INTRO Why do we swap fiatmoney, alike dollars and euro's, to silver? As a hedge against inflation of the fiatmoney. We expect silver to preserve our purchasing power better than dollars and euro's. That's plain wrong. Dollars and euro's and also silver do nothing to protect our purchasing power. They are dead cotton+ink and metal. This is something important you should realize. Nothing makes you lose or gain or breakeven. It's what some other people DO to dollars, euro's and silver, that makes you lose or gain or breakeven. Inflation literally means 'blowing up'. In the case fiatmoney, it means increasing the amount money circulating in the economy. The same amount products, and an increased amount dollars or euro's, together mean more dollars or euro's per product. UNLESS the producing part of the population is able to increase the amount products. Since most of the new dollars and euro's are spent by the parasiting part of the population (as debt), it means that the producing part has to increase its production WITHOUT being rewarded for it, in other words: at the same cost. That's do-able. It's what happened since decades. Working more efficient. Waste less. Better organisation. Faster working. Labor in shifts. Computers. Automation. Larger scale operation. Larger machines. And so on. BUT there is a problem. Fiatmoney. It's very cheap to produce. Cotton+ink. Free choice of amount zero's. Electronic money. Almost zero-cost. Improving production is clearly much harder. So, for the producing population part, it's a constant losers game. So, dollars and euro's devalue continually. The new dollars and euro's flow like a wave throughout the economy. The first that swap them for products/services, do so at lower older price levels. The spending itself, causes the price levels to increase. The last that swap them for products/services, do so at the higher newer price levels. Here, we arrived at a CRUCIAL element: ORDER. Why crucial? Because this is the determinating element whether you are closer to the winning or closer to the losing edge of the inflation wave. Here, an economical world war is being fought, between the parasiting part of the population and the producing part of the population. The goal of the parasites is to PREVENT the producers from buying products/services TOO SOON. In order to achieve this, a range of economical war-instruments are used, that are based on direct legal force (government) or indirect legal force throughout granted privileges (ex. bank/central bank/institution). Examples: 1) Intrest rates / limits (max limits on bank saving accounts forced by govt on banks, tax deductability for some debt) 2) Intrest rates / manipulation (national/central bank forced inter-bank intrest rates such as LIBOR) 3) Intrest rates / artificial buying of bonds in order to make the government/institutional debt easier/cheaper to pay off. 4) Intrest rates / rates spread manipulation, being the masquerade that is disguising the brutal counterfeiting. 5) Specific market and marketwide interventions in order to control price levels of products that are speculated upon by the producing part of the population as an attempt to evade the fiatmoney-based theft by the parasiting part. 6) A level of operation that is much bigger than the level that the producing+speculating population part operates on (upto the superlevel, being a total Adolf Hitler-style manipulative control of the entire world market, known as 'megaeconomics' - see Google). At some point, the parasiting part of population exceeded the limits present at the given historical time frame. That point is where Depression, and all its consequences, starts. With 5), we arrived at our silver case. TRADING BEHAVIOUR As aboves intro explained, it's not the metal that is going to preserve your wealth. It's your trading behaviour. Because the parasiting population part ALSO buys silver. And not to protect their wealth, but to inflict you an already INFLATED price AHEAD of other prices. FRONTRUNNING, a vampiric drain upon the market. An easy job, and winning, exclude eachother. Just buying silver as soon as you earn dollars or euro's, regardless silver price, is the easiest method. And therefore, it is the losing method. Especially during a crisis, where big price cycles magnify the errorlevels. For the same reason, Dollar Cost Averaging (DCA) is not much better. It's swapping a fixed amount dollars or euro's to silver, on a regular (ex. monthly) basis. Too easy. For the frontrunners, experienced professionals, with lotsa first-hand and paid-for data and indirect privileges available, it's not hard to 'overcome' DCA. The parasiting population part also SELLS silver. Of course. They didn't want it in the first place, remember? They only bought it to inflict the producing part of the population a higher price and thus less silver. At carefully chosen moments - when they think alot doubt/concern is present, they dump it again. FRONTRUN in selling. Bad trading behaviour also happens after that. First, stackers buy at inflated silver prices, wasting their earnt dollars or euro's. Then, instead of buying after the frontrunners dumped, they sell. In order to avoid this bad trading behaviour, one has to understand what is going on on the market, and why. The 'why' was aboves INTRO. What is going on, is next. Several things are going on, and their effects propagate just like the earlier inflation wave. The list has a bottom-up order, local silver market - intrinsic things first, macro economical things last. THE SILVER MARKET The silver market, just like any, has several sides. Alot, if not all, influence eachother, so don't consider a specific side as the single story-maker. These sides distinguish themselves by their incentives and the way they buy silver, the two often having a close relation. 