I will try to explain why it is even more important than ever to keep silver handy today. Remember this "deflationary collapse" argument that circulated around making people scared to do anything? That argument is invalid. Totally false. But it wasn't like that before. At one time someone created a graph illustrating that deflationary collapse in relation to the gold price. That graph was valid at a time it was created. 8 years ago or so. Let me show you: http://1.bp.blogspot.com/_cvdgPlEKW...c/n8pY_udAeQE/s1600/Freegold_future_chart.jpg The above link was published at a later time - so the date stamp of the article there is irrelevant. I am not even exactly sure when that theory was created, but in essence it was about a hypothetical future moment in time - when all assets would eventually collapse causing a massive printing event. That theory based itself on the fact of low system liquidity at the time. It was just after the 2008 events. But what was possible then - is not possible now. It is not possible now, because the assets base in relation to gold is so much bigger than 8 years ago - that the gold price will not behave like before but rather will follow a camel double hump shape before taking off to stratosphere. This is why everybody needs to hold gold and silver now even before the panic starts. This time gold will not fall into the first market contraction! It will first go UP, then correct to levels that we see now and then take-off, after Cbs start printing again. Price-wise I would imagine gold going up to $1450 then falling down to like $1300 and then going up to $2500 in one single move up. That is my prediction and most likely scenario. Now let me say why I think this: Mathematically speaking each and every gold run starts by people purchasing - and that purchasing is directly correlated to the total outstanding debt in the world and that is all panic related. You see - buying and selling during panic is always a fraction of the total assets accumulated by the people. Rich people, poor people, institutions, central banks and sovereigns. EVERYBODY. Then - if panic occurs - it is proportional to number of people. People panic, but not all the people. Just a fraction panic first. Assume that fraction is 0.3% of all people - just a hypothetical number pulled out of nowhere for a sake of ilustration. The panicking number of folks is either the same as previously or similar, because it is related to people and their psychology and the population growth is slow. I would strongly argue that the number will be close to that in 2008. But this 0.3% of people is now much, much , much richer than previously! So the number of panicking people is CONSTANT but the correlated assets are bigger. It is very important to understand that concept, because it helps understand what happens next. Now consider that each and every asset on the planet is a direct results of somebody's debt. Both grew exponentially every year. Those assets grow - and we should not care who has those assets, because it is irrelevant to the market. There will always be somebody holding those assets - because the market is stable while there is no panic YET. But when the panic starts and the same % number of people panic, but the assets are substantially higher so the money flow will be much, much bigger than in 2008. The panic is a complicated process - some people panic early and some panic late - so the number of people who panic is a Gaussian distribution really. The same people - just richer people with more assets will panic early - and that will lift gold prices early, because of the early flow within that panic. The panic will cause physical drain from the system and that is just starting as illustrated by the increase in gold imports to the US now. But now the gold market is substantially smaller in relation to all assets than previously so that gold drain will slowly lift prices now and the process will even accelerate, because now the market fears the FED, interest rates, deflation and all other issues like war, Russia, China, crazy nut in North Korea etc. So this is the flow that will create the first camel hump. Then, the market will indeed contract. It will fall, because the economy is stagnant and starts to come off the cliff slowly. So that again slowly will cause the gold buying to equalize with liquidation and initiate a small drop in price maybe even 20% - but from much higher level. Not from here. Let's say hypothetically a maximum of 20% fall from $1450 will be to $1160 and that's it. Miners will never be unprofitable during that time. EVERY SINGLE MINER that stands now is profitable at those levels and selling those companies makes no sense at all. But some people will sell and will never get those shares back. EVER. Then gold will go up crazy and the mining stocks will simply explode. Last time there was a widespread panic gold fell from $945 to $735 by numbers of off SMA20. That was a 22% fall. Today such price correction is practically not possible. I am very much in doubt we will see another 20% correction in gold from any level. This is why I think we will not fall that far. I think we will maybe see a 10% correction. From $1450 to $1300. Even if a large bank goes BK and even if 5 banks go BK the panicked investors will push gold up rather than down. Last time market held 22% correction - now - with same panicking people making larger purchases will stop the correction much earlier than before. Silver is a ghost of gold. If gold goes silver follows much stronger. So it is silver to be held, not gold. Once we start going into that first camel hump shaped wave there will be no going back down. That will be the end of the system as we know it. Bottom line gold will never go down below $1160. This level is impossible. I would rather see silver going to 24, then correcting down back to like 19 dollars per oz and then we will see a yuuuge move up again. YUUUGE. EOM.
