Gold/Silver is a bubble

Welcome to the Precious Metals Bug Forums

Welcome to the PMBug forums - a watering hole for folks interested in gold, silver, precious metals, sound money, investing, market and economic news, central bank monetary policies, politics and more.

Why not register an account and join the discussions? When you register an account and log in, you may enjoy additional benefits including no Google ads, market data/charts, access to trade/barter with the community and much more. Registering an account is free - you have nothing to lose!

B

benjamen

Yellow Jacket
Messages
1,574
Reaction score
9
Points
0
Location
Migratory
Hello all!

I have had several interesting conversations about metals with random people in the past month concerning metals. It seems the average persons view of metals is it is a bubble. The view is metals, especially gold, are a bubble and will crash in price soon

First what is a buuble? Here is an excellent, albiet wiki, article on economic bubbles: http://en.wikipedia.org/wiki/Economic_bubble

The biggest reason, in my opinion, for bubbles is the herd mentality. For there to be a bubble in the metals, you would need a large majority of the population hyped up about them. How many people do you meet think metals are a good purchase? Personally, I have had a lot more people ask me about the Facebook IPO. Amusing article where a guy tried to sell an ASE for 5-10 dollars on the street:

http://www.sovereignman.com/finance/why-were-nowhere-near-the-mania-phase-in-precious-metals/
 
Last edited:
There is a guy in California - Mark Dice - who periodically posts YouTube videos where he goes around trying to sell gold coins or use them to buy things which are pretty funny:

From 2009:

From 2011:
 
I think that the average person sees PMs as a bubble because a majority of people don't really have a good sense of how little their FRNs are really worth, and how quickly that worth is changing on the downside.

Some of it is a bit of a bubble, but we usually see those shake out within a few months of each other. That comes with everything that is traded: PM, paper, real goods, etc.

Just my 2 cents.

ADK
 

It is amusing to see the shock in people's eye when you tell them a hundred years ago 20 USD was one ounce of gold and 1 USD was one ounce of silver!
 
The lack of public participation in the gold sector is to the point of idiocy.
 
....of course it is not a bubble, everybody and his dog (I've learned that new saying in English, and I love it ) HATES PMs, try to talk to anybody investing about differentiating into gold/silver, and watch their faces melting into mixture of amusement/freaked-out and "whaaaaaa???" state.

We are constantly HAMMERED with news that even in NORMAL situation (let alone "bubble") should be extremely bullish for PMs, yet apart from great volatility in gold price, PMs are going nowhere, short-mid term.

Quite unlike any of the other bubbles I can think of. If anything, it is currently in a "negative" bubble - everybody hates it. As usual with sheeple - they make round eyes, and do not analyse things on their own. then they woke up, when the game is long up, and all the smart guys are already cashed out.
 
Last edited:
Haha... Mark Dice just posted a new video where he tried to sell a 1ozt Maple for $25 in front of a coin shop:

 
I do not talk about PMs in public, period. It's just asking for trouble.

One day, the people of the western world will be forced to open their eyes, and then there will be trouble.
 
PMBug said:
Haha... Mark Dice just posted a new video where he tried to sell a 1ozt Maple for $25 in front of a coin shop:
Click to expand...
That was hilarious! "Bubble" my bottom Geez, where this guy lives, I might hang around corners, and make one sweet deal, if I am lucky
 
I had some good laughs today showing these to a couple guys who are helping me do infrastructure improvements (which is why I'm not logged on as much these days). Note: Most didn't graduate high school. Not one didn't know what a gold coin was worth. Maybe stupid city folk just suspected a fake (and didn't know how to tell), but these guys would have hopped right on that instantly.

I have a perhaps different definition of bubble than most, but try this on:
No leverage in use, no bubble - it's gotta be levered to provide the "pop" of that bubble when it happens.

Every pro is "all in".

Retail is starting to get really excited, and they are going all in (faceplant? Started right off as a bubble with idiots opening etrade accounts just to put all their and their family's money into it, ouch).

When the taxi drivers, barbers, shoeshine boys are talking, it's time to get out.

Virtually all bubbles show a price curve concave up - like APPL recently did when we made some money shorting them. Not all bubbles pop all at once, there are always some bargain hunter bumps going down (look back at the crash - a lot of that crap should have hit the floor by the second day, but no...took awhile to sink in that it was truly worthless, and the crash wasn't a short term glitch).

