Because this thread represents the whole market. Also, nice try at an underhanded slight by calling me "very disingenuous". I stated why I thought 16% matters and it has nothing to do with it being a great return simply that bears are jumping for joy over 16% which is truly nothing in silver. It shows how out of whack market sentiment is right now. It's like when the stock bears come out after a 4% down move on some Greek news.

1. You are right and I think that is well said.

What I am saying is that gold and silver are not commodities (in the typical sense). They are money. And USD is currency.

No crystal ball here. But I do know that the US has abused the privilege earned by the blood, sweat, and tears of the great generation and that the rest of world (and probably the US) would be better off with a fairer and more economically sound monetary / financial system.

There is a reset coming. IDK when but it is coming. My best guess, China + Russia unveil a gold backed currency that makes short work of the dollar.

If oil dies the petro dollar goes, etc.

Go read some more Peter Schiff bro...

Listen. Let me make this really ****ing clear to you.

Have a look at this:



Had you bought Nasdaq, or SPY, instead of silver, at the date of OP (and not even at the height of the bubble), you'd own about 4x the amount of silver than a silver bug would.

Let's say one guy bought $1000 worth of silver and the other guy bought $1000 worth of the index.

Silver guy would have $520
Market guy would have $1900

That's how ******ed an investment silver was.

What is this "16% below the last low" bull**** you're talking about? The point is that since the OP was posted, and all the hyped up discussion, someone who simply bought the index is nearly 400% better off than someone who bought silver.

You trade silver and you don't instantly know the answer to this question?

In regards to the last bit, I can't post an image at the moment, but have a look at this graph:

http://www.macrotrends.net/1470/hist...100-year-chart

Note how it's still well at the (inflation-adjusted) highs.

Also note how much silver lost you in the crash of 1929. It went from $16 to $4.40. So much for a ****ing hedge - silver lost more value than stocks! In 2008 the same thing happened - it lost 40% of its value, as much as stocks.

Silver is an utterly idiotic investment, and it is still at historically high levels - and this is in an environment of very low rates.

Did you read anything I wrote? Obviously not. I'm not talking about if silver was a good trade in the past. We all know it wasn't, thanks for pointing out the obvious btw, I'm making the case that right now it is a good trade. You're arguement is the same as the bulls who started the thread. Its bad because look at my charts it did really badder before. Same as the bulls that just thought it was going from 50 to 130 because look ma its better den da s&p.

I don't have to believe in some wild crash thesis to own silver. Nowhere did i say anything about that. Also, lol at the "but low rates are going higher" arguement. It's real rates that matter. Interest rate increases dont have a signifigant influence on how silver, or gold, trade.

Also comparing a 40% loss in stocks to 40% move in silver is ok if you have no regard for the individual volatility of the two.

Except your not.

Yeah, I am. I think it just hurts feelings when I say that I'm bullish because most are bearish and most people are wrong most of the time. Intuitively its easy to be bearish but trading is about breaking intuition and doing what the crowd can't. Thats why im being attacked. It wouldn't matter what I say because its like telling people up is down.

Its not very useful to say that silver is at historically high levels (in USD). Because the USD has changed over the years. Silver has not.

If the money supply were the same as it was in 1929 this type of analysis would be more useful.

Just my two cents, silver is pretty cheap around $15 give or take a couple of bucks.

Do you understand what making a case for something means?

LOL wut? Silver/gold have gotten crushed over 35 years, 85 years compared to the markets. ABSOLUTELY WAFFLECRUSHED.

"'I'm not sure I believe you or maybe your facts are wrong, but I'm not going to look and prove you right."

Seriously - that attitude is the last refuge of the cluetard forum poster. +1

Stocks have crushed silver both in absolute AND risk-adjusted terms. Since you're so good with the numbers I'll let you provide the Sharpe, Sortino, and Omega ratios.

That way you don't have to worry when the facts contradict your opinions or thesis or WAGing.

Finally, gold and PMs get seized by various Gov'ts ALL THE TIME throughout human history. No gov't has ever seized VFINX from Vanguard's computers. You can move your stocks, stock futures anywhere in the world and they are worth the same with near-zero transaction costs.

Physical silver, looking at Kitco, has a 4-6% b-o spread [perhaps there is better but I doubt it's much below 4% Kitco pool is 4.6%], plus at least 2% carrying costs for storage, insurance. You don't get to ignore those esp when evaluating 'risk.'

Meanwhile, the SPX pays you 2% to hold it. So, you're a minimum of let's call it 8% ahead to start the year, every year transacting stocks v physical silver.

Silver will never outperform any developed market index over very long periods of time. Not in your lifetime. Not ever. And there's still no explanation why you would *ever* want silver instead of platinum which is worth more to jewelers and to industry, and is wayyyyyyy more rare than gold and silver. I guess retail hates admitting it's retail, eh?

