Silver price discussion and analysis

Mr Z · 6 June 2011

Re: SILVER

Cynic,

Governments determine what currency is, human nature determines what money is... again you have money and currency mixed up. Gold is the best natural money that man has found, silver is quite probably the second best. Silver is not in a bull market today because of its value as a commodity, it is in a bull market due to its value as money.

BTW, it can be easily proven that gold is not a good inflation hedge just by looking at historical data. Natural monies are a crisis hedge, they gain value when people lose faith in governments ability to reliably maintain the financial system. They are the only money in the world today that do not represent someone else's liability. This is why people are turning to them.

If you think of gold and silver as commodities you will get this market wrong. I have had people telling me since 2000 odd that gold and silver simply have not got the supply demand funnies to do well. The people telling me that completely over looked their roll as money. Since then gold has compounded at 20%+ PA in USD mainly due to the growing concern over the USA's ability to keep the system together.

Central banks hold gold because in the end it is the only easily held money that they can guarantee will be trusted. Silver is poor mans gold, money that is no ones debt.... whatever its form, over time, it will retain value unlike our ever diminishing FIAT currencies.

Logique · 6 June 2011

Re: SILVER

explod said:
Not one basket at all. Many investors are holding only cash at the moment as there are signs of another servere global stock market crash...

I think silver will be ok, I'm not commenting specifically on that.

But there are plenty who are more optimistic on commodities generally: http://www.bloomberg.com/news/2011-...s-amid-improving-global-growth-prospects.html
Funds Boost Bullish Commodity Bets Amid Improving Global Growth Prospects
By Yi Tian - Jun 6, 2011
"Funds boosted bets on rising commodity prices to the highest in four weeks, led by copper, amid signs that the global economic recovery will remain resilient and boost demand for raw materials.

Speculators raised their net-long positions in 18 commodities by 7.3 percent to 1.26 million futures and options contracts in the week ended May 31, government data compiled by Bloomberg show. That’s the highest since May 3. Copper holdings more than doubled. A measure of bullish agriculture bets also climbed as adverse global weather curbed crop production.

The Standard & Poor’s GSCI Spot Index rose for a fourth straight week as Chinese metal inventories plunged and droughts lingered in the Asian country and Europe, trimming prospects for wheat and cotton crops. The global recovery “is gaining strength,” the Group of Eight leaders said May 27 after a summit in Deauville, France. In the U.S., consumer sentiment rose to a three-month high in May, a private report showed last month...."

explod · 6 June 2011

Re: SILVER

Cannot really agree on your post Logique, not saying you are wrong or that it will (though I do think so) but there are pointers to big market problems to be led by Wall Street, so on that basis alone cash (and silver as safe money) is king for me at the moment.

http://www.cnbc.com/id/43236764

explod · 6 June 2011

Re: SILVER

Bron Suchecki said:
Here I am, popping up. Just this week we shipped in 20 tonnes (643,015oz) of 1000oz silver bars (with more coming). We are selling that physical at the "paper" price. It is laughable to think that the prices on ebay represent the "real" price, or that the volume of oz sold on ebay have any effect on worldwide silver prices.

Yes, we are in the middle of production improvements which has curtailed our ability to melt those 1000oz bars into retail sizes, but that is not a good indicator to rely on as to the real supply/demand balance.

The Aussie paper price today is $1,080 for 1kg and on ebay the bidding today for Perth Mint 1 kg bars are reaching $1,400. In fact there is one that has just hit $1,650

So, you are being robbed over there in Perth ole pal

Bullion Money · 6 June 2011

Re: SILVER

explod said:
The Aussie paper price today is $1,080 for 1kg and on ebay the bidding today for Perth Mint 1 kg bars are reaching $1,400. In fact there is one that has just hit $1,650

So, you are being robbed over there in Perth ole pal

I think people have to ignore eBay as it simply does not represent or indicate true market price and demand.
The market on eBay is so small, almost negligiable.

People paying $1400 for a kilo bar on ebay are clueless. there is just a stigma attached to eBay that its cheaper than retail outlers and eStores, definately not the case with bullion. Also people get attached to Auctions - emotions take over..

I say this as I currently sell a Kilo Silver Perth mint coin on ebay for $1350 and also sell one on our estore for $1150.....
Go figure?

explod · 6 June 2011

Re: SILVER

Bullion Money said:
I think people have to ignore eBay as it simply does not represent or indicate true market price and demand.
The market on eBay is so small, almost negligiable.

People paying $1400 for a kilo bar on ebay are clueless. there is just a stigma attached to eBay that its cheaper than retail outlers and eStores, definately not the case with bullion. Also people get attached to Auctions - emotions take over..

