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DSAbug

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6% Down day on silver...

I am buying 20% of my account today. I think we still target $24 range but i'm not going to look a gift horse in the mouth. You rarely get this much of a down move over the holidays..
 
I made a small purchase earlier today. :)
 
When the money lands (due soon!), I will see you in line there at the coin shop.

The strategy that has served me well for DECADES now is to just keep buying, whether Spike or Dip. Over the past couple of purchases I have been lucky to buy at the Dips, but over the many years I have been buying, MANY of those purchases were at Spikes (that turned out to be short term in nature).

+ 1000 derek.
 
We are probably going lower so i will probably be kicking myself tomorrow. I just would be surprised to see some of the $25 or below targets actually met. maybe i'm just a bit too eager but I think that most of the movement today just didn't seem "real" to me.
 
Such a massive downday rarely comes alone. It usually means some more selling preasure on the following days. It caught me by surprise that the metals plunged out of nowhere (together with everything else) once us markets opened. I´m glad I didn´t close my shorts yesterday. Maybe I´ll close them tommorow, but I want to see a real turn arround first.
For a short term trade my silver volatility trade (see here: http://www.pmbug.com/forum/f3/how-trade-silver-volatility-using-options-343/) is playing out well.
 
Yup, the charts for the PMs have been looking sick for awhile now, and I've been down to my core holdings for a similar time as well.

DoChen's dollar cost averaging is a smart way to work it long term. If you buy too much today, and it goes down more, you missed a better shot. DCA guarantees at least you won't make a huge mistake.

But maybe I'm cocky - I'd just gotten out. But not so sure as to go short - I think we're seeing crazy volatility as strange things happen in the non public banking systems worldwide - and Derek might therefore be right if as many think, this is "transitory".

I'm rarely sure enough to go straight from long to short and back. Usually it's long or out, or short or out. I was just in the "out" phase of that.

I like to see a real turn too - you can do fine buying a little after the bottom, then selling a little after the top most times, and you just sleep better. Getting most of most major moves, and only getting hosed infrequently seems a good way to make money in general - get all the singles, a few doubles and maybe a triple here and there. I never count on a home run - but I'll take them when they happen. It's just rare, that's all.

For me, the other warning was the constant din over about the last month on ZH with everyone boasting how PMs had beat all other investment vehicles (well, not really but stocks and bonds) in a non-trading buy and hold world, for the year. No surer sign of a top than that kind of boasting.
 
I'm all for DCA with my silver, but don't really have a lot of "dry powder" right now. It is extremely tempting to dive in and get another MB of ASE, but I'm a little gun shy with this most recent bout of what appears to be hard core deleveraging. This is an ugly time of year with respect to retail, year end reporting and the upcoming layoff of a spitload off seasonal workers. I might wait till we see what January brings before dipping at the well. Fear is a powerful emotion, and I think there will be fear enough for everyone this January.
 
Its like gold and silver went on sale. It will be interesting to see the premium between spot and the actual physical purchase. Visiting the local guy, I will give an update tomorrow!
 
I know if I was a dealer with a lot of stock bought earlier and higher I'd not be real excited at selling it lower right now...I'd be wanting to wait for fairer weather to sell, but I might be buying if I could get it at spot and right now. But I'm not a dealer and privy to their ways - just a trader (and we all share that one).

But like SA says - this might well not be over yet, and if you use your dry powder up too soon, you won't have it when it is over and turning back up. It's still silly season.
 
I called my dealer this afternoon. He will sell me junk silver at 19-1/2 times face delivered to my door. I told him I would decide on Sunday whether I can buy any.

And based on my 40+ years experience with metals markets, it looks like to me PMs have finally got near a bottom. They are not likely to go much lower any time in the next several months.

Au_Wk_Cht12.GIF


Ag_Wk_Cht12.GIF


Sunday I am looking at renting a building (2700 sq ft) at $425 per month including utilities and garbage. My current building (2400 sq ft) costs me $1500 per month plus water plus electricity. If it is doable, all of my PM money, and then some, will go into the move. Once I have moved, I will have even more discretionary funds for PMs.
 
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Yeah I watched this early in the day when I was playing a new board game with the kiddo. Not that upset with myself for being early, but I bought Au & Ag last week at 1600 and 29. Oh well. Hope everyone had a nice Christmas.

