Phil_Stacker
New Member
See the post I just made under the "Silver" index. Something strange is going on that we have an increasing deficit of supply to demand yet the price isn't currently matching the changing supply vs demand.
Silver - a store of value? Really?
- Thread starter mmissinglink
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Pirocco
Well-Known Member
1.
It are the buying and selling decisions that determine whether value is stored or lost.
Applies to any product, including governments fiat.
At which price you buy.
At which price you sell.
2. A buy after a great fall is better than a buy after a great rise.
3. Negativism is an indicator for buying. Positivism is an indicator for selling.
4. Storage / transport cost, applies to any product including fiat.
It are the buying and selling decisions that determine whether value is stored or lost.
Applies to any product, including governments fiat.
At which price you buy.
At which price you sell.
2. A buy after a great fall is better than a buy after a great rise.
3. Negativism is an indicator for buying. Positivism is an indicator for selling.
4. Storage / transport cost, applies to any product including fiat.
mmissinglink
Active Member
James said:
First of all, even if the market is being "manipulated" by dark forces or by a conspiracy of giant financial institutions trading paper (which is certainly possible and likely to some degree), there's no reasonable reason to think that there will never be a time that there will be no manipulation at all.
Besides, it doesn't matter if it's a sham or not....buyers and sellers use that London/NY fixed price all day, every minute, every second.
Are you paying USD $6,000/oz (or whatever the currency of your liking) for silver right now (or whatever price you think silver would be at in an "unmanipulated" fix atmosphere) or are you paying the current London/NY fix price when you buy silver? If you are like everyone that I know of, you are paying the London/NY fixed price. Hypothetically, were you in dire need to sell right now because you were in a personal crisis situation, do you think anyone would pay you $6,000 for an ounce of silver? You bought it at an alleged "manipulated" price and you will be selling it at an alleged "manipulated" price....so what?
I'm not stating that if there is manipulation that it is a good thing, just that if there is, it has almost certainly always been and always will be. The only way that I know of that you can avoid having to buy and sell silver at prices that are not based on the "manipulated" London/NY fix is to not buy and sell silver.
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Really?James said:
Firstly, it is not a "paper options" market - first indication you don't understand how the markets work.
Secondly, if it is such a sham and not true market price, could you kindly explain why physical price follows the "sham" market price of spot?
James
Member
Where is the evidence of physical metal being traded on 'market' pricing exchanges ? Unfortunately, one only have data from the COMEX of a huge turnover in paper contracts being covered. Sure, I'd love to find evidence of it not being a sham. Don't get me wrong - the charts show a paper price for physical which guides what people believe, such that exchanges like SS can trade the physical.
Lets start with the sales threads on this forum... all prices based on spot.James said:
The charts show a paper price for physical because that is because COMEX actually trades - physical... via contract settlement, or EFP.James said:
The two are interchangeable, and cannot be detached due to arbitrage.
James
Member
wrcmad said:Lets start with the sales threads on this forum... all prices based on spot.James said:
The charts show a paper price for physical because that is because COMEX actually trades - physical... via contract settlement, or EFP.James said:
The two are interchangeable, and cannot be detached due to arbitrage.
Sorry, spot 'price' of metal isn't set by the Silver Stackers trading forum.
You are right.... though I didn't suggest that was the case?James said:
Spot price is set by the entire market, of which the trading forum is a miniscule and insignificant part..
Prices on the forum are based on spot.
And I again kindly ask what part of this market is a sham?
Silver_Dealar
Member
Theoretically, trading on the forum would have no impact on the spot price at all, as no one knows its happening except us few right?
Theoretically, trading on the forum does have a miniscule impact on spot price - probably immeasurable, but still there none-the-less.Silver_Dealar said:
Any metal sold privately on the forum potentially stays out of the hands of dealers or wholesalers.... potentially impacting supply on the wider market, and thus price. Conversely, it may also act to detract from demand for metal that may otherwise have been purchased on the wider market, again affecting price via the supply/demand balance.
Even if that "unknown" change of hands or forum transaction acts to maintain spot stability by neither adding, nor subtracting to supply or demand... it is still an effect, no matter how miniscule.
The sum of all these tiny transactions forms the market, and determines spot.
A good example of "sham" or "paper" price can be found in the old communist Soviet Union.
They manipulated the market and set the price of goods at what they deemed they 'should' be.........
...fast forward many years and who can forget the image of the supermarkets with empty shelves. The same 'fixed' price items were selling like hotcakes for 4 times the price on the black market.
