Silver at $40 an ounce.

[Pliny]

Ya, I buy maple leafs too. What do you pay usually, how much above spot?

Without looking at my receipts I seem to recall my last purchase was a bit over a dollar. $1.34 maybe?

Well, there was no news from Bernanke. He is going to do whatever it takes to curb inflation. To me that means, no QE3 and rising interest rates, with the accompanying lack of borrowing. People will start saving and then it will be vilified as hoarding and then, if it gets bad enough people's savings accounts will be raided. High interest rates are the only means the fed has to control inflation, besides stopping the printing presses. It means some pretty lean times for a lot of people. But all the debt, the created credit, has to be written down.

[ZenOps]

Rumor has it that Apmex is buying back silver eagles at $3 over spot.

Nowadays I don't think any premium coin (especially the .9999 maple) can be bought for anything less than $4 over spot.

It never ceases to amaze me that people would pay 3% comission to buy paper silver on the market, but wouldn't pay a couple bucks (maybe a little more than the paper comission) for the real thing. Why wouldn't you want the physical if you could get your hands on it? Maples are shiny

[Bonam]

I don't think this is any different than the precious metals boom in the first half of the last decade. They went up and up and up and just when everyone was throwing more money at it it all collapsed. Nothing keeps going up and up forever. Not houses, not silver. You guys jumping on this boat would do well to hedge your bets.

[ZenOps]

Hedge?

Physical has no hedge. If you want to sell a small portion of your silver holdings to buy something else that is fine, but there is no "hedge". Which makes it far superior to the paper market as they charge fees for all sorts of things like puts and calls and options. It also IS money - meaning that if a particular currency starts collapsing, you can convert it to any paper dollar you want to (if you wish to re-enter the paper game) So you can buy a US eagle, and if the US dollar starts collapsing, simply sell it in Euros... Remember: It is money, the ultimate currency (along with gold) paper is the fools game.

Do you really want to be the Zimbabwean bread boy? http://www.gonogonow.com/?p=953

Its much easier to just sell 3/100ths of a physical silver holding than hedge on a paper market and *always* lose the money to fees.

< The case for Silver being more expensive than gold.

I do agree with most of that video... All except the part that we have about as much refined Silver as the 1300's, I'm pretty sure its much closer to 900AD. Put it like this: Centuries of silver mining has been consumed in the last decade and thrown into landfills (unrecoverable silver, such as bandages, water filters, electronics)

If you want reality: Try to go out tomorrow and buy a silver coin from probably one or two mint dealers in your city. You might be shocked.

http://www.mint.ca/store/mint/customer-service/dealer-locator-1400026

The only thing I fear is that it might go so high - that the government will step in and confiscate and/or make it illegal to own.

Edited April 29, 2011 by ZenOps

[Pliny]

The only thing I fear is that it might go so high - that the government will step in and confiscate and/or make it illegal to own.

That is a real concern. Government is not beyond the confiscation of wealth. If the rich don't pay in taxes they will pay somehow.

As for hedging - silver will never be worth zero. But no one is suggesting that a person keep his entire portfolio in silver and gold. It is just the most liquid asset and always redeemable for something.

The scenario in the late seventies with silver was not the same as today. There is a real instability and volatility of currencies today that didn't exist back then. Most of the rise in silver prices in the seventies was due to speculation and, so I hear, the Hunt Bros. More of a bubble than a real concern over currencies collapsing through inflation. Inflation of the money supply is the real concern today.

Bernanke was disappointing really. After inflating the money supply he says inflation is the number one concern. Duh! Winning!

[ZenOps]

Exactly.

What stock analysts tend to omit, is that the Hunt brothers were basically shut down by the government because they changed the rules. If the government had not stepped in an put a stop to it - than the Hunt brothers would have cornered the market and none of us small investors today would probably own physical silver (as little of it as there is left) So Ironic.

That two men - nearly cornered the entire global silver market 30 years ago definitely does underline exactly how little silver there is out there. This time around, it is much scarcer than it was back in 1980, thirty years of unrecoverable industrial demand and waste.

Silver is also spread around much more evenly. As few as silver investors are - they are still more spread out around the globe than the Hunt brothers. If you try to buy a Silver Maple Leaf today, you will have to wait weeks to get a 2011, all of the bullion of previous years is gone (Remember, coins have been minted for thousands of years) Gold maple leaf? No problem... Lots on the shelf, heh.

