SILVER

[romans holiday]

Why not keep it even simpler and just trade the volatility in silver via swapping between the metals. Leave fiat out of the equation as we are in a fiat currency crisis, you are just adding another level of risk.

 

You say that the dollar is the second or third best form of liquidity [as in Exter's triangle], which means that it is below the precious metals. With a service like goldmoney you can easily swap between metals and grow the amount of your physical metal. Silver doesn't appear on Exter's pyramid but I think it should be included with gold in the bottom. Silver has actually been used as money for more time than gold through history.

 

Gold is the money of kings, Silver is the money of gentlemen & Federal reserve notes are the money of slaves.

 

Swapping silver for dollars at $17.90 was the wrong move, it would be bigger of you to actually admit it rather than keep defending your dollar "hedge".

Do you actually bother to read posts?

 

Read the post again carefully... the one you replied to, and you can see the/ my logic for holding gold, dollars and silver.

 

Also, it really is tiresome having to repeat I sold a smaller trading position in silver for dollars because of perceived risk [with the dollar hedge, dollars are not to be risked]. As far as being "wrong", it was more a bad trade, but not wrong within the context of my investment strategy. I can afford to make the odd bad trade, given my core in bullion.

 

When/ if silver retraces, I will look at trading silver again.... for dollars. Do I have to keep repeating that I have a larger silver bullion position that has been core for a long time? I don't mind risking silver continuing skywards because I have a large enough core in bullion. I'm content both ways because even if volatile silver retraces, I don't doubt it will continue upwards at a later date.

 

A hedge is a hedge, and pretty basic to the concept of investment. One hedges against their major position in case one is wrong! Re-read the post above to my reasons for hedging. You may not agree with the logic, but it's logical and coherent.

 

 

As far as trading the ratio, yes I can do that with bullion at GM.

[Pixel8r]

Do you actually bother to read posts?

 

Read the post again carefully... the one you replied to, and you can see the/ my logic for holding gold, dollars and silver.

 

Also, it really is tiresome having to repeat I sold a smaller position in silver for dollars because of perceived risk [with the dollar hedge, dollars are not to be risked]. When/ if silver retraces, I will look at trading silver again. Do I have to keep repeating that I have a larger silver bullion position that is core? I don't mind risking silver continuing skywards because I have a large enough core in bullion.

 

A hedge is a hedge, and pretty basic to the concept of investment. One hedges against their major position in case one is wrong! Re-read the post above to my reasons for hedging. You may not agree with the logic, but it's logical and coherent.

 

 

As far as trading the ratio, yes I can do that with bullion at GM.

I understand what a hedge is and I did read your post. I just don't understand why holding the money of slaves makes you feel more secure when it is being created at the rate it is. To get to the level of understanding that you obviously have on money and politics it confuses me as to why you then don't trust what it is that you have worked out and feel the need to hedge it.

 

I will now leave this subject and leave you to your dollar hedge, but please don't keep going on about it in the gold and silver threads.

 

 

[romans holiday]

I will now leave this subject and leave you to your dollar hedge, but please don't keep going on about it in the gold and silver threads.

I think that's a poor comment... makes you sound like the thought police.

[alexreeve]

Interesting take on silver manipulation from Mish, well worth reading.

 

http://globaleconomicanalysis.blogspot.com...ilver-just.html

 

The easiest way for the CFTC to accomplish the silver conspiracy advocates' goal of eliminating the massive short position of JPM would be to up the margin maintenance on silver futures and not let anyone buy any more futures until open interest shrinks sufficiently.

 

Ring a bell? It should. If not, please consider Hunt's Attempt to Corner the Silver Market and how the story ended.

 

I am not proposing that solution, I am merely warning silver conspiracy advocates including Ted Butler and GATA that they better be careful about what they are asking.

 

In my opinion, if controls are placed, those controls WILL be on the long side (which of course will affect the short side) and everyone screaming for controls will get what they ask – forced long liquidation via inability to buy futures, only sell them.

[HPCsoYESTERDAY]

.../..

Do I have to keep repeating that I have a larger silver bullion position that has been core for a long time? I don't mind risking silver continuing skywards because I have a large enough core in bullion. I'm content both ways because even if volatile silver retraces, I don't doubt it will continue upwards at a later date.

.../...

 

 

sorry Romans for what may appear to be 'ganging up on you' here, i can assure you i am not

 

however, i still get confused with some of your replies. For example, I had asked you about selling your core ag pos earlier this year and this was my reply:

 

 

Sold for around $15.50. The bulk had been bought at around 12/ 13/ 14 dollars... so all up at least broke even.