If silver and gold were manipulated this too would be the case.
They manipulated the market and set the price of goods at what they deemed they 'should' be.........
...fast forward many years and who can forget the image of the supermarkets with empty shelves. The same 'fixed' price items were selling like hotcakes for 4 times the price on the black market.
If silver and gold were manipulated this too would be the case.
Ironic what happens when price is manipulated.tolly_67 said:
There are many here who like to publicise their "should" be price for PM's.... with nothing of substance to substantiate it - except that they are holding a naked long position in phys and therefore price "should" be higher.
Well, a store of value....depend of people around you. For what they believe. Somebody can say it is good store of value, somebody say no.
My position is to stack enough i can handle. Same with gold, diamonds or precious stones, buy some agricultural lands and a rental property that i can smoothly manage.
I see it is not a worth of time. I am saving for my self and for my wife. Children can save for thier own becaused we invested on their good education.
Let say 500kusd in metals, storage and handling is pretty tough.
So why bother too much, buy and forget.... put your money in different things. Diff class assets i should say. Work hard now and set a retirement age.
Find where you are good at in earning money then convert it with profitable or enjoyable things. Few in metals is very good.
Though i love and enjoyed to buy silver. Past and present situation taught me a lot in good approach. Time is very important to me. Enviroment were i live which i should adapt and take advantage where i could earn easily. It is an easy math for a decent earnings not even a day to go to business school.
My position is to stack enough i can handle. Same with gold, diamonds or precious stones, buy some agricultural lands and a rental property that i can smoothly manage.
I see it is not a worth of time. I am saving for my self and for my wife. Children can save for thier own becaused we invested on their good education.
Let say 500kusd in metals, storage and handling is pretty tough.
So why bother too much, buy and forget.... put your money in different things. Diff class assets i should say. Work hard now and set a retirement age.
Find where you are good at in earning money then convert it with profitable or enjoyable things. Few in metals is very good.
Though i love and enjoyed to buy silver. Past and present situation taught me a lot in good approach. Time is very important to me. Enviroment were i live which i should adapt and take advantage where i could earn easily. It is an easy math for a decent earnings not even a day to go to business school.
Phil_Stacker
New Member
I've been to business schools. They don't teach the wisdom you already hold. I agree in full.
mmissinglink
Active Member
kramer said:
There is no pat right answer because there are too many variables. I guarantee you many people who purchased metals after the summer of 2011 and beyond thought that they were making wise buys when they were paying USD $40-$28 /oz silver. Were they wrong? I can't say necessarily but we sure know that the USD denominated value of those purchases went down since then. In general though, if someone desires to own phy pm's, obviously they'd want to pay the least possible they can.
The problem with the notion that "physical pm's is always a good store of value" other than the fact that it's a ludicrous notion on it's face, is that at any point someone could find them self in an unforeseen heap of financial troubles and be forced to sell their pm's to cover extraordinary costs they didn't anticipate. It's happened to at least 1 member here....I forget his exact story but he unexpectedly ran into a very serious situation and in order to pay off some very significant medical expenses, he was forced to sell much of his physical stack at a huge loss of value. It was very sad to read his testimony.
For this person and for any and everyone else who may find them self in similar situation, physical pm's is not a store of value.
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Silvermario
New Member
Silver and Gold are good stores of value, but you cannot buy something like this off of emotion or hopes and dreams. (As a disclaimer, I am American, so any references will be to American items, currency, policy, etc.) I know this forum is silver Stackers, but you are buying an investment item. The price of the item will go up and down based upon supply/demand, monetary policy, interest rates, stock markets, large investors moving supply or currency, etc. This does not affect the VALUE of the item, even though the price changes. This is an important distinction, because value is what you end up with after the purchase, not the buying price.
I remember reading an article before the 2008 financial crisis, concerning investment in silver and gold. It stated that silver and gold were crap investments, because, if you looked at the value of silver and gold over the preceding 100 years, and adjusted for inflation, the price would be the same. You would not have gained any money in the process of owning the PMs. 2008 and onward price movements were such an anomaly, because it was a "perfect storm" sort of situations. Money supply in America was expanding, as they were trying to avoid the next great depression. The Fed was pumping 80 BILLION dollars into the economy every MONTH. Based on that alone, PM prices would have gone up, but then they lowered interest rates to the lowest that have ever been, 0%, and falling interest rates are good for PM prices, as it means that people are less likely to put their money into other things (such as bonds) and shove their money into PMs. Then there was the scared factor, everyone thought the financial world was going to end. People were looking for ways to keep their money safe. Commodities were going up in value across the board. All of these things drove PM prices up up up.
