GOLD

[Steve Netwriter]

Leave them alone.

We need someone to be on the other side of our profitable trades,

and the thickos on the mainstream help to serve them up

 

I quite agree

[Bobsta]

I started to reply to you, but it became too big for this thread, so I've created one just on the case for silver.

 

http://www.greenenergyinvestors.com/index.php?showtopic=2887

 

Steve

A great article Steve. Many thanks for taking the time to put it together.

 

As you highlight in the collection of articles, Silver is currently being used up faster than it's mined. In addition, it clearly has more uses than gold. Electronics and jewelery being the obvious ones, but more recently silver is being used in a whole host of materials due to it's antibacterial properties. Only this week I've done my bit to support the Silver price by taking delivery of a new fridge freezer and a new super-king mattress - both containing antibacterial silver coatings.

 

The only counter-argument to this that I feel is worth considering is the simple one of supply and demand. If silver costs $20 an ounce, it makes sense to use it in solder, low-resistance circuitry and in antibacterial medical and home products. If it costs $40 manufacturers (of end products) look at alternatives.... and if it costs $60 they positively scramble for alternatives. Of course, higher prices also drive more mining ... and therefore is this quite an elastic product that can't cope with such a high increase in price (demand falling, supply increasing)? Unfortunately I'm no chemist or "uses of Silver" guru so don't know if there *are* any alternatives to Silver in the applications in which it's typically used today.

 

I've been with Silver since $14 (£16 more heavily... $18 even more heavily) so if we hit $25 I'm happy to just sit back and see what happens. Interesting times ahead.

[Steve Netwriter]

I've noticed recently poor performance from the Kitco.com site... Refreshing the gold, silver, platinum (and I'm sure other) charts often results in a connection failure and a retry being required.

 

Is this potentially a sign of more interest in PMs out there? ... or do I just have an unreliable Internet connection?

 

I've got a load of Kitco charts on the website I use on my computer, and they have been coming up with no problems.

Of course I'm asleep during most of the US day

[Steve Netwriter]

Talking heads just on CNBC. A quick run down.......

 

Daniel Sillhart, LB Swiss

 

Gold runs in a 8 year cycle 1972 - 1980.......2001 - 2009 ??? Will the Bull die ?

 

The market expects a correction to $900 - $870 sometime in the next 4 weeks.

$1100 - 1150 target for 2009

 

Silver moves twice as much as gold.The $40 high manipulated in 80's

Expect a $24 dollar high this time.

 

Not my views but interesting to see what mainstream is pumping out.

 

To me this reads you better think twice before jumping into gold as your upside is minimal and short lived. If you are already in, it might be best to start thinking where the exits are.

 

IMHO......This of course allows the likes of Goldmans to buy it up when we have the big correction at the $1000 mark which will shake a lot of people out of the market. After that the rockets will really start

 

Buy and Hold

 

That CNBC 'advice' sounds about on a par with Paul and Pippa on morning TV here.

"Ooooh, gold is expensive, what else could we buy? How about copper?"

 

You've gotta love mainstream ignorance

[ConvertedGoldBug]

The only counter-argument to this that I feel is worth considering is the simple one of supply and demand. If silver costs $20 an ounce, it makes sense to use it in solder, low-resistance circuitry and in antibacterial medical and home products. If it costs $40 manufacturers (of end products) look at alternatives.... and if it costs $60 they positively scramble for alternatives. Of course, higher prices also drive more mining ... and therefore is this quite an elastic product that can't cope with such a high increase in price (demand falling, supply increasing)? Unfortunately I'm no chemist or "uses of Silver" guru so don't know if there *are* any alternatives to Silver in the applications in which it's typically used today.

 

I have no idea of the answer to this, however I could hazard a guess by suggesting how many ounces of silver are used in each product. For example, if one ounce of silver is used over 10 products, then the price increase of the product to the consumer only need increase by $2 to cover the increase in cost of materials.

 

Also, if industrial demand weakens, how much of the slack would be compensated by investment demand? (since silver is money, just like gold is).

 

PS: I just worked out the value of my investment in 2016 if silver was $600..... in my dreams

[azazel]

Hello narco. Did you get an email from coininvestdirect.com with new offers? I haven't yet and I'm holding off placing an order until I get it. They are interested in advertising here and I passed on the details to DrBubb, so I feel quite smug about my contribution

 

Az

 

Edit. The offer seems to be 2008 krugerrands for £505 each, 5 per customer.

