Skip to comments.3 Weird Things About Tonight's Huge Silver Selloff (-9%)
Posted on 05/01/2011 6:07:53 PM PDT by blam
3 Weird Things About Tonight's Huge Silver Selloff
May 1, 2011, 7:49 PM
After last week's manic action, silver is falling out of the bed to start the new week, declining by over 9%.
A few quick thoughts on the weirdness:
* Nobody really knows what's up. Querying around, nobody has any solid sense (yet) of what's driving the decline. There was no particular news that would seem to be feeding into this. Update: There's a little bit of chatter about the weak Chinese PMI report from this morning, but it doesn't seem that convincing or robust of an explanation. There's also talk about margin hiking (which has been going on forever).
* Silver is a major standout. Gold isn't moving the same way. Other commodities are down a bit, and the dollar is up, but not on the same scale.
* US futures remain higher. This is a big surprise, given how consistently silver has traded in the same direction as equities.
(Excerpt) Read more at businessinsider.com ...
Love that Atlas quote on their website! The Navajo here in Arizona also have their own power plant and are mining coal. The enviros have been trying to shut them down and they told ‘em to stick it.
Protectionism is as certain as the day is long...as is sovereign default. And, they are not related.
Keep an eye on Beijing.
If the Chicoms decide Trump is going to win - they’ll proactively get in front of it, and revalue the Yuan to stave off protectionist measures.
Could be, they’re unloading tons of silver now, to re-buy with more valuable Yuan later.
Which would be a (huge) money-making opportunity for anyone who were to buy, before then...
I wasn’t aware he sold his stake.
It’s probably the big banks then.
I drive thru the Navajo reservation quite a bit. You see them selling coal on the sides of the road quite a bit.
Yeah, well, I don’t have any money.
And from what the doctors tell me, by the end of the summer/fall I won’t have any.
So what the heck.
A silver correction is way overdue. It actually started to drop a while back, but then the Japan earthquake hit and everything skyrocketed again.
Tell me about it. I did the 30-miler version of the Minnesota Ironman with my kids ("The Velocity Twins") today.
31 degrees when we left with 20 mph headwinds. Have you ever been pelted in the face with wicked little snow that stings like a sandstorm? In MAY?
...and there were tendrils of snow being blown along the surface of the pavement, just like in midwinter.
I got into garlic "futures" last fall -
Poked a whole bunch of cloves in the ground - and now they're sprouting up right good. Nothing like fresh, out of the ground garlic. You never want that 6 months old stuff from the store again.
A friend way up north plowed up a half acre last fall to plant garlic. It's really a good money crop - a more stable market too. ;o)
Amazing how so many here see each dip as a burst bubble and each rise as the final race to $100.
But you can bet the bank on this: It will take an act of God to save the dollar. When the dollar hits the downhill slopes at high speed, where is the money going to go? Another paper currency?
Paper money is teetering nearly everywhere. There are no guaranteed safe havens for assets, but you have to make some choices if you truly believe the dollar is dying (as I do). What are you going to do?
If silver drops to $20 (it won’t), I will be on the phone to Kitco in minutes. We will be lucky if our dollars are worth 75% of their current value in 18 months.
I would much rather, and I mean much rather take advice from someone who is usually right like Rogers than someone who is usually wrong like ‘You're a great American’ Hannity.
All Hannity’s flag waving won't and simple phrases wont feed me or pay for my gas and electric. I am convinced someone feeds him his republican talking points.
Think about all the great oil field in the world. They were discovered more than 40 years ago. The UK has been exporting oil for 26 years, within the decade the UK will be importing oil. The US is in serious trouble; the UK is in worse trouble. The UK has nothing to sell. Once the North Sea Oil dries up the UK will be in much, much worse shape.
