cappy Z.]

CNN has it down about 4% or $80. an ounce at 10:45AM......

You can't eat gold...

 

[jim4silver]

CNN has it down about 4% or $80. an ounce at 10:45AM......

You can't eat gold...

Nor can you eat paper money, real estate, cars, stocks, bonds, etc....

So I guess all your investment capital is in Twinkees?

Jim

 

[usandthem]

Good one Jim.

 

[Cappy Z.]

Actually Twinkies would be a a safe investment. Gold will close DOWN again today....probably below the 1700 mark..but I'll 'invest' saying it will close the day at about 1666. Let's watch and see as the bubble burst.

 

[Cappy Z.]

Actually Twinkies would be a a safe investment. Gold will close DOWN again today....probably below the 1700 mark..but I'll 'invest' saying it will close the day at about 1666. Let's watch and see as the bubble burst.

It's noon..and Gold is BELOW my projected $1666. Hmm?

 

[Cappy Z.]

Yep. Gold closed around $1567. an ounce. I was 9 dollars off.

Next week...It will continue its spiral downward. It is simply overpriced and over-hyped.

 

[Marchas45]

Yep. Gold closed around $1567. an ounce. I was 9 dollars off.

Next week...It will continue its spiral downward. It is simply overpriced and over-hyped.

Actually gold closed today at $1657.20 and also I've never seen this gloatting side of you before, maybe it's time for me to ignore your auctions and I'll use your favorite slang Hmmmmmmmmmmmm