Sunday, November 29, 2009

Sunday Views on Silver

With the entire NFL waiting for the monster Patriots vs. Saints clash tomorrow night, the games today were a bit boring.

-The Dolphins lose again!
-The Texans blow a lead against the Colts, easily the most recurring theme of the season. Note to Colts fans: Having to come back from 17 points down is all fun in the regular season, but come playoff time that will not work. Period.
-I think the Titans will win out this year

My take on the huge game tomorrow night between my two most loved NFL teams? Either way I win, but I think the Patriots have a break out game on Monday and pull off the shocker.

Sunday Views on Silver
On a slow Sunday two esteemed friends of Economic Disconnect weighed in with some views on Silver.

Stagflationary Mark of The Illusion of Prosperity offers his view on Silver as it relates to Aluminum:
Silver to Aluminum Price Ratio
There is a great chart provided and I think it a worthwhile stop to make if you are a fan of silver.

Denver Dave, writer of The Golden Truth, has a very interesting letter detailing the ginormous short position held by JP Morgan in the Silver market:
A London Silver Trader Shines a Spotlight on the Huge Silver Short Position on the Comex
One might look back in time and see the actions of the government when Silver was being aggressively hoarded by the Hunt Brothers (See Silver Thursday) and spot the difference. Silver prices going up on leverage is bad, but excessive short interest in silver is ok.

Regular readers know I am a big silver fan and own silver through a variety of channels (PAAS, SLV, physical bullion).

I suggest checking out the two pieces above. Food for thought.

My own take is still the same:
In a time where the very meaning of "money" is being called into question by overnight vaporization of debts, governments printing non stop, and asset bubbles being pumped by carry trades and low volume futures bumping, I think many are turning to the oldest store of value known; Gold and to a lesser extent silver.

Maybe I am a metals "bubble head" or maybe I just like shiny things too much, but that is how I see it. I am not saying "Its different this time" as much as I am saying things may be moving back to some kind of system where "value" and "worth" have some kind of tether to something that cannot be fudged. My 2 cents.



Fiat Currency

Have a good night.


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Rob Dawg said...

I think the Patriots have a break out game on Monday and pull off the shocker.

A healthy defensive line makes their game complete.

Funny, I red the Ag/Al post immediately before yours. I'm in the middle. Silver may do well but you absolutely have to admit and live with the article's truth that the silver market is manipulated. Indeed we are just about far enough away from the Hunt bros debacle to need to learn that lesson all over again.

GawainsGhost said...

Yes, this certainly has been a weird season in the wild and whacky world of sports.

The Steelers are imploding, the Titans are surging, the Giants have a quarterback injury problem, the Texans are headed for yet another losing season (what else is new?), the Bears are redefining the word ineptitude, and the Cowboys, well, December starts tomorrow so we'll just have to see about them.

Yeah, this Saints vs. Patriots game tonight will set the tone for the rest of the season. The way this year is shaping up it looks like it's going to come down to one of these two teams and the Colts or the Vikings. But you never know who might sneak in. The Eagles? Please let's be serious.

Anyway, as to this whole precious metals thing, in the event of a systemic economic collapse, which is not outside of the world of probability, do you really think anyone is going to exchange food for something shiny?

Farmable land remains the only true investment.

watchtower said...

Mike Keith (Titan's Radio) said that Jeff Fisher has had an incredible heart stress test this past week and a half, first the narrow win last week, then his son was playing and the team he was on came back to win after being down 40 points, and then the win yesterday.

Mike thought that the Titans 5 win streak after losing the first 6 might be an NFL first.

Stagflationary Mark said...


I certainly would not claim that my aluminum to silver comparison is anything bordering on proof. There are a lot of factors driving silver's price. It's just something to think about. That's all.

I do think that our currency has major long-term problems, but I would have believed that just as much in the 1970s. I think it really would have ruined me to bet on it then. Maybe that makes me too cautious now. Time will tell.

getyourselfconnected said...

no worries, I think you bring up plenty of great points on the metals and I appreciate the thought check as I am prone to go all glassy-eyed about the metals!

I know everyone says "its different this time" and while the US currency was in trouble in the 70's, any parameter you can look at says things are much much worse.

I am still of the opinion that the US dollar now backed by MBS crap paper brings us to a real inflection point of "value". Quite right, time will tell.

I have no interest in "economic collapse" strategies. If things really go south it is not gonna matter what you have, people will take it from you.