Dont get caught up in the frenzy

[jim4silver]

Don't get caught up in the frenzy

I stopped into a local coin store today and it was crazy what I saw. Two different buyers were loading up on gold. They had that look in their eyes like a gambling addict when he is walking into the casino. One transaction had some snafu and the guy was about freaking out, he looked desperate to buy his gold and from what I heard he wanted to spend about $50K. I saw another guy buying over 30 oz of AGEs (it looked like AGEs, could have been $20 Saints but I was too far away to tell). The guy was smiling like he won the lottery.

I am as bullish on PMs as anyone, but no way would I be loading up right now. Yes I believe gold will someday go to $2000, maybe even $5000 if things get bad enough. But I would bet we will see a sizable correction at some point if gold keeps rocketing up. I am starting to get the same vibe I had as silver was rocketing towards $50. I remember seeing the same thing in the coin stores as guys were buy silver bars and rolls of ASEs like candy at $48, $49, etc.

Don't follow my advice since I am no expert, but anyone wanting to go all in right now should think about it for a while first. You don't want to be the person who never buys and then decides to buy when the metals are at a high, only to wind up selling after the price crashes and lose money and then bad talk PMs for the next 10 years.

Jim

 

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[hombre_de_plata_flaco]

Re: Don't get caught up in the frenzy

I'm getting ready to unload a bunch of scrap jewelry as we speak.

No way I'm buying any gold right now. Shizz is too expensive.

 

[Chug And Red]

Re: Don't get caught up in the frenzy

I'm getting ready to unload a bunch of scrap jewelry as we speak.

No way I'm buying any gold right now. Shizz is too expensive.

Same here going to Unload about 10 percent!!!! No way am i going to sell it all off Yet!!! hh chug

 

[hombre_de_plata_flaco]

Re: Don't get caught up in the frenzy

I'm getting ready to unload a bunch of scrap jewelry as we speak.

No way I'm buying any gold right now. Shizz is too expensive.

Same here going to Unload about 10 percent!!!! No way am i going to sell it all off Yet!!! hh chug

I know we are hearing a lot of "gold is at an all-time high" talk, but adjusted for inflation, the actual high was back in the early 80's, when in today's money it would have been at $2000/oz. I think the $2000 mark would be a good time to get out completely. Surely this can't last forever. I want some US Gold coins instead of this scrap jewelry, but there is no way I am going to shell out that kind of $$$ for coins.

 

[FreedomUIC]

Re: Don't get caught up in the frenzy

AU is so high right now it is out of my reach unless it is fractional. When the debt rating was lowered over the weekend, I spent all day Saturday at coin shops buying all the Morgans/Peace and Rounds that I could get. Sunday I was on EBay for over four hours buying
Morgans and Peace dollars. Figured that silver would rocket just like Gold, But, I didn't lose money in the process as Silver
seemed to retract slightly and then bounce back.

I am in this for at least another 10 - 15 years so it really doesn't matter to me which PM I buy, just wish I had enough for AU once
in a while....

 

[billjustbill]

Re: Don't get caught up in the frenzy

.....Don't follow my advice since I am no expert, but anyone wanting to go all in right now should think about it for a while first. You don't want to be the person who never buys and then decides to buy when the metals are at a high, only to wind up selling after the price crashes and lose money and then bad talk PMs for the next 10 years.

Jim

Jim,

I see your point of view and let me carry it one step more and ask you a question....
Today, if I took some of what gold and silver I've collected to the average "We buy scrap gold" places many towns have, they are offering me between 30%-40% of market price.... If it wasn't for refiners buying it and "appearing" to give 2%-10% below, gold and silver wouldn't be worth much....

If those fellows buying gold and silver by the thousand-dollar-lumps, who is going to buy PM's when times are really bad and how much is an T-oz. going to be worth? How much better off are the guy's like you described when times get really tough? I know it is worth something, but it would seem that MRE's, building supplies, and rolls of copper wiring would be as good or better?

On a bad day after the economy has its self-leveling events, how much better will PM's be than other items?

Bill

 

[jim4silver]

Re: Don't get caught up in the frenzy

.....Don't follow my advice since I am no expert, but anyone wanting to go all in right now should think about it for a while first. You don't want to be the person who never buys and then decides to buy when the metals are at a high, only to wind up selling after the price crashes and lose money and then bad talk PMs for the next 10 years.