1) Industrial supply (mines/recyclers) 2) Investment supply 3) Industrial/medical/photographic/etc non-investment demand 4) Silverware/jewelry (could be seen as semi-investment demand) 5) Coins/finished bars investment demand 6) High-tolerance 'rude' 1000 ouncers investment demand geared towards derivatives/electronic/paperbased investment trading (alike Comex futures contracts and Exchange Traded Funds). Since price changes origin from market changes, elimination is possible of elements that change in a little/neglectable degree in comparison to other elements. http://www.silverinstitute.org/site/supply-demand/ 1) The industrial supply is stable enough to allow elimination (keep in mind, this is a moment/period based statement, no universal rule, it is possible that it becomes prominent, alike the discovery and exploration of America as continent and the silver deposits there once did over a century ago. But the likeliness is low. Scrap recycling is also quite stable. In 12 years it went up only 30%, and most of it only from 2010 onwards, clearly showing that it was caused by the higher silver price, meaning that the opposite will happen at an eventual again dropping price, thus a net neglectable effect in the general longer term time frame. 2) The investment supply has gone throughout major changes in the past decade. It could be said that the effect of America's silver deposits discoveries and exploration phased out. Mining there became as hard as it became elsewhere in the world. And also the sales of the consequential government/institutionals stock finished. Until 2007 or so, there was a long lasting industrial supply deficit that was compensated for by government/institutionals sales. This was what caused the flat silver price during decades. From 2007 onwards, however, Exchange Traded Funds came into existence. These were a major game changer. Allowing silver to be traded alike a stock, has some major benefits relative to delivered silver (as is named "physical" by some). No premiums. No proportional big storage mess/cost. No tax on the purchasing of silver. Fast to get, fast to dump. ETF's though, are a mixed story. While they have a good longer term reason to exist, they also serve as a High Frequency Trading environment for the frontrunners/parasiting population part. Without knowing who owns which amount shares/silver, it's hard to estimate their buy&hold fashion "degree". Only experience can tell that, and since they came into existence almost together with the crisis, there is no experience. In 2011 they caused the price runup from $32 to $50 and back. But since, they show quite buy and hold "nature". For example, during 2012, only 7% of their stock was 'volatile'. So their supply-changing effect and thus the price trend could be seen as neglectable since the 1,5 years after their crazy 2011 story. Yet, it's not because something hasn't effect on the moment, that it should be ignored. The potential effect is present, and thus should be monitored as to know when the game is changing. 3) The industrial demand is much touted about, by many on many forums. Yet, the figures show that the amount, and thus its effect on the price, changes little. 2008 shows the same industrial demand as 2010 and 2011. 2009 was 20% less. Yet, the silver price tripled over the same period, clearly showing that industrial demand isn't the game changer. Photography is declining for the obvious digitalisation reason. But most of the decline already passed, so it's not a game changer yet to come. 4) Jewelry is quite stable. Silverware shows a steady drop since the decade and has little room to drop further. As a price changer, it's a small, and phasing out one. 5) Coins. Shows a strong increase. More than a tripling in the decade. Certainly a game changer, especially since 2008, were most of the tripling started. It became a quarter of industrial demand. 6) Investment ETF/derivative demand. TheSilverInstitute measures it indirectly, an amount silver produced but not bought by the listed categories. Hence the 'Implied Net Investment'. Certainly a game changer. Even the biggest game changer. Conclusion about what elements to look at? Clearly 5) and 6). Let's sum up the amounts since 2008: 5) 65.3+78.8+99.4+118.2=361.7 Moz or 1/3 of worlds annual supply. 