Editing to add that my local coin shop has no ASE in stock except 2011 and is charging a $7 premium on 2011 v.s. $5 on all other years of ASE. They also raised their premium to $99 on AGE. She wasn't trying to advertise it to the other customers but she said that supply is an issue for them at the moment. Mostly on the silver. They haven't been able to really restock in high amounts since the run they experienced after the big dip/correction back in the fall. I only bought a few ASE with what I had left over at the end.
 
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MMerlin,
450 a month!!!

Holy crap son! Sign on for a looong lease at those rates?? That's crazy cheap! By utilities and garbage.....do you mean electricity, water, sewer, A/C etc?? I have 3,200 s.f., but have a mortgage and do not rent, but my power and water are around 675 a month. It sounds like they're just looking fgor a placeholder so teh building isn't empty, which makes it a tartget for copper thieves, vandals and vagrants.

Goos for you man! I love to hear about someone getting a killer deal.

Hell, you coule build a little partition and turn part of the place in to an apartment, you know, two birds...one stone?
 
MMerlin,
450 a month!!!

Holy crap son! Sign on for a looong lease at those rates?? That's crazy cheap! By utilities and garbage.....do you mean electricity, water, sewer, A/C etc?? I have 3,200 s.f., but have a mortgage and do not rent, but my power and water are around 675 a month. It sounds like they're just looking fgor a placeholder so teh building isn't empty, which makes it a tartget for copper thieves, vandals and vagrants.

Goos for you man! I love to hear about someone getting a killer deal.

Hell, you coule build a little partition and turn part of the place in to an apartment, you know, two birds...one stone?
Click to expand...

$425 per month includes water, sewer, garbage, and electricity. Living there is probably not allowed and probably not doable because of no bath/shower facilities, just a bare toilet and sink shared with two other tenants. And not easy to install shower because of layout.

I moved into my current building 28 years ago and rent THEN was $525 per month plus utilities.

Building is on main drag through town and 1 block from city center in a town of 800 population that is on the National Historic Register. Building is also on the NHR, so the owner is limited in how it can be used and what improvements can be done. Fortunately, it was an automotive repair shop 100 years ago, so I fit right in even though I don't fix cars.

Biggest positive and negative is that it is 200 miles from here, a tiny town of 2.4 million people. I really want to be 300 miles out, but finding anything in a town of less than 50 people is impossible.

Owner swapped other paid for property in the same town for the building several years ago. Has no plans on selling it any time soon. Not entirely sure why rent is so low, but being on the NHR does limit its uses as does the size of the town. Like how much demand can one generate for a shop in a NHR building in a town of 800 with only 30,000 people in a 50 mile radius? With two auto repair shops in town (within 2 blocks), I don't think a 3rd would be viable.

Even if it is not doable, I am sure I can find something in the same area that is a whole lot better than I have now at half or less than what I am now paying. I am so sure of that that I rented a large storage unit early this year and have filled it up. I could theoretically operate out of several storage units with a garage sized shop (10X20) nearby for the dirty work. Mini-storage units there rent for $45/mo for a 10x20 (37.5 cents/ft) whereas here they rent for $55/mo for a 5x10 ($1.10/ft), so even storage is cheap there.
 
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ancona said:
Hell, you could build a little partition and turn part of the place in to an apartment, you know, two birds...one stone?
Click to expand...

This happens more often than many realise.
Cost of a false wall or lowering the office ceiling is usually all it takes.
Then the pattern of use has to be established with hints of working nights to confuse the natives.
Recently saw a nice 'snug' built over the office part of the building.
No good for a family situation though.
Better to own the building if this is the plan.
 
hey folks...here is my shopping report....no silver at all, save for special date stuff with a double plus premium. no 90%. i got 1 Krugerrand at 1625 and 1/2 oz panda(1986) and 5x1/10 AGE at 1600. several people in selling silver jewelry, and one fellow with a 5 gallon bucket of pennies he claimed are all pre '81 and he also had a 3 gallon pail of nickles. times are tight. i hope everyone stays safe and maybe gets a good deal on a few items before it spikes back up.
 
That was likely an intermediate term low. We should go to the upper bollinger band which is currently sitting at 1774-1827 (that level does change). We could have a retest though which is quite normal in the gold market. The next meaningful decline under that scenario wouldn't happen till February.

If i'm right, a lot of longs in waiting are going to get discouraged.

