Warning Fools! Silver Will Fall by 66%

[Zippyjuan]

So it would seem. Might as well have it in silver stocks.

 

[oyarde]

Thanks for the info Zip , I always thought I would get around to looking at that , but had not.

 

[XTreat]

Not sure the benefit of putting silver into a IRA. I don't plan on reporting any gains to the IRS in the first place if we are talking about a ROTH and I would rather the IRS not know about the existence of my PM stash if we are talking about a traditional.

 

[oyarde]

Not sure the benefit of putting silver into a IRA. I don't plan on reporting any gains to the IRS in the first place if we are talking about a ROTH and I would rather the IRS not know about the existence of my PM stash if we are talking about a traditional.

Makes sense to me.

 

[Brian4Liberty]

Silver closed over $29 today. Last week was probably a (relative) bottom. We shall see...

 

[matt0611]

Not sure the benefit of putting silver into a IRA. I don't plan on reporting any gains to the IRS in the first place if we are talking about a ROTH and I would rather the IRS not know about the existence of my PM stash if we are talking about a traditional.

This. ^^^

I'm not really sure why anyone would want to put gold or silver in an IRA...

 

[oyarde]

This. ^^^

I'm not really sure why anyone would want to put gold or silver in an IRA...

I would not , defeats the purpose of having it.

 

[oyarde]

Silver closed over $29 today. Last week was probably a (relative) bottom. We shall see...

I figured last summer @ $26 was the bottom , forever ....

 

[Brian4Liberty]

I figured last summer @ $26 was the bottom , forever ....

Seems to be a lot of talk about hitting that $26 again this summer. We'll see.

 

[oyarde]

Seems to be a lot of talk about hitting that $26 again this summer. We'll see.

Then I would buy some more,most of mine , probably 1/2 below $10 , other half, below $27 , so , I am happy.Bought a little bit of gold a few days ago.Some copper today.

 

[Brian4Liberty]

$29.40 now. There are some buyers today.

 

[fatjohn]

First day of the new bull market in metals.
Tell others I told so.

 

[flaversaver]

First day of the new bull market in metals.
Tell others I told so.

So far you're wrong. I hope the other holds true however.

 

[Carson]

I remember once when I was young noting that the price of silver was very low during the depression and wondered why everyone didn't buy it. Someone mentioned because no one had any money.

But going back to the Great Depression in the 1930's, silver prices were 25 cents per ounce, and the U.S. mint paid that to the miners, yet turned that silver into coinage worth $1.40 per ounce, as there is 0.72 of an ounce of silver in $1 face value of 10 dimes or 4 quarters minted 1964 or earlier.

http://silverstockreport.com/2009/rapture.html

The miners didn't. ?????


Anyway we saw the housing bubble burst. Most recently I thinking I saw inflation get to the point that the money we were working for no longer covered the cost of our business operations. I saw layoffs and hours cut. The morning commute to a sever cut in traffic.

I think that cutback caused a lot of loan defaults. I think that in turn caused our currency to regain some of its value. Silver prices fell. I'm assuming other commodities and stocks did as well.

It then became worth it for some to increase hours. Others to hire. Traffic has picked up in the morning. I thinking another round of inflation will yank the slates right out from under us.

http://www.silverseek.com/quotes/5silver.php

I think the big pullback in this one was the housing market.

http://www.google.com/finance?q=INDEXDJX:.DJI


Anyway it seems a dilemma for me. On the one hand I should be charting all commodities and stocks and following them as they twist and turn with each other like the way DNA twist and turns. Buying the lows selling the highs.

On the other hand it looks like the little recent gains we've made are going to get stopped in their tracks.

I think only restoring sound money can stop the inflation. Its gone past the point of regaining some control through government spending. Even if we did have their hearts and minds to do so their are still those outside of the country with access to the fake money presses.

Are we the new miners?

 

[Carson]

They would if I could have gotten to it. It went over a 10 foot embankment at 2AM. I went back at first light and couldn't find it. Not that I could have done much, I've never cleaned a deer in my life. I'd be all...

I've had help in the past with such things. The advice that really set me free and allowed me to get in up to my elbows came from a friend as he was in there doing my work for me. He said what he does is cut out all the parts he doesn't want to eat.


P.S. 100 countries?

P.S.P.S. Let me know if any of the women are asking about me.

 

[ronpaulfollower999]

I think we're due for a rise in silver and gold. Maybe 1,800 and 35.

 

[qh4dotcom]

OP was almost correct two years after this post was created

Silver has fallen about 60% since the $50 high....not quite 66%

The silver bubble took on a new dimension this month, with the price of the metal rising nearly 30%. Last Monday, share volume in the iShares Silver Trust ETF (NYSE: SLV ) was five times its daily average in the first quarter. While many investors may cite capital preservation as a reason to buy silver, an analysis of the historical data suggests that those who pay nearly $50 an ounce will eventually suffer massive losses.

Gold's real return: aero
Like gold, silver has lived up to its billing as a store of value -- if you measure your holding period on a geological timescale. Using data from precious-metal dealer Kitco, I constructed a series of inflation-adjusted silver prices going back to 1800, according to which the metal generated a historical average return of 0.4% per annum. (Much of that small premium over inflation is due to price appreciation over the past 10 months. If we use the price of silver in mid-2010, the average annual return falls to 0.1%).

