What's going on with gold and silver?

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DRHolden's picture
DRHolden
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Posts: 131
What's going on with gold and silver?

Can anyone give me a reason to not be nervous about my gld and slv ETFs?  I bought fairly recently and have seen both go down dramatically, and do know if I should cut my losses, or hold.

Brainless's picture
Brainless
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Re: What's going on with gold and silver?

Or buy some more on the dips. And why ETF's instead of physical?

 

M.E.'s picture
M.E.
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Re: What's going on with gold and silver?

Yes, they are a paper promise that could go poof.  Buy physical.

SteveW's picture
SteveW
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Re: What's going on with gold and silver?

Most knowledgeable commentators are suspicious of both GLD and SLV, especially since their prospectuses reveal that there is a liability that the custodian and/or their subcontractors might be unable to fulfill their obligations. On the other hand the closed end funds, GTU, CEF and PSLV are considered to be much safer since the number of shares is fixed (until the trust acquires more metal and is able to make secondary issues).

Should you be nervous about the price declines? Some say the decline is due to an ongoing bear raid by the bullion banks who are desperate to shake out  the longs enabling them to cover some of their massive short positions. If you are nervous then sell, but if you think PMs are still in a long term bull market then buy the dip.

Tommygun's picture
Tommygun
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Re: What's going on with gold and silver?

I used to get nervous and sell the gold stocks I had. I only had about 4-5 thousand dollars invested. I would get scared and sell. take a small loss. Then eight months later, there would be a monetary crisis with Greece, a big bank crisis or something like that and then the gold stocks would go back up. I would kick myself for selling. I have been watching the precious metals market for over three years now. I am just an average guy. But I have learned to ride out the storms and sit tight. I like what Jim Rogers says, "Buy the long term trend."

Gold is a long term trend until all this financial crisis plays out. I say hold on if you can. but do what you feel is right.

Tommy

Doug's picture
Doug
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Re: What's going on with gold and silver?

DrHolden

Look at the article linked in today's dd on silver.  Apparently institutions are selling paper (SLV. et al.) and individuals are buying bullion.  Institutions (read banks) are short covering while individuals are buying the metal because they (we) see ever decreasing amounts available.  At some point metal shortages have to win out.

http://www.kitco.com/reports/KitcoNews201101024DeC_coins.html

Also, check out this site: http://jon-silver500.blogspot.com/ 

which has this link:

http://www.theglobeandmail.com/globe-investor/funds-and-etfs/funds/why-eric-sprott-sees-silver-as-the-next-big-investing-windfall/article1818091/

Quote:

The printing of money makes gold more valuable. You don’t have to be a genius to figure this out. The Johnny-come-latelies – the Paulsons, Einhorns and Soros – all figured out, when [the Fed announced the first round of quantitative easing], that they should own gold. It becomes more obvious every day as you see these financial challenges that we have in Europe.

Eric Sprott

I think this sell-off in paper is just shaking out the weak hands and short covering.  But the bullion owners aren't getting sucked in.  I think you'll find that most people here are long term holders of physical.  You just bought at an inconvenient time.

Doug

DRHolden's picture
DRHolden
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Re: What's going on with gold and silver?

I think part of my problem is that I'm not worried about my physical gold and silver (which I do own) because I plan to hold for a long time, and they are not as easy to sell.  When I have something so much easier to sell, I get trigger happy...

FAlley's picture
FAlley
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Posts: 90
Re: What's going on with gold and silver?
DrHolden wrote:

I think part of my problem is that I'm not worried about my physical gold and silver (which I do own) because I plan to hold for a long time, and they are not as easy to sell.  When I have something so much easier to sell, I get trigger happy...

 

Go physical, in-your-hand, and get rid of the trigger. Problem solved.

Jager06's picture
Jager06
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Re: What's going on with gold and silver?

Well said Tin Man.

Wendy S. Delmater's picture
Wendy S. Delmater
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Posts: 1988
Re: What's going on with gold and silver?

