Like a lot of the folks who are frequent contributors to this excellent board, I've been in the market for most of my life. Starting when my dad let me run my the custodian account he set up for me, that's now 45 years. We've all seen several market tops and bottoms. I guess what I'm getting at is where the price of silver is now in relation to where it will be when it ultimately tops out, or arrives at its fully-valued plateau, or however one might wish to characterize it.
What is striking me right now is the question "at what price will Ag be when ordinary, diversified funds begin to see it (or, precious metals, and/or related plays) as a legitimately allocable investment category?
We're clearly not there now, and it isn't going to be very long before the POS is sitting comfortably between $45-$50/oz. And, I'd be very surprised if we'd begin to see the run of the mill funds apportioning anything at all into the metals.
It's almost as if it's going to take upwards of $100/oz for this phenomenon to materialize. By the way, I can't imagine that the funds will really give a rat's backside what silver is going for. I'm guessing that their demand will be about as inelastic as that of industrial users. But, that may be the price of silver that prevails when the price of gold finally triggers mainstream fund participation, i.e., in the $2,000-$2,500/oz range, I'm guessing.
Assuming any of this is true, one can only imagine (dream) about where these things will actually top out, because the funds' participation will begin no later than the beginning of phase 3, and perhaps as early as mid- early- phase 2.
Obviously, just having a little fun pondering as a lead-up to more March Madness this evening.
My opinion is when your scenerio takes place, and I believe that it will, that will be the top of the range for silver and gold, and it will signal a time to sell...at least all of ones trading shares...if you are a long term investor, you may want to keep some miners....I won't, but then I am not a long term investor...
Take a look at TGC...I have been trading in and out since .40....still have a large position at .85...their first conference call will take place on Thurs....could be an interesting catalysist for the stock (one way or the other!)
Continued luck with your investments, and thanks for the opinons, musings, info. we all benefit from such discourse.
Interesting. I was just talking about this with someone this morning. I don't think it's Au/Ag price dependent. It's a mentality that pervades the vast, vast majority of the investment community-- precious metals as an asset class are too risky/volatile for my clients to enter. Perhaps it is due to the high beta of the miners. If I were in the business I could see getting a call from a client on a Monday that their account is up $50K and they are thrilled and then the next day getting a call complaining that they are down $30K (or more) for the day. I'm 100% in miners and bullion and I tell very few people that because I don't want to hear about how I need to diversify and I carry too much risk. What else would I invest in (energy, agriculture-- that's it)?