There is no reason for investors to expect anything more from silver: Why would a metal -- a commodity with no yield -- accrete value? But silver's price volatility disqualifies it even as a stable store of value. For proof, just take a look at 10-year trailing real returns since 1810 (based on average annual prices):

The silver bubble took on a new dimension this month, with the price of the metal rising nearly 30%. Last Monday, share volume in the iShares Silver Trust ETF (NYSE: SLV ) was five times its daily average in the first quarter. While many investors may cite capital preservation as a reason to buy silver, an analysis of the historical data suggests that those who pay nearly $50 an ounce will eventually suffer massive losses.

Gold's real return: aero
Like gold, silver has lived up to its billing as a store of value -- if you measure your holding period on a geological timescale. Using data from precious-metal dealer Kitco, I constructed a series of inflation-adjusted silver prices going back to 1800, according to which the metal generated a historical average return of 0.4% per annum. (Much of that small premium over inflation is due to price appreciation over the past 10 months. If we use the price of silver in mid-2010, the average annual return falls to 0.1%).

There is no reason for investors to expect anything more from silver: Why would a metal -- a commodity with no yield -- accrete value? But silver's price volatility disqualifies it even as a stable store of value. For proof, just take a look at 10-year trailing real returns since 1810 (based on average annual prices):

The silver bubble took on a new dimension this month, with the price of the metal rising nearly 30%. Last Monday, share volume in the iShares Silver Trust ETF (NYSE: SLV ) was five times its daily average in the first quarter. While many investors may cite capital preservation as a reason to buy silver, an analysis of the historical data suggests that those who pay nearly $50 an ounce will eventually suffer massive losses.

Gold's real return: aero
Like gold, silver has lived up to its billing as a store of value -- if you measure your holding period on a geological timescale. Using data from precious-metal dealer Kitco, I constructed a series of inflation-adjusted silver prices going back to 1800, according to which the metal generated a historical average return of 0.4% per annum. (Much of that small premium over inflation is due to price appreciation over the past 10 months. If we use the price of silver in mid-2010, the average annual return falls to 0.1%).

There is no reason for investors to expect anything more from silver: Why would a metal -- a commodity with no yield -- accrete value? But silver's price volatility disqualifies it even as a stable store of value. For proof, just take a look at 10-year trailing real returns since 1810 (based on average annual prices):

http://www.fool.com/investing/general/2011/04/29/warning-silver-will-fall-by-66.aspx

 

[ronpaulfollower999]

So 2 or 3 more dollars to go....

 

[Brian4Liberty]

And the long-term Silver Prediction Award goes to Alex Dumortier and bobbyw24!

Congratulations.

It took over three years, but the original prediction has come to pass. And overshoot to the downside it did. Yippee.

Silver could fall by two-thirds!
Silver prices are now well ahead of their historical average (the red line). The chart doesn't do justice to the extent of the gap that has opened up with respect to a fair price since it ends on the average price of silver during the first quarter of this year (roughly $32), whereas daily prices are now close to $50. In fact, the price of silver would need to fall by nearly two-thirds to get back to its long-term average of $18/ ounce -- not to mention that markets typically overshoot.

http://www.fool.com/investing/general/2011/04/29/warning-silver-will-fall-by-66.aspx

 

[Brian4Liberty]

What a long thread, just for fun, here's some select quotes. Most of these are from 2011.

It's always darkest before the dawn. Are we there yet?

If silver drops by 66%, I'll look at it as a great buying opportunity! Bring it on!!

It's on.

At some point, this statement, "Silver Falls by 66%", will be true;
How long will it take? 1,2,5, or 10 more years?

• The Bear market in Silver lasted over 20 years.
• What if the 66% drop happens (for example) after you sell your silver for $401/OZ?

It took over three years.

Exactly -- buying opportunity!

It is difficult to make money in the metals market if you are a short term trader or an emotional trader because the peaks are often sharp and the troughs can be extended. But if you are consistent and buy on dips for the purpose of holding the asset you will be fine.

Buy low, sell high. Easy concept. Timing is extremely difficult.

I like the trend... means I can buy more for my monthly purchase!

True,

So where's the bottom going to be?

IMHO, worst case scenario (total crash) takes us down to a minimum of $20/oz.

And what a long, slow crash it has been, with a bounce in between.

If silver drops back down to $15 I'll buy up as much as I can just like last summer. I am currently not buying above $30 an oz.

Almost time to buy?

This.

29-32$ silver is back up the truck time.

Do you have another truck to fill?

This.

It's been a while since I could really afford to add to my silver position. Now that I'm just weeks away from being able to make a significant (for me) purchase...well I hope it falls to 25$ !!
...
Bring on the knife like drop to 20$.
...
This time around, 16-22$ silver will be very much like 8-9$ silver in 2008. STRONG strategic buy point.

I`m not convinced it will even go that low. It might though.

At we there yet?

$20 was my worst case scenario too. Will we see the worst case though? Sentiment is pretty negative all around, which usually means buy to contrarians.

Relative (to other fiat currencies) US dollar strength is all that worries me for the metal price in US dollars. That usually levels out at some point. Are we there yet? Or does the dollar have a significant rise left vs the Euro?

And the dollar continues higher...how far will it go?

I hope it does go down to $20 (and gold to $1450 or whatever) so I have time to make more FRNs and buy more for less.

The dollar is temporarily perceived to be strong, the economy is temporarily perceived to be growing...

Deflation before inflation...

Your wish has been granted.