Silver Down 4.00...look Out Below

The Fed has added $2 trillion to it's balance sheet since then and the U.S. National Debt has grown by over $4 trillion. The value of the USD has been in a free fall this year as well. Many things are different than October 2008.

We've added over $6 trillion to the money supply, that alone dilutes the value of the USD big time. The JPMorgan COMEX manipulation of SLVR prices has been exposed for the crime that it is and now we have U.S. taxpayers on the hook for trillions in bad debt via Fannie Mae and Freddie Mac that have an unlimited free credit line with the U.S. Gov't.

Very few people realized the magnitude of the crisis in October 2008 and the "solution" has been to spend our way to prosperity. No problems have been solved and more have been created by simply creating and spending money to fill the holes in our economy.

SLV is selling 2.2 billion dollars in new trust shares in order to buy more silver and sees 80 dollar silver due to increased demand. At least some of the big boys think that the escape from the falling dollar is for real. In the meantime I'm making sure that my bullion purchases are nice to look at because I may have to hold them for a long time if the SLV and I are wrong. This market certainly is interesting if nothing else. I've been reading a book, "The Creature from Jekyll Island" by G. Edward Griffin. I paid $41 dollars for the book, and it came with a Peace Silver Dollar inside as a gift from Midas Resources. It is an in depth study of the history of The Fed and also a historical study of fiat currencies throughout the ages. They always fail. Not one fiat currency in history has ever failed to fail, and ours is past the point of no return. I am without fear as an investor in this market. I would rather die with a stash of precious metals than let the powers that be continue to reach into my savings with an invisible tax. So far The Fed has taken 97 percent of the dollars real purchasing power through inflationary printing. That is a tax that the public never even realized that it was paying. These are the reasons I firmly believe that this is not a bubble. I believe it is an awakening of a large sector of the public trying to remove themselves from this fractional reserve system. I think the markets may retract, but at some point the dollar will be beaten down for the worthless paper that it has become. Many bullion dealers are warning to buy precious metals while they still accept dollars as payment. At some point in time you will need Swiss Francs to buy any part of the world's limited supply of precious metals, the only REAL currency still in existance. Very soon the US Government will require a 1099 form to be filed for any purchases over $600 US. I wonder why?

There saying osama bin laden is dead

I think perhaps some more profit taking eh. Who knows, we may see that happen several times, via a flux from 45 to 49, until it finally cracks that peak....

I won't argue fenton. The fact remains that we have dumped $7 trillion into the trough with no backing other than debt. Our country is still in an unprecedented financial crisis with trillions in liabilities and growing by the minute.

You can't borrow your way to prosperity without paying a steep price. We will see the price to paid over the next few years and it won't be pretty.

American has been throwing the biggest party the world has ever known...and now the bills for that party are coming due. Pretty soon Uncle Sam's credit card won't work anymore, and we Americans are going to have to face the debt will accrued.

There's no doubt that the US government has a huge debt/spending problem & that is part of the reason for silver's rise. The modest increase in industrial demand is another part. If those 2 areas were the main reasons silver has increased at the rate it has then the other PM's would be showing similar increases.

IMO the main driver is investor demand....mainly due to the fact that silver ETF's have been buying almost all production in excess of industrial needs. While that creates the perception that there is a shortage that silver hasn't disappeared. If investor sentiment changes it will come back on the market causing further price declines.

A few thoughts:

1. The dollar is not the sole source of Silver's rise. Silver is up 530% since 2008. The dollar is down about 20%. Based on dollar movement only, silver should be no higher than $11 per ounce. A weak dollar is generally seen by economists as bullish for the U.S. economy since it makes our goods cheaper over seas which spurs exports and creates jobs.

2. Historically, most commodity spikes have been short lived. Over the longest periods of time, precious metals simply track inflation and have been a far worse investment than either common stocks or bonds. Price manipulation, particularly in silver, is commonplace. Based on some of the 10%+ daily swings, it certainly seems the commodity has been artificially manipulated by a few investment banks (i.e. JP Morgan) to artificially high levels - likely - to reap huge gains on options and futures positions before selling off their principal.

3. The U.S. national debt is not the source of silver's rise. Treasury demand is high and treasury bond yields remain near historical lows. Inflation, as measured by the CPI, is exceptionally low running at about 2% rate. US long term entitlements are a serious issue since they may represent a 50-70T liability but that money has not yet been spent and repairs can be made legislatively (reduce defense, modify medicare, change retirement age, etc...)


4. The U.S. Money Supply is not the source of Silver's rise. M3, the broadest measure, started to contract as a result of the economic crises and both M2 and M3, which include M1 (currency), have been relatively flat.

5. U.S. has approximately 180T in financial and real assets. Our debt levels are significant but they are backed by immense national wealth and military power. Average U.S. citizens tend not to realize this because so much of our wealth is concentrated in the hands of a tiny few (top 1-2%) of individuals. US net worth net of all debts exceeds 60T.