i think buy BUT up or down one things 4 sure = manipulation

[scrounger d detector collector]

what a deadly time to be living in.

there seems to be no limit to what electronic trading

can do. our financial markets were once used for

hedges for farmers. todays trading has no relation to this.

late last week just as silver was getting into the lower

40s. they changed the rules again.

the whole world is on a fast track to financial

disaster. a few fat cats are getting even fatter.

you raise the margin requirements on futures.

and bingo pms fall. makes it look like everything

is ok. this is the 3rd or 4th time they have done this.

why ? to keep people believeing in paper funnymoney.

im gonna load up on some silver and gold

at cheeper now.

 

[blai745]

yup I hear that...I just love it when people compare this drop to the 2008 drop in gold and silver..and say its going to the low 20's.... we'll theres a bunch of factors that are different to 2008... The US debt wasnt 10 times the total economy like it is now! There wasnt a European Crisis... Plus if you want to use history as a way to analayze Trading... Then you should see that practically every paper monetary system has Hyperinflated and failed within a average 40 year life span...and where right now on the edge of that life span.

 

[mts]

yup I hear that...I just love it when people compare this drop to the 2008 drop in gold and silver..and say its going to the low 20's.... we'll theres a bunch of factors that are different to 2008... The US debt wasnt 10 times the total economy like it is now! There wasnt a European Crisis... Plus if you want to use history as a way to analayze Trading... Then you should see that practically every paper monetary system has Hyperinflated and failed within a average 40 year life span...and where right now on the edge of that life span.

I assume that you are talking about me.

As for manipulation, did they manipulate the price of copper recently too? Did they manipulate the price of nickel? How about platinum? Did they change margin requirements for any of these metals? Yet they all crashed at the same time and by the same basic percentage that silver did. How do you explain that? It's awfully hard to explain that away as silver price manipulation.

The way I explain it is that silver is first and foremost an industrial metal. It is a store of value second. All industrial metals took a HUGE hit these past few weeks for a couple of big reasons:

1. The situation in Europe is worse that people think it is. If Europe collapses then it will hit our market very hard. Perhaps even hard enough to make it appear like 2008 all over again. Will it be exactly the same thing? I don't know. Different cause, but perhaps the same result. Does it really matter what the root cause is? If we eventually see 2008 prices (sub-$20) are you going to sit there and claim "well it's not the same thing as it was back in 2008 because the root cause was different"? I'm not sure that makes a lot of sense to be honest.

2. The situation in China is also getting worse. They are looking at a huge drop in metals consumption due to a drop in demand/manufacturing.

3. Things in the US aren't wine and roses either. We have a mess here and the economy is very fragile. Everyone is running scared and confidence is very low. You can have 20 pieces of good news and the market ticks up slightly. But even one piece of marginal news (MSFT only made a 4% profit instead of a 4.1% profit) and all of a sudden prices fall. The market is skittish to say the least.

I'm very bullish on silver long term. But I think it would be wise to consider the possibility of there being another market crash by the first of the year. And if I'm wrong and silver goes way up... no harm done. It sure wouldn't be the first time that I have been wrong on my investments. And it won't be the last either.

 

[Silver Surfer]

At least you believe in silver for the long-term.... Right with you on that...
Although I definitely believe that we are going to see a very scary economic scenario play out in this country in the next few years, I really don't see our economy quite as bad as what is being force-fed to us on a daily basis.. Why? People, even poor people, are still driving like gas is $1.00 gal, punching the pedal on their guzzling pickups... Also, where I live, Snowbirds are already pouring in. The restaurants were packed this past weekend and traffic is starting to show it also. If things are so bad, Snowbirds SHOULD be pinching pennies and I have a feeling that it will be another "normal" year as far as numbers. Heck, it's not even cold up north yet... I remember back in Carters day, you could tell that things were bad... Vacations changed or cut short, restaurants hurting and even closing due to people cutting back, economy cars hitting the market big time due to gas prices and the bad economy.. Yeah, we are surely in a downturn, but until I really start to notice people cutting back in their lives, I mean really cutting back, I won't believe that it is quite as bad as we are hearing.. We are just spoiled, and although things are more expensive and unemployment is up, people in general don't seem to be hurting all that bad. Even Pam and I, with as much economic hardship as we have encountered the last 3 years (due to medical issues), we still have Internet and basic cable.... So it can't be that bad, right?