 

http://coininvestdirect.com/main.php?a=11&id=107

[Steve Netwriter]

A great article Steve. Many thanks for taking the time to put it together.

 

As you highlight in the collection of articles, Silver is currently being used up faster than it's mined. In addition, it clearly has more uses than gold. Electronics and jewelery being the obvious ones, but more recently silver is being used in a whole host of materials due to it's antibacterial properties. Only this week I've done my bit to support the Silver price by taking delivery of a new fridge freezer and a new super-king mattress - both containing antibacterial silver coatings.

 

The only counter-argument to this that I feel is worth considering is the simple one of supply and demand. If silver costs $20 an ounce, it makes sense to use it in solder, low-resistance circuitry and in antibacterial medical and home products. If it costs $40 manufacturers (of end products) look at alternatives.... and if it costs $60 they positively scramble for alternatives. Of course, higher prices also drive more mining ... and therefore is this quite an elastic product that can't cope with such a high increase in price (demand falling, supply increasing)? Unfortunately I'm no chemist or "uses of Silver" guru so don't know if there *are* any alternatives to Silver in the applications in which it's typically used today.

 

I've been with Silver since $14 (£16 more heavily... $18 even more heavily) so if we hit $25 I'm happy to just sit back and see what happens. Interesting times ahead.

 

I'm glad you liked it. I'm actually fairly new to silver. I bought a bit last year, and topped up recently.

Hence the interest in articles recently.

 

I must read more. But at the moment I see it as a good gamble on the side of gold.

I did notice Jim Sinclair makes the point that he thinks gold will stay up, but silver won't.

[wren]

The only counter-argument to this that I feel is worth considering is the simple one of supply and demand. If silver costs $20 an ounce, it makes sense to use it in solder, low-resistance circuitry and in antibacterial medical and home products. If it costs $40 manufacturers (of end products) look at alternatives.... and if it costs $60 they positively scramble for alternatives. Of course, higher prices also drive more mining ... and therefore is this quite an elastic product that can't cope with such a high increase in price (demand falling, supply increasing)? Unfortunately I'm no chemist or "uses of Silver" guru so don't know if there *are* any alternatives to Silver in the applications in which it's typically used today.

Am I wrong in thinking that the price of silver does not so greatly influence its supply or demand for the following reasons?:

1) Most silver is produced as a by-product in the mining of base metals, like copper, zinc etc.

So, many miners cannot choose to increase their silver production while not increasing the other metals. A side effect of this is that in a recession demand for base metals might drop and silver production could drop with them.

2) In most products containing silver the silver is a relatively small component of the price so a big increase in silver price impacts the price relatively less.

3) In many silver products, there is no really good cheaper substitute.

 

It's a long time since I read these things about silver, so please correct me if my memory fails.

[Steve Netwriter]

I dunno, you go to sleep for 8 hours and 5 pages have appeared!

 

Cheers for the info Steve, I have been to Central vault in Wellington and wasn't hugely impressed to be honest. Also as it is at the centre of 4 fault lines and below an office block I did wonder about it's integrity in the 'big one'

 

I have decided to store my coins in the ASB vault in Auckland as it looks safer, is more geologically stable and I can drive to the NZ Mint and pick up my gold and drive it across town.

 

I have now found that NZI will cover me insurance wise (including the drive across town!) and that plus the deposit box costs are still about 1/2 the cost of storage / insurance at the mint.

 

So do I take it that you store your stash in a good vault and not worry about insuring it? That would give me sleepless nights!

 

Sylvester

 

It's difficult to keep up isn't it

I'm now clicking control-click on all the reply buttons of the posts I want to reply to, and then replying when I've reached the end

 

Yes, I did wonder about your earthquake situation. It's good to hear what you think of the vaults.

I'm split between BV, GM and physical "in the hand". For that I prefer it to be stored locally, just in case I went to be able to get at it quickly.

Hence my suggestion of local bank safes.

 

I take it you're interested in 1oz Kiwi gold coins from the NZ Mint. I did ring around, but their offer was better than any other I found.

[Steve Netwriter]

Blimey, looks like the posts per day ratio at GEI (3 days 43pages) has quickened up just a tad.

 

I'm very glad to see some of the more respectable names from HPC, (my personal opinion of course) Pluto & Goldfinger over here on GEI as the only thread I visited on HPC was the gold thread, even though i never posted in it, i always read it with great interest and very much enjoyed the posts and rocket pictures, but it was always hard to keep pace.

