Over the long term I'm certain that it will, as I see little evidence that our government will end it's deficit spending anytime soon. But will gold and silver prices move higher in the near term? That's another question. And is there a better way to hedge against inflation than with gold or silver stocks? For example, some food and energy prices have been soaring upward recently. Has anyone considered the soaring price of potash for example? How about the recent supply and demand situation for rice? Most stocks and commodities become over or under priced at times due to the changing demand for them. Many claim that most gold and silver mining stocks were bid up to excess levels recently and even now remain overpriced. IMO the preferred strategy is to sell into the strength during the PM rallies so you'll have some cash to buy more stock during the selloffs. The range of these recent swings have been sufficient to lock in some nice trading profits. We can debate the pros and cons of buying or holding PAAS at this time. PAAS is now more than 21% below it's high of $44.10. But there are other silver mining stocks that are much further below their highs than is PAAS. Does this suggest that the future potential rise is greater for those silver stocks that have been beaten down the most? I have many questions, so I'm turning to this board for some answers. I'm certain that this board will not disappoint me. SS
I started off this thread with a question, the answer to which will only be known after the passage of time. We have observed both gold and silver taking a beating recently. which is why I raised the question. We have read several thoughts as to why gold and silver may now be experiencing this selloff. I liked your comment about observing the rotation into selected tech stocks. In fact, I sold one at a modest profit today in order to obtain some cash to buy additional shares of PAAS stock. I know that PAAS may still head lower, but today's price was too good to pass up IMO. I'm confident that a year from now I'll look back and be pleased with what I did today. A decision to do nothing as PAAS tumbles is still a decision. SS
>>You are not the only contrarian here. I just bought..
Silver is at support here. You know what that means; the expectation is that it will hold and bounce off it. However if the support level breaks... then it's time for some seasoned bunnies. Are you ready, I'll be heating the oil soon..
"... there are other silver mining stocks that are much further below their highs than is PAAS. Does this suggest that the future potential rise is greater for those silver stocks that have been beaten down the most?" Usually when a sector takes a breather, the stock that recovers earliest and strongest is the one that was strongest immediately prior to the retracement. The ones that were weakest usually have weaker recoveries, and later ones.
Keep in mind that the longer the term you are talking about, the more important the quality of management is in terms of the stock price. I think PAAS has excellent management, and therefore will continue to outpace the sector average.
Going back 5 years, PAAS has breached the 200 dma about once per year. We are getting close (~33), so hopefully some limited further downside to this correction, then off to the races. Too bad I f****d up and bought the July $40 calls too early. Might double down soon.