 

[usandthem]

^ Good post. I've been saying the same for years. We Americans are spoiled. Visit or live in a third world country and you will understand.

 

[mts]

At least you believe in silver for the long-term.... Right with you on that...
Although I definitely believe that we are going to see a very scary economic scenario play out in this country in the next few years, I really don't see our economy quite as bad as what is being force-fed to us on a daily basis.. Why? People, even poor people, are still driving like gas is $1.00 gal, punching the pedal on their guzzling pickups... Also, where I live, Snowbirds are already pouring in. The restaurants were packed this past weekend and traffic is starting to show it also. If things are so bad, Snowbirds SHOULD be pinching pennies and I have a feeling that it will be another "normal" year as far as numbers. Heck, it's not even cold up north yet... I remember back in Carters day, you could tell that things were bad... Vacations changed or cut short, restaurants hurting and even closing due to people cutting back, economy cars hitting the market big time due to gas prices and the bad economy.. Yeah, we are surely in a downturn, but until I really start to notice people cutting back in their lives, I mean really cutting back, I won't believe that it is quite as bad as we are hearing.. We are just spoiled, and although things are more expensive and unemployment is up, people in general don't seem to be hurting all that bad. Even Pam and I, with as much economic hardship as we have encountered the last 3 years (due to medical issues), we still have Internet and basic cable.... So it can't be that bad, right?

I've been saying the same thing for the past two years every time someone tries to tell me how bad the world has gotten. All of my neighbors who had lost their jobs are now gainfully employed. People in my area do not appear to be holding back on spending. We took a big vacation this year down to Florida and the theme parks were as packed as we've ever seen them. Houses on my street are selling fairly quickly. The company I work for is not laying people off and is profitable for the year. So I do agree to a certain extent that I don't personally see the doom and gloom.

However.... how was "snow bird" spending in 2006 and 2007 leading up to the big crash? Didn't things look good from the consumer's perspective? Weren't people oblivious to what was really coming? Quite frankly, like me, I don't think the average consumer has any idea of what is going on until it actually happens.

But as usual, it isn't black and white. I think consumer confidence certainly counts for something. I'm just not sure how much it counts when predicting events that the average consumer is not privy to.

 

[Marchas45]

Just read this on a magazine I recieve via e-mail:

Many reasons exist for gold’s tumble. First, we have growing fears that the European debt crisis will wreak havoc on the euro-zone and its currency.

On this side of the Atlantic, American politicians threatened another government shutdown. The issue was temporarily resolved last week, but Washington’s political gridlock lives on, especially with a hotly contested Presidential election just around the corner.

And with stocks tanking, fund managers who owned gold had to sell the metal to raise cash to pay for redemption requests. Finally, we have boneheaded speculators who rushed into gold just because it was rising, and then bolted at the first whiff of weakness.

Now we are starting to hear financial news pundits talk about the demise of the “gold bubble.” These “experts” are always the first to react - after the fact. That is usually a positive signal.

The gold market has been looking toppy for the past few weeks. And, in any bull market...