Now the Fed has stopped pumping money into the economy. Interest rates are starting to rise. People are not as scared as they were. According to the BBC, businesses think that President Trump will mean good things for the economy, and everyone is racing to put their money into stocks. Which all means that people are taking their money out of PMs and bonds to try to make more money. Business is returning to usual. The prices of PMs fall, and will continue to fall, as they will return to historically normal levels, until the next event that comes up which spells the end of the world or the fall of PM prices. Its how investments tend to work.
At the end of it all, Gold and Silver will still be an excellent store of wealth. Just don't buy it on the downhill part of the investment.
I remember reading an article before the 2008 financial crisis, concerning investment in silver and gold. It stated that silver and gold were crap investments, because, if you looked at the value of silver and gold over the preceding 100 years, and adjusted for inflation, the price would be the same. You would not have gained any money in the process of owning the PMs. 2008 and onward price movements were such an anomaly, because it was a "perfect storm" sort of situations. Money supply in America was expanding, as they were trying to avoid the next great depression. The Fed was pumping 80 BILLION dollars into the economy every MONTH. Based on that alone, PM prices would have gone up, but then they lowered interest rates to the lowest that have ever been, 0%, and falling interest rates are good for PM prices, as it means that people are less likely to put their money into other things (such as bonds) and shove their money into PMs. Then there was the scared factor, everyone thought the financial world was going to end. People were looking for ways to keep their money safe. Commodities were going up in value across the board. All of these things drove PM prices up up up.
Now the Fed has stopped pumping money into the economy. Interest rates are starting to rise. People are not as scared as they were. According to the BBC, businesses think that President Trump will mean good things for the economy, and everyone is racing to put their money into stocks. Which all means that people are taking their money out of PMs and bonds to try to make more money. Business is returning to usual. The prices of PMs fall, and will continue to fall, as they will return to historically normal levels, until the next event that comes up which spells the end of the world or the fall of PM prices. Its how investments tend to work.
At the end of it all, Gold and Silver will still be an excellent store of wealth. Just don't buy it on the downhill part of the investment.
mmissinglink
Active Member
So Silvermario, on what specific basis then do you calculate the precise value of the silver blobs you own? How do you define "wealth"? Do you believe that silver, not functioning as money for the vast majority of people in most places of the world and not backing any major currency is of equal "value" today than it was 50 years ago, 500 years ago, 5,000 years ago?
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I like using a different term. I call silver and gold a "foundation of wealth". It's the bricks that your building of wealth is built on. You keep it as your support and back up. You add to it and build it up. It's your fallback and security. You use all your other wealth or risk your other money on investments. But you always have this foundation of precious metals. It will never ever go to zero. It will always be an asset. I'm not advising lies or cheating taxes but I will say that it's an asset that can be "invisible" and not tracked. If you are sued you can hide your precious metals and have some wealth to start over. If the market or economy or dollar goes to garbage it will still hold value or go up. I can take it to ANY land or government past any border and it will have value. Precious metals are not stopped by some fake line in the dirt. That is security and peace of mind. Although it's a very rare event we all know the extreme example of Zimbabwe. If any of those people had their wealth in precious metals they certainly must have fared greatly better than their countrymen who didn't hold precious metals when inflation went insane. India and China deal with massive inflation constantly, it is incredibly hard to keep from losing money due to inflation over there. Precious metals help with that.
And you should always diversify. This can not be stressed enough. Investing in precious metals is great for diversifying. Always spread out your wealth in different areas to minimize risk. And learn to follow cycles and move on cycles for maximum gain.
Can you buy to high? Absolutely. A lot of stackers seem to be really bad at investing. And don't diversify. But at the very least they are far far ahead of the average person who blows their money and live pay check to pay check. So it is a good way to gain wealth in that sense. Silver and gold isn't just sitting in an account as numbers easy to spend. So it holds value in that way. You aren't whittling it down buying useless crap. I watched one guy on youtube who stacks but he was so bad with money that once he made a huge profit on silver he sold off he blew through all the cash super fast and had nothing. That is unfortunately what so many people these days do if they have cash in front of them. But a determined stacker loves to see his stack grow and it motivated them. Also the one account was given how someone had to sell his stack for medical expenses. Ok lets look at the other side of the coin. Had he not been stacking perhaps he would have just blew all that money if he had it, and guess what, maybe he'd be dead right now because he didn't have enough to get the best treatment or delayed in getting help. But he had that foundation of silver to sell to fall back on. I've seen people lose everything on scams like Enron. Retirements sometimes get reduced. Social security is always at risk. But you always have your "foundation of wealth".