Jim

Jim,

I see your point of view and let me carry it one step more and ask you a question....
Today, if I took some of what gold and silver I've collected to the average "We buy scrap gold" places many towns have, they are offering me between 30%-40% of market price.... If it wasn't for refiners buying it and "appearing" to give 2%-10% below, gold and silver wouldn't be worth much....

If those fellows buying gold and silver by the thousand-dollar-lumps, who is going to buy PM's when times are really bad and how much is an T-oz. going to be worth? How much better off are the guy's like you described when times get really tough? I know it is worth something, but it would seem that MRE's, building supplies, and rolls of copper wiring would be as good or better?

On a bad day after the economy has its self-leveling events, how much better will PM's be than other items?

Bill

Bill,

My view is that if we have a complete "mad max" world, say due to extensive nuclear warfare or something that catastrophic, then gold and silver would not really mean much. But for anything less than that, I believe PMs will be worth even much more later than they are now.

There is alot of wealth that exists in the world, it may be held in various forms, but there will always be (short of mad max world) a place where the smart money goes. Sometimes the smart money lacks foresight but eventually it catches on. Back in Weimar and even in recent Argentina, when the currency went hyperinflation, gold had much more buying power than even what we see today from what I have read.

Even if there is so much unrest it seems like mad max land for a while, I believe that over time things will settle down. Societies generally don't tolerate chaos for too long, except in those few nations that always seem to have such behavior, but generally not here nor in European nations. The bad news is that if a real mad max type world happened here, probably not many would survive, even if they had supplies and means of protection it would only be a matter of time before their supply would be overtaken or run out. I don't think I personally would want to live in a post-nuclear land anyway since the modern nukes are far more powerful than what was dropped on Japan in WW2.

When people say you cannot eat gold and silver, I like to respond with you cannot eat fiat currency nor stocks nor bonds. I don't see where owning PMs and being prepared with your own supply of food, water, means of protection are mutually exclusive though for the eventual bad stuff that could happen here short of mad max down the road. I could easily see where food and water supplies could be shut off for a period of time due to some natural disaster or other unforeseen bad event.

Jim

 

[Silver Surfer]

Re: Don't get caught up in the frenzy

Appreciate your views Jim, I really do. Please keep posting your "advice"...
I think that owning PM's AND having food, ammo, etc., is the only smart thing to do anymore... He'll, I have pounds and pounds of coffee vacuum packed.. Can you imagine what that could be worth if a crash comes? Sugar, salt, water filters, etc., are also in the mix, pounds and pounds...
What most people don't consider is that it doesn't have to be the market crashing to be prepared for. What about a MAJOR catastrophe in nature? We seem to forget that we can get hit, and are long overdue. Combine this economy AND a major natural event, and ANYTHING will be worth a lot... Of course, if you aren't trained and armed well, what's yours will be someone else's very quickly. Like London can't happen here... Uh Huh....
Going to be a tense next couple of years..

 

[Marchas45]

Re: Don't get caught up in the frenzy

Hell I'm still buying, just bought 2k worth of silver tonight and I'll still be buying if the price is right. Great post there Jim and advice it's always welcome.You put it into words that I can only think.

Here's a link I've been following which has helped me out a bit. On the right half way down click on the Archives. http://tradingstocks.me/tag/silver-price-forecast/page/2/

 

[JD-GA]

Re: Don't get caught up in the frenzy

This is why emotional investing doesnt work so well Jim. Look where the prices are a week later. Those guys in that store are banking it.

 

[hombre_de_plata_flaco]

Re: Don't get caught up in the frenzy

Here is a chart I made today taken from APMEX:

 

[jim4silver]

Re: Don't get caught up in the frenzy

This is why emotional investing doesnt work so well Jim. Look where the prices are a week later. Those guys in that store are banking it.

I agree that a person should not invest based on emotions, but unfortunately investing based on logic seems to fail just as much from what I have seen. Best to try and read what the markets are doing and combine that with knowing as much info as you can about the underlying asset you want to invest in, then go with your "gut feeling". That is what I have been doing and so far it is paying off most of the time.

But you never know what the markets have in store for you just around the corner. Some helpful market quotes I have read over the years are (I am paraphrasing a bit because I don't remember the exact wording):

"you have a friend in the trend" seems apt today with the bull market in PMs.