A Correction Is Healthy

 

[scrounger d detector collector]

wow got a load of insight here. im not gonna pick a

specific quote but a lot of good was said.

the one thing i would like to add is about govt regs.

really the main thing keeping us down here

is govt regulation and multinational coporations.

since itsa global economy now laws we make here

in the usa dont help much if other countries ignore

the same problems.

while i dont want the love canal in my backyard

much of epa rules are misguided and hurtful.

when the epa gets tough many of the companies say'

allright u wanna play hardball ?

were leaving. well be selling our products in usa

same as always were just moving the manufacturing

to another country. see ya !

also we are awash in goods. part of the reason

for a poor economy is theres nothing left to buy.

as far as smalls. when i was a kid my dad had ONE hammer

after i lost it . i had to pay for a new one. anbout

2 months allowance. how i bitched !

today people got several minimum.

yes we are spoiled. when it comes to christmas

i have no NEEDS. my friends and relatives have no NEEDS.

sure we all have wants.

technology has kinda petered out also.

when the vhs vcr was invented u had one device that

everyone in the world wanted at least 2 of.

microwave oven ,cellphone.

where are the life changing devices we were promised.

the last big profit maker was the flat panel tv.

the internet has brought us all the media content we can

possibly handle.usually for free.

translate declining book, audio and game sales.

 

[Voice of Reason]

Manipulation indeed...such that most no longer even comprehend how the system actually works.

The "true value" of gold is a constant - unchanging. When we say "gold is going up," we should be saying the "dollar is going down." Inflation and deflation are illusory.

Take a common loaf of bread for instance...A loaf today has the same value as a loaf two hundred years ago. That it used to cost five cents, and now costs five dollars merely indicates that the value of the money required to purchase it is drastically reduced! The bread is no more valuable than it was in yesteryear, but we must fork over much more money to acquire the bread. A loaf of bread is still a loaf of bread! So it is with gold, and every other commodity.

We have been trained to accept inflation as the increased value of an item when it is nothing more than the decrease of the purchasing power of our money used to buy that item. In this way, the rise in SPOT (which we happily look for) is sadly indicative of our diminishing dollar. This has nothing to do with supply/demand economics or scarcity, it all depends on the value of the dollar.

Now we know that the value of the dollar IS manipulated by the Fed - that's what they do. As the value of the dollar drops, their remedy is to put more funny money in circulation, which further decreases the value of the dollar. Eventually, this (evil genius) scheme will cripple our nation, but not without first robbing us of all true wealth and resources. So in essence, the Fed controls our economy - interest rates, inflation/deflation, gold prices, etc., etc. The private bank is bleeding us dry - Manipulation indeed!

IMHO
Voice of Reason

 

[mts]

Manipulation indeed...such that most no longer even comprehend how the system actually works.

The "true value" of gold is a constant - unchanging. When we say "gold is going up," we should be saying the "dollar is going down." Inflation and deflation are illusory.

Take a common loaf of bread for instance...A loaf today has the same value as a loaf two hundred years ago. That it used to cost five cents, and now costs five dollars merely indicates that the value of the money required to purchase it is drastically reduced! The bread is no more valuable than it was in yesteryear, but we must fork over much more money to acquire the bread. A loaf of bread is still a loaf of bread! So it is with gold, and every other commodity.

We have been trained to accept inflation as the increased value of an item when it is nothing more than the decrease of the purchasing power of our money used to buy that item. In this way, the rise in SPOT (which we happily look for) is sadly indicative of our diminishing dollar. This has nothing to do with supply/demand economics or scarcity, it all depends on the value of the dollar.

Now we know that the value of the dollar IS manipulated by the Fed - that's what they do. As the value of the dollar drops, their remedy is to put more funny money in circulation, which further decreases the value of the dollar. Eventually, this (evil genius) scheme will cripple our nation, but not without first robbing us of all true wealth and resources. So in essence, the Fed controls our economy - interest rates, inflation/deflation, gold prices, etc., etc. The private bank is bleeding us dry - Manipulation indeed!

IMHO
Voice of Reason

Well, I agree to a certain extent. However, you are looking at it as if the world is only black and white.

