What will do it?

[Silverfondler]

It seems we are currently in a cycle of $18.50 - $23.50 for an OZ of Silver these days. I am interested in all of your opinion's on; What will it take for Silver to Drop past $18.50 or go above $23.50?

"Hard work beats talent, when talent doesn't work hard."

[creshka46]

IMO: Continued tapering of QE by the Fed. If they hold to their schedule of $10/month, they will be down to $0 by August or so. I think that will have a huge affect on the mentality of a lot of bulls that inflation/TSHTF is iminent. How far it will fall, though, I don't know. I don't think it can go that much lower, though because the economy is picking up again and silver is partially an industrial metal. Maybe $17.50 or so? back in late 2010 it was hovering right around there consistently before it began it's huge climb up to $50 in Spring 2011. I don't know much about technical analysis but it seems to me that that area would be a huge support.

[68Camaro]

What happens when the fed stops tapering? Bond yields go up, and the USG suddenly has to print money again to pay the new higher interest on their obligations and then a vicious cycle starts. No, they can talk big about a supposed taper and do some short term sleight of hand, but there is no turning back. Mises himself noted that once you start the money printing there is no stopping, only the timing and severity of the crash will change (and we're way past the soft landing stage)

[silverstacker]

IMO: Continued tapering of QE by the Fed. If they hold to their schedule of $10/month, they will be down to $0 by August or so. I think that will have a huge affect on the mentality of a lot of bulls that inflation/TSHTF is iminent. How far it will fall, though, I don't know. I don't think it can go that much lower, though because the economy is picking up again and silver is partially an industrial metal. Maybe $17.50 or so? back in late 2010 it was hovering right around there consistently before it began it's huge climb up to $50 in Spring 2011. I don't know much about technical analysis but it seems to me that that area would be a huge support.

I have to agree here. The bulls will definitly be down at this point becasue there will be little to be bullish about. Without this the PM market will see a rise. To what level I can only imagaine.

[Silverfondler]

Let me throw this at the panel for discussion as well. In what scenario will Silver/PMs rise - but not rise with inflation? For example if Silver rises to $100 oz. and inflation rises with it. Then by proxy there really is no valued gained.

[scyther]

Let me throw this at the panel for discussion as well. In what scenario will Silver/PMs rise - but not rise with inflation? For example if Silver rises to $100 oz. and inflation rises with it. Then by proxy there really is no valued gained.

Historically, the value of the dollar has dropped continuously since the 1930s. Silver has been up and down relative to the dollar, although the long term trend has of course been up. When silver prices went down following the peaks in 1980 and 2011, the dollar didn't get any stronger. So I see no reason why it can't go up again without a corresponding loss of purchasing power.

[Silverfondler]

Let me throw this at the panel for discussion as well. In what scenario will Silver/PMs rise - but not rise with inflation? For example if Silver rises to $100 oz. and inflation rises with it. Then by proxy there really is no valued gained.

Historically, the value of the dollar has dropped continuously since the 1930s. Silver has been up and down relative to the dollar, although the long term trend has of course been up. When silver prices went down following the peaks in 1980 and 2011, the dollar didn't get any stronger. So I see no reason why it can't go up again without a corresponding loss of purchasing power.

I agree with that logic. The big question is, What will make that happen. I don't think it will be a random event and one day silver just shoots up. I believe something - a world event - a domestic event. Will trigger the silver prices to shoot up. Perhaps, another mine closes or goes on strike while simultaneously the PMs paper market dries up and people start calling in for their physical PM only to find it is not available? Causing a panic for PMs.

[christostock]

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[johnbrickner]

The rest of the world comes up with a reserve currency they would rather use than the U$ Dollar.

