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Betting it all on $50 silver?

To say that some Numismatic News readers are forecasting $50 silver enthusiastically is something of an understatement. While I won’t call them giddy, they are tending that way.

Reading through the responses to Friday’s e-newsletter poll question as to whether it is time to take profits in silver now that it has exceeded $30 a troy ounce shows that many of those who bother to write say no while the poll online currently shows 60 percent of the participants saying yes, cash in some profits.

In fact, of those who are writing, it is approximately 75 percent in favor of handing on for the ride and 25 percent who urge taking some money off the table.

Which way should we turn?

There is no doubt that the answers of those who believe the sky is the limit make exciting reading. That is the point of asking for responses.

Those who counsel taking some profits may be writing from experience, or just being prudent.

On the personal level, prudence is a good thing. That is how we survive in the world where the future is unknown.

However, prudence doesn’t make for exciting stories with large headlines and it is not the stuff of memorable movie scenes where gamblers who are enjoying a run of luck keep going.

Is the sky the limit on silver or is it time to be prudent? What does your gut tell you?

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5 Responses to Betting it all on $50 silver?

  1. truth says:

    The truth is:

    SILVER over $20 is extremely overvalued
    GOLD over $1000 is extremely overvalued

    At these prices, for your money you might as well buy enron stock as a long term investment!

    Irrational pricing can continue for a very long time (ex: 10 year housing bubble build up) … but it will all be corrected in due time.

    The truth is, the only demand there has been for GOLD/SILVER for the last few years has been INVESTMENT DEMAND – this is the only thing supporting the prices… and whether you want to believe it or not, people who buy things for investment all plan on selling them! The hurd will run its course.

    Also, another key thing to remember – most of the investment demand is from the exact same people that just spent 10 years blowingh up real estate markets globally – HEDGE FUNDS. The investment demand from them will dissapear and become gigantic selling pressure on prices the instant they change thier minds – HEDGE FUNDS are the worst kind of hurd that will stampede and destroy retail investors when they do! Just look at the last few YEARS of real estate market chaos – the same thing is coming to GOLD/SILVER and other commodities near you… AND MOST LIKELY MUCH SOONER THAN LATER, IT’S ALREADY 2011!

  2. Michael says:

    When everyone’s buying…Sell! Sell! Sell! 😉

  3. I read one analysis where the spread in the valuation between silver and gold says either gold is over valued or silver is under valued. In the term of gold and silver contracts, the spread is about 200:1. Either gold has to come down or silver has to go up. This analyst said silver should go up over $50.

    I think 40-percent, or $42 is more reasonable.

  4. Mark says:

    The Silver price is down about $2 from it’s high early last week and Gold about $45. Naturally all the anti gold and silver people thrilled and are jumping up and down saying "See I told you so". One lesson I learned a long time ago is that nothing ever moves in a straight line. Both gold and silver are going through a much needed correction before they resume their climb higher. Funny how no one ever is filled with glee during a stock correction.

  5. Jim says:

    I first learned my lesson re’ precious metals’ fluctuations and bubbles during the 1978-81 Hunt brothers-induced silver run-up and subsequent crash.

    My advice is to diversify your coin collecting pursuits and only have about 20% or less of your liquid assets in bullion-related items. "Invest" another 25-30% of your "disposable" income in late eighteenth and early nineteenth century classic silver and/or gold coins in whatever series interest you.

    Even if world-wide inflation reaches unprecedented levels in the next decade or two (at it likely will), it would only take one stroke of the Legislative pen to declare holding private gold illegal.

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