 

I am only invested in Gold and Silver Bullion coins at present, and adding to my collection every time a price dip occurs (not that there’s been many)

 

So may I ask these questions.

 

What signs are you looking for that would signal to you that a top in the gold price is in place ?

 

Obviously de-flation has got to be key here, and if I’m correct the £20 note is one of the most produced banknotes currently in circulation. for those outside of the UK the bank of England is currently circulating 2no. different £20 notes. But nobody seems to know when the "old style" £20 note is going to be pulled out of circulation.

 

Would the announcement of this must have an effect on the gold price as this must surely be seen as "actual deflation"

 

http://www.bankofengland.co.uk/banknotes/noteissue.pdf

 

does anyone else know if this situation is happening in other currencies, IE: is there 2 different types of $100 bill in circulation maybe showing 2 different "dead presidents" ?

 

Also, after listening to the latest FSN and the "Gold round table" Money supply was being mentioned quite a bit, with the removal of the M3 figures, is this just the figures for the USD$ or have the M3 figures been removed for ALL currencies ? and would this also confirm that the above weblink only shows data up to Feb 2006 ?

 

Sorry about the multiple questions here, but I’m still fairly novice in these sorts of matters, so go easy folks

 

SR

 

I think this thread is much better than the HPC one. I got fed up reading some of the posts on there.

 

When to sell ? When Jim Sinclair says so He wrote a bit about that. He said "when I say sell you won't." And then went on to explain why. I will.

 

I read an article recently which listed M3 in the top 20 countries. It was pretty high. I'll see if I can find it.

[G0ldfinger]

Gold-silver ratio from the London Fixing below. I don't think it is really turning. I think we will see some jitters, and then it's going to go further down.

 

[Steve Netwriter]

Am I wrong in thinking that the price of silver does not so greatly influence its supply or demand for the following reasons?:

1) Most silver is produced as a by-product in the mining of base metals, like copper, zinc etc.

So, many miners cannot choose to increase their silver production while not increasing the other metals. A side effect of this is that in a recession demand for base metals might drop and silver production could drop with them.

2) In most products containing silver the silver is a relatively small component of the price so a big increase in silver price impacts the price relatively less.

3) In many silver products, there is no really good cheaper substitute.

 

It's a long time since I read these things about silver, so please correct me if my memory fails.

 

That sounds exactly like one of the articles I read.

So, no I do not think you are wrong

[Steve Netwriter]

Found it:

 

M3 Data

 

How the Gold market defies the Law of Gravity - by Gary Dorsch, Feb 18 2008

mms://media.kitco.com/weeklyreport/dorsch20080218.wma

 

Money supply in 18 of the top 20 economies growing at double digit rates.

 

Aus: broad M3 = 23%

China: 19%

Korea 12%

England 12.5%

India 21%

US 15%

[G0ldfinger]

I wired more funds to GoldMoney today, and I will buy silver stored in Zurich once it has arrived. I hope gold and silver don't move higher until I can buy.

[drbubb]

So may I ask these questions.

 

1/ What signs are you looking for that would signal to you that a top in the gold price is in place ?

 

Obviously de-flation has got to be key here, and if I’m correct the £20 note is one of the most produced banknotes currently in circulation. for those outside of the UK the bank of England is currently circulating 2no. different £20 notes. But nobody seems to know when the "old style" £20 note is going to be pulled out of circulation.

 

I think Gold will "go parabolic" before it peaks. That hasnt happened yet.

I would also look for long rates to show a signiicant rise, and short rates to bottom,

and maybe hold higher.

 

2/...nobody seems to know when the "old style" £20 note is going to be pulled out of circulation.

Would the announcement of this must have an effect on the gold price as this must surely be seen as "actual deflation"

 

3/ does anyone else know if this situation is happening in other currencies, IE: is there 2 different types of $100 bill in circulation maybe showing 2 different "dead presidents" ?

 

That isnt a trigger that I personally find of great importance.

Maybe you can explain more about why we should be watching this?

 

4/

Also, after listening to the latest FSN and the "Gold round table" Money supply was being mentioned quite a bit, with the removal of the M3 figures, is this just the figures for the USD$ or have the M3 figures been removed for ALL currencies ? and would this also confirm that the above weblink only shows data up to Feb 2006 ?

 

So really do think that M3 is misleading, and if you look at a broader measure of money, including something like commercial paper (which has dropped precipitiously), then overall money is growing at something like 3%. So maybe a focus on "old M3" is way too narrow

[drbubb]

To me the Dow chart of today looks very bearish.