I say this as I currently sell a Kilo Silver Perth mint coin on ebay for $1350 and also sell one on our estore for $1150.....
Go figure?

Or perhaps ignore the Perth Mint. Some would be concerned that the Ponzi Bullion banks maybe involved in this too.

Ebay is a free market and I do not think to many paying out 1 and a half grand would be all that ignorant.

So the questions still remain IMO.

and; silver is in a strong uptrend and as a safe haven against the current frivolaties in the market place, a good place to park cash.

cynic · 6 June 2011

Re: SILVER

Mr Z said:
Cynic,

Governments determine what currency is, human nature determines what money is... again you have money and currency mixed up. Gold is the best natural money that man has found, silver is quite probably the second best. Silver is not in a bull market today because of its value as a commodity, it is in a bull market due to its value as money.

money (mun'i), n. [Fr., from L. moneta, a mint], paper or metal stamped to show its value

(Source : The AWARD COMPACT DICTIONARY, ISBN 0-86163-109-9)

It would appear that my pocket dictionary is at variance to your liberal definition of money.

Mr Z said:
If you think of gold and silver as commodities you will get this market wrong. I have had people telling me since 2000 odd that gold and silver simply have not got the supply demand funnies to do well. The people telling me that completely over looked their roll as money.

Increased demand for commodities can easily arise from (amongst other things) the perception of commodities as a good vehicle for the storage of wealth. However, by definition it does not become "money" until it is minted.

BTW I believe that you meant to say "role" (not "roll"). Perhaps a new dictionary might be in order here.

explod · 6 June 2011

Re: SILVER

cynic said:
BTW I believe that you meant to say "role" (not "roll"). Perhaps a new dictionary might be in order here.

Dictionaries come and go and are updated on what reflects common usage. Not homophobic or gay myself but the word "gay" is a good case in point.

It is anything that can be used in exchange for goods and in the past gold and silver played that function and will again in my view. So the dictionaries will then reflect that. The following is one of the best explanations I have encountered:-

http://www.the-privateer.com/gold-b.html

Mr Z · 6 June 2011

Re: SILVER

cynic said:
money (mun'i), n. [Fr., from L. moneta, a mint], paper or metal stamped to show its value

(Source : The AWARD COMPACT DICTIONARY, ISBN 0-86163-109-9)

It would appear that my pocket dictionary is at variance to your liberal definition of money.

Increased demand for commodities can easily arise from (amongst other things) the perception of commodities as a good vehicle for the storage of wealth. However, by definition it does not become "money" until it is minted.

BTW I believe that you meant to say "role" (not "roll"). Perhaps a new dictionary might be in order here.

LOL... yeah dickshunary me! That will help! They are wrong... it is that simple. : Money is whatever any group of humans decide is a store of value and a medium of exchange... REGARDLESS of what any government condones or accepts. They determine the currency of a regime WE determine if it is an acceptable money. This is why people in the US are increasingly opting for precious metals... you need to learn that lesson or else the reason for this precious metal bull market will allude you to the end!

I just tripped over this in following leads on a another discussion...

Australia

In Australia, the creation of legal tender, in the form of notes and base metal coins, is the exclusive right of the Commonwealth Government. According to the Australian Constitution, s 115[3] which states: "A State shall not coin money, nor make anything but gold and silver coin a legal tender in payment of debts." Under this provision the Perth Mint, owned by the Western Australian Government, still produces gold and silver coins with legal tender status, the Australian Gold Nugget and Australian Silver Kookaburra. These, however, although having the status of legal tender, are almost never circulated or used in payment of debts, and are mostly considered bullion coins.

Australian notes are legal tender, as established by the Reserve Bank Act 1959[4] for all amounts. Australian coins for general circulation, now produced at the Royal Australian Mint in Canberra, are also legal tender, under the provisions of the Currency Act 1965,[5] but only for the following amounts:
not exceeding 20 ¢ if 1 ¢ and/or 2 ¢ coins are offered;
not exceeding $5 if any of 5 ¢, 10 ¢, 20 ¢ and 50 ¢ coins are offered;
not exceeding 10 times the face value if coins in the range 50 ¢ to $10 inclusive are offered;
to any value if face value is greater than $10 are offered.

The one cent and two cent coins have been withdrawn from circulation since February 1992, but they remain legal tender.

According to the Reserve Bank of Australia,[6] the legal framework[7] for legal tender in Australia is somewhat unclear. The Reserve Bank Act 1959[4] and Currency Act 1965[5] establish that it is not legally required to accept legal tender, even for an existing debt, although failure to do so may be prejudicial in future legal proceedings.

