It's no secret that the silver market is red hot. As I write, silver American Eagles and Canadian Maple Leafs are sold out at their respective mints. Buying in India has gone through the roof, especially noteworthy among a people with a strong historical preference for gold. Demand in China continues unabated. Silver stocks have screamed upward. So, as an investor looking to maximize my profit, I have a natural question: is the silver trade getting too crowded, meaning we're near the top? Have the masses finally joined the party such that we should consider exiting? After all, it's not a profit until you take it, and you definitely want to sell near the top. There are several ways to measure how crowded the silver market might be. I prefer to look strictly at the big picture and not get caught up in the weeds. This means I'm looking for signs of market exhaustion or the masses rushing in. Nothing says "peak" more than an investment everyone is buying. http://www.freedomsphoenix.com/Article/087286-2011-04-06-silver-is-getting-too-popular-right.htm Comments?
Everyone can see the penetration of gold and silver isn't big compared to other investment classes or even big companies them selves but how about comparing them with in their own investment class? Compare Gold to other currencies its exchanged with and Silver with the rest of the comodities market (not just oil and gas).
Well if selling near the top is the question, then watching who & what people are buying shouldn't be one's focus. My focus is on when people start selling as the trigger for when we're near the top. Someone once said "leave the last 10% for someone else", meaning 90% of the peak market price is good enough. The risk is that the market will plummet on the other (right) side of the graph line. But that's a very hard call in any environment. What's wrong with selling after the peak has occurred and it's clear the price is steadily falling? Sure, you've missed the peak, but you're still 90% there, and you've mitigated the risk of selling early. I agree Silver is now 'HOT'. But today's investors are generations away from feeling comfortable holding physical wealth (other than Real Estate). They're used to counterparties taking on some responsiblity for their risk. That's why I reckon the EFT's or whatever new fangled "E-Silver" 'spin-offs' that may emerge will be the indicators to keep our eyes on. Not as a suitable investment, but as a weather vane for what the 'investing public' are doing. When the price reaches the point where the BIG players start divesting their physical, the signal will be telegraphed to us by these ETF's... I reckon we're still years away yet but that's just my opinion
Ye, GSR, you might have gazillion of investors even from Moon and Mars, but when GSR ratio'll be going up on favor of gold, then I say we are far from top. Dow/Gold ratio is 8.5, while the price of gold is in nominal all-time high. Well thats saying something. And at the end we still have JPM with their little scheme.
I don't think its getting popular. Sure people are starting to wake up, but there are still a lot of people in denial of what real wealth really is. The problem is the nature of the physical market, its just that small. So a small percentage of people wake up and start accumulating, this is draining the physical supply. Shortages and lengthy delays are developing or have developed. Its only a matter of time, before we see some explosive gains. This will be caused by a large herd rushing in to buy at whatever price they can to preserve the little wealth they have left. We should see a complete decouple of physical to paper prices. Until then, I wouldn't say Silver is getting too popular. We need these implosions to cause wide awareness and mania phase activity. I'd say give it another year or two we should be well and truly into this phase. By then it would be way popular. At the moment its gaining traction, but due to tight supplies it might appear that its getting popular and everyone wants it causing a real shortage. Do not confuse yourself here, maybe 1-2% of people want it now. The 98% don't have a clue, just this 1-2% are draining all available physical =D. I can't wait to see the 98% rush in, by then I would be planning to offload. Slam
Was having a coffee with a mate and while looking at some coins, the waitress told us that we should get into silver: "Bullion, coins whatever". I was truly shocked. She mentioned Perth Mint closing its unallocated silver accounts. She's an Italian lady who's husband owns the establishment; he is a semi-professional poker player. I would say she is way more savy than your average person, but I was still shocked. No female has ever even mentioned precious metals to me, much less recommended I get in now. That being said, I don't think we are near any top at all, but we are getting close to the last stage, no doubt. Where are the queues in the streets? They are in front of the Apple store.
We must have had the same boss. Did you ever work for a German ex-pat who jumped the Berlin Wall did you?
i think whn you go to a stripclub and one if the girls gives u a lapdance and you pay her by giving her a 1954 florin and u say keep the change and shes all happy then its time to get out of the silver market
I've been watching some of the auctions on feebay and there is definately a rising trend in the bidding... It's getting annoying...worrying...there used to be some good buys, but now it's getting too expensive...even for someone who has paid premiums for good silver Maybe that's a leading indicator (first place most people will go looking for silver is evilpay )
In previous bubbles I've seen in shares, NASDAQ or whatever, a "true bubble" situation usually results in a day or 2 of extraordinary spikes and I mean 10-50% rises. We havent seen a 10% daily rise in this silver run-up so I'm leaning towards the fact that the fundamentals are driving the market at this stage.
Yeah, if it were in a bubble there would be a lot of volatility and margin requirements would be significantly higher