6) 31.2+132.2+184.6+164=512 Moz or 1/2 of worlds annual supply. This is the cause of the price tripling in the period 2008-2011. So this makes clear what to watch in the silver market. In order to maintain the $30 price level, this demand has to continue snooping up supply. Take into account that the supply adjusts itself to demand too. Supply and demand are interacting along the price mechanism to an equilibrium. So the 'requirement' is some middle-way in the snooping up. THE GOLD VERSUS SILVER MARKET COMPETITION In real terms of value, gold and silver only differ in a practical way. Much like how a $50 banknote differs to a $5 banknote. You use the $50 note when bigger amounts, and the $5 note when small amount. Since people do both big and small buys, and much more small buys than big buys, both metals have a place in this practical way. Yet, there are some serious market differences that makes it much more than a practical choice. Golds market has a large presence of the parasiting part of the population. Alot 'professionals' rely on what is essentially a governments/central banks shaped situation. It's clear that the parasiting part of the population 'promotes' gold relative to silver. Just look at the Central Bank Gold Agreements, it's not a coincidence that they only started a mere decade ago, in the runup to this crisis. They want to make gold appear as more 'reliable', more 'stable'. Because they possess large stocks of gold, and have thus a good control over its price. Alot so-called gold buyers/stackers seem to use governments central banks behaviour / granted benefits to gold (alike tax exemption) as a motivation to buy gold. And this is quite contradictional, upto even misleading. Just think about it. Gold is bought as a hedge against fiatmoney (dollar, euro, ...) creation/inflation, right? Who causes that inflation? Governments. National/central banks. How can you then chose a precious metal of which they control its price well? Why do governments/national/central banks own gold anyway? Remember they abandoned the gold standard? Even the already bogus (it was a gold/dollar standard only redeemable by governments and its institutions, not by anyone else) Bretton Woods one? Some use the argument that governments/central banks are NET BUYING gold as an argument to buy gold too. That's even ridiculous, because when they are buying, they sustain or drive up the price, and inflict you LESS gold. So then why do they have gold stocks? The answer should be very obvious: to manipulate its price and thus its market. Central banks bank don't need gold at all. They print/electronically create the amounts fiatmoney they need. They have no problem buying back gold at ANY price, since they create the legal tender declared money to do so. Those Central Bank Gold Agreements are so-called sales limits. No more than X tonnes sold over a period Y. But there is a catch of importance: WHEN? Take for example the International Monetary Fund, the IMF. In 2008, the middle of the crisis, the hard hit of precious metal prices, when the NON professionals SOLD, the IMF BOUGHT instead. Near to 200 tonnes from the market. Guess what happened to those 200 tonnes? They SOLD it on the market. During 2010. In stages. Every month a fraction. To not disrupt the gold market. Isn't that humor? They suppressed golds price uptrend during 2010. Likely the very reason for golds smaller price increase since 2008 (x2.2 versus silvers x3) http://www.imf.org/external/np/sec/pn/2011/pn11121.htm The IMF had 7 billion USD profits from these on-market sales. 191 tonnes is the equivalent of 61,407 gold futures contracts, the total at the moment is 188,659, so that's 1/3 of the Comex market side, not exactly something minor. Every dollar origins from a gold speculator that anticipated on inflation due to QE's and decided to hedge along gold. Now read the official 'why' of the gold sales of the IMF. http://www.imf.org/external/np/sec/pr/2009/pr09268.htm It's to aid poor African governments. It's to pay the IMF's administration bills. The first joke in my post has yet to come. Place these excuses in the bigger picture. Central banks alike Federal Reserve and European Central Bank and many if not all others, created trillions fiatmoney since 2008. It was used to prevent numerous governments, banks, institutions and big companies from going bankrupt. The IMF itself received its part of the big bucks. The role of the IMF was increased to a new dimension, with corresponding financing. Yet, they would have had to sell gold to bail out poor African countries as a middle man, and to pay its administration bills. When I think twice about buying gold as to avoid legal theft by privileged thieves (that's what inflation is), it's clear to me that gold should be avoided. Yet, there are hedgers buying it, they represent a demand / competition for silver, and they should thus be taken into account in this "What's Going On". Alot buy silver as a inbetween step to gold. That means that if you chosed silver, you have to take into account their presence on the silver market. Because it's not a buy and hold longterm presence and thus a