Panic Selling Or Panic Buying?

Oils been working its way up with the unrest in the middle east. As long as that area is a war zone and we wont drill everywhere possible it can hold that high price.

The huge difference between oil and silver though is the world has to have oil and huge amounts of it to function. Everything plastic has oil in it, shoes, q-tips youd be shocked how many things need oil to be made and thats not even counting the use.

Yes silver is used in some electronics, but its fairly replaceable and we dont need anywhere near as much. If the silver supply was cut off we could make do, we couldnt without oil.




Theres another big difference between now and 08, well several actually. The first is weve seen its not the end of the world. But the 2nd and probably most important was 08 was a fast hard drop, this drop started almost two years ago and hasnt turned around.

Youre right we cant do what we are now forever, but we can for a few decades if not longer, well have another president in a couple years as well and maybe a new senate in a year so by no means are we locked into this forever. Before we could collapse the world would have to isolate itself from us economically to let that happen. Being the biggest buyer in the world makes a lot of places very dependent upon our consumption, even if things were much much worse than they really are we just wouldnt be allowed to collapse and take everyone down with us.

How about corn? Our little farm yields about 20,000 bushels on a good year. At $7/bushel we gross $140,000. At the "long-term" average of $2/bushel we gross $40,000.

Our 100 tillable acres was worth $100k 20 years ago and $200k 10 years ago. Now it's appraised at over $1 million. Maybe it's due to collapse and take John Deere stock with it?

Many trillions from The Fed have yet to "hit the streets" but eventually they will and my guess is The Fed won't shut the valve off soon enough (the time has already passed really) but instead will keep it wide open through next year producing dire consequences within a few years. They didn't learn from 2001 through 2005.

I found this talking about how much The Fed made in 2012. It was in an article for Jan. 2013.

The Federal Reserve said on Thursday that it sent $88.9 billion in profit to the Treasury Department in 2012, a record that reflected the vast expansion of the central bank's investment portfolio.

The Fed is required by law to hand over a large majority of its profits, a long-standing provision that has become a lot more lucrative in recent years. Because the money is transferred at regular intervals throughout the year, Thursday's report does not affect the imminent arrival of the debt ceiling.

As part of its campaign to stimulate the economy, the Fed over the last five years has amassed $2.7 trillion in Treasury securities and mortgage-backed securities. And the central bank is still expanding its holdings by $85 billion a month.

The interest payments on those securities are the primary source of the Fed's profits. The Fed has transferred a total of $335 billion to the Treasury since 2009, compared with $147 billion in the previous five years, adjusted for inflation. The Fed has transferred at least some profit to the Treasury every year since 1934.

BH again your comparing things with an inherent value and things people need. We need land, we need food, we honestly dont need silver. Yes I know youll say silver has an inherent value and in some ways it does because we like shiny things, but not in the same way that we need food to live or land to live on.

Corn is needed for ethanol too which we insist on putting in gas. Your land value however looks like its been climbing for quite a while. Again silver has been on the decline for almost two years so its doing the exact opposite of your land. I would also add with the corn that gas prices will raise its value too for the price of production but theres so many laws requiring its use its kind of its own animal being both a food and needed for gas.

As far as QE you can get away with it a few times and its not a big deal. You cant do it forever but doing it a few times isn't going to crash anything. Well mess things up for sure but right now were doing fine in spite of the governments best efforts. Were more resilient than we get credit for and have been through harder times than this.

I entered at a bad time (2010), but I've been buying low so I'm about even overall. I intend to ride this thing out, no buying or selling for now. I just hope it doesn't take as long for silver to recover as some are predicting on here. I'd certainly be relieved to see some upward movement over the course of the next few months.

Bh - my inlaws sold exactly the same farm land last spring. 200 acres tillable land - no buildings - just pure farm land. It auctioned to another farmer for 2.4 mil.

Farmland in another sector that has seen increased buying from institutional investors lately. You have hedge funds and REIT's buying up farmland thousands and tens of thousands of acres at a time and driving up prices. Farmland will be the next mortgage-backed securities.