We might not be in the bloodbath phase but the bankruptcy phase
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Why do you think this miner bottom will be different then the 2008 bottom. Why a bankruptcy phase now but not then. Whats different?
QE1 is the difference.
But don’t you expect QE4
The banking sector was going through the bankruptcy phase in early 2009 until the government stepped in and aborted it. Unfortunately I don’t expect any such rescue for the mining sector.
This is a very good thing for PM sector. Completely agree with Gary. Nobody coming to rescue. If you are invested in a survivor you will be rewarded.
Finally! somebody is talking about what the bottom may really look like, rare earths remind anyone of a flatlined sector after a very hot run….look back at the sell off top in 1980 for the gold sector
Everyone refers to the 2008 big V reaction yet that was then with a massive US Gov TARP tossed at the markets….this is totally different times
This advice from Gary imo is one of his top calls as a Major Heads up to what the bottom will look like.
Tip of the hat to you Gary as I agree as a pure trader your 100% correct.
Mining is a NO NO in A Green NEW WORLD ORDER ! OK SLAVES ! LOVE YOUR PRISON FACBOOK And NETFUK ORE GOOGLE CONTROL AND ALIBABA IDIOTS IN CHINA ! Dont Worry MONEY TO BOM BOM IS OK ! https://www.youtube.com/watch?v=JlSQAZEp3PA
Al talks about opportunities but we have the bankers trying to keep trading on an orderly basis, but this is a dangerous plan because nobody knows what is going to happen. This is a time to either step aside or be bold. I know where my sentiments lie.
That would “if” there was not an event that would put liquidity in the market.
There will be an event to put liquidity in the market, and once we hit bottom ( hopefully really quick here ) metals and miners will bounce back quite well.
You mast now ! https://www.youtube.com/watch?v=t3YCc7uMjWc
I think Gary’s got an interesting point.
And Al/Cory, although you’re fine w/the positions you own, if HF’s short ETF’s like GDXJ, then your baby could be thrown out w/the bath water. I.e. all juniors could go down, indiscriminately.
I’ve always thought that the KEY thing to think about in the money printing, debt ridden world, is GOLD. Miners are a bet on future earnings, but if the schlitz is going to hit the fan, gold is going to survive and be the Phoenix. imho
Al talks about how he feels comfortable with his positions but he has had some real losers, (as we all have) ask him to post what he paid and what they are now worth and we will see.
For years I have listened to gold-bugs saying that ‘they’ – whoever ‘they’ are – can’t let the price of gold and silver go below X because it costs more than X to dig the stuff out of the ground.
Well, Duh! Of course the price can go below X and the mines that cannot afford to dig it out for X will either close down or go bust. Once bust others will come in and pick those mines up for a fraction of their SP and the mining will begin again.
I live in Wales and, whilst we no longer have no gold mines – the Romans took most of our gold, I know a fair bit about mining. You don’t actually want to close a mine as it costs an absolute fortune to re-open it.
But you can drive down the price of gold and silver to a point that lots of junior mining firms go bust. You can make them burn cash. You can make them make a loss on every ounce of gold and silver they mine. You can call in their debts.
At which point, once they are bust, you – and by ‘you’ I mean the banks and other financial institutions – can pick those junior miners up ‘cheap’ and take advantage of the metal that those mines contain.
You know, whilst I am not one for conspiracies, it has crossed my mind that if you were sitting on Wall Street, and you believed that inflation laid ahead, it would make a lot of sense now to drive down the price of gold and silver as much as possible so that you could bankrupt those junior miners and then pick them up for peanuts.
Agreed
Thanks Gary. Rick Rule from Sprott A.M has talked about miners have yet to experience blood bath. We’re in it now so it appears.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/10/29_Rick_Rule_-_Savvy_Investors_Will_Experience_Staggering_Gains.html
Gary any technical downside targets for gdxj or hui?
My system doesn’t pick targets, just timing bands for cycle lows.
Al can you give a call to Rick Rule and have him on the show to talk about what his thoughts are in mining sector?
