You just can't win in this game

F

fishduck

Well-Known Member
Silver Stacker
I've been thinking about this for some time but I can't help but think that stackers get the short end of the stick on pretty much everything.

I'll use a few examples

1) First I'll use some economic data as an example. US data seems to affect the price of PMs the most so I'll use that as a reference. US releases some data, lets say PMI manufacturing numbers for the sake of argument:

1. PMI manufacturing data is good/better than expected (even when in the whole picture it isnt), PMs go down because apparently, the US economy is doing well, so no need to buy PMs, buy US dollars, sell PMs

2. PMI manufacturing data is bad, PMs go down because apparently, the US economy is not doing well, so panic and sell PMs, buy US dollars

You can put pretty much any data that is sensitive (GDP growth, interest rate announcements etc) and get similar results. Example, GDP growth for said country was expected to go 5% down, it goes down by 4% instead and apparently this is a good thing.

2) Political circusing, lets say that Trump decides he wants to have a bone with China, so he sends out a tweet, lets say trade disputes for example, and PMs go down, because apparently this is bad for the US economy, panic and sell PM's, buy the US dollar

3) Were in a Recession!! Sell everything, including PMs, buy the US dollar as the world is about to end! Seriously though, if during the good times stocks/RE go up, PMs go down and in the bad times stocks/RE goes down (up in this case) and PM go down, have you really won by buying PMs if it was going to go down anyway?

4) We have Covid!! the world economy is crushed, sell everything, including PMs, buy the US dollar!!

5) The Fed has announced that they will print money to sustain the economy, this spills over to the US stock market with record highs in the Nasdaq (close with the Dow Jones), everything including food prices are going up, using the same mathematical logic, PMs should go up proportionally, but no, you can pretty much come up with any reason to push PM prices down and they stay down (Coles should start selling bullion as well as apparently prices stay down).

6) PMs go up a few dollars (even if it goes up quite a bit) then it goes down by as much because traders are taking profits, I'm sure stackers here heard this all the time. I rarely hear about stocks like Apple and Tesla going down because of profit taking (they have other reasons but profit taking was not the main one), apparently, traders are letting it rise all the way and not locking in any profits, PM traders are not doing this, if it goes up a little bit of the RSI, xxdays EMAs, apparently its overbought and its time to sell to lock in some profits.

7) and when stackers are awarded with their supposed big pay day (which has not happened as of now), they are threatened by someone (it doesn't have to be government) of the potential of confiscation, so any gain that you possibly might have made will be taken away and you will have nothing to show for it should this happen.

Seriously, after writing all this, sometime I don't even know where and whether I'm being sarcastic or not.
And I haven't even started with the alleged Paper manipulation and unbacked shorts whether this is true or not.

But seriously, even with Covid, even with all this money printing, even with institutional money (Buffett and pension funds) slowly coming in, gold can't hold $2000 USD and silver can't hold $30 USD, and apparently, PM prices are not immune to market crashes, and behave the same way as stocks do on the way down, when one of the selling points for PMs was the insurance factor that they would be "insured" in a market crash/downturn.

So stackers, why do you bother when the world has told you that your getting the short end of the stick? It feels like the world is finding every reason for PMs to be going down from pretty much what I've written down. Any positive outlook is dismissed (if its too big to avoid, it gets minimised) and any negative outlook is amplified.
 
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I was looking at the news today that the Nasdaq went down by about 5% today, and apparently PM prices are going down alongside for the week (it probably will go back up, its fluctuating within a range). The same thing happened in March when Covid started and the US lowered interest rates, yes, it can be seen as a buying opportunity but since most trades are done by algorithms these days, you have to sometimes wonder what programming logic they put in to get what we have today.
 
fishduck said:
I've been thinking about this for some time but I can't help but think that stackers get the short end of the stick on pretty much everything.
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True, but for good reason - PM's are an unproductive, stagnant asset. PM's are constantly touted as an insurance policy (true), but then stackers get upset when their ROI are relatively shit compared to other asset classes.
Go figure? o_O
Insurance policies don't pay big returns.
Can't have it both ways.