The international energy agency has come out with a report showing that the worlds oil reserves are declining at a rate of 6.7 % per year even after discoveries. You can do the arithmetic, in 15 years there will not be any oil at any price unless something dramatic changes. the facts are all the world oil reserves are in serious decline. This is true of all commodities you are going to see huge supply problems, the worlds inventories of food are the lowest they have been in 50 years. We have a shortage of fertilizer, we have a shortage of tractors, and we have a shortage of farmers .
Jim Rogers/Asian Financial Forum (World Commodities fundamenals enhanced) 1/21/09
If that happens I intend to double my stash.
The Monex tick shows silver at nearly 48.00/oz.
this is an non issue.
Look at gold. it is continuing upward.
I believe silver will go beyond 50.00/oz. this week.
Protect yourselves from the decay of the American dollar , My Friends.
There’s one group of people in the world, who can with a stroke of the pen, change exchange rates and the value of assets around the globe.
They’re just outside Tiananmen square.
Frankly I’m going to admit I’m not on their side. There have been times I’ve hoped American and China could work together, but increasingly it seems that is not the case.
As long as I perceive them to be seeking results unfavorable to my own nation America, then I’ll offer my own thoughts on how to beat them at the same game:
I’ll venture to say they’re about to preemptively raise the value of the Renminbi.
Now maybe it’s just me. But if I had the ability to make my own money more valuable just by saying so.
I’d unload everything I owned which was denominated in other currencies. First.
During the window of time between that sale, and that revaluation...
Thanks for talking down the dollar. It *is* appreciated. I am still buying when it’s low.
Everything has a value. If an asset’s valuation is currently below what it is worth, then it’s an investment opportunity.
This thread is all sorts of pure awesome. Getting back into silver close to an all-time high *after* profittaking? Good way to lose your shirt.
Sounds real good to me.
I have a Native American friend back here that wrote/recorded a song some 15 years back: “Apocolapse” - great take on words.
He's retired now, but he and his wife have performed around the world.
the words to this song were prophetic:
part of the verse:
“So store lots of food
and move far from town
Move close to some wood
put seeds in the ground
And gather your friends
and live close and quiet...
they run a community center now, in a tiny country town, and ‘are prepared” ;o)
Not quite 48.00, it’s 44.89 at 2046 hrs. CDT, down 3.07.
and what is the birth rate in these western countries?
There’s a massive deflationary push. Anyone who has actual money is going to benefit.
Congrats on doing the Ironman. My dad was a huge triathalon/distance runner until a glioblastoma took him away from us in December. He would not have liked that run, with snow swirling around, but would’ve been smiling anyway. He was that kind of guy, always a half full glass and enjoying the endorphins from running.
It makes this crappy spring all the more hard. I get my endorphins from working my rear end off in the garden.
Love ‘Velocity Twins’! Hubby and I have a 14 y/o son, he’s not into the running thing though, no matter how much his grandpa tried.
To stay on topic, my mom who lives with us now has a bunch of Kennedy half dollars. Think they’ll sprout if I plant ‘em? :)
Jim rogers says he is waiting for this selloff to buy some more.
I’m not paying attention until it gets down into the 30s.
IMHO we’ll see $20 by the 4th of July.
I don't believe enormous...or even modest sums of money are invested in silver.
The Chicoms don't play in such small markets. If they want silver they will buy as much as they need. If they don't, they won't.
Silver is basically an industrial metal and only has MONETARY value if gold ends up being the dominant money.
Don't get me wrong, that could happen. But it's not imminent. This bubble has to bust first.
And this commodity/stock bubble is the biggest that's ever been within the context of the REAL economy being at least 30% below it's frothy peak.
This move in silver will be followed by gold, oil, wheat, soybeans etc.
The end of Fed largess is probably at hand.
Totally agree. It was predicted by their margin moves up from 1% to 5% on Friday. I believe this was 3 minutes before closing. This was a slaughter. Funny how physical bullion has moved very little amongst the dealers. What a criminal enterprise we have going here.
Right on. It was a quarter when quarters were silver.