downward price protential in terms of purchasing power. THE SILVER VERSUS FIATCURRENCY MARKET COMPETITION This also applies to gold and any product that suits one or more roles of money (in our present case mainly the role storage of value). Silvers value is, like everything, expressed in a fiatcurrency. If the fiatcurrencies value is 'watered' by cheapskate production of more of it, one can reasonably assume that people that experience the devaluation of their dollars / euro's search for alternatives. This is how competition works. But unlike what some seem to think, this is not at ANY price. If the price of a given product A increased due to a demand that is NOT buy and hold fashioned, thus temporary, then silvers competitive advantage shrinks, because the potential and thus outlook on further price increasings, has decreased. Up to the opposite - downwards potential. So this competitional element is like a balancing mechanism. When silvers price is 'bloated' like this, people may rightfully decide that the outlook of the fiatcurrency, while negative, is still better than silvers, because even more negative. For the same reason, people sometimes even accept a negative intrest rate, alike in Germany for a while last year. Because the outlook of the alternatives was even worser. So, based on your geographic location and thus local fiatcurrency, there are in this aspect (don't use it as a single judgement directive!) 'good' and 'bad' moments to buy silver. If your local currency is "strong" relative to others, it is a 'good' moment to buy silver. For example, my fiatcurrency is Euro, so it's a better idea to buy silver when the euro is strong / the dollar is weak. I bought most of my silver early 2011, when the Euro was strong. Of course not at any price. Remember the underlined sentence. And vice versa, it's a worser idea if your local fiatcurrency is weak. The rate of fiatcurrency devaluation is for a large degree determined by its creation rate. But ALSO by its subsequent spending rate. And this is something that apparently few are aware of. We were and are overloaded with Quantitative Easings and Bailouts and government Bond purchases by central banks and other inflationary woohoo-talk. But it's remarkable how little coverage the Excess Reserves had. If you don't search specific for this, you don't encounter them in any newspaper/media article. Alike they are not worth mentioning. At the moment of my first and big silver purchases, I thought I had a good general awareness of the situation on the big currency markets. But this Excess Reserves I became only aware of early 2012. http://research.stlouisfed.org/fred2/series/BASE?cid=124 http://research.stlouisfed.org/fred2/series/EXCRESNS?cid=123 This makes clear that Excess Reserves are part of the Monetary Base. What is also clear is that Excess Reserves moved from order a few billions to over thousand billions. If I calculate this United State Dollar fiatcurrency case, it becomes clear that a mere 20% of all the dollars created since 2008, added to circulation, and were thus inflationary. About the Euro fiatcurrency case, in august 2012, a similar storyline appeared. http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=117.BSI.M.U2.N.R.LRE.X.1.A1.3000.Z01.E In juli 2012, Excess Reserves was less than 5 billion Euro. In august 2012, it jumped to 400 billion Euro. And also in this EU case, Excess Reserves is documented as part of the Monetary Base. http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=123.ILM.M.U2.C.LT01.Z5.EUR On the Dollar side, BASE is 2633 billion dollar. Excess Reserves is 1435 billion dollar. On the Euro side, BASE is 1631 billion euro. Excess Reserves is 403 billion euro. In 2008 ahead of the QE's, these BASE's were 875 billion dollar and 900 billion euro. If we now calculate the actual spending, thus BASE minus Excess Reserves: On the Dollar side, 2633-1435-875=323 billion dollar, which is 323/875=36,9% more than in 2008. On the Euro side, 1631-403-900=328 billion euro, which is 328/900=36,44% more than in 2008. In real terms, this means that we can expect to see general price increasings since 2008 of near to 40%. Gold did +120% and silver did +200%. This means that we should be very reluctant to pay more than todays price levels. Those quick price rallies we see are the frontrunners buying back in in order to make you pay more and thus drain off your fiatmoney. NOT people that are buy and hold fashioned as a hedge against inflation. My opinion is that the QE's are a scam. A trick to lure us into paying higher prices. We have luck that the gold, and especially silver markets were and are relatively small compared to other markets. They don't need much inflow to bring higher prices. So the demand from stackers and ETF 'savers' may suffice to maintain todays price levels. But as long as we don't see higher spending rates and thus higher general price increasings, we have the time to wait for moments/periods that the frontrunners dumped and are thus not reflected in the price. This fiatcurrency competition was just another element to take