It looks like we got another buying opportunity for silver on Friday. Just about every minor upleg in silvers bull so far has lasted at least 1 1/2 to 2 1/2 months. We should still have at the minumum of another 2-3 weeks of upward momentum before any meaningful correction.

Gary

Larry,
I have a hypothetical question. I think we all believe silver is in a secular bull market. I think we all agree that the dow gold ratio should sometime in the future reach a ratio of at least close to 1:1. If silver during that period returns to its historic 20:1 ratio to gold. Then we should attain a level of somewhere around $100 to $200 an Oz. That's roughly an increase of 1000 to 2000% in the next 10 years or so. We would have to make almost 100% per year in stocks to better that performance. Needless to say the odds of that happening are slim especially since we are already underperforming silver by quite a bit on a yearly basis. Just wondering what the advantage to trading stocks is and having to worry about general market conditions, management, etc. etc. when all we really need to do is buy silver and hold on. Heck even if it only goes to 50 or 60 in the next 10 years that would still be hard to beat in the stock market. Especially if you factor in taxes.

Gary

Gary,

The only problem with that is that it is terrible money management. And the reason it is terrible money management is because of the cardinal rule:

"Anything can happen."

I'm as bullish on silver as anybody, but I don't know for a fact that it's going to do what I think it's going to do. So I would never consider putting all of it in silver. Also, if it does what you say it's going to do, you're not going to have to have 100% in silver to make a lot of money anyway, are you?

Larry

Larry,
Yes I do realize that it isn't great money management. However the really big money is always made by taking a large position and holding thru a secular move. Ex. Buffett buying stocks in 74, Soros & Rogers in currency even Richard Russell took a large stock position in the 50's and Rogers has again taken a large position in commodities. These opportunities only come around once or twice in a lifetime. We've got a rare chance right now in that the bull market is in commodities. We actually have a large position in commodities already as all of our stock picks are commodity related. Unlike stocks silver can never go bankrupt. It will always be worth something. That alone limits our risk. I might point out that we seem to be heading in this direction already as most of the portfolio is in Gold & Silver with no stops. I'm guessing that the elimination of stops means we will probably only be adding to positions on pullbacks. I realize that this doesn't give you much to write about on a weekly basis. Maybe a small % of the portfolio reserved for trading just for some excitment:)

Gary

silver crossed 140 today. think we'll get a shape pull-back?

-ja

correction: i meant a "sharp" pull-back.

-ja

Of course it will have a sharp pullback...there that should guarantee we get to $20.

Gary

Joe,
It's working so far

Gary

gary,

yes, you are a great contrary indicator!

-ja