[Market Harmony]

From a technical perspective, both Gold and Silver are at the junction of a declining price resistance line and a level of previous price support. This is a period in time right before big moves happen. Either the declining resistance line is broken and prices increase to meet previous levels of broken price supports (newly created resistance prices) OR the last level of price support is broken and price cascades lower to create a new short-term bottom, bounce up, test that price, and react from there. The latter is what we have been experiencing since March of 2013, which was preceded by a 6 month chop, preceded by a cascade from the highs of 2011.

It doesn't look good from a technical perspective. Fundamentally, PM's have never looked so attractive in USD terms.

[InfleXion]

Let me throw this at the panel for discussion as well. In what scenario will Silver/PMs rise - but not rise with inflation? For example if Silver rises to $100 oz. and inflation rises with it. Then by proxy there really is no valued gained.

Historically, the value of the dollar has dropped continuously since the 1930s. Silver has been up and down relative to the dollar, although the long term trend has of course been up. When silver prices went down following the peaks in 1980 and 2011, the dollar didn't get any stronger. So I see no reason why it can't go up again without a corresponding loss of purchasing power.

I agree with that logic. The big question is, What will make that happen. I don't think it will be a random event and one day silver just shoots up. I believe something - a world event - a domestic event. Will trigger the silver prices to shoot up. Perhaps, another mine closes or goes on strike while simultaneously the PMs paper market dries up and people start calling in for their physical PM only to find it is not available? Causing a panic for PMs.

Remember that metals have two-fold protection. Yes they are an inflation hedge against rampant money printing, but they also provide default protection due to intrinsic value. Default is the ultimate downside of deflation. While deflation is bad for the price, if deflation leads to default then the price mechanism changes, and you are left with buying power.

It is correct that the inflation hedge aspect does not increase value. It maintains value, which is something the currency would not do.

As for which scenario PM's will rise in price without inflation - that would require a metal shortage or the end of the dollar. Without a shortage the exchanges can set the price however they like. In the absence of the dollar there is no incentive to suppress the price of metals which are its competition. However the end of the dollar will likely coincide with default, and as the buying power of the metal adjusts to compensate for decades of price suppression the price should go up vs. remaining currencies and other asset classes.

I don't think we will see the end of the dollar for as long as the metal suppression is successful. China is happy to buy cheap metals, and the US is happy to keep borrowing without immediate consequence.

Therefore I don't think any of this will change until metals are truly in a shortage. The trend in that direction is ongoing, but if there were to be a catalyst to speed up the process that would be global instability as per the Libya crisis in metal highs in 2011.

Even though the economy continues to deteriorate, and debt continues to grow at a fever pitch, this can continue indefinitely as long as people choose fiat over real money, to their own detriment. It will only be when something major happens to ramp up the fear trade that the physical supply situation will risk exceeding the control of the exchanges, unless that something is the supply situation itself

[68Camaro]

It's interesting that the supression we're seeing here is effectively priced in USD (which still the advantage of being the defacto standard); for many currencies around the world they aren't seeing the supression - they are getting beat-up vs both USD (and therefore gold), so the price of gold for them is near or at all-time highs. Saw this graph below, today at goldseek, for the Argentina peso. For those poor slobs they are in the end game already.

gold_vs_peso_31-01-2014.png (119.64 KiB) Viewed 908 times

[Silverfondler]

Let me throw this at the panel for discussion as well. In what scenario will Silver/PMs rise - but not rise with inflation? For example if Silver rises to $100 oz. and inflation rises with it. Then by proxy there really is no valued gained.

Historically, the value of the dollar has dropped continuously since the 1930s. Silver has been up and down relative to the dollar, although the long term trend has of course been up. When silver prices went down following the peaks in 1980 and 2011, the dollar didn't get any stronger. So I see no reason why it can't go up again without a corresponding loss of purchasing power.

I agree with that logic. The big question is, What will make that happen. I don't think it will be a random event and one day silver just shoots up. I believe something - a world event - a domestic event. Will trigger the silver prices to shoot up. Perhaps, another mine closes or goes on strike while simultaneously the PMs paper market dries up and people start calling in for their physical PM only to find it is not available? Causing a panic for PMs.