I'd also like to point out that the spread chart (XAU vs Gold) finally turned up and broke it's 12 month downtrend line (declining tops line). It's entirely possible we'd seen the end of the correction in the miners. The only thing that really makes me hesitate is that this is all end of year price action and it's way too easy for people to paint the tape.
 
As is usual, I didn't have sufficint dry powder at the bottom to pick up more silver. Oh well, I still have enough for lunch today!

Christmas wiped us out this year, as we have vowed to not use any credit that cannot be paid 100% at the end of the month.
 
Trash went out today. Saw what the neighborhood bought themselves for this Christmas at the curb more or less. Our pile was one of the more modest, even though I spent quite a bit. I guess we just go the extra mile to break big boxes down to fit in the recycling bin.

My PM fund for the previously mentioned purchase was literally left over cash-on-hand after all Christmas shopping had been finished. Glad Ancona mentions refusal of credit cards for things like Christmas. Was taught (and learned) long ago that the plastic is only for emergencies or when necessary like with car renting. Anyway, my woman was a bit mad at me with the PM buy, because she was in attendance. Her words to me were, "You better spend about a third of what all that just cost you on me..." type of comment. This was before gift giving, last week like I said, and just replied to her that she didn't know what I'd gotten her yet. After she opened her 1 karat diamond earrings in gold setting she didn't mention it anymore. Her father gifted a 2000 ASE to her son, his birth year, for Christmas. She kinda smirked at me. Her old man is a nice guy and knows more about managing money than I do, but we never really chat about it. He put the ASE in a nice case display. Anyway, in passing he mentioned that he's had it since 2000. If I were a betting man I'd bet that isn't the only silver or gold coin he's ever owned. His wrist is full of about 5 oz of gold in bracelets. (Weird but eh, to each their own.) He joked and said to his grandson, "Give it to your mom to keep safe for you until you're all grown up, or you need it to buy a loaf of bread." Worst thing about it, is that it might happen. Nothing we little folks can do about it except be prepared.

Have a Happy New Year!
 
ancona said:
as we have vowed to not use any credit that cannot be paid 100% at the end of the month.
Click to expand...

+100 Ancona, us too.

My next move is to figure ways to operate without credit cards altogether. I have heard there are ways to reserve hotel rooms, buy online etc without ccards, but have not yet looked into it that much yet.
 
In a ridiculous twist of fate, I don't have credit myself at all. I cut up the cards after paying them off sometime in the '70s - and now they won't give me any! Me, a millionaire (liquid$, there's more in land etc)! They tell me a blank credit record is worse than a bad one.

Fine with me. I use debit cards for when I need to use a card at all, almost everyone around here takes checks anyplace other than fast food. I have open accounts with the major vendors I work with for my shop.

But note - you don't get the buyer protections on those as well. What I do is keep a separate checking account for the card I use online and for mailorder.

I *have* had the cards hacked. The online-mailorder separate one is a response to that. Before, I'd had the one attached to my payroll account hacked, and some joker in NYC was using it to buy $100/day of prepaid long distance calling, then probably selling those on the street. What made that ridiculous is that at the time I was the guy developing voice over internet (VoIP) and had ZERO need for a long distance bill.
(that's how I got rich, BTW)

At first, the bank didn't want to do squat. But I'm a big fish in a small pond, so I said, well, if my money's not safe here, lets cut me a cashier's check I can take across the street - right now - suddenly things got straightened right out. It's a good thing that bad guy didn't know there were tens of thousands in that account!

So, the trick is to use a separate account for the debit plastic, limit how much cash you have in it, and prevent the bank from putting overdraft protection on it that can sap some other account - and build up fees along the way. That one is harder, they kept adding stuff like that on an opt-out basis, till I went down and berated some VP types. At this point, I run 3 checking accounts for just this reason. Paypal is notorious for wrong doing around your money, so they got their own, and I get money out of the PP side and into the bank very rigorously - don't keep squat in the "cloud".

You can talk most small-town banks out of charging a bounce fee if it was because of fraud, so just by doing this, it's free to have this setup. Most give free checking too, and even pay a little interest. (yes, it's very little!)

To make this manageable, I use my bank's online stuff to move money around at will, and have two of the 4 accounts "safed" - no debit card transfers allowed, no card, no pin, just a bank account. Those are the ones that have all the money in them...easy enough to move around on the web when I want to.

And of course, avoid all large banks and the types that sell CDS and generally get fancy for the reasons we know. My bank only does banking, local real estate and small businesses.
 
Update on the building I was looking at.

