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Relax, have a smoke with a glass of fine bourbon, over rocks. Yes, I realize that the price of silver was up almost 5% today, despite both U.S. and Canadian stock exchanges being closed for President’s Day and Family Day, respectively.
Yes, I realize that, were those markets open today, anyone holding AGQ would be running around, madcap-style, kissing their latest brokerage statements in adulatory dis-belief, handing out shiny new dimes to children and mendicants as is the right of all wealthy individuals.
But savvy AGQ veterans have seen this kind of thing before and so, rather than spending the night on the Best Buy website outfitting their newly excavated man-cave with 126″ laser-guided 240 mhz 1080dpi 3-d LED moon-scaped wall displays, they are instead hunkering down and preparing for a temporary blow off spike in the precious markets, which may join equity markets in a pull-back tomorrow, no matter what the U.S. dollar does.
I will likely wait unti 10 a.m. to do anything at all, which would include eating a number of samiches (sic), lightly salted, lightly peppered. As yesterday’s SLW illustration showed, I am expecting a run for that stock back to the old highs, and then a pullback, either at, or slightly higher than those levels. If we break old highs, I expect the pullback to be shallow, if we are turned before breaking to new highs, I expect we may find ourselves right back at Friday’s close when all is said and done.
You will find that if you watch these things over many years, you will get a sense for their trickery. One would think that in a relatively consistent bull market like we’ve had for the last ten years in PM’s, riding this trend would be relatively simple. Nothing could be farther from the truth. They are evil wood sprites, as a rule, and they take pleasure in your pain and indecision.
They really love leaving you behind as well. Yes, I am talking to you, PM skeptic. If you have been watching this blog for any amount of time, you have no doubt kicked yourself enough times to form a large callous on your own buttocks. Do not be chagrinned, I carry a similar leathery ass, and it’s simply the lot of all PM investors and traders. The wood sprites are simply too crafty to allow you to take every trade profitably.
That is why I have urged you to always “keep a core,” and trade around that nucleus like the best Fermi Level Physicist in the CalTech Senior Laboratory.
Tomorrow we shall observe with anticipation and trim like expert barbers if necessary. For now, we enjoy the anticipation… along with a finely rolled Dominican Cigar and only the best bourbon money can buy.
Best to you all.
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If we get an initial pullback in gold and silver stocks in the morning would you advise buying into it?
Also I did get one response regarding allocation in a portfolio re: silver and gold. Would you mind sharing yours? Thanks.
I would wait and see if there’s a blow-off in the physical, simply because of the steep ramp Friday and today.
I answered your other query on the previous post.
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Love your take. Long time metal watchers have seen this time and again.
From Scrap Monster via Kitco:
Silver recycling can happen only at prices above $50Tags : precious metals, mining, silver, gold mining, fabrication, demand,
MUMBAI (Scrap Monster): Silver supply could increase only if more recycling takes place as in gold, but for recycling to become monetarily feasible, the price of silver should touch the historical high of $50 according to analysis by Chandni Burman in Daily News and Analysis (DNA).
The supply of silver scrap which was at 180.7 mn ounces in 2000 rose to 188 mn ounces in 2006 but thereafter declined to 165.7 mn ounces in 2009, according to The Silver Institute- GFMS survey.
Silver mine production rose by 4 percent to 709.6 Moz in 2009. Gains came both from primary silver mines and as a by-product of gold mining. Regionally, the strongest growth stemmed from Latin America, where silver output increased by 8 percent, with the most visible gains recorded in Argentina and Bolivia. Peru was the world’s largest silver producing country in 2009, followed by Mexico, China, Australia and Bolivia.
All of these countries saw increases last year except for Australia, where output from the lead/zinc sector declined markedly. Global primary silver supply recorded a 7 percent increase to account for 30 percent of total mine production in 2009, according to The Silver Institute.
Meanwhile silver production is not being ramped up sufficiently to meet demand and some analysts opine that the world will run out of silver by 2020. “Silver is largely used as an industrial metal. It is a very good conductor of electricity, the best heat transfer agent and reflector of light, a very good lubricant, catalyst and alloy. But it is used in very small amounts as an industrial metal. Given this, it is not easy to recycle silver,” the DNA report said.
Also, at its current price, it is not monetarily feasible to recycle silver. Experts are of the view recycling will become monetarily feasible only once the price of silver crosses around $50 per ounce (currently it quotes at around $32-33 per ounce). Given these reasons, increasing sale of silver scrap is not very easy, the DNA report added.
Thank-you!
PM’s off their highs, already.