Yes, PM's get sold down when things are going well - unproductive assets are the first to be liquidated to chase better returns in other assets.
Yes, PM's get sold down when things are going bad - unproductive assets are the first to be liquidated for capital or margin calls.

fishduck said:
5) The Fed has announced that they will print money to sustain the economy, this spills over to the US stock market with record highs in the Nasdaq (close with the Dow Jones), everything including food prices are going up, using the same mathematical logic, PMs should go up proportionally, but no, you can pretty much come up with any reason to push PM prices down and they stay down (Coles should start selling bullion as well as apparently prices stay down).
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That logic is wrong! The maths is wrong too.
IMHO the biggest myth sold to the potential stacker (ie. the potential bullion buyer ;)) is that PM prices should go up in price proportionally to the number of dollars printed.
This has to be the biggest crock of shyte lie there ever was. And most poor stackers still don't get it.

fishduck said:
6) PMs go up a few dollars (even if it goes up quite a bit) then it goes down by as much because traders are taking profits, I'm sure stackers here heard this all the time. I rarely hear about stocks like Apple and Tesla going down because of profit taking (they have other reasons but profit taking was not the main one), apparently, traders are letting it rise all the way and not locking in any profits, PM traders are not doing this, if it goes up a little bit of the RSI, xxdays EMAs, apparently its overbought and its time to sell to lock in some profits.
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Really?

fishduck said:
7) and when stackers are awarded with their supposed big pay day (which has not happened as of now), they are threatened by someone (it doesn't have to be government) of the potential of confiscation, so any gain that you possibly might have made will be taken away and you will have nothing to show for it should this happen.
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Really? o_O


fishduck said:
And I haven't even started with the alleged Paper manipulation and unbacked shorts whether this is true or not.
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Pffft!!!! Please don't!!! :p

fishduck said:
But seriously, even with Covid, even with all this money printing, even with institutional money (Buffett and pension funds) slowly coming in, gold can't hold $2000 USD and silver can't hold $30 USD, and apparently, PM prices are not immune to market crashes, and behave the same way as stocks do on the way down, when one of the selling points for PMs was the insurance factor that they would be "insured" in a market crash/downturn.
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Yep, seems you were sold the lie. :(
 
wrcmad said:
That logic is wrong! The maths is wrong too.
IMHO the biggest myth sold to the potential stacker (ie. the potential bullion buyer ;)) is that PM prices should go up in price proportionally to the number of dollars printed.
This has to be the biggest crock of shyte lie there ever was. And most poor stackers still don't get it.
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How come? Central banks are printing money all over the world (do I need to prove this?), so by economical definition the money supply has increased (expansion of the monetary supply), and the classical definition of inflation says that prices rise as a result of the expansion of the monetary supply (the modern one says inflation is a rise in prices and fall in the purchasing value of money) so by using the classical definition, the monetary supply around the world has increased, which should result in the rise in prices. Food prices have been rising, RE/stocks have been rising, a lot of other stuff have been rising so why not PMs? What makes PMs so special to be immune from the laws of supply and demand?

Even using the modern definition of inflation, why is this not showing as much in PMs? Are you saying that the value of the dollar is not going down in value, even with the money printing going on in the world? And if it is, has the value of PMs gone down as well if prices are not going up as much? And if PMs have gone down in value, what fundamental changes have happened that I have not seen?

So far, institutional investors are slowly getting in (gold and/or mining stocks), with the information they have, have they also been lied to? And by what? Pension funds are conservative by nature (or at least they should be, either by their charter or by their stewardship code/ fiduciary responsibility) either buying it as an insurance or a safe investment, so using your argument above, have institutional investors like Buffett have been lied to the fact that PMs (PM mining stocks have leverage and risk, but for the sake of the argument, I'm talking about the whole sector), are a safe or good investment or a good hedge (insurance)?

Which I guess comes back to the original question, you seem to be bearish on PMs, if thats the case, and assuming you have some interest (possible positions included) in PMs as you are in this forum, if you still have a position in them, why do you put a position in this when the world has told you that youre getting the short end of the stick?
 