Some are predicting at least a 16:1, 10:1 or even better than 1:1 ratio to gold before it settles back at its market value.

And I have to say: That if the government does step in and hammer Silver back down - it would be irresponsible. Keeping such a scarce resource artificially low at this point in time would discourage silver mining and exploration (Silver being far far far more important than oil IMO) and recycling.

And a word of warning to the paper Silver players: A pre-1964 US Government certified "Silver Certificate" is worth a little less than $2.

Edited April 30, 2011 by ZenOps

[maple_leafs182]

I know my economics professor was suggesting that the US will go through a Japan like recovery where they will have periods of growth when the Central Bank and government are spending and contractions when deficits become too high and they cut back on spending. Something Richard Koo calls a Balance Sheet Recession.

If the Fed does not have a QE3 then the US is bound to slip back into a recession. If that happens I would think silver would take a hit vs the US dollar in the short term. The US dollar has become the worlds carry trade currency and because of this people would be forced to buy dollars to pay off their debts in the event of an economic downturn. I think we could possibly see silver fall down to somewhere in the low 40s or even the 30s against the US dollar. However, if there is a downturn, I think that would be enough for the Fed to justify QE3.

A side note, Peter Schiff brought to my attention that if you look at the US economy when priced in gold, silver or even some other currencies such as Swiss Francs, the US economy has actually been contracting. The Federals Reserves inflationary policies have just been making it appear as if there has been economic growth.

With oil prices also on the rise I think we will see another economic collapse soon.

[GostHacked]

A side note, Peter Schiff brought to my attention that if you look at the US economy when priced in gold, silver or even some other currencies such as Swiss Francs, the US economy has actually been contracting. The Federals Reserves inflationary policies have just been making it appear as if there has been economic growth.

Schiff is one smart cookie. He called the collapse of the housing market two years before it happened. People called him crazy, ... Schiff is a great resource for future money trends, I really like listening to him.

[ZenOps]

I would like to see silver hit the $150 mark (for obvious reasons)

But also because it would put some kick back into capitalism. Put a little bit of greed back into peoples minds. It would make youth get off their Xbox playing asses and go out there and find a silver mine, a gold mine, and an oil deposit.

Nothing creates an economic boom like a gold or oil rush, but the prices have to be high or everyone will just be content twiddling their 44 million food stamp receiving, Xbox sore thumbs.

[maple_leafs182]

I would like to see silver hit the $150 mark (for obvious reasons)

But also because it would put some kick back into capitalism. Put a little bit of greed back into peoples minds. It would make youth get off their Xbox playing asses and go out there and find a silver mine, a gold mine, and an oil deposit.

Nothing creates an economic boom like a gold or oil rush, but the prices have to be high or everyone will just be content twiddling their 44 million food stamp receiving, Xbox sore thumbs.

Ya, I am not that optimistic.

I think a falling dollar will lead to massive unemployment, an increase in the crime rate, food riots, and civil unrest.

[Pliny]

I think a falling dollar will lead to massive unemployment, an increase in the crime rate, food riots, and civil unrest.

It will lead to panic among governments whose revenues won't be able to match liabilities.

If crime rates increase, or food riots occur along with civil unrest it will be because governments can't feed themselves and not because people can't feed themselves. People have been providing for themselves as we go along. It is only when governments get too big and can't fund their liabilities that we get into trouble - other than natural disasters.

Right now there is a bit of a panic in government and they don't know what to do. They need revenues. do they increase taxes? There is no guaurantee of revenues in doing that - the economy has to be growing in order for revenues to increase, upping taxes kills economic activity. Do they just print money? Inflation is the result of that. Do they raise interest rates? Once again that kills economic activity and puts homeowners at risk of foreclosure. So the problem is where can government get their revenues - not how do we get food on the table - we know we can do that. The only solution is cutting the size of government and it's budget the other option is dictatorial tyranny - massive wealth acquisition schemes for government to keep itself funded, control wages and prices and basically keep itself relevant and important in our lives.

[Pliny]

And a word of warning to the paper Silver players: A pre-1964 US Government certified "Silver Certificate" is worth a little less than $2.

That is only because of it's historic value to collector's. Take it to the bank and they will trade you one "silver certificate" for one crisp new dollar. You can argue all you like that silver is now worth $45/oz but a dollar is no longer a weight of silver or gold, it is a value in itself determined by supply and demand.