 

I probably could have stayed in it until we saw 17 or 18 again, but I decided to get out of silver [as a long term core position] as - being a deflationist - I came to the realisation that there was just too much risk hanging over it. This was confirmed for me when it broke it's long term support. I put together a thread on this at the time. Actually, looking back, I was speculating on silver... that the ratio would go to 55 or 50 and I could then swap to gold. I will stick to buying gold in the future when "investing" and when speculating look to do something like the above posts outline. I don't think silver is a substitute for gold, which looks to me a lot safer.

 

I still have a good core of gold which I won't be selling come hell or high water. When selling my core holding of silver at GM, I also bought a lesser amount at BV to trade for dollars.... will look to sell this when silver gets to 18/ 19. I feel more comfortable swapping for dollars at BV as there is no uncertainty involved with sitting on dollars for a long period of time, and this is a lesser amount involving speculation not buy and hold. I will still bother to speculate a little with silver/ dollars because, who knows, silver may eventually explode to the upside in a few years time. But in the meantime the volatility should be traded. My targets will be to sell at 18/ 19, buy at 11/ 12 or so, and to not bother with intermediate moves.

../...

 

 

for the interests of clarity and my own sanity can you just clear this up please - did you re-buy your core pos?

[Icarus]

Interesting take on silver manipulation from Mish, well worth reading.

 

http://globaleconomicanalysis.blogspot.com...ilver-just.html

 

'The easiest way for the CFTC to accomplish the silver conspiracy advocates' goal of eliminating the massive short position of JPM would be to up the margin maintenance on silver futures and not let anyone buy any more futures until open interest shrinks sufficiently.'

 

General price discovery works like this. When there are more buyers than sellers the price rises. More people want to buy and less want to sell. When buyers and sellers balance an equilibrium is reached. Conversely when there are more sellers than buyers the price falls.

 

Price discovery on the COMEX silver market works a little differently. When there are more buyers than sellers JP Morgan shorts massively. The price does not rise. It falls instead. Repeat untill most of the world's silver is consumed.

 

[romans holiday]

for the interests of clarity and my own sanity can you just clear this up please - did you re-buy your core pos?

When I first arrived at GEI, like most others I soon became enamoured with silver. As my macro views developed I decided silver was not a straight forward leverage on gold... it would be a lot more volatile [which is hardly a criticism] but might also carry a bit more risk with it in a deleveraging environment.

 

So after the large core silver was sold most of those funds went into gold, though I did also put some into dollars. At an earlier point I also put 10% of my worth into silver kilos [hard to get out of]... this must have been in 2008 [post-crash] because I remember collecting them from the mint when I went back on holiday.... I now refer to this as my core silver [a lesser position relative to core gold]. Having a "larger" core silver position, mentioned above, is relative to the traded silver I sold at 17.90.... which was small fry in context. Bad trade, but big deal, there's a good chance I'll get another go at it.

 

In sum, I have 50% into gold and 10% into silver.... those percentages have been rising with bullion prices, but I hope to "re-balance the portfolio [bullion/ dollars]" on a decent dollar/ silver trade in the near future.

 

Note: I am bullish long term silver, but look to use the volatility in silver to hedge core bullion. The mix I have with gold, silver, dollar suits my own macro views.

 

 

 

Edit: I think a lot of confusion arises from posting about the trading of silver on a thread which is mostly centred on long term hold and buy/ investment in silver.

[Pixel8r]

When I first arrived at GEI, like most others I soon became enamoured with silver. As my macro views developed I decided silver was not a straight forward leverage on gold... it would be a lot more volatile [which is hardly a criticism] but might also carry a bit more risk with it in a deleveraging environment.

 

So after the large core silver was sold most of those funds went into gold, though I did also put some into dollars. At an earlier point I also put 10% of my worth into silver kilos [hard to get out of]... this must have 2008 [post-crash] because I remember collecting them from the mint when I went back on holiday.... I now refer to this as my core silver [a lesser position relative to core gold]. Having a "larger" core silver position, mentioned above, is relative to the traded silver I sold at 17.90.... which was small fry in context. Bad trade, but big deal, there's a good chance I'll get another go at it.

 

In sum, I have 50% into gold and 10% into silver.... those percentages have been rising with bullion prices, but I hope to "re-balance the portfolio" on a decent dollar/ silver trade in the near future.

 

Note: I am bullish long term silver, but look to use the volatility in silver to hedge core bullion. The mix I have with gold, silver, dollar relates to my own macro views.