Remember that metals have two-fold protection. Yes they are an inflation hedge against rampant money printing, but they also provide default protection due to intrinsic value. Default is the ultimate downside of deflation. While deflation is bad for the price, if deflation leads to default then the price mechanism changes, and you are left with buying power.

It is correct that the inflation hedge aspect does not increase value. It maintains value, which is something the currency would not do.

As for which scenario PM's will rise in price without inflation - that would require a metal shortage or the end of the dollar. Without a shortage the exchanges can set the price however they like. In the absence of the dollar there is no incentive to suppress the price of metals which are its competition. However the end of the dollar will likely coincide with default, and as the buying power of the metal adjusts to compensate for decades of price suppression the price should go up vs. remaining currencies and other asset classes.

I don't think we will see the end of the dollar for as long as the metal suppression is successful. China is happy to buy cheap metals, and the US is happy to keep borrowing without immediate consequence.

Therefore I don't think any of this will change until metals are truly in a shortage. The trend in that direction is ongoing, but if there were to be a catalyst to speed up the process that would be global instability as per the Libya crisis in metal highs in 2011.

Even though the economy continues to deteriorate, and debt continues to grow at a fever pitch, this can continue indefinitely as long as people choose fiat over real money, to their own detriment. It will only be when something major happens to ramp up the fear trade that the physical supply situation will risk exceeding the control of the exchanges, unless that something is the supply situation itself [/quote]

I have to agree. I think will see this play out when there really is a shortage of Gold and Silver world-wide. The only thing I see that can speed it up would be for Gold/Silver to have a fairly modest increase in value and then the general population would have a frenzy buying up whatever they could get their hands on. Having said that, being around people daily and being fairly young. Whenever a discussion of sorts comes up. I just don't see the general population losing their, "faith" in the current FIAT currency. I don't know why - it makes so much sense on why it doesn't/shouldn't work in our current era. All signs and symptom's point towards an unstable FIAT system. However, the masses need a lot more convincing to think outside the box. And/or maybe we are just at a point in our society where ignorance is a bliss - people just cannot fathom not having a currency. Here is a scary social experiment to try. Ask someone in your daily routines what would happen if we didn't have a currency or what would we use as a currency if the USD wasn't worth anything. The answers are astonishing - 2/3 the time PMs are not even brought up...

Little bit of a rant and off subject. It is just frustrating to see these signs and quite honestly only about 1% of the population is reacting to it. Back to the original question, What will make the prices jump? Basic supply and demand for sure would do it. Less to go around and will see the value jump. What about silver being in relation to gold? From what I have collected in history. Silver has always been about 15 to 1 to gold. Meaning you can have 15oz of silver to 1oz of gold. In todays game it is more like 60 to 1. One, would have to think that it will eventually correct itself and silver should shoot up in value based on this?

[silverstacker]

Good Question. I'm currently enjoying the lower prices but am quite confident that this will only last for a little time. I feel that by Q2 we will start seeing higher prices

[Silverfondler]

Good Question. I'm currently enjoying the lower prices but am quite confident that this will only last for a little time. I feel that by Q2 we will start seeing higher prices

While I agree with you on the lower prices. I have to say after seeing how the PM game has reacted to this initial "taper." If the FED continues with their planned 10 billion a month taper. I think we are going to see the PMs market continue on a downward cycle. And, the lowest prices coming in the summer months. Having said that, I, believe this will be a very small window of some very suppressed PM values and a BIG opportunity to purchase. I think at that point it will be next to impossible for them (whoever them is) to continue manipulating the PM market and we will see the free-market in action with the PM market(s) correcting to fair-market value. At that time PMs will soar.

[Numis Pam]

You guys keep discussing..... I want more info!!... I am listening!