All psychology, in other words. But to me, there's no bubble without leverage, else you just don't get that extreme selling pressure off the very top when it's time for it to blow out and pop. You almost require that initial sudden and steep drop to make the thing really crash - it creates the necessary fear in those who would otherwise "hold, this is only a glitch".
 
http://www.silverdoctors.com/u-s-gold-net-exports-increased-substantially-during-first-quarter-2012/

If gold is a bubble, why is the U.S. exporting gold as fast as it can? Net of imports, the U.S. exported over 100 tonnes of gold in the first three months of 2012!

"Of the total 178 metric tonnes of gold exported from the U.S. during Q1 of 2012, Hong Kong, the United Kingdom and Switzerland acquired 161.7 metric tonnes or 91% of the total amount. If the rumors are correct, the majority of this gold is being shipped to these countries and being purchased by the Big Eastern Buyers."

 
http://www.silverdoctors.com/cnbc-host-claims-gold-is-now-in-a-bubble-hilarity-ensues/

"With a bullion bankster from RBS as the ‘guest host’, the latest CNBC Commodities Corner attempted to claim gold is ‘in a bubble’ with the metal nearing $1800 again, claiming ‘nobody actually needs gold‘ and that those wishing to allocate a portion of their funds to gold should utilize an ETF.

Unfortunately for CNBC, the producers didn’t do their homework on their guest, Managing Director & CIO at Swiss Asia Capital, Juerg Kiener."

:rotflmbo:
 
Nice one. I love especially that quote :

"I've never seen a bubble in my life, where investors are allocated (on average) less than 1% in" :rotflmbo:

Well, I might not be able to put it all together as nicely as the gentleman did, but I must agree, my thoughts exactly
 
Last edited:
bwahaha.. CNBC = Propaganda financial news.
 

That's basically what I was saying.. There is no public participation.
 
When everyone you know has gold and is trying to get more gold, then it might be a bubble. Until then, it's not even close to a bubble.
 
Mark Dice has a new video out. He offered to give away an ounce of gold if someone could tell him how much it was worth - within a 25% of it's value:

 
"Bubble" is now a doublespeak word that gets thrown around by everybody, with only a precious few who know what it means; dumb***es will see any asset appreciating and automatically call it a bubble. Asset bubbles are created by the artificial credit expansion of a central bank, and there is 0 debt denominated in gold (if there was, it would be a million dollars an ounce by now lol). 99.9% of the public has 0 interest in gold, and if you want to know how bad things really are: at a time when Bernanke is monetizing debt to the tune of $85B a month and the world is swimming in dollarz, they are trading their gold for fiat cash when they should be the ones paying "cash for gold". They don't own gold and they sure as hell don't own the gold equities right now (especially the juniors, the whole sector has been left for dead). The notion that "all the sheeple are rushing into gold" is the most sheeple-esque thing you can say.

Gold has not even begun to move yet, to anything close to relative of the amount of fiat dollarz that have been printed. The world is allowing us to export inflation, but only for so long, and when they finally decide to dump the dollar all those chickens are gonna come flying home in oceans of paper and trillions of terabytes a second. It was very interesting to see that Mr. Dollar Bull and gold basher extraordinaire Warren Buffett has secretly bought the biggest jewelry supplier in South Africa, a place that is getting very scary; mofos are down there getting decapitated by machetes but Mr. Conservative Dividend Grahamite is rushing into the heart of darkness to buy inside access to the Rand refinery and its mega gold production? lolzolzolzozlzolz He didn't get to be the richest man in the world by being stupid, but he sure is a cynical bastard
 
Last edited:
Haha... Someone finally bit on one of Mark Dice's offers ... and he wasn't an American:

 
but that yurpeen buyer wasnt any smarter than the average murkan, he just saw a shiny souvenir. It might as well have been a silver foil wrapped chocolate coin.

its no wonder gold and silver is in a bubble !

and what a pity it wasnt his 1 ounce gold coin )-:
 
You must log in or register to reply here.
Menu
Log in
Register
Cookies are required to use this site. You must accept them to continue using the site. Learn more…