In an economic collapse, Silver price fall and Gold will go up. Who will consume all the Silver that is not required by industry? How much did Silver go up in 2007/2008/2009 before/during/after gfc
It won't - I know a small industrial company that contemplates a silver purchase covering their need for 1 decade. Other companies think alike. Samsung wants silver. Solar wants silver. They will buy MORE expecting what is coming. Industry will want to buy 10x annual need of their own.
Not if the demand is not there, in an economic collapse how many solar panels orders will be cancelled, how many car factories will shut due to falling demand. Silver and Platinum are basically an industrial metal. Purchasing departments of companies like Samsung, major solar panel and big car manufacturers would have second thoughts before reporting to HQ that demand will sky rocket during a global economic collapse? That is like saying Oil refinery before the next big crash buying 10 annual requirement at $40 a barrel before the economic GFC2. Why wait for the prices to tank due to less demand because people are losing jobs and less transport of goods.
That is the biggest load of pumpshyte I have seen for a while. Obviously cut'n'pasted - none of it substantiated.
This IMO is probably one of the biggest silver psyops out there. They have tried to convince people that silver is just an (otherwise) useless commodity metal that will have no demand when industrial silver use "declines". Silver is MONEY, just like gold. Demand will rocket from "investment" safe haven purchases alone. And despite the severe economic turmoil ahead, I cannot see industrial silver demand falling off the cliff as some like to predict. The longer I look into the future the greater the total demand for silver. And less new supply. It's an asset to buy now for almost nothing and then hand bucket loads of wealth to your kids and grandkids.
Really? To me, historical charts show a reasonably good correlation between price rises and declines in gold vs silver, but if you've got anything else I'm all ears... Like I've said many times - I have never seen such avid claimed precious metals enthusiasts do such good job of talking down gold and/or silver. edit: There's a reason why particularly silver is SOOOOOO talked down, and also why silver is #1 in the concentration of commodity short positions (link here: https://www.bullionstar.com/why_invest_in_silver, scroll down for the chart with red and green bars). The reasons are to dissuade people from buying and to suppress price.
I'm not saying off the cliff forever, I'm talking about the immediate aftermath, don't get me wrong, I hold silver, but I don't believe silver will have a huge investment demand. GFC occurred in 2007- 2008 what was silver highest peak in 2007, 2008 and 2009? Why is platinum trading at lower than gold?
Platinum too is kind of a monetary metal, although not as popularly known as gold and silver. Refer to the chart linked to above, and see that #1 silver, #2 platinum, and #3 gold are the 3 most shorted "commodities" (price suppression). There are probably a host of reasons why platinum is now lower than gold, some of which I am not even aware of, but i believe one primary reason is a follows: Official inflation figures are around 1%, which many of us realise is total bull***. Examples: at Bunnings a roll of 19m roof/wall insulation was $30 and jumped up to $36, a wood heater flue kit was $398 and jumped up to $449 in about April this year - that's a whopping 13 and 20%. Anyone who eats (and does the shopping) can see grocery prices soaring waaaaaay more than 1% per year. Electricity and gas prices. Water. The basket of goodies used to "calculate" inflation is changed when certain items rise too much, so as to hide the real figure. Countless other examples. Official inflation figures are a complete fraud. Now, one way to reduce (hide) real inflation is to lower the price of the materials used to manufacture goods so that the prices rise less than they normally would have. Virtually everything is at extreme lows - iron ore, copper, silver, aluminium, platinum, oil, etc etc. This is all planned and achieved using the fraudulent price fixing mechanisms we have in our "free, democratic" markets, e.g.: short selling and high frequency trading. Platinum is an industrial metal much more than gold is, so it's more important to push that lower to hide inflation on produced goods. Ditto for silver. Gold's only use (almost) is as a monetary metal. The benefactor of this is the global banking mafia - our currencies are being debased at an alarming rate and most people are blissfully unaware. The losers are us, and the commodity producers.
Surely the amount of gold and silver used in most products is so small that even a doubling in price would add only a percent or two (if that) to the total manufacturing cost of a TV or mobile phone?