[NDFarmer]

I sure wish it would break through that $18.00 barrier. I would like to make a major purchase below that level to offset all the ounces I purchased over $30.00

[Silverfondler]

I sure wish it would break through that $18.00 barrier. I would like to make a major purchase below that level to offset all the ounces I purchased over $30.00

Obviously I cannot guarantee anything. And, What I am about to say is purely my own opinion. If Silver continues on its current trend and in relation to the FED tapering each month. I think we could see $15 an OZ silver by July. When and if this happens it will be a HUGE opportunity to purchase. I do not think it will stay down at that level very long.

[smackvay]

I just want to post that I appreciate the opinions and knowledge you guys share on here

[scyther]

I sure wish it would break through that $18.00 barrier. I would like to make a major purchase below that level to offset all the ounces I purchased over $30.00

Obviously I cannot guarantee anything. And, What I am about to say is purely my own opinion. If Silver continues on its current trend and in relation to the FED tapering each month. I think we could see $15 an OZ silver by July. When and if this happens it will be a HUGE opportunity to purchase. I do not think it will stay down at that level very long.

I wouldn't be surprised if we see $15 in July, but I think it could easily stay there. Hopefully it does; it takes a month or 2 for premiums to come down enough to really take advantage of the "dip"...

[50centsaver]

I too appreciate the economy lessons from those far smarter than me. The reason I am here is I tried to change careers 5 years ago to try to learn options trading. I was going to get rich and donate millions to needy causes, right? Wrong. I'm lucky I came out alive. Had some huge wins but far more loss. I considered it going to global economy school/was immensely interesting being thrown into global issues. It's a big world out there. So I considered my losses as college tuition. Thru that education I became introduced to PM, which I am thankful. Another "something good" out of my losses overall. I'm not a Robert Prechter fan or critic, but became aware of him, and do respect him as someone spending his life on his career. If I remember right, his prediction is that gold will eventually go down to the approx $680 range, and silver approx $8.50. It may be possible that if it gets that low there will be none to buy? If those prices happened tomorrow imagine the scurrying to the local coin shops/the long lines of us "1%ers".

And someone wrote: "Ask someone in your daily routines what would happen if we didn't have a currency or what would we use as a currency if the USD wasn't worth anything. The answers are astonishing - 2/3 the time PMs are not even brought up..."

What was brought up? Bartyring goods? food, ammo, essential items?

[beauanderos]

Let me throw this at the panel for discussion as well. In what scenario will Silver/PMs rise - but not rise with inflation? For example if Silver rises to $100 oz. and inflation rises with it. Then by proxy there really is no valued gained.

I think the consensus among us stackers is pretty much conviction that silver and gold will "keep up with inflation"... and/or "get you to the other side with your capital intact." I find that I have to disagree with the scenario above, where there is no value gained due to the fact that price increases merely keep pace with inflation. If you use John Williams inflation tracking methodology, you'll see that we're currently (and have been) experiencing avg increases from anywhere in the six to eleven percent range over the last decade (I'm generalizing)... not the official statistics of low inflation that aid and abet the GDP to show annual increases. In any event, over the last decade silver and gold have far outpaced even JW's figures, let alone what someone would have earned in alternative vehicles such as bank savings passbook rates, or CD's. Equities are problematic, as the nominal gains don't always give you a true picture unless you modify them for inflation (hah! just try to find a chart like that ).

In any event, the near daily manipulation of the metals by the banking batstirs can assist one in one's wealth accumulation schemes... as long as you hold the right perspective. As others have stated, one of the greatest transfers of wealth in history is about to occur/is occurring. What is proving difficult is predicting the time frame in which this occurs. For those who have a short term perspective... and are looking for/hoping for a "get rich quick" scheme... you may have come to the wrong place, if you're looking for black swan events in the near term days or weeks to catapult precious metals prices to stupendous new heights. I used to gravitate to that desire, but have changed my emphasis to patient accumulation of invaluable metals with worthless fiat, assisted by the suppression of prices that allows each of us to purchase even more. I sleep better at night not worrying about every blip on the chart... and to do that you need to have a long term perspective. It might take months or a few years to see gradual, but relentless, metal attrition lend impetus to supply/demand driven pricing increases... but at some point, in the future -- and we are all convinced of this or none of us would be here -- silver and gold WILL explode in value.