Edited May 2, 2011 by Pliny

[Pliny]

I know my economics professor was suggesting that the US will go through a Japan like recovery where they will have periods of growth when the Central Bank and government are spending and contractions when deficits become too high and they cut back on spending. Something Richard Koo calls a Balance Sheet Recession.

A side note, Peter Schiff brought to my attention that if you look at the US economy when priced in gold, silver or even some other currencies such as Swiss Francs, the US economy has actually been contracting. The Federals Reserves inflationary policies have just been making it appear as if there has been economic growth.

A balance sheet recession? Just a matter of accounting. Of course, that's all it is when electronic debits and credits are the sole means of trade.

With oil prices also on the rise I think we will see another economic collapse soon.

Governments get quite a few revenues from oil. A high price is good for them but not for politicians seeking re-election. The high price has probably more to do with increased demand in China and India than anything. Obama is investigating speculators though - a complete dunderhead. Try looking at government environmental or domestic oil development policy.

[maple_leafs182]

Within minutes following the announcement of OBL being dead silver fell over 5 dollars.

I think I may trade some of my silver in for gold, I'll wait till silver goes back up to $48-$50 first.

[ZenOps]

Osama being dead is probably a factor.

Another factor is that the CME is raising the margins *again*

http://www.kitco.com/reports/KitcoNews20110502AS_CME.html

Three times in less than two weeks... There is something not right in the state of Denmark. The CME are doing everything in their power to collapse the paper Silver players right now. The government hammer is hitting silver hard, but only the margin silver paper players are getting smacked.

There will be a dip, because those who cannot afford the new margin, must sell (just like at opening today)

I don't know if they plan to raise the margins all the way to 100% and just have people not borrow any money to own silver? That would greatly benefit the Chinese IMO, as its mainly the US players that buy with leverage and funny money?

Anyone else with conspiracy theories?

Edited May 2, 2011 by ZenOps

[Pliny]

Anyone else with conspiracy theories?

No. I am generally surprised by my own ignorance of all that is actually going on. Thanks for the link.

Superficially, the US seems strong after Osama's execution, and that is reflected in a return to confidence in the US dollar. Obama will continue with his economic policy and again erode that confidence, I think. The price of oil is the biggest influencing factor in market prices after confidence in the dollar.

In my view, one has to wait and see what the moves are of the power players. Unless one can get an inside line one just has to keep as much on top of the moves as possible.

Edited May 3, 2011 by Pliny

[ZenOps]

The hammer is falling yet again. Fourth margin increase

http://www.kitco.com/reports/KitcoNews20110504AS_silvermargins.html

Forcing all the ones who borrowed money to buy silver to sell! Bring Silver down to $5 again, but it still sucks for the physical people because noone will sell at that price because they know its worth much more than that.

The detachment of "spot" price, "real" silver and "paper" silver has begun.

Its kind of sad, because this does represent what the old Silver certificate does, the US dollar is no longer valid as a currency for "reality" (IE: Not redeemable for what it was originally supposed to be valued at)

I'm thinking about buying canned food before the US dollar becomes detached from "food" reality.

Edited May 4, 2011 by ZenOps

[Pliny]

The hammer is falling yet again. Fourth margin increase

I think the drop is an opportunity to buy. The economy hasn't changed because OBL is dead. Nor is there a restored confidence in Obama. Confidence in the American dollar, with resultant strength against other currencies and the metals market, comes from a shift in America's self-perception. The reality of the economy will settle in and Obama, if he stays true to his ideological roots, will continue to be intrusive, redistributive and divisive as regards the economy. However, if they change course and raise interest rates in order to fight inflation, which is what they should have done in the first place, then saving will start to occur and money will sit in banks accounts. It will kill the bull market we have been experiencing and limit the volatility of commodities and currencies.

Governments certainly enter an unknown variable that can affect so much in an economy. Politicians making the policy have an inside line that I think is criminal. I'm certain Senator Dodd knew where to move his investments when he was making decisions about stimulus packages and bailouts. Maxine Waters, who had an interest in a bank that received bailout money didn't get much press. It should have had more legs. It certainly isn't a level playing field when government can shift an economy and it takes inside connections to make personal financial decisions. It's corrupt.

So what do you think? Rising interest rates or QE3? QE3 is a continuation of current monetary policy and means further volatility, and rising interest rates means a period of downward adjustment?

Edited May 5, 2011 by Pliny

[Pliny]

I'm watching commodities and oil and the market drop like a stone. A little bit of a panic, I think.

I note Europe has announced no increase in their interest rates and a 115 billion dollar bailout for Spain's economy. Central banking policy that may be reflective of America's future policy. Who knows?