 

It has certainly smasshed thru key support levels,

and so may need to go down another "full notch" to the next key Moving Average

 

Next support is about Dow-11,500

[G0ldfinger]

http://www.bloomberg.com/apps/news?pid=206...&refer=home

MBIA, Facing Downgrade, Asks Fitch to Stop Rating (Update3)

 

By Christine Richard

 

March 7 (Bloomberg) -- MBIA Inc., under threat of a downgrade, asked Fitch Ratings to stop issuing credit rankings on its insurance units, saying the grades have become less valuable to investors, of little use to the company and too expensive to maintain.

 

:lol:

 

 

:lol: :lol:

 

Sorry.

[G0ldfinger]

It has certainly smasshed thru key support levels,

and so may need to go down another "full notch" to the next key Moving Average

 

Next support is about Dow-11,500

There seems to be a lot of resistance from below at the 12,000 level. Maybe some SWFs dive in bigtime at this level.

[Henry Holland]

Greetings from yet another Goldfinger/G0ldfinger disciple.

 

I stumbled across HPC around three years ago (when Dr Bubb was a prolific poster over there), and was fascinated by the wider financial knowledge being shared and discussed.

 

I lurked and learned, paid off all non-mortgage debt, switched to a cheap ten year fixed rate mortgage and rearranged my savings and investments based on my newly aquired knowledge. I even tried GEI in its early days, but felt out of my depth.

 

In January 2007 I took cgnao's advice to "protect myself" and nervously ordered a single 1oz Kruger from Bairds (c£350), just to test the water. As predicted by the goldbugs, once I had handled a bullion coin and understood what constitutes real money I started buying little and often and have recently started accumulating Silver as well.

 

Thanks to the many ex-HPC goldbugs, I now feel that I have some kind of financial protection for myself and my family.

 

I intend to spend more time lurking on this forum, but it will probably be a while before I can contribute anything of any value. I'll just sit at the back of the class and try to take it all in.

 

Cheers

Dutch

[qwerty]

Dr.Bubb I am interested to know if you were investing in Miners Juniors Exploration before or after the Tech crash and if so how they fared in the subsequent carnage?.

[G0ldfinger]

...

So really do think that M3 is misleading, and if you look at a broader measure of money, including something like commercial paper (which has dropped precipitiously), then overall money is growing at something like 3%. So maybe a focus on "old M3" is way too narrow

Not sure about M3 being too narrow. What we see at the moment is M3 growing because 'shadow money' that was not included in M3 gets bailed out (in a way, the central banks are taking the shadow banking system back on balance). What happens is that some people who would have lost money, now don't lose it, and they take it and invest it in the next big thing, i.e. commodities. So, the upsurge in M3 corresponds with the inflation in commodities in a way.

 

Maybe I am overly simplistic here. Try to make a case for M3. I agree, CP etc. was seen as 'money', but as money went into such investments, it went nowhere else and inflation was contained. Now the process reverses.

[G0ldfinger]

This MBIA thing is unbelievable. How naive are they really? But maybe they get through with it and a carpet of silence will be put over the whole thing.

[Pluto]

Some trivia for all you metal heads, and I don't mean the musical kind.

 

$50,000 invested in Rhodium in 2003 would see you investment standing today at a cool $1,000,000. Not too shabby is it?

 

http://www.kitco.com/charts/rhodium.html

 

Rhodium is a silver-white metallic element, is highly resistant to corrosion, and is extremely reflective. It is used as a finish for jewelry, mirrors, and search lights. It is also used in electric connections and is alloyed with platinum for aircraft turbine engines. Another use is manufacturing of nitric acid and used in hydrogenation of organic compounds. Rhodium usage is dominated by autocatalyst applications where it is used together with platinum and palladium to control exhaust emissions

[wren]

Cheers

Dutch

Welcome aboard.

[drbubb]

Dr.Bubb I am interested to know if you were investing in Miners Juniors Exploration before or after the Tech crash and if so how they fared in the subsequent carnage?.

 

I started well before that. In fact, before the Bre-X crisis.

But I was investing in a rather smaller way until about 2001, when I STR-ed.

 

Like many, I found it difficult to make money trading Juniors during the bear market,

but I did generally outperform the Junior stock indices.

 

Having lived through that time, I tend to be quicker to take profits after a good run than many that

started later. I also learned to play the seasonal cycles, buying most aggressively in August and

in December, and then selling after a 2-3 months run up from each.