I have no trouble trading PMs when I think there's value, I made money buying gold under $300 when all the central banks were dumping. Motivated sellers. EZ game.

I look fwd to your tinfoil hat posts in the future, assuming they're not just below this post.

I am not a big fan of Peter Schiff but at least he's an Austrian and not a Keynesian...

There are plenty of people that think along those lines. I think my first exposure to the idea of Yuan backed by gold was from Chuck Butler via the Currency Capitalist over at EverBank.

The risk adjusted terms I am referring to are not historic volatility of silver priced in USD.

You are missing my whole point.

I AM NOT TALKING ABOUT SILVER PERFORMING. It is the USD that goes up and down. An ounce is an ounce is an ounce.

I suggest this as the Standard Silver Rejoinder to all the ******ed handwaving and lulz superiority of silverbugs and tinfoil-hatters. OMG U GAIZ CANT DO RETURNS IN DOLARRS STOP U GAIZ CMON GAIZ IM SO CEREAL PLS GAIZ1!!!11!




See you guys in 3-4 years. Actually kinda hoping it goes back to $50 by then so we have some vol to trade.

You can do returns in dollars. We pay taxes in dollars, most of our economy operates through the USD.

But real returns are more useful than nominal ones.

And dollar returns in the case of physical PM purchases for the purpose of hedging currency are not very useful. That is all.

Buying physical in order to get rich is not the move. Trading paper is fine. In which case your returns are more about your trading than the performance of the asset.

If you want to buy and hold indexes or w.e. go ahead and be my guest. But the wise guys get off at the top and back on at the bottom while the public rides the roller coster...

...ha, or does the exact opposite.

I don't think most are bearish on silver. I'm neutral tending to bored. I think:

- It's impossible to have an edge on silver, especially in these conditions
- Long term, silver is a ******ed play that will under perform S&P 500 by a lot
- Silver provides no crash protection - it is in fact riskier in a downturn
- Silver fundamentals are simply not right for another bubble; we won't see the run up to 2011 - caused by a number of unique factors all coming together - repeated for a very long time. Decades, probably.

So there's no reason to long or short silver. It will under perform other investments whether you go long or short. It's just dumb.

If you have something substantial to add about silver fundamentals (mining, bank purchases, investment flows, industrial usage, etc) that is worth saying and makes a bull case, then please do, otherwise you're just trolling, really.

Other than gold and silver not being money and being commodities, I completely agree.

Protest is not an investment thesis.

It would be hilarious if they did go with a gold standard! I hope that you are right. I'd like to be able to buy one of those two countries with my pocket change to bail them out.

Other than oil being priced in dollar terms, this makes no sense. Weak oil = strong dollar.

How many chicken eggs (or other object of your affection) you can trade an ounce for is what matters.

I invoke Poe's Law at this point. Good game.

A couple other things to add to Toothsayer's point about the performance silver during the crash of 1929. Silver performed terribly during the beginning of the Great Depression while the metal was fully monetized. Silver was used [at the time] in regular coins like nickels, dimes, quarters, etc... It was recognized as legal tender during that time. So during the most extreme economic crisis of the last 100 years, silver was not able to retain its value. If the silver bugs were right, the silver price should have stayed steady or climbed during the worst of the great depression.

On top of that, we still have silver bugs who still can't acknowledge that the metal had a huge bubble run up from 2006 - 2011. We had posters like actionzip and others who would kept insisting it was a bull market after 60%+ falls in the price. Now that this thread has been bumped, more silver bugs will still defend it as investment.

The people who have been skeptical or even outright bearish on the metal in this thread aren't currently calling for big time shorts. In their opinion, there are other more interesting/better investments out there. The most they comment on is that the money put into silver would have gotten better returns elsewhere. Why is it so hard for you guys to understand that people want good returns on their money? They don't invest their money on protests or doomsday fantasies.

[nit] This isn't really a fair comparison - since most people buying physical will hold it much longer than a year, you can't count the bid/ask spread as an annual cost. [/nit]

That said I agree with the rest of your post, and even just missing out on the 2% (or whatever) expected return from the S&P is plenty to make PMs a bad investment in most circumstances.

Silver has intrinsic lulziness that maintains its lols regardless of market conditions. I can lolsilver during the runup when people were predicting $130/oz, but I can also lolsilver when the price collapses and the same silverbugs insist that now it's a great investment. It's a very useful hedge for my lol portfolio.

"Why is it so hard for you guys to understand that people want good returns on their money? They don't invest their money on protests or doomsday fantasies."



Silverbugs more often than not feel that they have gotten the short end of the stick in life. They just wanna watch the world burn. And after the world is left in ashes, then they shall arise like a Phoenix as the new money masters!

We don't want to watch the world burn. Its just that we are aware that the Zombie apocalypse is likely around the corner and we will be forced to watch from our rooftops our unprepared neighbors savagely attacked. When the dust finally settles, we just want to be positioned right for the new civilization. How will you be?