Should you put all your money in precious metals at any cost? No. Unfortunately there isn't much wisdom shared on stacker communities outside of "Stack hard and stack fast and go all in!". You need to be wise when you buy, you need patience and need to pay attention to markets. And silver and gold should only be a part of your investments. But at the very least they should have a huge stack of silver and gold when they retire. I can't see that as a bad thing. Especially when so many people these days die without a penny to their name and in debt. I also see guys that stopped buying some fast food every week, cut back on extra costs, cut down bills, all so they can buy more silver and gold. That's wealth in your pocket that would have never been there for them. But silver and gold motivated them, and now they have some actual wealth, a foundation of wealth.
Sure we did have a massive spike in precious metals. Whoever timed it right made out amazingly well. A lot bought to high too. But it will find it's equilibrium again and after that it will only go up and hold to inflation. With some spikes here and there. Someday it will skyrocket again. If it's around retirement time then it's a good time to sell small amounts to live off of or enjoy the sunset of your life better. Personally I believe silver will go sky high at some point in my lifetime as it's more sought after. If it ever crosses a price point threshold where banks and governments want to store it like gold it will do insanely nuts in price almost over night. You want to be on the correct side of that. Not that I'm banking on that, if it even acts the same historically I can do fine with that too. It may be decades but I do believe there will be a huge turning point and it will happen fast. Keep in mind also that every time the price drops now you are closer to a bottom and then it's only up from there when it finds that bottom. I do feel for people who bought way way higher up though. But it will find a bottom I guarantee you.
And you should always diversify. This can not be stressed enough. Investing in precious metals is great for diversifying. Always spread out your wealth in different areas to minimize risk. And learn to follow cycles and move on cycles for maximum gain.
Can you buy to high? Absolutely. A lot of stackers seem to be really bad at investing. And don't diversify. But at the very least they are far far ahead of the average person who blows their money and live pay check to pay check. So it is a good way to gain wealth in that sense. Silver and gold isn't just sitting in an account as numbers easy to spend. So it holds value in that way. You aren't whittling it down buying useless crap. I watched one guy on youtube who stacks but he was so bad with money that once he made a huge profit on silver he sold off he blew through all the cash super fast and had nothing. That is unfortunately what so many people these days do if they have cash in front of them. But a determined stacker loves to see his stack grow and it motivated them. Also the one account was given how someone had to sell his stack for medical expenses. Ok lets look at the other side of the coin. Had he not been stacking perhaps he would have just blew all that money if he had it, and guess what, maybe he'd be dead right now because he didn't have enough to get the best treatment or delayed in getting help. But he had that foundation of silver to sell to fall back on. I've seen people lose everything on scams like Enron. Retirements sometimes get reduced. Social security is always at risk. But you always have your "foundation of wealth".
Should you put all your money in precious metals at any cost? No. Unfortunately there isn't much wisdom shared on stacker communities outside of "Stack hard and stack fast and go all in!". You need to be wise when you buy, you need patience and need to pay attention to markets. And silver and gold should only be a part of your investments. But at the very least they should have a huge stack of silver and gold when they retire. I can't see that as a bad thing. Especially when so many people these days die without a penny to their name and in debt. I also see guys that stopped buying some fast food every week, cut back on extra costs, cut down bills, all so they can buy more silver and gold. That's wealth in your pocket that would have never been there for them. But silver and gold motivated them, and now they have some actual wealth, a foundation of wealth.
Sure we did have a massive spike in precious metals. Whoever timed it right made out amazingly well. A lot bought to high too. But it will find it's equilibrium again and after that it will only go up and hold to inflation. With some spikes here and there. Someday it will skyrocket again. If it's around retirement time then it's a good time to sell small amounts to live off of or enjoy the sunset of your life better. Personally I believe silver will go sky high at some point in my lifetime as it's more sought after. If it ever crosses a price point threshold where banks and governments want to store it like gold it will do insanely nuts in price almost over night. You want to be on the correct side of that. Not that I'm banking on that, if it even acts the same historically I can do fine with that too. It may be decades but I do believe there will be a huge turning point and it will happen fast. Keep in mind also that every time the price drops now you are closer to a bottom and then it's only up from there when it finds that bottom. I do feel for people who bought way way higher up though. But it will find a bottom I guarantee you.
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