Posted on 01/02/2011 10:15:58 PM PST by Frantzie
http://www.zerohedge.com/article/proper-way-use-sledge-hammer From Zero Hedge too.
(Excerpt) Read more at youtube.com ...
The Apple Mac commercial by Ridley Scott has been used over and over but this may be one of the best.
The final words at the end of the video by Thomas Jefferson are worth reading again.
What guarantee is there that the government won’t confiscate it, again?
Silver breaches $31 in o’nite trading! 30.97 x 31.02
Getting to be a crowded trade.
Maybe the American public is waking up to the fact that 1929-1933 didn’t just happen just like 2008. The question is at what point with people say NO to Obama and his goons.
Most idiots would rather watch NFL, Jersey Shore, reality TV or Oprah. Maybe the sheep will wake up.
Didn’t it just close above $30 last week?
It did. I don’t consider silver as “owning” $30 in any way. Silver has a very long established way of having trouble at “round numbers”, and, as any commodity, another tendency to smash the latecomers.
I’m still buying silver but I own loads at $5, 7, 11, 15, and 17 and 21 so I have plenty of downside protection. Right now I won’t knowingly pay more than $27.mid.
Great video! I like it and thanks!
However, by the end of this year the current prices of Gold and Silver are going to look like never-to-be-seen-again fairy tale entry prices.
Right now the lifeboats look full, but wait until the 30 year bond reachs 4.9%. My personal guess to this date is as early as Feb 13th 2011. But whenever it happens, that's when we will begin to see what a crowded trade really looks like.
exactly right...
The people are more apt to donate their lead first...
You are talking about a >1% move in the ten-year in ~~ a month? I suppose that has happened before but to use a word that’s supposed to be “retired” in 2010, that would be “epic”.
It would also be a massive, massive, world-wide “refudiation” of the Bernank’s policy of QE. I am probably as disdainful of QE as you or anyone else, but I’d suspect things hold together at least thru spring. The markets don’t care about unemployment, etc; they only care about making money with free Fedbucks.
As for silver, I am plenty long and always looking to get longer. We both know there is going to be a day of reckoning when the newbies get flattened. From what price level that happens, I can’t tell you. Normally, silver has a habit of having trouble at round numbers, so I was pleasantly surprised to see it blast thru $25 with such gusto, but as I said, I’m not convinced it owns $30 yet.
The way I try to answer the question is by asking “how can the newbies be destroyed by about 25%”, and what I come up with is a serious DUMP from 32.high to about $25. Just my opinion, but I’ve followed Ag for quite a while. I still have the rolls of qtrs & dims I convinced the gals who worked the cash registers at my jr high school in 1965 to set aside for me.
It should be noted that a 10% correction in silver, perfectly normal event for any market, all markets, anywhere, any time, is over $3 at this juncture. A $3 move in silver in any year before 2010 is in itself “epic”, a giant, enormous move. For most of the time I followed silver, a 12 cent move was biggish, a 20 cent move was a once, twice a year event! And all I mean by that is that the traditional way the silver market devastates newbies is to let them accumulate positions on margin, then the COMEX raises margin req’ments (as it did about a month ago) and all the newbies get blasted out and forced to sell.
I was at a couple of auctions and a few antique stors last week in Kentucky. I bought all the morgan silver dollars I could get my hands on at $25 each and Ben Franklin halves at $12 each.
When I saw silver break $30 this time, I firmly saw it as setting a new floor.
You make some excellent points. However, this time I don’t think it is about the price of silver. Rather, I think it is about the value of the dollars being used to purchase it.
I think we are in a 100 year storm, and depending on the knowledge gained by watching the typical cycles for the last few decades may lead one astray from what is actually happening.
In terms of self-assaying forms such as junk coins and SDs, which can acquire modest premium over their pure bullion value, I do not consider it a sin to overpay very slightly. Because if you were buying mail-order from a dealer, you would have to pay freight and thus would have to undergo that piece of friction. If you like junk silver, you will like coin shows, in my experience. www.coinshows.com lists many of them. It’s cheap entertainment (usually $2-3 admission) & worth blowing off a few hours on a weekend if you’re not otherwise engaged & it’s not too far to drive. I am always amazed at how many silver dollars are out there. Bazillions. And quite possibly, 5/8ths of them have been melted down!
What annoyed me in Kentucky was that I still had to pay a 6% sales tax on the purchases. In Washington state, they don’t charge interest when you “buy money”.
I don’t disagree with the 100 year storm theory.
I will make you exactly one caution, however, and it is illustrated/exemplified by folks who value junk silver as bullion + scarcity. It’s one or the other. It cannot be both. You can not add $5.50 (22x face) to the numismatic value of a 1932-D quarter. That quarter is either a numis item or it’s a bullion item.
Silver is not particularly rare. It’s a commodity worth what the market says it is worth LESS AT LEAST 2 and as many as FIVE individual pieces of friction which are very, very difficult to escape. Another way to say this, whatever you pay for silver, you have lost at least 2 elements of friction as soon as you agree to the deal. That’s on SALE. On the BUY end, if you buy an individual 10 oz bar from a dealer, pay $1.19 prem per ounce and $10 to ship it, you’re paying almost a 10% premium over spot to acquire what is probably an insignificant amount of “wealth” or whatever you happen to regard silver as being.
I don’t bring this up for any reason but to impart the awareness that involvement in PMs has vicious, relentless, inescapable frictions that are quite frustrating at times. Yes, I know you don’t plan to sell your SDs next week.
If you want to accumulate silver, have at it. But do not pay for it thinking it is “scarce”. If silver triples in price, all your and all my buying mistakes will be fixed. However, there WILL be a point where the market price, all by itself, will flush out literally kilotons of forks and spoons.
Here is an article from ~~1999 (about the period, 1980) that may interest you. The author claims he personally sent $400 MM in junk coinage to the refiner. That’s a load of money in 1980! The one place where IMO the author goes off the rails is where he claims that common dates may turn rare and rare dates may turn common. That is BS. Otherwise, good article, IMO.
http://www.pcgs.com/articles/article496.chtml
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