In Australia, except for when sending items via Registered Post, Australia Post prohibits the sending of coins or banknotes, for any country, in the post.

http://en.wikipedia.org/wiki/Legal_tender

So gold and silver are not money unless mommy stamps it? Give me a break! Real money is defined by human nature, not government. The world is in the process of relearning this. I repeat gold and silver are money that is no one else's debt, in times of systemic mistrust they will always come to the fore. We are in times of systemic mistrust as is evidenced by a 10 year bull market in both these metals which both have a technical oversupply if you only look at their use as a commodity.

You may not think that they are money... but they are!

These are the types of arguments we where having on gold sites 10 years ago! It is kinda quaint really :

Mr Z · 6 June 2011

Re: SILVER

P.S.

Dickshunary's also tend to define inflation as an increase in prices as opposed to the original and more correct definition which is an increase in the money supply... of which, at certain points, rising prices may be a symptom.

It is called dumbing down, the loss of subtle but powerful nuances in the way a term is defined. Suffice to say the current and more popular use of the term inflation completely obfuscates the original meaning of the term and conveniently hides the abuses that government indulge in when it come to the management of our currency. The less people understand the better as far as government are concerned!

tothemax6 · 6 June 2011

Re: SILVER

Mr Z said:
No that is not true, you are confusing currency with money.
Gold and silver are money because of their attributes, nothing can change that, they both meet the criteria that humans need in a natural money.
PS. It is still minted as legal tender in the USA... albeit unused in that roll.

You are confusing a commodity with money. If something is money it is: The medium of exchange, the unit of account, and a store of value. No one uses "Oz XAG" as their unit of account, and no one uses silver as a medium of exchange, hence it is not money. Today money is stupid bits of plastic and paper backed by nothing.

Mr Z said:
Governments determine what currency is, human nature determines what money is... again you have money and currency mixed up. Gold is the best natural money that man has found, silver is quite probably the second best. Silver is not in a bull market today because of its value as a commodity, it is in a bull market due to its value as money.

Have you seen anybody using gold or silver to make payments in public recently? Even once in 20 years? No one uses it as money.

explod said:
Silver and gold have been money for 5000 years. For convenience paper backed by gold became the norm till the Britton Woods agreement. And of course the intrinsic value of money (paper) has been diluted ever since and is why we find we have problems today.

Yes, paper money is useless, but that doesn't mean silver and gold are money. People only use paper $AUD tax-credits legal tender whatever as money, and silver and gold are currently commodities. I look forward to the day when we implement gold-standard free banking, and the RBA gets demolished and replaced by an inter-bank clearing house. Until then, the shiny stuff is still just metal.

cynic said:
There seems to be some confusion between current/liquid assets, commodities and currency in these posts.
Just because a precious metal can at times be minted does not automatically confer the status of "money" to all of it's occurences in nature, mining, refining etc.
However, a precious metal may be considered to be a "current" or "liquid" asset as it can normally be readily exchanged for legal currency.

Exactly.

sinner · 6 June 2011

Re: SILVER

tothemax6 said:
You are confusing a commodity with money. If something is money it is: The medium of exchange, the unit of account, and a store of value. No one uses "Oz XAG" as their unit of account, and no one uses silver as a medium of exchange, hence it is not money.

You are conflating money and currency. The store of value doesn't need to be the medium of exchange.

Today money is stupid bits of plastic and paper backed by nothing.

No, that's currency.

Have you seen anybody using gold or silver to make payments in public recently? Even once in 20 years? No one uses it as money.

For someone who is wrong, you are awful sure of yourself.

http://www.youtube.com/watch?v=JVArPiDebdY&feature=player_embedded#at=49
People paying for food, fuel, medical services with gold and silver in Michigan.
http://online.wsj.com/article/SB10001424052748704422204576130192457252596.html
JP Morgan takes gold as collateral
http://www.youtube.com/watch?v=s3LdNxV0yPM
Panning gold to buy bread in Zimbabwe

Yes, paper money is useless, but that doesn't mean silver and gold are money. People only use paper $AUD tax-credits legal tender whatever as money, and silver and gold are currently commodities. I look forward to the day when we implement gold-standard free banking, and the RBA gets demolished and replaced by an inter-bank clearing house. Until then, the shiny stuff is still just metal.

Ignorant and wrong. If it is just a metal, then why is gold held on the balance sheets of almost every Central Bank in the world?

Answer? It isn't your incorrect definition of money. It is because gold is a reserve asset. Reserve asset as in, store of value.

cynic · 7 June 2011

Re: SILVER

Mr Z said:
Money is whatever any group of humans decide is a store of value and a medium of exchange... REGARDLESS of what any government condones or accepts. They determine the currency of a regime WE determine if it is an acceptable money.

