Metals Crash Report-We Won't Get Fooled Again-Ty Andros--09.May.2012

Ty Andros called FSN today, Wednesday, 5/9, to weigh in on the recent precious metals slam down. Given all the money printing and the global economic instability, now is indubitably a good time to be a buyer. Today, we discussed the real story on Chinese inflation, and it's far worse than has ever been disclosed. Over the past year, meat and food prices have doubled! So this means real Chinese economic growth is far below official statements, just like in the US. So don't panic, and don't let your emotions get the better of you.

“I’m under the impression that the bad ju-ju in europe is causing the dollar to rise, effectively hitting PM’s as measured in dollars.”

That’s my take. Additionally, stock declines fuel margin calls in many/most commodities.

I sold 1/3rd my gold $1760 and may buy some back around here. I would not ordinarily try to see-saw or ratchet or whatever one might call attempts at price improvement, but I unfortunately own my gold highish ~ $1500 and do not feel like the oppty to rebuy around here (or possibly, even lower) will go away.

I think you have it right.

This is a thing our brains do to us. They discern a trend and think it will go to infinity. Intellectually, we know that cannot and almost certainly will not happen. But while we are busy thinking we are smart, our brains drive our stomachs in a way that tends to prevent us from acting out of fear.

As an example, perhaps the greatest in history, consider where the stock markets were in Mar ‘09. You had things like Dow Chemical trading for $6. CAT trading for $24. Literally a hundred others. Was it a slam dunk that the mkt would double in 3 years? No. Many, many stocks rose 6-8-10 times. What *was* clear (and dead wrong) was that the world was going to end. You did not have to go looking for obscure stocks to find “impossible” prices.

Now perhaps one can say the same thing about PMs, but the fact is that gold is not 1/2 off its peak peak as was the stock market at that nadir. Indeed, silver, as I repeatedly tell people, did not decisively leave $10 behind until 2009 and spent 1/3rd of 2008 under $10. So silver is high. Gold is high. Do we think these items have already expressed the degree of money printing that has gone on? I don’t know, I really don’t. I think you can act to buy snippets here and there and have dollar cost avging be smarter than anything your brain might come up with.

Worldwide, gold costs about $700 to pull out of the ground, purify, refine, and form into recognizable form like coins or bars. I think there is a potential hard-ass bottom somewhere in the 1200-1400 range, but, we may not quite get there because the rest of the world has caught onto gold and may start buying in before “the bottom” (a price point nobody can know)

I am not averse to selling some of my PMs, nor am I averse to buying more opportunistically. Some folks are “never sell an ounce” guys. I think that is wrong. Gold is not rare, except for the miners who have to dig it up. Any old time you want, you can exchange money for it, and it isn’t going to change your life if you pay even $100 or $150 more per ounce for it. I can name you ten places that will sell you gold with pricing within $10 per ounce for a given form factor. I do not think the oppty will disappear to buy at these or lower levels for some time here. IOW, the train is NOT leaving the station. I don’t buy this crap (and it is crap, because when you buy it, your money is stuck into it) for a $15 bump.

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