P M ?

This is a silly poll, anyone interested in silver and gold is buying/selling and holding. If your just going to buy and hold and never sell then buy at any price, whats the difference since your going to die with it anyways.

Northern,

For those with kids, it's kinda fun to put this stuff in a SDB and leave it for them. I write a little note in each box that is in my SDB to my family since they would only be in that box if I was dead. Why wouldn't one want to leave nice stuff for future generations? I realize most would want cash over silver and gold, but it's easily cashed into spending money.

The 3 dollar on ounce point was a good one. I know aluminum used to be worth a fortune until they got the cost down.

I have a question. With new alloys being made and a switch from film photography to digital what keeps silver in demand. Is it all medical and jewelry? Could silver ever end up like aluminium? I like junk silver for what it could buy back in the day and Maple leafs for a date set so all in all if the bottom drops out in silver I will just get to buy a few potato bags of junk and still be happy.

@yup7676 today I found a book...

@Silverbug

Thank you, just proof that what I have been saying is universally accepted, contrary to what is thought, averaging down is not smart. For decades and decades, traders such as myself are instructed to NEVER average down on a position that does NOT show a profit from the start. It NEVER works.

Averaging down is a killer across any asset class. Commodities are the worst since there is NO yield, no sort of income that comes in besides the potential increase in value of the commodity.

Averaging down in stocks is also risky and while a dividend can help, the risk is if the stock keeps sinking, the market just might be pricing in the fact that the stock might be on the verge of canceling the divy. So in stocks one must be certain and know what metrics are valid and being used to measure the health of a stock and its dividend.

I think the issue is that people confuse "averaging down" or dollar cost averaging and fail to realize there is a time to do it and a time not to do it. You always hear the catch phrase "buy when there is blood in the streets" which I believe was Sir John Templeton. Others quote folksy Warren Buffet who says "buy when others are fearful".

The problem is these individuals have either

a- a much longer time frame than you

b- tons of cash to deploy

and ...

c- inside information that you are not privy too.

Therefore, how does one know what assets to stay away from? How do you manage risk? For starters, like all traders and institutions do, you never put a huge line in a position. You always send out a probe first to see how it reacts. IF it works, you pyramid in on the way up. That is why assets rise in price, the buyers are buying and other buyers keep buying as well. A basic rule that all trading desks work off is "Buy STRENGTH, Sell WEAKNESS". If anything, let that simple statement sink into your mind.

Therefore, any assets, whether they be commodities, stocks, currencies, bonds, and any other asset that can be traded, if its at or near yearly HIGHS is worth buying.

On the other hand, any asset that is at yearly lows, means institutions are exiting, traders are dumping, and its being sold. These assets are always near or at, or are making yearly lows frequently.

In some stocks, in an uptrend in the stock or market, buyers employ a "buy the dip" tactic. I personally do not like doing this as I never sell rallies and I do buy down days but I do know fellow traders who again, in an uptrend average down a stock that perhaps is taking a breather, or buy the indices on pull backs.

HOWEVER, all of them use some sort of stop to manage risk. Another simple rule we traders live by is "What is my exit?". The minute buying the dip doesn't work, they get out. None of them either would be buying the first dip if the markets indices were say, at yearly lows.

The key to all of this is price action. Certainly anyone who tried to average down the Nazzy from when it topped out in 2000 has not enjoyed almost breaking even, its been 15 years now. No one who averaged down as the bank stocks benefited either, if you bought bank stocks and they were the wrong ones, you got washed out.

Anyways, I am getting off topic here. But the point is, averaging down is the kiss of death to your cash. I have seen all the supposed reasons why averaging down supposedly works, none of those individuals are around anymore in the markets.

One only starts buying when you get confirmation to buy and then you start nibbling, probing. As it starts to work up, you leg in and add a little more. No one in the markets is interested in finding the absolute bottom, rather they are interested in managing risk. The inverse of this is true when you sell short.

Again, great find SilverBug. As I have said, averaging down in a declining asset is the kiss of death. But hey, no one needs to believe me, there is plenty of proof to back up my reasoning. I will be standing and remain profitable as a trader because I do not engage in averaging down. Success comes from being a student of the price action, which is as old as the hills. As the the greatest trader ever to walk this earth once said, "nothing is new in Wall Street, just the pockets change".

Silverbug,thank you for the compliment, just helping out my fellow collectors here understand how the markets work, glad to see you have found books related to that!

Worthless paper dollars. Go into any grocery store with 5 one dollar paper bills and 5 one oz. US silver eagles. Sure, they'll each buy a pound of hamburger, but OUCH did I just take a HUGE loss on my silver investment!