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Re: What's going on with silver?

Posted: Mon Mar 23, 2020 4:27 am
by ochotona
Vil wrote:
Mon Mar 23, 2020 3:53 am
Thanks for sharing it. Indeed, my understanding is the same as yours. I got well enough of it (ETF equivalent of ~100 kg), now have to do nothing and wait. Regarding the price - again I have a simplified view of how it works - I think the production cost cannot be beaten down in a sustainable manner and over long periods of time.
Ah, yes... the cost of production...

For oil it's important because every barrel of oil produced gets used. So if you go below cost of production, wells get shut in, and eventually the glut fixes itself.

But most gold ever mined is still in circulation; very little lost. So the price of production is not so relevant, because miners are "competing" against the entire world stock of gold ever mined from time immemorial.

Silver... somewhere in-between, because it' somewhat industrial, somewhat monetary.

Re: What's going on with silver?

Posted: Mon Mar 23, 2020 5:43 am
by Vil
Do not disagree. Indeed, for Gold has read somewhere that more than 98% of the Gold ever mined since ancient times is still in circulation. For Silver its just the opposite - quite of it is kind of lost given its (IMHO) more of a industrial metal than monetary those days. And the price of recuperation from 'exhausted' goods is too high to be worth. Let's see, I am happy with my silver purchase even though not be able to see it (can play with some of my Austrian philharmonics to compensate ;D )

Re: What's going on with silver?

Posted: Mon Apr 13, 2020 3:00 pm
by ochotona
The gold silver ratio is so compressed... 111:1 my goodness

I sold some AAAU and bought some silver miners... iShares SLVP ETF. Performs a bit better than SIL. Lower expense ratio.

At least if I'm going to get "paper silver" I might as well get some companies and dividends instead of whatever it is you get with a SLV. A promise.

Re: What's going on with silver?

Posted: Mon Apr 13, 2020 3:21 pm
by pmward
ochotona wrote:
Mon Apr 13, 2020 3:00 pm
The gold silver ratio is so compressed... 111:1 my goodness

I sold some AAAU and bought some silver miners... iShares SLVP ETF. Performs a bit better than SIL. Lower expense ratio.

At least if I'm going to get "paper silver" I might as well get some companies and dividends instead of whatever it is you get with a SLV. A promise.
I'm playing silver as well, currently as a short-medium term mean reversion play, but if all continues to go according to plan I am hoping to promote the position to a longer term trend play. So far it's been working out well for me. I stuck with SLV though, because the miners are still stocks... and at the moment I'm weary of stocks in general (market beta can be a bully...), and weary of how the mining industry will be effected by the virus.

Re: What's going on with silver?

Posted: Fri May 15, 2020 1:50 pm
by Ad Orientem
Silver +5.3% so far today. Gold up about .5%. Any idea whats going on? In a severe economic downturn, I would not expect much from silver which is an industrial metal as well as precious.

Re: What's going on with silver?

Posted: Fri May 15, 2020 2:05 pm
by pmward
Ad Orientem wrote:
Fri May 15, 2020 1:50 pm
Silver +5.3% so far today. Gold up about .5%. Any idea whats going on? In a severe economic downturn, I would not expect much from silver which is an industrial metal as well as precious.
From a dark arts perspective, GLD is battling its overhead resistance at ~$165 today. Once it gets through that, it's likely to follow silver up. Fundamentally and historically speaking, look back at what happened post 2008. Silver was hit harder than gold in the liquidity squeeze. But coming out of the liquidity squeeze silver led gold all the way through the rest of the bull market phase. This is what is happening right now I believe, and was the reason I took on a silver position the moment I started seeing some relative strength vs gold. It's a repeat of that 2009 dynamic that I (and many other speculators) are hoping plays out, and in that dynamic SLV went from $9 all the way up to $48 so there is a lot of potential reward if we are proven right.

Oil is even more economically sensitive than silver, and it's been rallying lately too. Remember that markets look forward not backward (or even to the present for that matter). Economic data is likely to get better going forward, not worse. Silver also got really beaten down quite badly back in March. A lot of people feel like they missed the boat with gold, and that gold has already run up too much and that can scare away some buyers... but silver hasn't... there is still plenty of room for silver to play "catch up" and beyond. They may feel they missed the boat with gold, but they see that silver is just now leaving the dock.

Re: What's going on with silver?

Posted: Fri May 15, 2020 5:02 pm
by mathjak107
In 1987 I bought 2 100 ounce bars of silver .... I sold them in the 1980’s ...well here it is 2020 and they still have not even doubled from what is cost back then

Re: What's going on with silver?

Posted: Fri May 15, 2020 5:26 pm
by Ad Orientem
mathjak107 wrote:
Fri May 15, 2020 5:02 pm
In 1987 I bought 2 100 ounce bars of silver .... I sold them in the 1980’s ...well here it is 2020 and they still have not even doubled from what is cost back then

Recency bias. Silver has been within spitting distance of $50 oz. The question is less where it is, than where it is going. And we have ample evidence that it can in fact go much higher in the right conditions. That said, given the industrial aspect of the metal, I remain skeptical as long as we are looking at the prospect of economic armageddon.

Re: What's going on with silver?

Posted: Fri May 15, 2020 5:57 pm
by pmward
Unlike gold I also do not see silver as an "investment" or something worth holding for a long period of time. I think it's a wonderful trading vehicle though. When it gets volatile, boy does it get volatile, both in the upward and downward direction. If you can go long or short at the right time you can really make a killing.

Re: What's going on with silver?

Posted: Sat May 16, 2020 3:46 am
by mathjak107
Ad Orientem wrote:
Fri May 15, 2020 5:26 pm
mathjak107 wrote:
Fri May 15, 2020 5:02 pm
In 1987 I bought 2 100 ounce bars of silver .... I sold them in the 1980’s ...well here it is 2020 and they still have not even doubled from what is cost back then

Recency bias. Silver has been within spitting distance of $50 oz. The question is less where it is, than where it is going. And we have ample evidence that it can in fact go much higher in the right conditions. That said, given the industrial aspect of the metal, I remain skeptical as long as we are looking at the prospect of economic armageddon.

i paid 9 bucks an ounce in 1987 ... no recency bias here ... just an investment that sucked for decades

Re: What's going on with silver?

Posted: Tue Jun 23, 2020 1:25 pm
by Ad Orientem
JM Bullion has 1 oz SilverTowne Buffalo Silver Rounds on sale(!) for $2.49 over spot. Holy crap. I bought a couple hundred of those back when silver was under $15 oz and with a mark up of .49 cents/oz. The premiums for physical bullion are insane. Haven't done much in metals this year, but if a rebalance becomes necessary I will be using IAU.