Did you really mean to say this?

The last time I checked our Government was composed of a number of groups of humans (political parties and independent representatives). So what you are stating is, in effect, tantamount to a statement that groups of humans have no regard to their own determinations regarding money!

Mr Z said:
This is why people in the US are increasingly opting for precious metals... you need to learn that lesson or else the reason for this precious metal bull market will allude you to the end!

Did you actually comprehend anything that I wrote in my previous two posts? I definitely alluded to the dilution of currency being a potential driver of PM demand. So no! The various reasons for the recent "Bull Market" haven't eluded me and anyone whom believes otherwise is somewhat deluded in their thinking.

Mr Z said:
So gold and silver are not money unless mommy stamps it? Give me a break! Real money is defined by human nature, not government. The world is in the process of relearning this. I repeat gold and silver are money that is no one else's debt, in times of systemic mistrust they will always come to the fore. We are in times of systemic mistrust as is evidenced by a 10 year bull market in both these metals which both have a technical oversupply if you only look at their use as a commodity.

You may not think that they are money... but they are!

Well why don't you take one of your precious silver nuggets and shove it into the hands of your local bookseller and try to persuade him/her to part with some English Dictionaries, of commensurate value, in exchange. (Take careful note of the amount of human agreement you experience whilst attempting this transaction.)

Mr Z said:
LOL... yeah dickshunary me! That will help! They are wrong... it is that simple. :

Do you really believe this ? Are you really that simple?

Mr Z said:
These are the types of arguments we where having on gold sites 10 years ago! It is kinda quaint really :

Do yourself a favour and invest in a new dictionary (preferably one that's written in modern English)!

Mr Z · 7 June 2011

Re: SILVER

I love it.... you guys just don't get it and you probably will not till it is all but over.

Again you are generally confusing currency with money.

Challenge your preconceptions and look at human history and behavior.

Cynic I am dyslexic... not stupid, leave the spelling alone unless you want a flame war.

Mr Z · 7 June 2011

Re: SILVER

cynic said:
Did you really mean to say this?

The last time I checked our Government was composed of a number of groups of humans (political parties and independent representatives). So what you are stating is, in effect, tantamount to a statement that groups of humans have no regard to their own determinations regarding money!

In a way, a combination of human nature, pragmatic considerations and availability determine what money is. To date the best naturally occurring fit has been has been gold with silver running up a reasonable second. That is not to say that under certain circumstances other things cannot become money, more that if gold and silver are available they are preferred.

cynic said:
Did you actually comprehend anything that I wrote in my previous two posts? I definitely alluded to the dilution of currency being a potential driver of PM demand. So no! The various reasons for the recent "Bull Market" haven't eluded me and anyone whom believes otherwise is somewhat deluded in their thinking.

Did you actually comprehend anything that I wrote in my posts? The dilution of the currency is not the driver of PM demand in and of itself. That is a misconception generally made by people who don't really get this bull market. Gold and silver come to the fore when the risk verse reward ratio of other assets fall. People are buying gold and silver as a crisis hedge, people are buying gold and silver because because they are the only forms of money that are not someone else's obligation. This is being driven by a mistrust of the financial system and the governing entities.

cynic said:
Well why don't you take one of your precious silver nuggets and shove it into the hands of your local bookseller and try to persuade him/her to part with some English Dictionaries, of commensurate value, in exchange. (Take careful note of the amount of human agreement you experience whilst attempting this transaction.)

Again you are confusing money and currency! Although @ $1440 AUD oz I suggest that my bookseller would be a fool not to take the gold.

Since you want to play that game... what about I give you the choice of 5K in gold or 5K in AUD. Spin the globe, stick my finger in some remote point, drop you there and challenge you to buy your way home. What universally recognized form of money do you think would be most effective in that circumstance?

cynic said:
Do you really believe this ? Are you really that simple?

Yes, dictionaries often mess up the precise meaning of terms just enough to render the original purpose and power of the word relatively useless. Inflation is a classic example but there are many others, many professions use a more precise definition of a term because the general usage definition has been bastardized or dumbed down over time. Calling me simple over that is arrogant and unwarranted. Are you so simple you believe all that is written in a dictionary without thought or question?

cynic said:
Do yourself a favour and invest in a new dictionary (preferably one that's written in modern English)!

I'm dyslexic enough that spelling gives me a hard time.... BTW way to play the man, all class!

