Silver the industrial metal

[Lowlow]

7 hours ago, vand said:

The interesting question is what happens when the dollar fails? The dollar is effectively the world currency... so everything priced in dollars ie, literally everything - goes up to a greater or lesser extent.. a lesser extent for paper assets, and a greater extent for hard assets. OK, you may want to hold your wealth in Yuan or CHF and hope that these survive the apocalypse, but both these and every single other fiat currency has the same fatal flaw of infinite elasticity...

This is where I think we're actually headed, because the fiat currencies have all done the same thing, and they are all basically in the same place with so much world debt.  What happens when they ALL fail ?  We don't know, it's never happened before.  In the history of the human race (as far as we know) there's never been a situation where every currency used is debt based / paper money / fiat, and they've never all failed at once in a cascade of currency failures.

[Lowlow]

4 hours ago, KDave said:

... who cares. Is the thing in question cheap and compared to what. That is more important.  

This is a concept that is hard for a lot of new investors to understand, that there is no "universal value".  They assume, at first, that their home currency is universal because all the charts and assets are denominated in that currency, so the $us for the U.S. as an example.  Once they learn about forex markets and understand that the $us swings wildly over time vs. other "foreign" currencies, they start to look at charts of commodities, etc, in other currencies too to understand what is going on.  Then when they come to understand that commodities too, even silver and gold, also have fluctuations, and that even they aren't the best ruler to measure with, then they can start to understand the reality of the situation ... there is no ruler to measure with except that things move against one another in a constantly moving system, and that what you are actually trading is the ebb and flow of these potentials.  Tomorrow if it is discovered that some weird rare earth metal is the cure to cancer, that will be the most valuable commodity in the world.  If it is discovered that you have to have millions of barrels of horse piss to create artificial intelligence, there will be a run on horse piss.  Some of these trends change slowly, some quickly, and the markets don't move in a constant direction towards their potentials but more like a squirrel darting back and forth across the road before it gets to its favorite tree.  The key is to always be paying attention to what is going on, to keep your eye on it, and to never get too comfortable, if for no other reason than the markets are famous for doing whatever is necessary to screw the most people out of their hard earned money and putting it into the fewest hands.  But even that isn't a universal rule, because studies show that active traders do worse than chance, that in a lot of cases your average trader would do better if they flipped a coin to make their trading decisions.

[KDave]

He is at it again chaps 

[universalcurrency]

2 hours ago, KDave said:

He is at it again chaps 

Pretty sobering stats, personally I've been more attracted to gold in the last 12 months after comparing dealer premiums over spot. 4%  premium for gold verse 28% premium on silver (if you buy in europe) .

Also when it comes to sell, the concentrated value in gold takes a lot of the hassle out.  With silver your often selling multiple items to many buyers to get the same money.

That said if silver goes up and gold tanks then I might take the opposite view.

[vand]

21 hours ago, KDave said:

But will silver outperform gold over time regardless of timing. The answer is not historically. 

You know I share your sentiment though, let's just drop these labels they are a distraction, money, commodity, who cares. Is the thing in question cheap and compared to what. That is more important.  

 

I think it greatly depends what time period you look at. Most of the analysis out there takes 1968 as the starting point because that is when Nixon abandoned USD convertibility and the beginning of the Petro-dollar. This makes a lot of sense in a way, but there is no doubt that this date was one of the most favourable for gold in its history and so gold's relative performance has had that tailwind for the last 50 years. If you conversely pick a date that is most favourable for silver such as 1990 or 1940, then you will get a different conclusion... all this does it highlight that your entry price DOES matter a great deal. Which is the point I'm constantly trying to ram home against gold's perma bulls.. that for everything there are more favourable and less favourable times to be buying.

 

I do agree though that "commodity" is just a label. Ultimately we are talking about a thing that is bought and sold, and like any other thing that is bought and sold its perceived value goes up and down. 

 

[Oldun]

https://m.youtube.com/watch?v=8to4yqKlAz8

[Coolsmp]

Silver is awesome!⚪

[KDave]

12 hours ago, Coolsmp said:

Silver is awesome!⚪

Agreed.