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Any silver I can buy is mostly 30 and gold is well above 2000 for physical. I dont see what you are talking about?
My stack has risen in value alot but it's still got a long way to go IMO. It's a waiting game at this point with plenty to watch along the way.
There will come a time when the price wont be contained and it's coming faster all the time.
Theres already very limited supply at all the major dealers and it will only grow as available stock is bought up.
By the time the world realizes metals are gone it will be too late and prices will go insane.
Supply and demand will take hold and the market will set the prices.
 
JohnnyBravo300 said:
Any silver I can buy is mostly 30 and gold is well above 2000 for physical. I dont see what you are talking about?
My stack has risen in value alot but it's still got a long way to go IMO. It's a waiting game at this point with plenty to watch along the way.
There will come a time when the price wont be contained and it's coming faster all the time.
Theres already very limited supply at all the major dealers and it will only grow as available stock is bought up.
By the time the world realizes metals are gone it will be too late and prices will go insane.
Supply and demand will take hold and the market will set the prices.
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When I mentioned those numbers, I was speaking of the paper prices the traders use, even if there is a difference in the paper and physical market, the physical market still uses the paper prices as a reference point (if the paper prices go down, physical prices as a reference point would move in a similar direction, when paper goes down, physical rarely goes up, it either goes down slower or doesn't go down at all in the best case scenario unless you can show me otherwise) when pricing physical.

PMs haven't been rising as much as other asset classes (RE/stocks/Crypto etc) if were talking in dollar terms and using stocks (mostly tech stocks) and cryptos in some cases as an example, even one good news shoots the prices up and even the bad news can be made to be sound like good news from what I have been seeing.

I guess the point is, I'm sure many people can anticipate the aftermath of what Covid will entail economically but PM prices don't seem to be showing that as much as of yet.

For example, Australia is now officially in a recession, but PMs are going down (at least from a weekly view), this is not an argument of the long term direction but more to do with the logic (so Australia is in a recession and Australians sell their gold this week? )
 
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fishduck said:
How come? Central banks are printing money all over the world (do I need to prove this?), so by economical definition the money supply has increased (expansion of the monetary supply), and the classical definition of inflation says that prices rise as a result of the expansion of the monetary supply (the modern one says inflation is a rise in prices and fall in the purchasing value of money) so by using the classical definition, the monetary supply around the world has increased, which should result in the rise in prices. Food prices have been rising, RE/stocks have been rising, a lot of other stuff have been rising so why not PMs? What makes PMs so special to be immune from the laws of supply and demand?
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Simples.... you said it - the laws of supply and demand.

Firstly, a lot of stackers tend to assume that all dollars are represented solely by PM's, and thus price must rise in proportion to dollars printed.
Most realise that the value of other assets must take their share of dollar representation, so the theory about money printing and PM prices to the moon dissolves.
Doesn't matter how many dollars are printed, the dollars are allocated to each existing asset as demand and supply would dictate.
PM's are not in as much demand as stackers would like, thus, their price rise is not proportional to that of other productive assets - given this allocation does not meet the stacker narrative or investment objective, stackers tend to label this phenomenon "manipulation".
 
Metals are holding their own pretty well Id say.
Stock market is mostly flat and way overpriced, housing is a bubble with less buyers daily, commercial real estate decimated, retail cratering, etc.
No other asset class as a whole has done what gold has done this last year.
Gold is the only thing not getting bailed out right now and it wont need any haha.
 
you wait until Scotty come to visit, he will beam all your gold up
 
I'll gladly take all your PMs off your hands and give you fancy US dollars if it's not performing the way you want.

As for me, my stack is performing just as it says on the box. Sitting there, looking shiny, and storing my wealth which would otherwise be robbed through inflation.
 
fishduck said:
So stackers, why do you bother when the world has told you that your getting the short end of the stick? It feels like the world is finding every reason for PMs to be going down.
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I think your “short end of the stick” scenario includes the assumption that we (all) buy PM for the same reasons. After reading your post, I can tell you with absolutely certainty that my reasons are different than yours.