1. I disagree that a loaf of bread has the same value today as it did 200 years ago. 200 years ago a loaf of bread was a big deal. There were very few other foods available. If you had a loaf of bread you had a life sustaining product. Today, people don't consider a loaf of bread to be a special thing. Many would rather have waffles, cereal, cookies, and many other packaged/fast foods that they consider to be more valuable. However, this only enhances your argument. I would say that a loaf of bread has less value today yet costs more.

2. The value of gold is also not constant. The recent run up to $1900 shows this. The value of the dollar (and prices) did not momentarily change by 15% in one month. In general, the value of gold is fairly constant but can also see wild fluctuations when speculation and panic set in. Gold is a product that does indeed still abide by the laws of supply and demand. It is true that PART of the increase in gold prices is due to the dollar weakening. But it is not an absolute.

3. What a loaf of bread cost 200 years ago really isn't any concern to us. No one living today was living 200 years ago. What we care about is what costs are today. Yes, a loaf of bread costs $5 today instead of 5 cents. But I also make way more than 100 times what people made 200 years ago. The idea that we should look back 200 years to see what our currency is worth is really a moot point. Why do we care what our currency could buy back then? I only care what my currency can buy now over a few short years (or at least during my lifetime).

 

[jim4silver]

Well, I agree to a certain extent. However, you are looking at it as if the world is only black and white.
The idea that we should look back 200 years to see what our currency is worth is really a moot point. Why do we care what our currency could buy back then? I only care what my currency can buy now over a few short years (or at least during my lifetime).

I don't like comparing asset prices from the past to present either. And I would say 200 years doesn't matter, since technically we did not have the same "dollar" then that we have now. A more informative and educational review would be to go back to 1913, when the fed reserve was created, or maybe 1933, when a US citizen could no longer redeem their paper for gold.

To look back at either of those dates shows how much the value of your "dollar" has been degraded/devalued/lost buying power/etc. Knowing this does not really matter per se with reference to survival in our modern world, but it does give an idea of where we are headed and why in certain economic times physical gold trumps paper assets.

Here is an example worth knowing. Take a 20 dollar gold piece back in 1932 (a double eagle) and a 20 dollar bill from that same date. Fast forward to today and let's ignore any possible numismatic value the gold coin or 20 bill has. That 20 dollar gold piece is worth about 1600 or so in current "dollars". That 20 bill from 1932 is worth 20 current "dollars". If you factor in how much work and effort it took in 1932 to earn 20 bucks (and the buying power it had back then) and compare it to today's 20 dollars, you would have lost over 90%+ in real buying power holding the paper instead of the gold.

And yes, there have been long periods of time in US history during the past 100 years where the price of gold stagnated or dropped while US stocks went up several hundred percentage points. But a person has to be nimble and recognize the current signs and how they give hints as to what might be coming in the future.

Anyone think that what has happened over the last 10 years points to growth and prosperity in the US in the near or intermediate future? If so, please state what those signs are, because they have eluded me completely and I constantly try to find them, in that I don't like believing that a financial tsunami is heading our way.

More and more printing is going to happen in the US and in Europe. It is the only way to prevent a total collapse of the major financial institutions and many governments in Europe as well as states here. Plus all the folks getting gov handouts will keep needing and demanding them-- food stamps, medicare, extended unemployment benefits, disability payments, etc, plus the gov is probably going to keep our troops in the mid east for a while (that alone costs roughly 300 million per day according to an article I read--don't know if it is 100% accurate).

This is just a portion of spending requirements our gov requires on a daily basis. That money will need to come from somewhere and will be created/printed to keep things rolling in my opinion. If people stopped getting their gov goodies I believe there would be rioting in the streets, and by that I don't mean the "protests" like you are seeing now on Wall Street. The politicians want to keep public order and get re-elected so they will keep the printing presses going in my opinion. And if that happens it is very inflationary.

I wonder how many US "dollars" a 20 gold piece will be worth in just 5 years, or 10 years from now?

Just my opinion.

Jim

 

[Voice of Reason]

Valid and Reasonable points indeed.

Great discussion.