I’ve been keeping an eye on those metals – especially the silver market. Fairly recently, I wrote about the blatant manipulation we’re seeing in these markets – how it’s done and why it’s being done. I also mentioned how the market was stressing from supply issues and how many sources were charging significant percentages over “spot” price, simply because the market was fed up with the ridiculously low prices. I learned to keep an eye on E-Bay for current market values – and even when prices were down as low as $10.00-11.00/oz for silver, people were paying upwards of $15.00-$20.00 simply because physical possession was difficult all around the country. E-Bay, oddly enough, shows the fairest market prices that I’ve been able to discover anywhere – after all, it clearly indicates what people are willing to pay.
I’ve wondered to myself how they can keep the prices so artificially low for so long. Well, I think we’re finally starting to see the dam break and it’s coming back with a vengeance. Since the first of the year, we’ve seen silver go from $11.00/oz up to about $14.50 at last check, or about a 31% slide upwards. Compare that to other commodities, such as crude oil prices, and you’ll find nowhere near the same response. In fact, oil has been steadily falling since the beginning of the year. Corn shows the same trend, as does canola, wheat, cattle and nearly every other commodity out there. (Source)
So, the commonly spewed logic that gold and silver generally follow the same trends as other commodities is clearly being blown out of the water. With this being the case, there would seemingly be no logical reason for the prices of silver to have fallen from the low 20’s back down to the low tens over the course of late 2008. It obviously has a mind and life of it’s own, completely independent of other markets. Logically so, too…gold and silver have inherent actual value whereas other commodities are only as good as the price people are willing to pay for them. I suppose this could be said about gold and silver as well – but it’s truly an odd world when the charts say it’s worth “X” and people out there are paying “X” plus ten to a hundred percent.
I guess the point here is that I wanted to dig on the idiotic logic of all those economorons out there who consistently stated that gold and silver follows other commodity trends. I told you so. Look at the numbers and charts. Explain away. Can you see it yet?
Lalalalala…I’m not listening.
I expect silver to at least hit $25/oz this year and gold will probably touch $1250/oz. Maybe more…maybe a LOT more. There’s a lot of wild and unpredictable factors swirling about right now and a whole house of cards that could come tumbling down even further. I wish you all well this 2009…and I’d highly recommend you get out of stock and commodity markets and into something you can have and hold. Pure silver and gold!