into account. Again, NOT the single judgement directive. THE FIATCURRENCIES MARKET AS A WHOLE. There is an old strategy performed by the parasiting population parts of their respective time frames. That is, taking out alternatives, as to destroy competition and to be able to continue unpunished. In a multiple fiatcurrencies monetary market, the classical trick is a working-together of the parasites. If dollar, euro, pound, yuan, yen, etc, would really compete, any single one that is inflated, would soon see its abandonment due to the producing part of the population refusing them as payment(a phenomenon known as hyperinflation). And in a scenario that became the rule instead of the exception, such event would soon also lead to simultaneous stories in the other fiatcurrency markets. So, the governments, central banks, and their interest groups, work together to avoid this competition. This is done by manipulating exchange rates,currency swaps, and other secondary supporting measures. The prime goal of all this, is to avoid any single fiatcurrency weakening too much relative to other fiatcurrencies. In other words, blocking those EVIL speculators (they mean the non-sheeps among the producing part of the population, alike us, silver stackers) from becoming too successful. This cooperation happens on the marketwide, the macro economical level. They manipulate prices and rates along High Frequency Trading markets, by buying and selling in a frontrunning fashion because they make the big central planning decisions themselves so they know ahead of all the rest what is next. Essentially the price trends / rates are thus forced, without the force being too visible. That is crucial because failing to remain hidden as real causes, would soon end in too many people linking the two ends in the chain of first cause to last consequence, in other words: being busted. Since World War II, as a successor to the Marshall Plan that demanded governments to spread the dollars evenly, they attempted such macro economical manipulation in the European Union, it was named the 'Werner Plan' according to the name of its author that was a politician and top banker at that time. His method was named 'Snake In The Tunnel', because on a chart, the floating but inter-limited individual EU currencies appeared as snakes in a tunnel. It was an early (and failed) attempt towards an EU wide monetary competition-killer. It failed because the central planning lacked control of too many elements, causing its EU influence zone to shrink, ultimately to only a few central countries, until it was given up altogether. Nevertheless, the Euro DID became reality. And it brought the control level they need for this macro economical goal. In a mere decade, they succesfully spreaded their inflation uniformly over the entire EU. And there we have it. Uniformly. The crucifix of killing competition. Take a look here: http://finviz.com/futures_charts.ashx?t=DX&p=w1 http://finviz.com/futures_charts.ashx?t=6E&p=w1 See the fluctuations? Those are the 'snakes'. Draw lines between all tops. Draw lines between all bottoms. See how straight the resulting lines are? Those are the 'tunnels'. Their goal? To spread their inflation uniformly over the dollar+euro world. Now scroll abit back in my post here, to the bold tagged percentages. See how similar they are? 36,9% versus 36,4%. Coincidence? No. It's the uniformly spreading of their inflation. This is the superlevel at which the parasiting part of the population operates. They do their best to block us, speculators, producing part of the population, from routing out/dumping their crap. And it's not easy to defeat them. They will only lose if we improve our trading behaviour. Instead of competing with eachother, trying to get our gains/inflation hedge by inflicting fellow stackers a loss, we should work together against them. And this, is the reason for this topic. MARKET DATA USED TO ACCOMPLISH BETTER TRADING BEHAVIOUR Next is a list sources where key silver-relevant market data is available. >>> Inflation-related: USD monetary base: http://research.stlouisfed.org/fred2/data/BASE.txt Component EXCRESNS Excess Reserves: http://research.stlouisfed.org/fred2/data/EXCRESNS.txt Euro monetary base: http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=123.ILM.M.U2.C.LT01.Z5.EUR Component L010 Banknotes in circulation: http://sdw.ecb.europa.eu/browseExplanation.do?node=SEARCHRESULTS&sk=123.ILM.M.U2.C.L010.Z5.EUR Component L021 Minimum Reserves System (the 'fraction' of the fractional reserve system. http://sdw.ecb.europa.eu/browseExplanation.do?node=SEARCHRESULTS&sk=123.ILM.M.U2.C.L021.U2.EUR Component L022 Deposit Facility: http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=123.ILM.W.U2.C.L022.U2.EUR Excess Reserves: http://sdw.ecb.europa.eu/quickview.do?SERIES_KEY=117.BSI.M.U2.N.R.LRE.X.1.A1.3000.Z01.E >>> Futures market-related: Futures market trends in 4 time resolutions: http://finviz.com/futures_charts.ashx?p=w1 The green trend below is the total net position. It reflects the share that the futures market has in the