Silver Tops 30.00 An Oz. At 5:00 Closing.

Everyone of these reasons are a spoke on the wheel. The axle they turn on is the prevailing economic policy of nations trying to reverse the economic downturn. It is called competitive devaluation. Our govt talks about quantitative easing, creating jobs by putting money into the work place, aka - printing money causing devaluation. What you do not hear them talk about is that the idea is to cheapen the dollar to restrain imports and grow exports creating jobs at home. Nations around the world are in the process of applying this ploy in response to what we are doing. It does not work. Consider Germany. They did not run down this path and have changed direction. Their unemployment is between 7 and 8%.

As long as this policy is in place, silver will stay strong. I just borrowed a half mil to build a new facility for the company and deal with one of the largest banks on the east coast. The head of commercial lending tells me that they believe we have another two yrs of this mess. The reason is that the banks are unwilling to lend cash in such a high risk market and all the money that the govt prints will not change matters. They intend to keep deposit rates very low and not expand their investment portfolio until they see safer risk. Low investment rates equal high commodity prices.

The key is construction. We have over built new homes and the inventory is horribly skewed. In our county, a health housing market has about 400 houses for sale. According to the local realtor's association, there are 850+ homes on the market. It will take three yrs to bring it in line. The housing industry bad debt has been adjusted for over the last three yrs. However, it is just the tip of the iceberg. The next round of charge-offs is coming in the commercial building sector. They believe the losses will be greater than in the housing market.

Low deposit rates, high unemployment, massive federal debt, inflation on the horizon and a horrible economic policy by the feds will keep pushing metals up. Anyone not afraid of the stock market should be. So, where else do you go to protect your money and look for investment gains. Hmmmm, how about the best producers over the last couple of yrs.

I'm buying sliver.
Jim

jim1953

the housing market will take longeralot . like you mentioned to many houses for sale as of today
its estimated that the foreclosure madness has not even hit yet.
More houses will have to be forclosed ,If someone does not protest a foreclosure its a automatic 12-18 months before the house can be taken back with the back log of caes in the court rooms . Atleast in places like florida,newyork and cali.2-3 years if a person protest the foreclosure

so the forclosure peak might be in 2-3 years with the 2008-2010 cases finally being settled with judgement sales.then 2-3 years more to level off the accumulated houses.
The time the market will really take off is 2015-16 ,7 years after the first 2007 forclosures hit, those people will be 7years with cleaned up credit looking to rebuy , then the 2008-2009 clean credit people rebuying cuasing a serge in house prices once more ,as peoples old foreclosures fall off their credit record they to will seek new homes to buy.Plus todays teens and early 20's people will be looking to buy there first home in around 7-10 years ( age 24-28) seems to be the first time home buyer market

If anyone believes or accepts the theory that money is being printed then you should NOT be invested in anything.

This is one of the most "misunderstood" concepts (QE) of all times and I wonder which talking head on TV started this illiterate concept.

For anyone interested listen to the 60 Min interview on what was said.

Cylon62 - Ok, may be that the presses are not exactly running, but the Fed is buying Govt debt so they can put money into the marketplace. Not sure how you buy your own debt without "printing money".

coppertop5150 - I agree with your analysis of the housing market. I think most would agree that the run-up in gold and silver has been driven by economic fears. Your statement on housing sure does not inspire a belief that this is turning around or anything else for that matter. I see no reason that that fear and or monetary policy changes by other govts won't continue to drive metals. $30 is a ceiling. Once thru, $35 won't be far away.

Cylon62

Ok, silver like all things, moves on fundamentals "supply and demand". The driving factors on the demand side are NOT normal and that was the analysis. I am not sure anyone is particularly afraid of the Fed. Betting against the power of the American economic engine is a suckers bet, though. It is underestimated.

They buy tresaury bonds from banks.

Yes simply put the Federal Reserve has absolute power to control the United States money supply.

During hard times like now, they are in a good position since money has zero velocity and there is no inflationary pressure. Hence, the Federal Reserve can monetize U.S. debt with little or no consequence. I won't go so far as to say U.S. Federal Debt is meaningless but it is far less consequential than people think.

Would you be worried about your mortgage if you were authorized to print $100 bills? Probably not...