It was fortuitous for the Fed and her bullion bank buddies to cap gold and silver wth derivatives and then drive them into the toilet with more of their rear end paper.
When is the world going to recieve some semblance of a free market?
Is that when China,Russia and the ROTW begin pricing metals based upon free market principles-as in supply and demand of the product?
The land of the home and the free has become a nonsense.
Al, you need transparency on your stock purchases something which Peter Grandich always posted, credibility is a big part of any newsletter.
Most people aren’t traders like Doc or jj, but you know this.
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I came to the PM market in 2010. Could not come before. There’s never been good times.
Just bad times and no times.
That’s it.
Last one out please turn off the lights.
Too funny Paul, the lights have been off for 3 years yet the goldbugs didn’t notice because their Tin Foil hats were covering their eyes!
I turned mine off in the spring with a massive loss when newmont fell hard and have made up those losses in the nasdaq.
🙂
Some confused posters that do not understand that the price of gold is a creation of diversion to benefit the world’s paper king,your world master and paper god.It’s a chronic bully that sides with the strong when the strength has been acquired at the expense of the rest of the world.Then again,many have been confused for some 120 years now.
That’s a question I was going to ask you. Ron Paul asked Ben Bernanke in Congressional testimony that simple three-word question “Is gold money?,” which got a one-word answer, No. What do think?
Alan Greenspan:
It’s currency, of course. Gold, and to a lesser extent silver, are the only major currencies that don’t require a third party credit guarantee. Gold is inbred in human nature. Gold is special. For more than two millennia, gold has had virtually unquestioned acceptance as payment to discharge an obligation. Remember, Germany could not import any goods in the last part of World War II unless it paid in gold.
I think it’s hilarious how you goldbugs that absolutely hate Bernanke and Greenspan because of their ZIRP policies quote Greenspan like a credible source now. Let’s be fair guys…
Greenspan said it was a great time to get change your fixed mortgage to an ARM next FOMC meeting he starting raising rates crushing anyone that followed his advice.
Greenspan is a loonie…………and a liar loonie………..
He professed that the brief case he use to carry to each FED MEETING , that everyone thought to contain info on rate policy…. HE confessed ,.was just a joke to confuse the markets.
Al/Cory/Gary…. I ran into a quote from Kyle Bass published on Oct 27.. If I’m not mistaken, I was shocked how accurate Bass was….any opinion?
http://www.scutify.com/article.aspx?q=544d8d4cb229aa0768473fa2
In a CNBC interview earlier this week from his Barefoot Economic Summit (“Fed Tapers to Zero Next Week”), Kyle Bass explained that this divergence is set to accelerate in the next couple of weeks, as the Fed will likely taper its QE3 purchases to zero. Two days later, Kyle notes, the odds are high that the Bank of Japan will make a Halloween Day announcement that it is expanding its own asset purchases. Such moves only increase the pressure on Mario Draghi and the ECB to pursue “overt QE” of their own.
what if USD is running into 100 at least or 120 at most (I just doubt i can go any higher than 120)… The only thing holding Draghi from QE seems just the German.. again.. “what if the German let it go”.. :(… gold sub $800 could be real.. and the scenario becomes genocide of the miners…
Anyone like to comment on the sell out of silver eagles at the US mint?
You would think with the price performance in the PAPER market at Comex that they couldnt give it away,that the silver stock would be absolutely huge.
I think it is rationing.
BTW, silver is really tight, there is report that people in asia scrumble for silver as well.
There is no shortage or wait times for delivery on silver orders over here.
probably because most are just not buying.
My stocks are not sceaming higher, either.
They are just screaming.
I think Gary’s right.
My concern at the moment is that the FTSE-listed gold/silver miners that I have been keeping an eye on fell MORE during the general stock market decline around mid October than they have in the recent plunge in gold.
This makes me wonder what will happen to them in any future decline in the FTSE/DOW/S&P.
I can’t resist saying, “When the tide goes out, you see who’s swimming naked.”
Bring on the bankruptcies.