"the market always does what it is supposed to do, just not when it is supposed to do it" which in my mind tells me stocks will eventually sink, the dollar will go down, PMs will go through the roof- some day of course.

"the market is never wrong, only traders are wrong" Jesse Livermore quote

"remember stocks are never too high for you to begin buying or too low to begin selling"- Jesse Livermore quote that could apply to PMs and stocks now.

Jim

 

[blai745]

Re: Don't get caught up in the frenzy

I stopped into a local coin store today and it was crazy what I saw. Two different buyers were loading up on gold. They had that look in their eyes like a gambling addict when he is walking into the casino. One transaction had some snafu and the guy was about freaking out, he looked desperate to buy his gold and from what I heard he wanted to spend about $50K. I saw another guy buying over 30 oz of AGEs (it looked like AGEs, could have been $20 Saints but I was too far away to tell). The guy was smiling like he won the lottery.

I am as bullish on PMs as anyone, but no way would I be loading up right now. Yes I believe gold will someday go to $2000, maybe even $5000 if things get bad enough. But I would bet we will see a sizable correction at some point if gold keeps rocketing up. I am starting to get the same vibe I had as silver was rocketing towards $50. I remember seeing the same thing in the coin stores as guys were buy silver bars and rolls of ASEs like candy at $48, $49, etc.

Don't follow my advice since I am no expert, but anyone wanting to go all in right now should think about it for a while first. You don't want to be the person who never buys and then decides to buy when the metals are at a high, only to wind up selling after the price crashes and lose money and then bad talk PMs for the next 10 years.

Jim

hellooo thats why you advertise to buy scrap gold jewelry...its like getting gold at a discount.. so you dont have that worry of a correction becuase your still in the profit zone...of course you dont pay like "cash for gold" cuz I doubt you'll get any buisness..but you make an honest profit and defintely keep your cheap GOLD.. btw acid test and scale wieghts isnt rocket science.

 

[quiksilver]

Re: Don't get caught up in the frenzy

History repeats itself. Short term anything you or anyone else says may be true and may have been true half the time in the past.

But if you look at history when money is devalued only one thing has ever happened that i know of, gold goes up . It also looks like to me the only thing goverments are going to do to get out of the current crisis is to devalue money.If your gonna gamble on a horse you may as well gamble on a horse that has never lost a race. Gold has never lost a value race with a fiat currency ever in history that i know of.

 

[blai745]

Re: Don't get caught up in the frenzy

I'm getting ready to unload a bunch of scrap jewelry as we speak.

No way I'm buying any gold right now. Shizz is too expensive.

Same here going to Unload about 10 percent!!!! No way am i going to sell it all off Yet!!! hh chug

I know we are hearing a lot of "gold is at an all-time high" talk, but adjusted for inflation, the actual high was back in the early 80's, when in today's money it would have been at $2000/oz. I think the $2000 mark would be a good time to get out completely. Surely this can't last forever. I want some US Gold coins instead of this scrap jewelry, but there is no way I am going to shell out that kind of $$$ for coins.

what happend in the 80's has no relation to whats happening now.... back then our DEBT was not 10 times our economy... it was no where near that...

what you should be saying is, Surely our dollar cant last another 2 years

 

[cyberdan]

Re: Don't get caught up in the frenzy

They had that look in their eyes like a gambling addict when he is walking into the casino.

I wonder what the look in their eyes were last Friday.

I know what mine were like when I entered friday's closing into my spreadsheet.

 

[jim4silver]

Re: Don't get caught up in the frenzy

They had that look in their eyes like a gambling addict when he is walking into the casino.

I wonder what the look in their eyes were last Friday.

I know what mine were like when I entered friday's closing into my spreadsheet.

I know what you mean. I have been steadily buying some form of PM by dollar cost averaging for a long time. I am still ahead on much of it, but some of my recent gold/platinum buys are in the red. But I am not worried since I don't plan on selling until I retire or sooner IF the price were to go really high. I try to diversify by owning silver, gold and platinum. My future purchases will likely be more silver if this correction keeps going.

It is depressing though to see an asset you own lose value, but it is not a loss unless you sell or the price never recovers.

It is hard to buy at the actual bottom of a correction. To keep waiting may pay off, or you can miss the bottom altogether. It is a gamble, just like buying now risks losing the chance to buy cheaper if the price falls to 20 bucks per ounce.

Jim