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Roger and Al,
There are some analysts that are claiming that all commodities are now in a bubble, including gold.
They are predicting severe deflation. One of their arguments is that, even if their is more quantittive easing, there is still going to be a huge tightening of credit on the part of the banks, regardless of whether or not central banks continue to “print” money.
In turn, this tightening of credit, i.e. nobody will be able to borrow, and thus a huge deleveraging will take place and prices will plummet, is going to take both gold and silver down with it, in significant fashion.
What are your thoughts on this?
thanks Roger,,great report.
Mike,
My impression of inflation, and I may be wrong, is that it is characterized by an increase in the money supply and not by a contraction of credit from lending institutions.
Pardon me, in my previous post I meant to say “My impression of deflation…”
Joe,
Inflation is an overall increase in the available money supply in the market whereas deflation is an overall decrease in the money supply. So to your point, a contraction of credit from lending institutions could be considered a deflationary pressure because it limits the amount of money/credit available to the market.
One of the primary symptoms of inflation is rising prices. Please keep in mind that rising prices are just a symptom of inflation and prices only rise following the increase in the money supply. This happens because there is a larger pool of money chasing the same amount of goods & services in the market.
Conversely, one of the key symtoms of deflation is a drop in prices becasue there are fewer dollars chasing the same amount of goods and servicesin the market.
For a very good, detailed explanation of inflation/deflation I would strongly recommend The Crash Course by Chris Martenson. The Crash Course is available as either a free online video or as a hrad cover book.
Keep in mind that the manipulating corrupt government may want to put a double top(technical painting) on the gold market as well as bail out their Hedge funds (for the poor rich people that love power and destruction and death and just ugly stuff) that short the miners and find themselves in a short squeeze. Would any dishonest government pass up the opportunity to attack particularly where the leader of the PPT is going to come out with a new employment plan. Plan: serfs do more manual labor and Fed bails out more banksters.
What the heck is going on at Silvercorp ???
I think it could be a hit piece but if it is then this stock is a screaming deal.
i made nice money on my harmony shares, sold on limit order . i have some silvercorp and found out a letter accused silvercorp management of cheating and lying about grade of gold. the stock droped a lot. managemant says its shortsellers who wont identify themselfs. i am holding on th my shares but unhappy
Re: Silvercorp – I bought more on Friday
Although it’s violation of copyright and not fair to other subscribers, StockHouse poster “jinglehimmer” posted comments from Casey Research.
It is not Muddy waters doing it so that is good but this is serious. I sold half for 14 in April and dumped the rest on Thurs. I see a nasty lawsuit coming
gold and silver will perform very well in deflation or inflation…. Don’t listen to the talking heads, keep your wits, study history and keep it simple…. We are witnessing a wealth transfer of a life time….. Stay focused !!!!!!
I’ll give my 2 cents….. If silver can break that 44 dollar level, silver could run up to that48.50 level without any resistance markers… Silver could sell off at this price before blowing through 50…. Remember to follow the volume on the charts… When volumes increase silver sells off……..
Gold and silver will be hit later this month in September with the other shares markets. However, we think, this time, the metals and shares do not fall quite as much as in 2008 and instead do a pivot reverse up. The Non-USA gold and silver buyers are taking control and the States’ trading platforms have less influence. Even the central bankers who sold gold are coming back in to buy. The shortages are increasing as gold and silver production cannot keep-up. We have not entered the final gold frenzy yet but it could come as early as 2013. I would prefer it last until 2017 on the cycles but it is what it is. We are going over 2,000 next and very quickly. It cannot be stopped – Traderrog
Thanks Roger. You are the man!