spot price. The goal for a stacker is to try to pick out moments where they have the lowest position. *Reminder* ALSO take into account other silver relevant elements. *Reminder* Do NOT use this specific element as the single directive. Comex Futures market Commitment of Traders report (a weekly report, where finviz.com gets the data): General data access page: http://www.cftc.gov/marketreports/commitmentsoftraders/index.htm Previous COT reports: http://www.cftc.gov/MarketReports/CommitmentsofTraders/HistoricalViewable/index.htm <- Last COT report: http://www.cftc.gov/dea/futures/other_lf.htm Comex Futures market silver stocks (updated every market day): http://www.cmegroup.com/delivery_reports/Silver_stocks.xls >>> Exchange Traded Funds-related: Sprott Physical Silver Trust (Inception Date 29/10/2010): http://sprottphysicalsilvertrust.com/NetAssetValue.aspx (sometimes fails to work) or http://sprottphysicalbullion.com/sprott-physical-silver-trust/net-asset-value/ IShares Silver Trust (Inception Date 21/04/2006): http://us.ishares.com/product_info/fund/overview/SLV.htm Bar list: https://ebts.jpmorgan.com/metalicsWebApp/ebts_downloads/BONY_SLV.pdf (warning: big file). ETF Securities Physical Silver(Inception Date 24/07/2009): http://www.etfsecurities.com/msl/silver_bar_list_us.zip http://www.etfsecurities.com/msl/bar_list.zip Central Fund of Canada (Inception Date 14/09/1983): http://www.centralfund.com/Nav Form.htm Zrcher Kantonalbank (Inception Date 16/01/2009): http://www.zkb.ch/etc/ml/repository/textdokumente/sparen_anlegen/barrenliste_etf_silber_pdf.File.pdf BlackRock Silver Bullion Trust Inception Date (7/15/2009): http://www.claymoreinvestments.ca/claymore-investments-closed-end-funds/fund/svr.un >>> Delivered silver-related: US Mint sales: ASE & AGE: http://www.usmint.gov/mint_programs/american_eagles/?action=sales&year=2013 AGB: http://www.usmint.gov/mint_programs/buffalo24k/index.cfm?action=MintageTotals&year=2013 Perth Mint sales (requires digging through blog, if anyone knows original source, if any, please share): http://www.perthmintbullion.com/blog/blog Some sources show historical data. Others don't. In those cases you have to log it yourself. I log it all, in case data becomes unavailable. By monitoring this data, you can pick out the best moments to buy silver. For example, suppose you see the Comex total position and the silver price increasing fast. With no other things changing, it means that it's best to suspend stacking. Because nobody buys silver as a futures contract to keep it as longterm hold fashioned. If they really wanted the silver, and thought todays price was a bottom price, they'd buy the silver directly, instead of a futures contract. It's for a reason that the by far big majority of the futures contracts never gets delivered. I use stock trends as shorter term price predictors. Fiatcurrency creation&spending trends I use as longer term price predictors. Both methods complement eachother. The same applies to the superlevel method. Example: End juli I noticed on finviz.com that the Euro "snake" was approaching its lower "Tunnel" edge. That means that it becomes very likely that the central planning is gonna take action to avoid it leaving the tunnel, and thus becoming "too weak" relative to other fiatcurrencies, and thus attract speculation "attacks". So I decided to swap my remaining euro's (I already bought quite some junk since the $27-28 price level was already present since months) into bullion from a couple dealers since no time left to wait for good priced junk. And indeed, mid august, the EU side of the parasites brought the next big decision, causing the Euro Snake to revert away from the lower tunnel edge. I have logged above data since april 2012. Before I didn't actually log, I just checked now and then, on the fly. POST NOTE This post was created due to several PM based questions for a complete explanation putting it all together. I don't know if above meets that criterium. I don't know if it's coherent. I put some effort in it. If it doesn't, shrug and move on. For those that can follow most of it: concordia res parvae crescunt. Regards.
Pirocco - that was an extraordinary effort you put in to try and give us plebs and (paper) panzies alike insight into how to beat the parasitic scum manipulating world markets, and in particular for us - the silver market. Since GP (The Boss) has so much respect for my opinions - I'm sure he's going to make this thread a "sticky" ... :lol: It certainly deserves a permanent place near the very top of the silver subforum! That way you can also keep your post updated from time to time as you discover more on the subject.
Great read Pirocco. You wouldn't happen to also post on kitcomm would you? You write extremely similarly to this person:
Is this not a contradiction Pirocco? Wouldn't the first part imply that one should buy when their currency is at the top of the tunnel rather than the bottom?
Thanks for the effort, however this whole read would be much better absorbed as a youtube post. You would also get more exposure for your thoughts.