Mr Z · 7 June 2011

Re: SILVER

tothemax6 said:
You are confusing a commodity with money. If something is money it is: The medium of exchange, the unit of account, and a store of value. No one uses "Oz XAG" as their unit of account, and no one uses silver as a medium of exchange, hence it is not money. Today money is stupid bits of plastic and paper backed by nothing.

No... no I am not. LOL Yeah the AUD has been a great store of value hasn't it? What does that 1970 dollar buy you now? Anyway... again you are confusing money and currency! (I just like saying that!)

tothemax6 said:
Have you seen anybody using gold or silver to make payments in public recently? Even once in 20 years? No one uses it as money.
Yes, paper money is useless, but that doesn't mean silver and gold are money. People only use paper $AUD tax-credits legal tender whatever as money, and silver and gold are currently commodities. I look forward to the day when we implement gold-standard free banking, and the RBA gets demolished and replaced by an inter-bank clearing house. Until then, the shiny stuff is still just metal.
Exactly.

Anyway... again you are confusing money and currency!

We use a currency... it is not really money! Mind you they have checked off most of the boxes, all but one and that is an important one

Gold is actually no longer suitable to back currency due to the way that our modern credit systems work. We will not be likely to ever see gold backing again on a permanent basis. It would be very deflationary and would make our credit system all but unworkable. I don't pretend that gold is the best currency that a nation can use, that in fact is a well managed FIAT. The problem lay in the way FIAT is managed, I think we are yet to see the best way to achieve that. Still, that does not take away from the fact that gold & silver are money that tend to come to the fore when the FIAT system runs into trust issues.

Mr Z · 7 June 2011

Re: SILVER

sinner said:
You are conflating money and currency. The store of value doesn't need to be the medium of exchange.

No, that's currency.

For someone who is wrong, you are awful sure of yourself.

http://www.youtube.com/watch?v=JVArPiDebdY&feature=player_embedded#at=49
People paying for food, fuel, medical services with gold and silver in Michigan.
http://online.wsj.com/article/SB10001424052748704422204576130192457252596.html
JP Morgan takes gold as collateral
http://www.youtube.com/watch?v=s3LdNxV0yPM
Panning gold to buy bread in Zimbabwe

Ignorant and wrong. If it is just a metal, then why is gold held on the balance sheets of almost every Central Bank in the world?

Answer? It isn't your incorrect definition of money. It is because gold is a reserve asset. Reserve asset as in, store of value.

Yey Sinner!

Central banks and Indians know what money is! I love that people who say gold is not money never seem to question why it is that the entity that makes the currency actually feels it needs a big old pile of gold!

China's CB is busy shoring up its gold stash, I think they are a little uncomfortable with the composition of their current foreign reserves. They actually need a staggering amount of gold to get to Euro norms, not to mention US standards.

sinner · 7 June 2011

Re: SILVER

Mr Z said:
Yey Sinner!

Central banks and Indians know what money is! I love that people who say gold is not money never seem to question why it is that the entity that makes the currency actually feels it needs a big old pile of gold!

Some people (bugs and skeptics alike) have no idea but feel the urge to spout what they've heard on youtube like it is fact anyway.

If you want to act like you know something, then a rudimentary understanding of the topic might be beneficial lest you appear to be highlighting nothing but your own ignorance, where the "google education" shines through every word and turn of phrase.

Just so we can keep it on the topic of silver, in respect to the Chinese, before the Communist revolution the currency of the land was in fact silver coinage. This was put into storage during the revolution, so all of that silver is still sitting in a vault somewhere in mainland China. IMHO this is the reason they aren't obviously accumulating silver as a reserve, they already have plenty.

sinner · 7 June 2011

Re: SILVER

and just to rub tothemax nose in it, here is a fresh photo from the silvergoldsilver blog,

From http://silvergoldsilver.blogspot.com/2011/06/sandpoint-idaho-population-6835-and.html

Mr Z · 7 June 2011

Re: SILVER

Yeah, I have seen the 25c a gallon petrol signs, also with the pre 64 silver coin caveat. In the US the general awareness of the dollars diminishing status has really risen since the GFC. They may not all understand it but more and more of the average Joes and Janes definitely know something is wrong in the center of the empire!

LOL... yes I wish you would stay on topic! It is embarrassing

Silver price discussion and analysis

Mr Z

Logique

Investor

explod

explod

explod

explod

Bullion Money

explod

explod

cynic

explod

explod

Mr Z

Mr Z

tothemax6

sinner

cynic

Mr Z

Mr Z

Mr Z

Mr Z

sinner

sinner

Mr Z

Similar threads

Silver price discussion and analysis

Investor

explod

explod

explod

explod

Similar threads

Privacy & Transparency

Privacy & Transparency