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Are Gold and Silver good investments right now?

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  1. #1

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    Are Gold and Silver good investments right now?

    Gold is now 1,600, dropping from 1,900 it reached in September 2011(-15%).

    Silver is now 28, dropping from 48 it reached in April 2011 (-33%).

    Are these two good investments, now that the hype is passed, and banks deposits no longer seem to be safe (see Cyprus). There are some people who recommend gold and silver (e.g. Mr. Sprott) but of course there are other people who say exactly the opposite, and of course Mr. Sprott might as well have bought a lot of gold and silver in September and April 2011, and he is trying to talk them up, so he can cut his losses.


  2. #2

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    Mr Sprott might be today's darling of one of the multitude of gold bug websites and they always think gold is going up tomorrow if not the day after. I wouldn't pay too much attention to that. Cyprus appears to have been a worse version of Greece if one can imagine such a thing. Pour encourager les autres on the cards. Might straighten out the permanent hand-out tendency a little.

    Last edited by walkup; 21-03-2013 at 07:40 PM.

  3. #3

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    Cyprus is tiny, but it could be the first domino.

    The eurozone's worst days are not behind. Many countries are in worse shape and they are of much larger size. The Germans cannot and will not continue to rescue everyone forever.

    Financial meltdown in Europe is far from over. That region's recovery is a total myth. Unemployment in the south is still sky high, and they're still running deficits and smashing debt levles. They will need more bailouts of ridiculous amounts. It is not a wild guess. It is a mathematical certainty.

    Equities will take a big hit again and revisit volatility periods. There will be flight to safety. Confidence in captial markets will be shaken once again and the hype for gold could be in discussion again, whether it's rational or not.

    I don't own gold, but I would not be surprised if all this played out.


  4. #4

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    Seems that the equity loan markets are set for a correction and when the sell off occurs, people will rotate to where it's safe and that is gold.


    M

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  5. #5

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    Quote Originally Posted by educator:
    Seems that the equity loan markets are set for a correction and when the sell off occurs, people will rotate to where it's safe and that is gold.
    Gold is not always safe at all.
    It moved a big fat zero between 1980 and 2005 which would have depleted your wealth immensely factoring in both inflation and loss income from interest. The last 2 years have been crap also and if you had moved into gold every time the market had corrected/substantially dipped you would again be sitting on a substantial loss. I would say rotate out of spending too much time reading the looney tune gold bug websites.

  6. #6

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    The problem with gold is that you can't eat it and nobody really needs it. So it is a question of choice to value it or not. The same does not apply to silver where the resources are running short while it is needed in substantial quantities for industrial productions.

    bak875 likes this.

  7. #7

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    Quote Originally Posted by hktraveller:
    The problem with gold is that you can't eat it and nobody really needs it. So it is a question of choice to value it or not. The same does not apply to silver where the resources are running short while it is needed in substantial quantities for industrial productions.
    That hasn't stopped silver tanking.

  8. #8

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    Quote Originally Posted by walkup:
    That hasn't stopped silver tanking.
    I thought you would look long therm? Why not buy and we talk again in 5 years. Also if you look back 5 years it wasn't all that bad until now. In these times of all bubbles because of all the money flooded in, everything is possible short term. Anyway, having bought some silver a while ago was a bit better than putting that money into a Cyprus (and who knows wherever in the future) bank.
    Last edited by hktraveller; 05-04-2013 at 07:29 AM.

  9. #9

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    Quote Originally Posted by hktraveller:
    I thought you would look long therm? Why not buy and we talk again in 5 years. Also if you look back 5 years it wasn't all that bad until now. In these times of all bubbles because of all the money flooded in, everything is possible short term. Anyway, having bought some silver a while ago was a bit better than putting that money into a Cyprus (and who knows wherever in the future) bank.
    Silver Vs Cypriot bank investing in Greek government bonds. Now there's a choice to ponder.

  10. #10

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    Quote Originally Posted by walkup:
    Silver Vs Cypriot bank investing in Greek government bonds. Now there's a choice to ponder.
    If everybody had known that when making the choice, they wouldn't have lost so much and Silver were higher today.
    BTW I don't call that tanking what happened with silver. More a correction.

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