[maple_leafs182]

I agree. I think OBL being dead made the US seem competent which has renewed confidence in the dollar but I do not think this will last long. As you said Pliny, OBL being dead hasn't changed the economy. It looks like we may be hitting a floor, I think now may be an excellent time to buy, I will be picking up a few ounces tomorrow.

As for QE3, I think the Fed may hold off on QE3 for a few months. They may wait till the economy takes another downturn before they can justify implementing another round of quantitative easing.

[Pliny]

I agree. I think OBL being dead made the US seem competent which has renewed confidence in the dollar but I do not think this will last long. As you said Pliny, OBL being dead hasn't changed the economy. It looks like we may be hitting a floor, I think now may be an excellent time to buy, I will be picking up a few ounces tomorrow.

People expecting to make a quick buck are getting out, in my view. People concerned about the economy are still hedging themselves.

I don't think you will regret buying more. Looking at this moment, the downward trend has stopped. Good luck!

As for QE3, I think the Fed may hold off on QE3 for a few months. They may wait till the economy takes another downturn before they can justify implementing another round of quantitative easing.

Governments are so whimsical and so damaging. They may have noticed that the economy is not bounding back or stabilizing with all the QEing they are doing. Trying to ride out and ease tough times by inflating the money supply. They may change their monetary policy to fight inflation, which means no future QEing and higher interest rates and a tough time for people without savings and those with big mortgages or debts. They did encourage people to have those big mortgages pushing the dream of the Community Re-investment Act and encouraging lending to low income earners so they have no one to blame but themselves. Instead of pointing fingers at Wall Street they should be hanging people like Barney Franks out to dry. Government only causes good things though and does no wrong.

Edited May 6, 2011 by Pliny

[ZenOps]

Physical is a decent place to be if you are still worried about the economic outlook of the US (actually probably more importantly Greece, which looks like they are going to defect from the Euro after taking the bailout money, hah!)

Side note: You can almost look at the bagging of Bin Laden as a massive drag on the economy. I mean really, they built thousands of multi-billion dollar planes preparing for some sort of gigantic conflagration. But all it took was a few helicopters, a small team of SEALs, and a good old fashioned gun.

I assume Obama means to shift from military production to "solar panel" manufacturing now that Bin Laden is gone? I can't help but think that with Bin Laden gone, you've just lifted the veil so that everyone can go back to thumb twiddling the Xbox.

[maple_leafs182]

I don't think you will regret buying more. Looking at this moment, the downward trend has stopped. Good luck!

The two places I usually buy from were not selling. I think they are waiting for the market to rebound.

Governments are so whimsical and so damaging. They may have noticed that the economy is not bounding back or stabilizing with all the QEing they are doing. Trying to ride out and ease tough times by inflating the money supply. They may change their monetary policy to fight inflation, which means no future QEing and higher interest rates and a tough time for people without savings and those with big mortgages or debts. They did encourage people to have those big mortgages pushing the dream of the Community Re-investment Act and encouraging lending to low income earners so they have no one to blame but themselves. Instead of pointing fingers at Wall Street they should be hanging people like Barney Franks out to dry. Government only causes good things though and does no wrong.

Pliny, fighting inflation would be the right thing for the Federal Reserve to do and that is how I know they will not do it. Ben Bernake never does what is right for the economy, Bernake doesn't understand how the economy works.

I will be amazed if their is not some form of Quantitative easing by the end of this year or early next year.

[Pliny]

The two places I usually buy from were not selling. I think they are waiting for the market to rebound.

Did they say that theywere waiting for the market to rebound?

Ben Bernake never does what is right for the economy, Bernake doesn't understand how the economy works.

So it seems. I believe he has full confidence that he can manipulate the economy whatever way he likes but doesn't want to be held responsible for making the necessary corrections - which will negatively affect the average individual but, more importantly, government revenues.

I think they(the FEd and the White House) are afraid to do what's right.

[maple_leafs182]

Did they say that theywere waiting for the market to rebound?

Nope, that was just an assumption, they may have been sold out. I just asked if they had any for sale and they said no.

So it seems. I believe he has full confidence that he can manipulate the economy whatever way he likes but doesn't want to be held responsible for making the necessary corrections - which will negatively affect the average individual but, more importantly, government revenues.

I think they(the FEd and the White House) are afraid to do what's right.

I think they believe what they are doing is right, they are keynesians.