Earthjade posted this on another thread. http://forums.silverstackers.com/message-215104.html#p215104
Silver is not as screwed as stocks! I think we are about to go down this path with stocks again...hence the reason I'm here and learning
hi bsylvest My eyes glazed over trying to read this thread, hopefully i'm not regurgitating others' thoughts. Anyway, i think: Many silver investors are bonkers, posters here include paranoid schizophrenics and psychopaths. Silver is, more likely than not, screwed. If it went to $9 in GFC1 it could go to something sickening like $4 in GFC2, by which point this forum's incessant BTFDers would have more on their minds than silver. I bought in the mid 20s and didn't bother with that cost averaging stuff (cost averaging is good for catching falling knifes but stupid for catching rising bubbles). I had the timidity/brains/discipline not to buy over $30. I missed the top but still sold most of my silver months ago for a decent profit. I'm now just left with a dozen kilo coins in a bank's safe deposit box. They might make nice doorstops or paperweights one day. Anyway, you're feeling bad about your gamble so I suggest you sell maybe a third of your silver now, regardless of your purchase price. (You can at least claim a capital loss.) The basis for my advice is that from here the price can only go up, go down or stay the same. If silver goes up, you can be relieved your investment was successful and you still have most of your silver to cash in. If silver goes down, you can be relieved you sold a fair whack at current higher prices. Plus there's always the option of buying it back. If silver stays the same, whether you sold or not is immaterial. Hope that helps, good luck people.
If most people are expecting further drops it can often be the sign that the bottom is in. (I'm not saying this is the bottom, I'm hoping for lower but not expecting it). Just as when silver is soaring and everyone's expecting the price to keep rising and euphoria is setting in, it will probably be at or near the top. You just can't trust what most people think.
Short version: its the piece of legislation that precious metals bugs freak out about because it deals with how the government can obtain precious metals from the public ("confiscation", "stealing our gold" etc). Its also largely irrelevant because at any point in time the government could just create a new law allowing it to do whatever it wants. If there are loopholes in an existing law, they can be closed.
Silver went from $8 in 08' to $49 this year. This time it will get smashed to $25 or so then rocket again like it did after 08' to much higher than $49. It seems you're another one getting shaken off the bull.
If you are ever in the position of the OP then it means you have taken on more risk than you can handle. It also points to a speculator mentality. Just ignoring the spot price of silver, the question must be can I live with putting this money into silver and never seeing it back. If the answer is yes, then go ahead and buy. If no, then put that money where it is needed. I'm fortunate in that I bought in at $19 and it fell to $16-17 and I bought more. If it had fallen to $1 I would have bought even more still. But I did this after getting a position in gold first. The spot price is absolutely irrelevant to me since I never plan on selling this silver or gold unless there is a good reason to. It is my core position meaning it is the foundation of my wealth. It will literally be the last things I'd have to sell to survive. If you want to get rich with silver being your speculative vehicle then you might; but if you are bucked off the bull with a drop like the last one, then you'll not only lose, you'll harm yourself with worry and stress. Just sell when you break even or set a stop loss now and sell till you can sleep at night. Sounds like you set out on a speculative hunt, and it hasn't worked out. I'll also offer to buy all your silver right now if it is reasonably priced.
Bsylvest....I was exactly the same I purchased the majority of my silver at about $550 kg and I,m not talking about a bar here and there I mean heaps then it rose to about 750 then the 2008 crash.."OMG" I thought "What have I done",,,why didn't,t I sell I held on and then it rose once again I sold at $900 kg..then bought again at $ 950 then sold again at $1400 it's a roller coaster buddy I love the wild ride...I am now half gold and half silver again...i have made more on silver than I would have with my money earning a %6 return at a rate of 10 times that amount at least..think of long term YOU WILL NOT GO WRONG..
freaking out at the first sign of volatility just shows you were 100% speculative with your decision. the volatility in silver and gold will be pretty wild over the next couple of months and you will find it comes and goes in waves. we are entering a volatile period now. strap in and consider accumulating at the point you feel fits. once the volatility eases gold and silver will be on the rise
"Many silver investors are bonkers, posters here include paranoid schizophrenics and psychopaths." Wrong. It's the mainstream media that is all of these things. "Silver is, more likely than not, screwed." ....If you're talking about silver being at the end of it's bull run, I believe you are wrong.
The other thing to consider is, even if the S does HTF, your assumption that industrial demand for silver will slump is not a given. More and more baby boomers are aging and getting diabetes, getting festering ulcers and sores on their legs, and silver infused bandages are the only real way to treat that. No matter how many banks go bankrupt, the aging population is still going to require medical care, and because of the reckless way GPs have doled out anti-biotics willy nilly for the last 50 years, thus creating super strains of bacteria, demand for silver over the next 20-30 years is going to be even stronger than ever before. Your paradigm of looking at these issues OP is bunk. You sound like a wuss.
One thing that's often overlooked with Silver is simply this... I hear people saying "Oh, we're heading for a recession, industrial demand will reduce, so Silver's stuffed" I hear people saying "Silver's not a precious metal, it's an industrial metal" Depending on which side of that fence you happen to be on, dictates the cry of doom you might be tempted to spruik. In all of that, some folks forget... Silver has it both ways. It's both an industrial metal (and more uses for it are being constantly found, many in medicine, and that demand alone will keep a lot of Silver off the shelves) and a precious metal (please go turn the pages of 5000 years of history and tell me it isn't). The reality is, this is one of the most manipulated commodities on the planet, and irrespective of which chart on spot price you want to trot out, I hold the opinion that the price you're looking at is complete bunkum, and does NOT reflect real world supply and demand, both as a PM and industrially. Fact of the matter is, despite the in ground GSR being 15:1 (15oz Silver to 1oz Gold), that does not reflect the current position of available above ground metal, nor current demand. If this were truly a free market, the price of silver, on all theory, should be higher than that of Gold, just based on scarcity alone. I'm beginning to believe that the only reason we don't (and the rest of the world doesn't) see it like this is because we're "conditioned" to believe Gold > all other. Not saying there isn't a place and reason for Gold - there is, and I hold some of that too. What you gonna do when the manipulators finally have to let the ball drop, and this all does return to a proper free market situation?
To the OP, personally, I'll recommend to anyone to buy when silver is under $35, but beyond that I go quiet and it's all at anyone else's risk then. You are right to think about the liquidation phase. The short supply argument for silver is also bunk, it is confusing the stock and the flow. Industry cares about the flow, not the stock. Do you have enough cash currently to pay for all your wants and needs for a year? Most people don't but it's OK, because they have cashFLOW. Just as there isn't some huge stack of iron hanging around, it is constantly being dug out of the ground. The flow of iron feeds industry. There is plenty of silver still in the ground. It's just where we have this temporary phase where people are hoarding silver. Demand has thus increased vastly. Supply will gradually come online(more mines) and feed that demand, and when monetary issues are over and monetary demand drops, well, what usually happens to prices when supply is significantly greater than demand? In any bull market all the scamsters and spruikers get listened to and reason gets drowned out. If you have listened to these people and bought in at a temporary top, beause it's what you wanted to hear, you need to start thinking more. However, more than likely you will be rescued as personally I am expecting a significant rise in the next few years, clearly the problems are far from over. These prices now are good buying prices imo, they may become better(lower) or they may not.