I hope for you that you do the chance to re-blance your portfolio in favour of silver vs dollars but feel you have missed the time to do it.

 

The other thing I have picked up on is that you consider holding gold, silver & dollars as investments. I think that is where you are going wrong, they aren't investments they are currencies. All you are doing by buying them is preserving your purchasing power, a lot less so in the case of your dollar holding.

 

My mining equity investments have vastly outperformed my bullion over the last two years, but that doesn't mean I want to not keep some bullion (cash) and go all in on investments in this unpredictable world.

 

 

[romans holiday]

I hope for you that you do the chance to re-blance your portfolio in favour of silver vs dollars but feel you have missed the time to do it.

You're missing the point here P. When I say the silver/ dollar trade is to "rebalance the portfolio", this is about trading say half the dollar position against silver volatility [i'm thinking of piling in and sitting on silver for a couple of years... AGQ double leveraged ETF... once/ if it's retraced]. The idea is to increase the dollar hedge in order for it to keep pace with the appreciation in bullion. This may seem odd to you, but it fits in with my macro views. I'm happy to make such a large trade in silver because obviously I think it will perform well.... and with low risk.

 

The other thing I have picked up on is that you consider holding gold, silver & dollars as investments. I think that is where you are going wrong, they aren't investments they are currencies. All you are doing by buying them is preserving your purchasing power, a lot less so in the case of your dollar holding.

Actually, I consider myself completely liquid and uninvested. Exter's triangle is all about being out of investments and in the strongest forms of liquidity [and yes, I think silver is there with gold... but obviously more volatile]. When I speak of being "invested", it's more often than not just a manner of speech. On more theoretical threads, I've mentioned "disinvestment" often.... not to mention talked of gold as a currency ad infinitum [i'm sure you don't read my posts ]. I don't think 50% in gold is too extreme because I consider it the prime currency. I don't have crystal ball, but do have a theory... so I keep it real and keep it hedged.

 

My mining equity investments have vastly outperformed my bullion over the last two years, but that doesn't mean I want to not keep some bullion (cash) and go all in on investments in this unpredictable world.

Congrats... but no doubt you also see more risk hanging over those prices there more so than in bullion.

[Pixel8r]

You're missing the point here P. When I say the silver/ dollar trade is to "rebalance the portfolio", this is about trading say half the dollar position against silver volatility [i'm thinking of piling in and sitting on silver for a couple of years... AGQ double leveraged ETF... once/ if it's retraced]. The idea is to increase the dollar hedge in order for it to keep pace with the appreciation in bullion. This may seem odd to you, but it fits in with my macro views. I'm happy to make such a large trade in silver because obviously I think it will perform well.... and with low risk.

Sitting on a double leveraged silver ETF for a couple of years doesn't sound like a low risk way of trading to me. I wouldn't be at all surprised if the commodity ETF's go pop over the next couple of years.

 

Keep it real, keep it physical!

 

 

[romans holiday]

Sitting on a double leveraged silver ETF for a couple of years doesn't sound like a low risk way of trading to me. I wouldn't be at all surprised if the commodity ETF's go pop over the next couple of years.

 

Keep it real, keep it physical!

Still missing the point.... this trade is not about increasing bullion. The ETF's a financial instrument in order to increase dollars in order to hedge my real physical position. Are you able to see things from another's perspective/ logic?

 

I'm not interested in buying yet more bullion. But I will scrounge around the Southern Alps for some.....

[Pixel8r]

Still missing the point.... this trade is not about increasing bullion. The ETF's a financial instrument in order to increase dollars in order to hedge my real physical position.

 

I'm not interested in buying yet more bullion. But I will scrounge around the Southern Alps for some.....

You are the one that isn't getting it. What if the ETF starts to not actually follow the physical price of silver or the company running it goes bust like AIG did in '08?

 

If it's pure leveraged gambling you are after why not spread bet silver?

[romans holiday]

You are the one that isn't getting it. What if the ETF starts to not actually follow the physical price of silver or the company running it goes bust like AIG did in '08?

It's a HEDGE. It doesn't really matter if it doesn't perform. If the ETF does blow up, the bullion position will perform extremely well.

 

But what I think more likely is the hedge will keep up in value with, and balance, the other side of the portfolio [bullion]. All the benefits of being fully liquid, and fully in bullion.... without actually being fully in bullion. No certainties [besides the obvious] in this world and all that.

