What do you guys think about going all in on silver for the next few months? My thought process was, if the debt ceiling gets raised, the crowd will pile in for inflation safety, if it doesn’t, the threats of an imminent government shut will have the same effect right? Another pile in for safety?
John_in_NC,
I subscribe to the newsletter from Chris Weber. It comes out every two weeks. It’s the best $250 I spend per year. He has been recommending silver and gold since 2001. He recommended we take profits just before the 30% correction in silver recently. That’s what I did. It would not be uncharacteristic for silver to plummet another 30% and trade sideways for a couple of years. I still hold some precious metals but am mentally prepared for a possible further correction as described. As Rookie states, commodities can correct violently, they’ll take U-Turn. It is possible that the scenario that you state may already be priced into the market. Remember “Buy on the rumor, Sell on the news”? Would you be able to sleep at night if there was a 30% drop in price and be willing to wait possibly years until it comes back? I’m seriously considering doing some private lending like fdjake and Rookie do. It’s a bit out of my comfort zone but so is the risk of loosing money in commodities/precious metals. Time for me to get out of my comfort zone and learn a different approach. If you go all in, I wish you luck.
JP
Well, Silver is up over 5% this morning!! I’m not really good at speculation :embarrassed
JP
Well I didn’t go all in, but I have a pretty big position in slv. Not a bad first day!
John_in_NC,
If you are going to do anything long term in silver or gold, you owe it to yourself to get Chris Weber’s Global Opportunities Report. It’s mostly about precious metals and foreign currencies and notes but covers some individual stocks and the market in general. As far as silver goes for me, I’m in CEF which holds physical gold and silver. The amount I have I consider my “core”. I will add when I get the signal from Mr. Weber. There are a lot of traders that have been attracted to silver because of it’s recent price action. What’s dangerous is thinking that silver etf’s will behave like a stock. That’s not so. 50%-60% corrections are not unheard of with silver. Especially after such a huge run. A lot of the traders suffered massive losses in silver on it’s last correction. There was a lot of leveraged money in the game. A good portion got wiped out. I played with AGQ and ZSL during that and made a small profit with AGQ and just about broke even with ZSL. Even though I made a small profit trading these it wasn’t worth the stress!
I believe you are right about the US budgetary concerns and a possible flight to safety. It could be to gold or to silver or to foreign currencies. I’m happy to be sitting on the sidelines accumulating cash. When the time comes to sell, what is the plan for your exit? Will you be looking for a price point or trading volume or something else perhaps? I’m just curious.
JP
Well it’s been a good week. I’m up a good 6 or 7%, which translates to tens of thousands. Of course I haven’t sold so it is all fictional until I click that sell button. Speaking of which, I sure wish I had that button on real estate. It would make life easier.
To your question JP, I don’t know exactly when I"m out to be honest. It will depend on what happens politically, as well as with my own personal investing in real estate. I had a large amount of cash just sitting in a biz account doing nothing… If silver plummets in the short term, well I’m in for the long term, unless a too good to be true deal comes along, then I’ll buy. I’m not happy with what is going on locally lately. A close Realtor friend is telling me things have come to a halt for the most part. Lending has really tightened over the past few months, and inventory has soared in our area. Combine that with an uptick of newbie investors bidding up to 2005 levels at the courthouse, and I’m left scratching my head here. Until then my money is on silver.
I had been studying gold & silver versus the dollar for a couple of years before I used one dime of my money to invest. I finally decided to use my self-directed ROTH and purchased SLV back in February when it was about 28ish. I watched it rise past 30…then 40. When it reached 47 (thinking that the 50 barrier was a major hurdle), I decided to take my money off the table and find a little more “stable” silver investment.
Call it intelligence or just dumb luck (i’d call it more of the latter :banana), it dropped off the table the very next week. I did some research and decided to wait and get back in when SLW reached 30. So far…so good. It closed today at 39.69.
I’m no sophisticated stock market guy but I try to learn as I go. I’d rather be in control of my money rather than turning it over to some broker who’d put it into some mutual funds, etc…
I just figured that there was going to be a lot of stuff hit the fan this summer. If I’m not going to own physical silver, this is a decent substitute. If I can find some Lease Option deals that I’d like to do within my self-directed ROTH, I’ll sell some SLW. Eventually I’d like to have a smaller position in silver and start purchasing some tax liens in my IRA where I’m getting 25%-15% returns.
Darin
I believe being an unsophisticated stock market guy can be an asset. As I hit the refresh key on my computer, the stock market is currently at $12,722.44. This is approximately 90% of the pre-crash level. Has the economy recovered 90% of its value? No. Has the overall housing market recovered to 90% of pre-crash levels? Not even close. Is unemployment even close to it’s pre-crash levels? Again, not even close.
The stock market has had a nice run over the last year. Could it go up further? Sure, but isn’t this just speculation? For this unsophisticated stock market guy, common sense says it’s time to take my money off the stock market table. This gives me more money to either invest in RE while it is near - what I believe - its bottom. Or, I could wait until the market corrects and re-invest it - just like you did with silver - and walk away with even more $$$.
Cheers :beer
chart:
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/draghi/gold%20ceiling%20old.jpg
-Mike
Wow. The market is at $11,605.47 today. I knew it was overvalued, but didn’t think it would go down this fast. When I wrote this I cashed out about 1/3 of my stock market holdings. I had planned on slowly cashing out by October. Now I wished I would have taken everything off the table. Hindsight is 20/20.
How are you doing with silver, John_in_NC?
I got burned to the tune of 5k! Expensive lesson, im sticking to what i know, real estate. Its funny i knew this for years, i guess i just had to see it first hand.
Sorry to hear that. After yesterday, I’m down quite a bit. I’m just going to ride it. Either it will go back up or I will go down in flames.
Thanks, I think this video pretty much sums up my silver play.
http://www.youtube.com/watch?v=W4hfdaC7eL4&feature=player_embedded#at=35
Before putting up an investment in silver, it is important that you truly understand the buying and selling processes. Besides there are few ways to invest in silver most are bullion and silver coins.