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Make or Break Time for Silver
Those who took my advice to load up on silver a month ago (click here for “Why the Really Big Play is in Silver” at http://www.madhedgefundtrader.com/august-13-2010-2.html ), are laughing all the way to the bank. The white metal outperformed gold better than 1.6:1 ratio that I predicted. Silver is now trading at a 30 year high, is overbought, and bumping up against key technical resistance.
Unsurprisingly, I have been flooded by emails from readers asking what to do next. Short term traders, those in the futures markets, and anyone using a degree of leverage should take the money and run. As I have pointed out with my hugely successful agricultural trades this summer (corn, wheat, sugar, coffee, soybeans), we now live in a zero return world, and the 13% gain silver has posted since August 23 puts you way ahead of the pack. Mean reversion can be such a bitch that it makes your ex wives appear like a convent full of nuns.
For those who hold physical bars and coins, it is a different story. Just keep it locked up and throw away the key. My multiyear target for silver is the old 1979 high of $50. Some hyper bulls, like Europacific’s Peter Schiff, thinks it may go to $100 (click here for my interview with Peter at http://www.madhedgefundtrader.com/february-20-2010-peter-schiff-of-euro-pacific-capital.html ).
In any case, the round trip dealing costs for physical bars and coins are too high, sometimes reaching 20%. There are also the tax implications, for those who bother with such things. Remember, coin dealers are now required to file 1099’s with the IRS on all precious metals sales by individuals. And if things don’t work out with this financial markets thing, and we enter the Armageddon daily predicted on the Internet, you can always use your silver to bribe the border guards.
To show you how mainstream silver is becoming, you can pick up silver coins on Amazon here for only a couple bucks over the spot price by clicking here at http://www.amazon.com/Buffalo-Indian-Nickel-999-BULLION/dp/B001OFTWE0/ref=sr_1_1?ie=UTF8&s=miscellaneous&qid=1284479236&sr=8-1
To see the data, charts, and graphs that support this research piece, as well as more iconoclastic and out-of-consensus analysis, please visit me at www.madhedgefundtrader.com . There, you will find the conventional wisdom mercilessly flailed and tortured daily, and my last two years of research reports available for free. You can also listen to me on Hedge Fund Radio by clicking on “This Week on Hedge Fund Radio” in the upper right corner of my home page.
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Yeah, I do well because I research the seller. eBay is not a seller, they are a venue. I shop prices amongst the sellers I have already done business with and I get free shipping. Last purchase was roll of $1 silver eagles at $22.30 which included insured shipping. I really don't care much about a 25 cent or 50 cent spread since those spreads disappear quickly in these market advances. I have not posted my sellers user names on ZH because the first response I'd get is that I have some fiduciary interest in them. Which I do not. Here is link to the listing from the closed (already sold) items page
http://tinyurl.com/38ldz8nMr Racoon, if you are willing to buy 500 at a time (mint box) check out Colorado Gold
http://www.coloradogold.com/
$23.05 each for a minimum of 500 quantity + 1.5% shipping ($172.85) by USPS. My last eBay purchase was less than that for a roll of 20 which included free shipping, but with the rise in silver since my purchase there is only a couple of cents difference per ounce. On the other hand I am an experienced eBay buyer, it's not for everyone. I'd say your site is as good as any -- if you have $11,697 you just got out of the sofa cushions.
This comment from the gold confiscation page is wrong:
There was one poor fella who paid dearly! But he had a LOT of gold stashed in a safety deposit box. So much for "safety" deposit boxes.
Yeh, I read the blog and thought the same when I saw that quote.
I could never buy from e-bay, I'm just to paranoid of getting riped off.
Know your seller. Simple. I buy from several who have low opening bids on small lots of 5 up to full rolls. I'm guessing but I think they get their stock from the folks who buy at local purchase points around the country. There is another seller which owns a large jewelry shop. Oh, what the hell, here is that one seller:
http://shop.ebay.com/midyatspor1000/m.html?_nkw=&_armrs=1&_from=&_ipg=&_...
At least you know I don't have anything to do with their business. Just wait until they have auctions. I think they may be slowing up auctions due to the volatility of the silver price. They have just a bit more feedback than I do. I've sold over 21,000 items on eBay.
I agree, but it seems people are buying locally at dealers. I see the gold & silver store here with a decent amount of people (could be selling too), as well as local ads.
Buying local for me means an additional 8% sales tax. I ain't paying that.
im not a huge fan of madhedge, but he mentioned amazon for the mainstream aspect.. you are a tool
Oh yeah: BUY ADBE OPTIONS 35 2012!! I JUST DID!
It will recover 15% and options will go X3!
Adobe Systems Incorporated (ADBE), the software developer said third quarter revenue rose 42% to $990.32 million from $697.51 million in the same quarter last year. Net income in the quarter surged 69% to $230.1 million or 44 cents per diluted share, compared to net income of $136.0 million or 26 cents per share for the year-ago quarter.
Its hard to find anyone bullish on gold or silver at these prices. It was also hard to find anyone bullish at $1250 for gold.
It was also hard to find anyone bullish on gold at $1045 just before India bought.
I bought a couple days ago at $1272, the first time I bought an all time(nominal) high in my life.
Today I've got a letter in my mailbox for our Belgium Mint.
They are selling silver coins at SILVER PRICE to every Belgium citizen and price the investment.
You can buy 10 silver eagles (US COINS) at 22$/pc
EXPECT SILVER TO SKYROCKET AS MANY MORE WILL START TO REALIZE SILVER IS THE NEW VIAGRA!
CORN. The equity. The ETV. Seriously.
He's been flooded with e-mails asking him what to do next. How utterly pathetic; imagine asking a newsletter writer what to do next.
Holding paper from a paper-pusher (some bunch of wall street slugs who make money bundling up the crap they sell) is a bad idea. Very bad.
If you want corn, buy a farm that produces it. Same for every other commodity. Metals are a little different because they have no storage deterioration (unlike food commodities), and so you can either own a mine, or own the metal. Physically.
But if you keep buying paper, expect to get screwed. What keeps every "commodity ETF" from doing the same thing the LBMA has done for at least 30 years? Uh.... nothing.
+100
Not even a single central bank in the world that can issue gold/silver denominated money
Everything is like demo trading with funny money
Be your own central bank and buy physical