RE: RE: Silver starting to trade as industrial metSo is gold, which has no industrial uses at all.
Either one believes that the market is simply hitting everything due to "deflation", that gold and silver are massively manipulated, or both.
I am 100% in favor of the manipulation theory, a major supporter of GATA. When gold falls $45 in two minutes at the open of the U.S. markets for no apparent reason (taking silver with it), you have to believe something is fishy.
Yoyo, hardly a comparison here, Gold is off about 25% from its high,while Silver has exceeded over a 50% decline from its recent high, and Platinum now well over 60% decline from its high...Oil also off about 50% from its high. Yes, anything that trades with a futures program has been hit very hard during this sell-off,but Gold IMO is still the true store of value and safe haven buying.
Find a link to Don Coxe,BMO commodities, he says the freeze of assets over the last few weeks/months has bankruptcy managers liquidating commodities and commodity positions at any given price...the principles/hedge funds that owned the positions were frozen out by the courts, and all is being sold regardless of the price and the flight is to cash,what ever can be salvaged. Central banks have also been selling Gold to raise cash.
Now the credit markets have turned their back on the industry of mining,so IMO unless SST is seeking an already producing mine,or mine in late stages of building,(both would have to have very manageable debt) an asset with a cheap cost of production,they may as well burn their cash...with the Silver spot price now where it is at ,many Silver mines are marginal at best...time to take a long pause and let this all settle out...IMO, Bad decisions are made in times like this, and I imagine if it is possible to hedge,you may start to see some bad moves made in the mining industry over the next few months.
I went through the post-Bre-X days, and IMO this is far worse,hopefully it will not take as long to turn back around as demand from growing countries should help,but I expect 6 mos. to 24 mos. minimum depending where a company fits into the food chain...ie.producer,near term producer,asset in the ground, or outright exploration...many will not be here,ie investors/posters on SH, and companies...the days of shell companies on the venture for $300K-$400K will return IMO...get ready for the next wave of share rollbacks and name changes.
GLTA,Magnum...all IMO.