Why to watch out for ETFs? Contango. Long article, but VERY worth it. ETFs basically reward short-term traders at the expense of long-term investors. Read how, here:

http://www.bloomberg.com/news/2010-07-22/etfs-imperil-commodity-investors-when-contango-conspires-with-pre-rolling.html

Travlin's picture
Travlin
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Re: What's going on with gold and silver?
DrHolden wrote:

Can anyone give me a reason to not be nervous about my gld and slv ETFs?

Sure.  You might get hit by a bus tomorrow, and then it wouldn't matter.  Personally, I'd be more worried about crossing the street safely.  Cool

Travlin

DRHolden's picture
DRHolden
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Joined: Oct 18 2009
Posts: 131
Re: What's going on with gold and silver?
Travlin wrote:
DrHolden wrote:

Can anyone give me a reason to not be nervous about my gld and slv ETFs?

Sure.  You might get hit by a bus tomorrow, and then it wouldn't matter.  Personally, I'd be more worried about crossing the street safely.  Cool

Travlin

oh great, now I'm afraid to leave my house Wink

fandango's picture
fandango
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Re: What's going on with gold and silver?

I had ETF's (because it was in a retirement acct) in both gold and silver, but I got out in Dec and early Jan and (by sheer dumb luck) made a profit.  Now in physical.  I researched like crazy to find the right broker....CM was very helpful.

sosMsos's picture
sosMsos
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Posts: 42
Re: What's going on with gold and silver?

ETFs for traders vs  physical for investors

ffowler's picture
ffowler
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Joined: Feb 16 2011
Posts: 2
physical

I just bought my first physical gold.  Like Chris Martenson says, "its like being in a candy store, feel like I'm hiding something; felt weird".  But, looking at it as long term investment.  Gonna pull the trigger on some physical silver when more inventor comes in on the recommended site.  damn silver market up again today.  Have a good day.

fandango's picture
fandango
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Posts: 53
physical/gold eagle

True story--

Consulted with a CPA on a future tax matter.  He told me that the "American Gold Eagle" coin in my hand was a collector item--just like a Babe Ruth baseball card/ball.  I had to tell him (3X) that it was legal tender.  Scary!!

Obviously, not using him again...

ao's picture
ao
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Posts: 2220
tax implications
fandango wrote:

True story--

Consulted with a CPA on a future tax matter.  He told me that the "American Gold Eagle" coin in my hand was a collector item--just like a Babe Ruth baseball card/ball.  I had to tell him (3X) that it was legal tender.  Scary!!

Obviously, not using him again...

He may have been referring to the fact that it's taxed as a collectible.

fandango's picture
fandango
Status: Bronze Member (Offline)
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Posts: 53
gold eagle

ao,

I should have explained further...we had finished our tax business. Regarding, the gold eagle, he thought I was just starting a numismatic coin collection.

DRHolden's picture
DRHolden
Status: Silver Member (Offline)
Joined: Oct 18 2009
Posts: 131
gold eagle

I've "collected" some pretty one ounce gold buffalo heads too. Wink

idoctor's picture
idoctor
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Posts: 1731
I've "collected" some pretty

I've "collected" some pretty one ounce gold buffalo heads too. Wink

These are real pretty coins....

DRHolden's picture
DRHolden
Status: Silver Member (Offline)
Joined: Oct 18 2009
Posts: 131
gold eagle
ao wrote:
fandango wrote:

True story--

Consulted with a CPA on a future tax matter.  He told me that the "American Gold Eagle" coin in my hand was a collector item--just like a Babe Ruth baseball card/ball.  I had to tell him (3X) that it was legal tender.  Scary!!

Obviously, not using him again...

He may have been referring to the fact that it's taxed as a collectible.

I would have to agree.  Maybe he went home and told his wife that some crazy person was saying that he was going down to the corner store to spend his gold eagle.  It may be legal tender, but there's no super market that I know of that will give you more than face value of $50, and they may not even take it.  So it's really the gold collector value that matters to us, and to the tax man.  He may have been trying to tell you (without saying it) that you don't need to include it in your tax return.

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