Even though it was a steal of a deal, I passed on it. After it was empty, I looked at it again. Everything was perfect. EXCEPT the doorway was too narrow for my truck!!! Two inches clearance on each side is not enough. Sooner or later I would damage the door. So, back to square one.

And today I spent part of that money on a forklift. Cost $1000 plus $100 delivery. Scrap value is $900. Similar forklifts in comparable condition are currently selling for $2500 around here IF YOU CAN FIND ONE. No silver for me next week. I get to watch the silver boat rise without me in it.
 
Silver at 31.78.. That's over 10% since it went into backwardation.
 
dereksatkinson said:
Silver at 31.78.. That's over 10% since it went into backwardation.
Click to expand...
Hopefully Sprott buys his 10 million oz solely from the COMEX and takes delivery as soon as possible. That would take about 1/3 of the COMEX inventory, probably even more, because the inventory numbers are obviously cooked :popcorn:
 
I received three beautiful ASE's in little plastic cqassettes, which I bought with money I won on a two dollar scratch off. They got here with the PM UPS guy. All together with shipping, it came to one hundred and one dollars.

SWEET!!!
 
You really wonder what is true here. Because a guy like Sprott - who already has a crapload of physical, would seem highly motivated to do just that - and would have been for years, because if *any* of this tinfoil hat conspiracy theory pron junk is true - a big failed delivery from Comex would cause the paper to go implode - but the stuff he holds already to skyrocket.

Why would he not have done this already? Riddle me that. Is he in cahoots? Superior restraint? Why? It just doesn't add up for me. If would only make him super wealthy, and his phyzz funds that much more popular and profitable.

Sorry fellas - someone's got to be not just wrong, but idiotically wrong here.
If I stepped on someone's religion, I apologize in advance, but this can't all be true at the same time on the planet I inhabit. There must be another explanation.
 
DCFusor said:
You really wonder what is true here. Because a guy like Sprott - who already has a crapload of physical, would seem highly motivated to do just that - and would have been for years, because if *any* of this tinfoil hat conspiracy theory pron junk is true - a big failed delivery from Comex would cause the paper to go implode - but the stuff he holds already to skyrocket.

Why would he not have done this already? Riddle me that. Is he in cahoots? Superior restraint? Why? It just doesn't add up for me. If would only make him super wealthy, and his phyzz funds that much more popular and profitable.

Sorry fellas - someone's got to be not just wrong, but idiotically wrong here.
If I stepped on someone's religion, I apologize in advance, but this can't all be true at the same time on the planet I inhabit. There must be another explanation.
Click to expand...
I've never taken delivery on a COMEX contract, but there could be some kind of "delivery limits" per participant. This would absolutely not surprise me.
There are also some cash settlement rules that might prevent a trader from taking delivery, giving the bullion bank some kind of "way out" for a huge premium (I've not taken a look at the details).
A deliberate crash of an exchange could be considered market manipulation by the regulators (I know it sounds funny). The fact is: The laws and statutes are designed to protect the exchange, not the investor. Thanks to the lobbyists.
The more speculative arguments are:
Sprott seems to be very well connected on Wall Street. He fooled retail investors twice last year when he sold large amounts of his fund right before the two big corrections in may and september. His timing was next to perfect. Publicly he pushed silver hard, though. He claimed having sold his shares in the fund in exchange for mining shares which wasn't completely true.
Maybe Sprott also wants to play the game for the long haul instead of going supernova right now. He knows the fundamentals of Silver and sees this as a long term cash cow.
Finally: Even if Sprott takes delivery solely from the COMEX, he wouldn't bust the exchange if the inventory numbers have anything to do with reality. It's obvious imho that the official numbers are false. The question is: HOW false? I don't think their vaults are all empty, the question is: Who owns the metal (hypothecation etc)? Is there some kind of double accounting? The effect of taking delivery soley from the COMEX therefore would probably just mean that the bullion banks actually had to repurchase large amounts of physical silver, therefore tightening the market significantly and sending futures again into deep backwardation.
 
Number one......I wish I had enough dough to take delivery of a Crimex contract.......number two, I am buying from small retailers who have to make a living, and do so through premiums. It's kind of like dealing with a bookie, they take a vig whether you win or lose. But, I'm OK with it, because I am considered a deer fly on an elephants ass.
 
Just for once the price of pm's went down when the bernanke spoke...probably to rub Ron Paulson nose in it!BTD...
 
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