A whole acre?! Garlic sounds so good right now. Some olive oil roasted garlic spread on crusty baguette. Worth its’ weight in silver. 8>)
IMHO the Chicoms are much more aware of what’s happening in American, than we are of what’s happening in the PRC.
They’re very much focused on us, particularly.
If Chinese intelligence concludes America is about to become protectionist, they’ll respond. Heck, they may even reach that conclusion before our own PC-hobbled intelligence can. Perhaps by months.
IMHO they’ve concluded that will happen, and we’re seeing the first response.
The question now: Is America nimble enough to enter this new phase of our international contest?
I think so. Let’s start.
Beautiful coin all in itself. I may get one just to make a necklace. I have a Mexican silver dollar on a chain - had it over 50 years (Quetzalcoatl) - and another large piece of expertly worked Tasco Silver - signed...larger than a silver dollar - about 32 grams) - head of Indian chief in Eagle headdress.
I don't get them for ‘collective’ value (don't have enough money to bother with that) but for beauty.
(Money and I have never had much of a ‘relationship’. If I have what I need, I'm content. Not chasing after money leaves me time for other things. ;o)...and I don't have to stay glued to the Dow
Selling puts, not buying. Should be some nice premiums in the morning.
Dumping a little volume into a soft market is a great way to clear out some stops. Same thing happened last week and we were fully recovered by Thursday. With the silver market being as tiny as it is, and the significant amount of attention being generated, volatility is going to be the keyword. Buy the dip!!!!! I now have a year end target on $108. Since I started buying silver at $7.42 / oz, I am not surprised by the actions of those that are late to the party.
I tend toward junk silver myself. Morgans, Franklins and Mercury’s in my case. Long term they should do ok, at least keeping up with inflation.
Are you actually claiming the world’s largest foreign exchange reserves cannot function during a mainland Chinese holiday?
Monday morning began just a few hours ago...
Let me first apologize for this example.
Seriously. Profoundly. I’m sorry and I assure fellow FReepers I’m not trying to dredge up any bad memories, or be a drama queen with this comparison.
But. Wasn’t very much the same, said about Tet?
ahaha - ever been through Gilroy, Calif? An acre would like minuscule.
Hey, who knows, it may become the coin of the realm. Back in Roman days, it was, literally, worth it weight in gold.
The 'stinky rose' has a long and illustrous history.
Yup. A number of times. I used to live in San Jose.
Everything has a value. If an assets valuation is currently below what it is worth, then its an investment opportunity.
My pleasure! Didn't know I was a person of such influential opinions.
I don't think Bernanke needs any help from me trashing the dollar.
I agree with your second sentence above. But I don't believe that is the case with the dollar right now. I'm not knowledgeable enough to trade currency, but I don't see any reason to see the dollar doing any real appreciating under the current bunch in DC. I think they are lying through their teeth and they are deliberately destroying the dollar. But be it malevolence or incompetence, they are doing it.
Jack up interest rates and we'll see it go up. But that doesn't change the fact that one way or the other, Washington has got to pull a trillion or so *each year* out of its metaphorical ass. And that is a doomed enterprise.
I own my silver at about an average of $12-$14. Even if I sold it now, the profit wouldn't be enough to change my life. I prefer to hold it as a disaster hedge. No disaster? Well, it will just sit there.
The volume is heavy for globex, moderate for a day session. That much coming in collapsed the bid no doubt. Real selling or a test? Volume is stlll pretty healthy and it’s heading back for that low.
I short-sold 50,000 ounces on Friday...(in a mock futures trading account...RATS!)
buy local folks or grow your own...
Advance knowledge of Osama announcement?
I like your style....we need more like you....
I believe the fundamental forces at play in the real economy are still aggressively deflationary. I also believe the Fed has surrendered in frustration.
That’s right! I just sold about 9 or 10 old dimes (Mercuries and Barbers)I had found in my closet and forgotten I had. Apparently I had bought them a year ago or so when the price wasn’t nearly as high as it has been! Those little bits brought me about 30 dollars; I was thrilled!