I have been buying silver since 1993, will the sole intent being to pass it along to my kids when I die. I don’t care about price, I don’t care about valuation to the USD, and I certainly don’t care about spot. Over the decades, I have built quite a collection, and I have made purchases at nearly every place on charts. Though admittedly, I made a lot of $$ when it was at $46/oz USD a few years back, but all I did was save it, and turn it back in to (more) silver when the price (inevitably) corrected.

For me, it’s all about PM as a savings. It’s just like someone who has a 401k. That person doesn’t (shouldn’t) pine on and on when stocks/ETFs/MF’s/ etc... are down, as s/he knows (trusts) that in the long run (ie 20-40 yrs) that holding will be higher. Sure, they may tweak it every now again, just like our selling, to ultimately buy more at a lower price). Silver is the less risky play for me. While my cost/oz avg is pretty low, due to starting collecting at a good time, the number has grown only higher over the years, which has driven (and will continue driving) my cost up. That said, regardless of what happens to my cost, I know I will have a physical asset to pass along to my kids (cost free) and that it should be worth a large amount.

The bottom line for me? There is no such thing as a bad time to buy...only more cost efficient times.
 
Little_Mountain said:
I think your “short end of the stick” scenario includes the assumption that we (all) buy PM for the same reasons. After reading your post, I can tell you with absolutely certainty that my reasons are different than yours.

I have been buying silver since 1993, will the sole intent being to pass it along to my kids when I die. I don’t care about price, I don’t care about valuation to the USD, and I certainly don’t care about spot. Over the decades, I have built quite a collection, and I have made purchases at nearly every place on charts. Though admittedly, I made a lot of $$ when it was at $46/oz USD a few years back, but all I did was save it, and turn it back in to (more) silver when the price (inevitably) corrected.

For me, it’s all about PM as a savings. It’s just like someone who has a 401k. That person doesn’t (shouldn’t) pine on and on when stocks/ETFs/MF’s/ etc... are down, as s/he knows (trusts) that in the long run (ie 20-40 yrs) that holding will be higher. Sure, they may tweak it every now again, just like our selling, to ultimately buy more at a lower price). Silver is the less risky play for me. While my cost/oz avg is pretty low, due to starting collecting at a good time, the number has grown only higher over the years, which has driven (and will continue driving) my cost up. That said, regardless of what happens to my cost, I know I will have a physical asset to pass along to my kids (cost free) and that it should be worth a large amount.

The bottom line for me? There is no such thing as a bad time to buy...only more cost efficient times.
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Hi, thanks for your input, I’ll try to get back on this discussion when I can properly sit down and do so but I do appreciate everyone who took the time to write down their thoughts on this.
 
Don't listen to the naysayers!
Some people just don't have the right temperament for stacking metals so they trash its investment potential.
Stacking precious metals is not a get rich quick strategy! An 5 - 10% return may not be enough for someone who wants to get rich quick.
If you want to learn successful strategies from people who make money from stacking; then just attend a stacker's meeting like Sydneystackers
 
two group of people
those who hold trough out since bear market 1980-2000 :(
and those who ride up 2000-now in a raging bull market :D
provided they have the metals, then none is losing any money :cool:
 
Doubt that many of us have the privilege to buy in 2000, especially with the GST. But locally a lot of people bought into the peak when they removed the GST in 2012. The local stacker community never recovered from the tragedy.
 
sgbuyer said:
Doubt that many of us have the privilege to buy in 2000, especially with the GST. But locally a lot of people bought into the peak when they removed the GST in 2012. The local stacker community never recovered from the tragedy.
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at the time the gold bars were right in front of me, back in China town, but have no clue of how to buy them
1 kilo about SGD 19,000
eBay were started posting after 2005-2006, so there were not much alternative to buy silver, only gold
no online forum for sure locally
we just look at how people trade Futures contracts etc and paying high service fees

many people thought that they must pay GST, when the rule change 2012, they were frustrated due to their own ignorance
some people park in freeport etc
but one can buy paper and wait for the law change to take delivery, just need to pay storage
 
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