Asia getting raped in early trading. http://finance.yahoo.com/intlindices?e=asia
Hmm I’ve never had or heard of Rowan’s Creek bourbon. I must check it out.
My special treat bourbon is the Old Rip Van Winkle 20 year… and I prefer Booker’s for more common occasions.
I look forward to this.
And for silver, I wouldn’t be caught taking a profit, especially not while silver futures are in backwardation.
I am keeping a keen eye on the march open contracts
Rowan Creek is relatively new… from a newer distillery created by a group of Old Bardstown types… their other brand is Noah’s Mill, also good.
I actually prefer the Pappy 15 over the 20 and 23 year. I am at odds with the Swan Brothers on this one.
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Yea, I haven’t had Noah’s Mill either. I will surely seek both out.
The 15 is delicious, as is the 23, but the 20 neat is my choice. (Googling Swan Brothers… sorry mate, I don’t get the reference)
They are local BMOC’s, in the literal sense. Started and sold two trading companies, the latest to Think or Swim (later TD Ameritrade), and huge bourbon aficiendados.
I say “literal sense” in that they are both about 6’10”.
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Are you primarily a bourbon drinker or do you partake in the other whiskey families as well?
Aside from red wine and the occassional highly hopped pale ale, I am chiefly a bourbon drinker now.
However, if someone cracks a bottle of 12+ year old single malt scotch, I certainly am not going to be impolite.
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I primarily drink bourbon or rye too, but… there is a white whale out there.
Hard to find in the states, but if you can get a tasting of the Bunnahabhain 25 year old, it has truly been near the top of my whiskey experiences. (If you do come across it, it will be about a $240 investment.. worth every penny)
As always, your advice is very helpful. I enjoy the click links too. Do you endorse the aforesaid bourbons.
Very much so, although my “drinking bourbon” is Woodford Reserve.
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Certainly one of the most mellow bourbons. Great choice.
I’m a fan of Jefferson’s too (8 year or 12-17 year reserve, both are good)
Mr. Gint,
I have a friend, we’ll call him Slow Shrimp, that recently started a very small position in SLW in the $34 range. This position is so small at the moment that it does not justify the usual take a little profit on a rip and hold the rest as a core. Basically if I… I mean my friend… wanted to take some profits he would need to sell out in full. My friend prior to the weekend was considering adding to said position on any dip.
The question is, should I… I mean my friend… take profits on a rip tomorrow and wait for a pullback back to around the $34 – $35 level or is that level gone forever? If SLW were to tip rits on Tuesday the profit could be enough to make my friend happy, but it won’t allow him to retire 10 years early by any means.
My friend’s portfolio is currently very underweight in PMs.
It’s a question of semantics. The way I would look at it is that I have started to work on establishing my core but am not yet done, so therefore I would have to be mad, MAD to sell any of this initial position.
You can’t trade around your core until you’ve actually got one.
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So does the position size mitigate against the core position concept? Indeed a question, but not one worthy of consideration,especially since slow shrimp has a very small position. I would hold and add on dip. Easier for me then slow shrimp as my position is very large.
Now that I’ve butted in, let’s see what Jake has to say.
Position sizing should be for your trading positions… I consider the core to be an investment to be sold only on clear demonstration of the bull end.
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I’ve had too much to drink. In case it wasn’t clear, my intention was to say that if I were slow shrimp, I would hold and add on the dip.
Slow Shrimp passes along his regards. He told me this made a lot of sense and he feels comfortable with this strategery.
This guy recommends buying the laggard gold for now.
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Do you agree with him?
Check the PPT for my buys today!
(In truth, I am pretty much full up on silver at this point).
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Amazing… 25 comments and not one on Jennifer Tilly!
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I was distracted by the cigar.
Jennifer replaced Carmen Electra as my favorite sex symbol fantasy for the new millennium years ago ….
I prefer Meg
Better looking, not as bazoomy. I heard she retired and has like… five kids?
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Must be time for a replacement …. taking recommendations, must be childlike, drop dead gorgeous and have huge boobs … TIA
Howabout Nicky Whelan?
She also works out!
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Unfortunately for me, I couldn’t click on your second link. But the first was fine!
Nice pick … I trust she won’t be turning up in any Bride of Chucky flix anytime soon?
Insanely accurate call on SLW, Dr. Goldfinger.
Do you see a pullback to the 50 day next?
Thank you, Dr. Goldfinger.
He prefers “Goldmember”. http://www.youtube.com/watch?v=DyuAsQH9t90
http://www.youtube.com/watch?v=sr0gNJ090JA&feature=related
Sorry, this one is funnier and briefer. I had to post it!