The silver price is the result of mentioned influences. The influences varies in strength. What is weak now can be strong over some time. A strong influence, that moves the price $10, "overrules" a weak influence, that moves the price $3. I stressed that several times, for this particular element, it was the sentence "This fiatcurrency competition was just another element to take into account. Again, NOT the single judgement directive." So, as said, you have to look at more to judge. The max fluctuation seen between dollar and euro since start 2011 was 12%. When I first purchased silver in february 2011, the dollar spot price was $32. That was the max I had set according to the QE's that tripled the USD monetary base. The euro weakened (and implicitly the dollar strengthened) since. Their biggest spread during that period was at my Euro side 12%. So, my $32 dollar targetprice of february 2011, became a $28 dollar target price. Despite dollar spot price was $28, $4 less than february 2011, the Euro price was still the same as in february 2011. So, and despite my weaker Euro, this summer with its $27-$28 for 3 months, was a good period to buy all the time. In other words: the weaker euro influence was undone by the silver market-specific element that caused an even lower price. (In this particular case it was the Comex market side that dumped to 4 and even 10 years record low total positions). And yes, I'm that same Lorian. I rather preferred it wasn't noticed but I guess the old story looks/talks/walks like/is a duck had to apply. I stopped posting there. I am too stupid to recognize when "rules infraction" apply, so instead of waiting for a next and ban I showed my tail light. As an available alternative I increased my activity here. This forum appears like you don't have to weight every word and consider every possible interpretation in order to avoid being shown the door. A couple years old thread isn't infested with dozens users subtitled 'banned'. But those that run a forum, pay for it. They have the right to ban me for whatever reason they see. I respect that right. So don't flag them as 'Bad' or so. Things are like they are. If I also become or already are considered a pest here, I'll stick a label 'Peace' on my back, turn around, and row to the sun.
Your posting here is much appreciated. Do you have a Euro price target you are eyeing off? An alternatively a short term buy/sell price? As hiho said, I'd be interested to see your opinion of what those earning $AU should be doing/looking for. Grinners
I rather refrain from giving price targets as long as market conditions are too far away from those that are stacker / longer term holder / silver saver - "friendly". Because too many variables working over too long periods, make them too uncertain. Usually it goes like this: - I wait for market conditions to improve (read: less buy and dump side impact). Example: Comex side dumps 20000 contracts (big influence in ounces - 20000 x 5000=100 Moz) and IShares Silver Trusts stock drops 20 Moz (small influence in ounces). - When this fits in the overall marketwide picture as a trend, I start to calculate how many contracts/Moz 1 price-dollar requires. - If I recognize some stability, thus a mathematical row, in that per price-dollar rate, it means that I can start calculating target prices. - When the trend continues, I start to do this at increasing frequency. - In a very "good" market situation, I sometimes do it hourly, as to catch the trend-terminating downspike. - In this last phase, I keep my browser open on several dealers in my region, of which I already pre-selected some based on the price differences between them and the kind(s) of silver I decided to buy a next time. - I learnt to have patience in this process. Those that talk about silver price explosions standalone in the world and Comex defaults, and last chance to buy sub $whatever, are after the fiatmoney you intended for silver. - Eventually, I make a purchase decision. I do not swap it all in one go. Also, I avoid 'wanting too much', I don't walk the edge. Because that can aswell end in giving away the chance you had. Look at all those that waited this summer when price was $27-28 for months. Look at all those that bought since mid august. Upto even $35. The overall marketwide (including silvers) conditions didnt change much during 2012. Except that I noticed that alot stackers sold in the $35-$32 range. A plausible explanation for this is that after X runups and rundowns in recent years, some decided to take the risk of a sell and buy back in cycle. Another explanation is that they were 'done' with silver, decided to leave disappointed, but chosed a better moment than those that did so this summer. Because it also happened at $27, as shown by a fast and quite big increasing Comex share at same spot price. So which of the two explanations it is, I don't know. In the first one, the same $26 level should hold. In the latter one, it might become $23. And very important: this ALL on condition that other elements don't change. And I actually don't like to be seen as a price predictor / guru / whatever. The goal of my topic is NOT to play the Pirocco the Price Predictor game and everyone following with eyes wide shut. There is a Golden Silver Rule (haha): don't take advice from anyone. It's YOUR fiatmoney. YOU worked and earnt it. Only YOU know what it is worth. Nobody else. And certainly not those with a vested interest (that includes me). The goal of this topic is to help to help oneself. To become independent. A 'Hey I Can Do This Myself'-attitude. I have the impression that this is needed. Too many people read about and/or are confronted with the crisis, become concerned, to then take action in a matter (markets) they know little to nothing about. They jump in, hurrah big green luxe monsterbox shiny Silver Eagles from the famous US Mint, YaY I hedged against inflation! Couple months later, they see the very same big a $5, $10, and even $20 lower price. It's less than 2 years ago I received the first silver coin. I saw this story repeating over and over again. At some point I decided to try to do something about it. Within the limits of what I'm able/willing to. I'm not on a Holy Crusade. This topic took me some hours to write. But I'm willing to. I see it as a part of the silver saving against the parasing part of the population - job. Take care of silver. Take care of the people on its market. Better trading behaviour is not only relevant to the price.
