What Happens To Gold And Silver Next? Look Out Below?

Actually residential is doing OK and in some areas is good. But other areas off the beaten path are not coming back, adnd its due to gas prices and low interest rates. You can afford more house if you ar not spending $800 a month on gas. That's both a function of really only slightly higher gas prices, but much lower rates. I studied negative rates extensively and I have positioned myself accordingly, and it has worked well.

I own treasury bonds quite a few. I was transferred in 2006, so I sold my house and two apartment buildings. I've had that money predominantly in treasuries and some gold because I was abroad where people were also buying gold and real estate and just about anything else. I think thats called prosperity. Don't see much of that here. But I'm glad you do. I'm hoping for an opportunity to go back to Hong Kong.

"Real estate is local and when house prices in California were doubling every couple of years my parents house was still falling in value."

Thats because things that used to be made in Michigan now flow through the port of California.

" I see companies making record profits. I see my company spending millions in equipment to increase production capacity."

You should never ever increase capacity in a negative rate environment. Domestics should cut costs and capacity. That is the source of US domestic corp profit and thats what has been happening and its not particularly good for most Americans.

I have some time here on a lazy Sunday to again repeat why and whats happening with gold and silver.

The facts and what we know presently, demonstrated by two simple measuring sticks that NEVER lie, are that gold and silver are stuck in a downtrend.

What are these two simple indicators? They are: Volume and price. The volume that is being exhibited in this downtrend is typical of heavy fund and institutional selling. They are saying "this is where we want to take profits and get out".... and they have. These are not one off events. This is not a situation where we go back to rising gold prices and the same with silver, immediately.

So does that mean that both gold and silver are done moving? Are they now going into single digits? Many are asking, who's doing the selling and why?

Herein lies the danger. These markets are huge and have many many users, speculators, investors, end users, hedgers and on and on. Those who succumb to constant theories, and frivolous articles about the reasons why prices have dropped and why they will rise.. which are based on rumor and unreliable facts, will be dragged down into a bottomless pit with their losses in silver and gold. It is NOT wise nor necessary to go on at length and form opinions why silver and gold have gone down.

Why? First, let me repeat... the market is HUGE and there are many market forces at work that know MORE than you or I. Second, by continually thinking about the whys, allows you to form a bias that can slit your throat. There's nothing to say at this stage that the selling is not over. Buy this recent dip and when its down another 100 dollars, as an example, and the losses will pile up fast, you can say all you want that you are a long time investor but you will have regrets and remorse will build as the prices attempts even lower moves.

Worse yet, suppose you successfully buy the dip, which rarely works especially in commodity markets. Are you prepared to see your money, already underwater, chop around and do nothing for an undetermined time period while other assets outperform?


So be careful in your believes and reasoning's. If they are not validated by where you have put your money and you are underwater, clearly you are wrong.

Now, many reading this, take this entire thread as an affront and attack on their reasoning that gold and silver must rise. The hairs on their back of their neck rises and they choke while they take a sip out of their drink, at the notion that the market is saying they are not interested in gold and silver for the time being. The automatic incorrect action they take is to attack like rabid dogs. They automatically assume and make the erroneous assumption that someone who disagrees with their view is saying gold and silver are going to zero.

The fact is we dont know how deep the selling will go. I can say with a certainty that we will run into a price point where REPEATEDLY over time, buyers have shown up. Nevertheless, this will not happen overnight, going forward patience and time are KEY. This will be a process.


I feel gold and silver will always have a place in long term diversified portfolios. Heck, I have been in GLD for a LONG TIME and its one of my FEW long term holdings. However, adding at these levels, is like trying to catch a falling knife,,, which NEVER works.. ESPECIALLY since this is a commodity. There is no such thing as "value" in a commodity that is nose diving, mind you there's not even a YIELD to pay you while the asset is down in the dumps for the time being.

Yet, what matters is not how I feel. I live by the statement that "opinions are always wrong, but markets never are." That is what has put money in the back account, not what I think, but following the tape, by following the price action. So please don't let this fact to escape your mind- gold and silver continue to be a strong downtrend for the time being.

I will be around for a little bit today so if anyone has any technical questions on the price action of silver and gold, I would be happy to answer your question on them and also in regards to other commods, such as copper, nickel,, which, I haven't gotten into depth because I didn't think was proper for the forum and I felt covering gold and silver in a timely manner would benefit the vast majority of members.

I did read an article on mine producton costs and that as gold/silver/copper are coming down, they will mine less due to the costs of mining outweighing the price. Copper has dropped as well and silver is a by product of some copper mines as well. There was a landslide in a Utah mine thus, less production there as well. Who know what will happen. I just am happy to know the PM I have, I have. It isn't a quick turn around investment for me.

They vary greatly depending on the mine, how efficient they are ect. Gold and silver was still produced back in 2003 when it was around 5 for silver and 300 for gold so obviously it wont come to a hault.

Personally I'm skeptical of what the actual costs are. No one is sitting there counting every single ounce coming out and it doesn't seem like it would be hard for them to get creative with expenses. Under reporting output either selling on the side or sitting on seem seems like it would be very easy.

I would assume if those costs are accurate its because theyre getting the hard to get stuff right now leaving the cheaper stuff for potential price drops. Thats what I would be doing planning for the future anyway.

But I take it with a grain of salt, its in their best interest from taxes to perception to report the highest costs possible under the current spot price.