 

I'm guessing you're not getting the desirability of a hedge because you have a 100% certainty in mind. Even so, it's only natural to be plagued by doubts, no-one has a crystal ball, and then those manipulated markets might just really remain utterly manipulated in the end..... evil blighters..... a hedge is also good for peace of mind, which has to be worth giving up a little profit for.

[Pixel8r]

It's a HEDGE. It doesn't really matter if it doesn't perform. If the ETF does blow up, the bullion position will perform extremely well.

 

But what I think more likely is the hedge will keep up in value with, and balance, the other side of the portfolio [bullion]. All the benefits of being fully liquid, and fully in bullion.... without actually being fully in bullion. No certainties [besides the obvious] in this world and all that.

 

I'm guessing you're not getting the desirability of a hedge because you have a 100% certainty in mind.

From the wiki on a financial hedge;

 

In finance, a hedge is a position established in one market in an attempt to offset exposure to price changes or fluctuations in some opposite position with the goal of minimizing one's exposure to unwanted risk.

 

Surly the point of a hedge is to remove risk not increase it?

 

As I siad if it is a pure leveraged gamble you are after why not spread bet silver, then you wouldn't have to tie up so much cash.

 

 

[romans holiday]

Surly the point of a hedge is to remove risk not increase it?

 

As I siad if it is a pure leveraged gamble you are after why not spread bet silver, then you wouldn't have to tie up so much cash.

We obviously don't share the same "logic".... or you're only using one logic, whereas I'm using several:

 

1] At one level, dollars are an outright hedge in case I'm completely wrong about the remonetization of gold [this is unlikely but possible]

 

2] At another level, dollars are not just a "hedge", but the second or third strongest form of liquidity [after gold and silver, for the next few years anyway]

 

3] At another trading level, it makes sense to trade a good portion of the dollar "hedge" against the volatility in silver [or whatever is most volatile] as they will move contrary to each other. By doing this the value of dollars may actually keep up with the value of the bullion.

 

This is starting to feel like ground hog day.

[G0ldfinger]

If it's pure leveraged gambling you are after why not spread bet silver?

See my gambling thread - full of levered ETCs.

[fitkid]

Sitting on a double leveraged silver ETF for a couple of years doesn't sound like a low risk way of trading to me. I wouldn't be at all surprised if the commodity ETF's go pop over the next couple of years.

 

Keep it real, keep it physical!

 

Yep even ETF dealers are warning to take physical possession.

 

From:

 

 

 

[romans holiday]

[Icarus]

'CME Group announced Thursday that margin requirements are being hiked for silver, copper and palladium futures, effective after the close of business on Friday.'

 

http://www.commodityonline.com/news/CME-Gr...-34662-3-1.html

 

Moves like this make them look desperate.

 

But let's hope this latest attempt to force the price down succeeds and I can buy some cheap physical. It's always nice to be given cheap silver.

 

 

 

 

[HPCsoYESTERDAY]

[electroweak]

Here it is (page 4):

http://www.cmegroup.com/tools-information/...Chadv10-507.pdf

 

For Silver, $9788/$7250 (initial/maintenance) becomes $10463/$7750.

 

As per the normal review of market volatility to ensure adequate collateral coverage, the Chicago Mercantile Exchange Inc., Clearing House Risk Management staff approved the performance bond requirements for the following products listed below.

The rates will be effective after the close of business on Friday, December 17, 2010.

[G0ldfinger]

'CME Group announced Thursday that margin requirements are being hiked for silver, copper and palladium futures, effective after the close of business on Friday.'

Confirmation of the continuing bull market.

[tinecu]

Confirmation of the continuing bull market.

Confirmation and promulgation of the continuing bull market.

[romans holiday]

Nice [but don't you think silver may have peaked here?].

 

Here's what I'm looking for in my next silver trade. Buy around 17.90 and sell at 54. May take a six month wait and then a couple of years sitting.

 

 

[HPCsoYESTERDAY]

Nice [but don't you think silver may have peaked here?].

 

Here's what I'm looking for in my next silver trade. Buy around 17.90 and sell at 54. May take a six month wait and then a couple of years sitting.

 

 

 

if you look at a linear chart, silver does indeed look like it has peaked (in this current wave)

 

 

However, the log chart shows a different story (open to interpretation). I did think that silver had peaked here but now i am not so sure given the log chart and looking at silvers current bull vs. palladium - i think pd has further to run here:

 

 

 

 

Of course, it's all in the eye of the chartist, so who knows. I note that Ronald Rosen has recently turned uber silver bull - i don't know if I'm happy with that!!