Silver dropped to nearly $19/oz today, falling below a support level or two. EXK showed some resiliency by declining only 6 cents on the day. But I, for one, need to see the price of silver rise above $20 to start breathing again. If silver keeps crashing, EXK will have a difficult go of it.
Many on this MB invest in PM's because of the dark outlook for our U.S. currency. Yesterday, the Federal Reserve's balance sheet rose above $4 trillion for the first time and with the "tapered" amount of QE just announced, the Fed will end 2014 with a $5 trillion balance sheet. Of course there are those who predict the Fed will continue their tapering effort. We'll see.
With the country's debts exceeding the levels prior to the 2008 financial crisis and the Fed's injection of $3 trillion since then which we know to be totally unbacked fiat, it's difficult for me to fathom why the world's historical currency (PM's) has suffered lately.
Now we see EXK sinking close to a 2 handle. Is it time to invest more since the rest of the world's investors are abandoning precious metals? For now, I will just hold onto what I have. I'd hate to think that I'd time a "selling" decision close to the lows that we're probably seeing at this time.
In any event, Newscentral, I don't think my family will quit frowning at me by simply hanging a few silver and gold coins from the Christmas tree. Besides....with their current attitudes, they don't deserve any. Ha ha. GLTU
Jim Grant on gold and gold stocks. (Silver investments obviously would be riding in the same boat!)
"Gold is just an enigma, isn’t it? As an asset it yields nothing and pays no dividend. Therefore, you can’t value it like a common stock or bond. To me, gold is an investment in the almost certain failure of the PhD-standard in central banking. The gold price is down some 25% this year and gold stocks have been destroyed. In fact, the bear market in gold equities is the only bear market I know of these days. But when the world gets a full-on glance of the new Fed Chairman Yellen and understands the measure of the policies that central bankers will likely continue to implement, the gold price will go up a lot against the dollar. Only if the central bankers ever achieve to solve all the problems with fiat money and if governments end their tendency to over-issue uncollateralized debt then gold gets obsolete. But I certainly don’t agree with that promise. I think gold will yet shine as a monetary alternative and maybe serve in my grand children’s life time again as an anchorage to the world’s monetary system." (Zero Hedge interview)
I think Mainman pointed out one of the main reasons in the post where I asked for opinions on the effects from QE. That being- people have been investing more in the stock market and demand for PMs is limited. Another compounding factor is the criminals like Goldman, etc. and shorting gold being the popular trade. Lately PMs have seen resilience to dropping despite many efforts to take them down and all sorts of experts calling for sub $1000 gold. What PMs need is some sort of big catalyst. I think the next debt ceiling fiasco could be just the catalyst. Any other potential catalysts that anyone sees moving PMs higher in the next 6 months?
Winusky: I had no idea this time around about what the FED would do per QE, so I didn't give you an opinion. Any tapering would cause PMs to drop due to a dollar reaction. Right now it's mostly about the dollar and with that I never hold a currency position for very long. I glad for that, because as of a month ago, I had though that the dollar would continue to drop. So no hurt there compared to my thoughts about the Mexico tax bill.
A couple of weeks ago, I mentioned that GS was selling some of their gold to clients, along with vault services increasing worldwide. Jeweler's vaults are selling faster than temperature and humidity controlled archival storage vaults, which are used for the preservation of valuable archives such as rare books, paintings and historical documents. I have a 50% ownership in a small business that sells rare historical stuff. I believe that vaulting will help hold metals range bound as well as the needs for silver in technology.
Our government doesn't want China owning gold and that should be a bigger discussion for the next couple of years than US debt numbers. EXK internals - They must bring home the gold. have Right now, day traders rule and it's not profitable enough to be one of them (miners). I still have a longer term outlook.
I actually had a producer well into the green today on good news and I got good news on a silver producer I have shares of. Silver follows gold...I was reading this from Zero Hedge just now : "JPM has been accumulating an impressive amount of gold, and what is more curious, it has been precisely in increments of 64,300 ounces of eligible gold on a daily basis. Putting this scramble in context, two months ago JPM had only 181K ounces of eliglble gold. And yet, just today, the Comex announced that JPM's eliglble vault gold rose by almost that amount, increasing by 125K to a reputable 1.2 million eligible ounces. "
I am even hearing they are having their thugs come into communities and local dealer shops and buying them out. They are trying to fleece the public all they can. One guy was saying in NYC they were dropping over 70K to buy gold. Something wicked this way comes. I am curious what I can buy locally. I know last time out to buy silver rounds, all I got were rounds of generic. It is still an ounce of silver, just not eagles as I wanted.