Your Mind Should Be Blown By Silver

The Business Insider ^ | 11-9-2010 | Joe Weisenthal

[blam]

Your Mind Should Be Blown By Silver

Joe Weisenthal
Nov. 9, 2010, 12:45 PM

Gold is getting crushed today, when priced in silver. This move is insane. Silver is up over 4%, compared to less than 1% in gold.

From FinViz

[snip]

[agere_contra]

The Silver/Gold ratio has reverted to norm.

Gold is not being crushed, silver has finally caught up.

[RobRoy]

I’ve been following silver today and saw something at first scary and then interesting. I watched it go to $29.10 and then, in just a few minutes, $29.20. It then went to $29.13, back to $29.10, and now, about an hour later, it is down to $27.92 as I write this.

IOW, I thought I was seeing a meteoric rise (even faster than yesterday) but it seems to have hit a peak. If it stops the “small collapse” and starts rising again, it means it has hit a “volatile trading” phase, like we saw in the stock market in late 2008.

[Red Badger]

Hi Yo SILVER!....AWAAAAAAAAYYYYY!!!!.................

[SeekAndFind]

I think there is an outbreak of Werewolves in the world. That’s the only explanation I can think of.... :)

[stockpirate]

the chart indicates that silver is over extended and should pull back to around $26.50’ish or even $26.00 in 4-5 days.

gold usually trades for 50X the value of silver, so silver is just catching up with gold.

[Atlas Sneezed]

gold usually trades for 50X the value of silver, so silver is just catching up with gold.

---

Actually, silver hasn’t traded for as low as that (relative to gold) for 2.5 years. For the last 25 years, 50x ratio or lower periods have been rare and brief (and barely below 50x).

I think 50x is unusually low, and suggests silver can rise with respect to gold.

[RobRoy]

I am pretty much in agreement. I do expect silver to catch up in the “mid run”. Heck, it might even surpass it if people are looking for something they could actually use to buy stuff.

It’s easier to, in an “economic collapse”, buy stuff with silver dimes than with Gold Eagles. Of course, I’m talking “mom and pop” establishments as opposed to Wal-Mart and Nordstrom.

[mas cerveza por favor]

I think there is an outbreak of Werewolves in the world. That’s the only explanation I can think of.... :)

Just standard manipulation by the big players who control these markets.

[netmilsmom]

I got it at 11.00!

[RobRoy]

My father quit smoking in 1964. At the time, cigarettes were roughly $.50 a pack. What he did was save a silver 50 cent piece every time he would have bought a pack of cigarettes. He had many shoe boxes full of the things.

He and I were discussing silver a couple months ago. It turns out he never got rid of a single coin! But that’s nothin’. Apparently he has been buying it in $1,000 FACE VALUE lots for quite a few years.

The stuff can get really bulky, but it is awfully easy to use to buy things. Just go to a farmers market or any mom-and-pop store and see what real silver coins can get you. And dimes are a fairly small denomination, even at the current value.

[Young Werther]

Are you suggesting that the FAT CATS are involved?

[Jim Noble]

It’s easier to, in an “economic collapse”, buy stuff with silver dimes than with Gold Eagles

Is that so?

What's your historical evidence that that's true?

Actually, in a scenario in which money is defined by society at large instead of the government, letting ANYBODY know you've got some, INCLUDING Mom and Pop at the store, is a very bad idea.

[Lancey Howard]

I believe what RobRoy meant was, it’s a whole lot easier for a seller to give you your change if you pay with a silver coin rather than a gold one.

“The total for your grocery order is $110.38, sir.”
“Got change for an Eagle?”
“Will 300 rolls of silver dimes do?”

[Red Badger]

You are obviously not old enough to remember the Lone Ranger’s horse’s name, Silver, and his signature goodbye call at the end of every show.............

[RobRoy]

First, it is fairly common knowledge (and becoming more common) that a 1964 or older silver coin in 90% silver.

Second, a US minted silver coin is relatively trustworthy while any other form is more “suspicious” as to its silver content.

Third, People are not nearly as familiar with the various gold coins being minted as they are with the good ol’ american silver coins.

Fourth, gold is so valuable that even the smallest coin I have seen is worth a LOT of money. It is a bit like running around with nothing but $500 bills in your pocket. It is not very practical “on the street”.

Fifth, (ties in a bit with the third point) as more people discover that Tungsten weighs almost exactly the same as gold, trust in the content of your gold coins will go down.

Sure, gold will be valuable and if you expose that you have too much of any kind of money on you - the latter is true today, of course - but the bottom line is that all indicators are that in a collapse, junk silver will be far easier to use in “barter” than gold for day-to-day needs.

[RobRoy]

Thanks, you were more concise than me. And yes, you nailed what I was driving at.

[Jim Noble]

It is not very practical “on the street”

But, in your scenario, the street is going to be crowded with wolves...

[stockpirate]

It has been trading for the last several years far lower than the 50X. Watch the next few days, without an upward move of gold silver has peaked. At this point only suckers would buy in or if you are shorting it and now pimping it here to the great unwashed.

But if you look at the chart the rate of increse is too steep and needs to correct to a lesser angle.

[RobRoy]

>>But, in your scenario, the street is going to be crowded with wolves...<<

Well, it COULD get that bad, but that is not the scenario I was referring to. If it gets that bad, there will be a lot of other risks to worry about as well. It is why one of the positives of our property in Kentucky is that it is an entire finger of a plateau - very defensible. And when you have cattle and a big garden, in a total meltdown that is a plus.