I feel bankruptcy may come with silver miners. For gold, only weak ones may go bust. More importantly there are other ways like convertible loan, warrant , etc. which can ensure the banks to dominate companies without bring them into destructive bankruptcy. The result might be continuous weak share price even gold goes up. There are a lot of financial engineering these days.
Just saw a report that gold miners are already preparing to cut production and halt projects to deal with lower price. It is those silver miners who don’t follow same strategy. I think they have lived on financing instead of profit for too long. In the last 20 years, most of these guys never made money even the good time like 2010-2012.
Maybe a bottom forming? I don’t know yet IMHO.
Rocket ships…………..to the moon……….shake out…………bankruptcy …….final flush…………18 MONTHS from now at the soonest….the attorneys will need to get their grubby little hands on much of the proceeds, and the judges need their cut.
Problem is, can they hold price down that long? It has been two years that they have been dumping gold heavily, not mentioning they have been doing it since 1990s on a smaller scale. Some have to be physical metal and China got a big boost in their reserve. Their stores are filled with gold and silver jewelry. I was shocked how many jewelry shops they added during the last few years. I even bought silver wrist band last year. It looks really delicate but worth twice of the silver content. Fort Knox must be fairly empty and fed vault probably all leased or delivered. Even GLD shed most of their gold. Now they are so desperate to use any dirty trick to prevent a yes vote in Switzerland. They even flatly refuse Germany to inspect and get their gold back after they requested. It all sounds like struggling. Can they afford another 2000 tons from treasury?
Silver is more troublesome since it is consumed and it has been in deficit for decades except short period. All the old coin melt has gone into electronics and solar penals.
PRICE is everything Lawrence you can have 1000 opinions and another 1000 fundamental reasons for anything being up or down, price is all that matters…look at gold according to the experts (lol) it should be thousands higher, well I can’t hit a $3000 bid, only a $1145 bid, reality vs perception, I have to live in the real world of pricing not that of those who call for $30 silver or $5….its $15.40
JJ, then do you consider everything rational as long as it is here? Einstein said existing thing may not be reasonable. If not reasonable it will change. Otherwise the world will stay idle. That is why forward looking is important in investing. You don’t have to look only at now. Trading is zero sum game. Are you going to swear you will never agree with my thought in the future? If you cannot, there is no argument at all then. I am not a gold bug. I sold gold when it was HIGH and bought when it was LOW. By gold I actually mean silver more. I see gold especially silver going higher in the future but you say it may go down. I agree with you. Off course it can go down. I have no problem with it. Really there is nothing to argue about. I don’t agree with a lot of gurus you are laughing at now and agree with some of them. Some of the guys you favor like Dan were recommending people to buy at the top, go back to look at recording in KWN. It is why I don’t take him seriously. I like Martin Armstrong and think he makes sense I just don’t have to follow his strategy since he did not recommend me to sell at the top. I know you like to add salt to other people’s wound but what is that for? I have not lost any money in PM and my gain prior to 2001 is enough to offset my loss these last two years. I only have around 14% of my wealth in PM anyway. My rest is in energy and other stocks and housing and they are doing well now.
If I buy silver at 15.4 and sell at 40, can I make money? This is what I did from 2008 to 2011. The key is that silver is below production cost. Going lower will men mine closure and mine closure will mean short supply and will mean silver going higher. Is it a logical thinking in a longer period of time?
Sorry should be 2011 not 2001.
If you were ever looking to Dan for a sell signal you don’t understand what he provides either when he was posting at Sinclair or KWN or his blog, all he does is show the current trend in play and at the time when he was with KWN it was up….he has not been bullish for years!
Not arguing with you just saying that opinions and fundamentals mean F-all its price that is everything regardless of a solid 1000 reasons why silver should be $50 or .5cents todays value and trend is all that matters.
good luck!
Pause days are brutal. Just get on with the flush already!
Gary, how can the market, especially silver, go back down if inventory is tight and production is decreasing due to bankruptcy?
My thought too. There is a large above ground inventory for gold in both government and private hands. The inventory is a lot smaller for silver and not in government hands.
Chart of the day.
http://blog.smartmoneytrackerpremium.com/2014/11/chart-day-42.html