I DO feel that great wealth will accrue to those of us who were early to the "game" (it is similar to pyramid principles) and the time to divest a portion of your newfound wealth (at that time) might be when the hockey stick goes parabolic... rather than ride it through to a new currency. IMHO silver and gold will see an immense gain far outdistancing inflation... without the need for hyperinflation to attain those heights. I'm talking ten to twenty times current levels, were the dollar for instance, to be suddenly devalued overnight as has happened in several other third world banana republics. Those who wait to buy metals will discover there are few to be found for sale. Not sure where I ran across this one... but...

Don't wait to buy silver and gold.... buy silver and gold and wait.

can you tell I finally have a day off?

[pennypicker]

Don't wait to buy silver and gold.... buy silver and gold and wait.

Beauanderos is absolutely correct in saying "patience" is the name of the game. Stick to your convictions regardless of what others might think or say. It reminds me of baseball card collecting pioneer Larry Fritsch who back in 1968 started buying the left over unsold packs of baseball cards directly from Topps for pennies on the dollar. Back then baseball cards had no value at all but he felt in his heart that some day they would be very collectible and valuable. In 1975, for instance, Fritsch purchased all of Topps' leftover baseball cello packs for virtually nothing. Back then Topps routinely disposed of all their unsold cards at the landfill so when Fritsch expressed an interest in their left over packs Topps was eager to save the disposal costs and simply GAVE Fritsch their left over inventory and only charged him the shipping charges. These individual cello packs that sold for .25 cents back in 1975 are now bringing $150+ each on ebay. Fritsch was buying so much unopened material back in the late '60s and through the decade of the '70s that he had to build a huge warehouse on his property to store it all. I'm sure that many of the neighbors and people in his small town of Stevens Point, Wisconsin probably that he was a nut back in those days and thought he was simply throwing his money away on childish games.

Fritsch now has a complete monopoly on the unopened baseball card market and pretty much dictates his own prices. So remember to stick to your own beliefs and convictions and don't let non-believers influence you otherwise--Fritsch stuck to his beliefs and though he recently passed away his son and immediate family are laughing all the way to the bank every day .

**Below is a picture of one of Fritsch's 1975 cello packs that Larry Fritsch Cards recently sold for $185 on ebay. Remember that these cellos sold for just .25 cents each back in '75 and Larry purchased THOUSANDS of these for free and only had to pay the nominal shipping charges!!!

mgECMkl1dF9yOsVCA5wXc-Q.jpg

**Below is a picture of one of Fritsch's 1968 cello packs that recently sold on ebay for a whopping $409--and remember he also purchased 1000's of these for free back in 1968!!!

m5OYEUhi203yP5ZFMto2aKw.jpg

[scyther]

That's a really interesting story, thanks for sharing it. About 10 years ago, I was putting all my money into Yu-gi-oh! cards. I was just buying them for fun, but I did hope they might go up in value. Looking back, precious metals would've been a better thing to buy. Maybe 10 years later, the opposite is now true... perhaps I should go buy a booster pack...

[pennypicker]

That's a really interesting story, thanks for sharing it. About 10 years ago, I was putting all my money into Yu-gi-oh! cards. I was just buying them for fun, but I did hope they might go up in value. Looking back, precious metals would've been a better thing to buy. Maybe 10 years later, the opposite is now true... perhaps I should go buy a booster pack...

You're welcome. Pre-1980 certified unopened baseball packs are on fire right now and the prices area going up monthly. So keep you eyes open at yard sales, flea markets etc. and if your lucky you might come across someone who doesn't know the value of what they have and you could score big!!!