My computer and software is so old that I can't even install what is required to watch Youtube videos. And me on Youtube? I don't want exposure. I already have too much exposure now, let alone that lol. It's for a reason that I take different nicks on different forums. It also entirely misses the point of this topic, see my previous post. Instead of spinning around me as a gravitational center of the silver universe, and inflict me all the work, I plau the daisy chain game. I say something to A. A hears it. Thinks about it. Tells it to B. Divide the work. Also, what I brabbled in this topic, is not some Universal Law Set. I'm sure that there are elements that I have no awareness/data for available. When I first bought silver, I only knew QE. I wasn't even aware of the existence of the COMmodity EXchange. Let alone what a future was. Snakes and tunnels? Lol, I coincidently read about them in a 1985 Artis Historia book about coins in EU throughout history, but I directly recognized the relevance of it, as it perfectly explained things I noticed. That's how it always went. In some past I failed to even find a possible explanation for inflation. I learnt things gradually. And with every new thing, I got another piece of the puzzle. At some point you see a part of the puzzle. Things that supplement/fit eachother into a bigger thing. Gradually, you start to have a clue about the 'Big Picture'. But so far, time after time I thought I saw the Big Picture', while afterwards was proven it wasn't. But I'm on the road. The more that are, the sooner the parasites will be forced to start again helping us, and the less ugly and shorter the transition phase will be.
Thankyou for this comprehensive and well researched post. I wish I had read something like this before plunging in based on heavily biased information and the created sense of urgency. However, like all stackers, I love silver regardless.
To give an example of silver market situations comparisons, here a snapshot relative to april 2012: - Sprott stock increased 16,5 Moz - IShares stock increased 17,4 Moz - Zurich Kantonal Bank stock increased 14 Moz (I'm not sure of the reference start, which could be months or even a year earlier since I was at that time using www.silberinfo.de of which I discovered later that the website must have stopped updating at some point) - ETF Securities stock increased 1 Moz - US Mint sold 28 Moz (anyone knows where to find sales of non ASE silver?) - Perth Mint sold 5 Moz - Austrian Mint sold 10 Moz (equally-distributed average based on a 2012 planned production figure reported in april) - Comex future demand change (will be cancelled since near to never delivered): 12000 x 5000 = 60 Moz - Comex stocks fluctuations' pivot stock increased with 10 Moz - Canadian Mint - unknown. 2009 was 10 Moz, 2010 18 Moz, 2011 23 Moz. Since price level same as 2010, assumption can be made also 18 Moz, or 12 Moz since april If I categorize above: Physical demand increase (limited to coins/coinbars): 55 Moz. Maybe 60 Moz if I include small nonlisted Mints. Paper ETF demand increase: 49 Moz (there are some I was unable to find/track data for; so likely higher.) Paper Future demand: 60 Moz The figures aren't accurate but it looks like an even spread of demand. Each market side added the same amount silver. That means that for ex Comex dumps can be compensated for by physical and ETF demand. It's thus possible that the $30 price level is sustained and that a much lower than $30 price isn't signalled by the market situation. Market condition judgements can also be made without above cloud figures. Except for a couple occasional junk coins (a black tarnished coin and a fast reaction sale) I didn't buy any silver since mid august when the $27-28 level was left. There is a nice guy that I learnt to know along ebay, he started to hunt flea markets for the coin kinds I stack and now and then he's at the door with some. He's aware of the price I pay (18 euro a coin, conforms to 800 euro per kilo silver) so if he has other customers paying more, I don't see him. Well, I didn't see him since start august. But yesterday, thus for the first time in over 4 months, he dropped 4 coins, despite the price being 10% higher than this summer. 2 days ago, I managed to buy 12 such coins along an auction site. At 17,2 euro per coin including shipping and above that 2 other silver coins (0,833 instead of the 0,900 I limit to), thus for 'free' according to my target price. So it looks again alike alot tend to be reluctant to buy and sell instead. What was that General Market Wisdom again? If everything looks Moon, sell. If everything looks Doom, buy. In other words: doing the opposite of what most others do. Instead of silver, I bought quite some stuff in those months. Things that everyone can use and hold the economical value they have today. All secondhand. So, right after start 2013, stack = stack + 360 gram. I have 4000 euro's ready, finding 222 or more such junk coins is the next job. But at spot $30, I'm not in a hurry. For the same old reason: I don't see general prices increasing enough to rocket-propell me.