I'm in broad agreement with you Steve, in the event of general increase. What I was trying to get at is that even though silver, gold and platinum are all monetary metals they behave very differently. Gold is the go to metal for the non initiated investor looking for safe haven and its price is mainly driven by investments/jewellery hence in a sudden economic change of environment ie a surprise closure of major bank it will have a sharp price change ie over night. Platinum is driven almost entirely by industry so the immediate movement of prices are likely down Silver is 25% investment and 75% industry and it's cheap as chips, though it might have a small spike at first but generally the price will head down due to ensuing lower industrial demand but over time as big copper and zinc mines close the prices will slowly increase but with a year or two lag as investors soak up the demand. Many of these investors can't afford gold or want to diversify from gold.
Sure. I agree. I was questioning Randomname's suggestion that PM prices are suppressed because rising prices would increase the cost of other manufactured goods. I think (don't know) that the amount of gold and silver used per device is very small and so price increases wouldn't be material.
I am not in manufacturing myself, but from what I heard or read, a solar panel the larger home roof models use half an ounce of silver or less now and catalytic converters use less than 1 to 2 of a grams in a small car one. So when a car cost $20,000 ($90 of plat) or a solar panel cost $600 to $1000 ($12 of silver) or so, not a big outlay.
I didn't think I'd have to elaborate on this but... One reason is that gold, silver and platinum are monetary metals and are dangerous to the fraudulent fiat currency system. (Recall that Libya and Ghaddaffi needed to be destroyed because he planned to create a north african regional currency, the GOLD BACKED dinar.) Another reason is industrial uses. Mostly silver and platinum vs gold. While each example of PM use cited above many be relatively small, add up the entire use of precious metals in industry and it would make a huge difference on a global scale, a difference that would be large in our ailing economies. Having said that, industrial PM use is only a component - I did specify ALL commodity prices are suppressed. PM suppression specifically (as opposed to general commodity suppression) is just part of the broader picture with respect to hiding inflation. But PMs also have the monetary suppression issue.
I'm amazed how far out some of the figures quoted here are. A solar panel for $600 to $1000 ?????? Try around $1 per watt, or $250 for a 250W panel. That's retail price. Some are more, if you are willing to pay. So 1/2 oz is $12, or 5% of the cost at current prices. At $50 silver (which still is not expensive considering the total picture re: global financial chaos/fraud) it doubles to almost 10% of the cost. That's pretty big. Now multiply that on a global scale. Now factor in other uses for silver. Now what if silver went to a fairer ratio to gold, say a GSR of 30-40 and below...
Of course some people buy solar panels and have it shipped from china, install it for themself, but most pay a company $600 to $1200 per panel plus all the electronics and all the associated wiring and whatever bells and whistles they need. I can only see jewellery industry being heavily affected by price. ie if spot doubles so will the jewellery base cost. Lets talk about demand for PLat and Silver re: cars and solar panels...... If the world economy crashed and the world unemployment was 25%. How many people will be rushing out to buy solar panels and brand new cars? If you were in the Purchasing department of GM or VW, would anyone be forecasting 10 times volume of catalytic converters? If you were Trina Solar (largest solar panel makers by volume) will they be buying 10x more silver beacuse of the what demand when people are not installing solar panels.
I still think your figures are way off. A typical offer found online 5 minutes ago... 3.5kW system for $3249 in VIC. 14 x 250W panels 3.7Kw Bosch Inverter Installation Remember the $1 per watt? 14 x $250 = $3500... already more than the cost of entire system quoted above. I guess the panel part of the above system equates to $2000-2500 at most, and that's taking into account the government rebate. Now work out the % of silver and see the effect of higher silver prices. I won't tell you where because you can easily google it yourself, and I believe grid connect solar is a con (designed by industry to give them 6c per kWh green energy from your panels while they must pay 8c per kWh for coal generation, but YOU and the taxpayer pay for the high infrastructure cost). Go off grid and get 100% for yourself and a big fat ZERO to the power industry. It's not that hard or expensive if you take a serious look at reducing your wasteful energy consumption. Bye bye chains of slavery.
Is that the cheapest one, a better efficient one will cost a bit more and to go off grid will cost a lot more but even than 14 panels uses about 7 ounces at $25 spot is $150 at $50 spot is $300 in a system that cost $3300 Now in the context to the OPs comment that industry will buy 10x more when Economic Armageddon comes around is like saying Solar panel manufacturers will be buying 10x annual silver requirement because the world is about to go into recession make no sense at all. Economic depression means job losses and a jobless person wont buy at $3249 or $3324 period, so the idea that silver will sky rocket in a global depression is silly. Maybe after a few years but not straight way silver will go downwards and gold will go up..
