Before you all just jump up and say “JUST KEEP BUYING FOREVER”…Read the entire post…..Over the last year and a half i have built a sizable stack with an average purchase price of about $32.00. So with these sudden rises over the last few weeks, i have to ask..when should we stop buying?? Here is what i mean by that. You keep hearing all the experts..David Morgan, Eric Sprott…etc keep saying the following..”anytime you can buy silver below $30 its a huge bargain”…So now will they start saying “anytime you can get silver under $40, its a bargain”…and then $50, $60, $70…etc ?? We all know the fundamentals and we think we know where silver is going but when is enough enough? For instance, if silver were to go to $75/oz and you got all your silver at $10/oz, $20/oz, $30/oz…you made out terrific…But if you got in at $70, then your gains are obviously alot less. I guess the answer im looking for is at what price do you all think silver will no longer be the bargain and investment of a lifetime?? Is it at $50, $100, $150.. …etc?? All your thoughts would be greatly appreciated. Thanks in advance 
SK16
SilverKing. Good Question. My personal belief is that we are a long ways from the point of the “stop purchase” button. The reason being, the market is manipulated and until the manipulation ends, the silver price will always be undervalued.
I have been going over the same question for the last few weeks. I was lucky to have done most of my stacking on the downward move from $35 ish this summer. Now that its $35 again I have conflicting thoughts
1) When you started you thought $35 was a good price, why has that changed now.
2) I’m being greedy but want more at sub $30
My answer at this point is to keep buying what I can afford as the price goes up, and watch for the spikes. The long term answer I believe is that the stop buying price it relative to the environment we are in. If Sliver went to $100 tomorrow I wouldn’t be buying because I believe the current situation doesn’t support that price, times are not bad enough. In January when QEternity starts to be felt and its impacts seen, then $100 may be a good buy, but we wont know until we get there.
Now on the flip side the answer is easy, if it goes down to $32 or lower, stack as much as you can and then some. If it goes below $30, sell what ever you can part with, borrow whatever you can, and stack it all. you will be able to get the stuff back and pay off the loans and still be ahead
I have read that at least one knowledgeable geologist has stated that silver will become the first extinct metal. Since silver has so many critical uses it is logical to assume that it will quite valuable in the foreseeable future. Owning 90% silver coins is probably the best bet since there are legal tender issues, coin collectors, and metal detectors. Beyond that if they still win then it is either throw in the towel or proclaim the liberty or death ultimatum. Some of my gold panda’s bought years ago (at spot) are selling for more than 5 times the current gold value to collectors now. My silver stash purchase price currently is averaging around $12 an ounce, so it seems, for now, life is good.
@buddy_boy8403 I don’t see Physical Silver as an investment, I see it as a savings plan. I wouldn’t go to friends or family to borrow because Friends, Family and Money don’t mix well, but I have no issue with the bank holding some debt to me. Using their debt against them is something I’m willing to do. I’m not saying that its for everyone. I’m also lucky enought to not have to go to a street corner to find work. I have also converted things that no longer have a value to me into silver via the paper that other people think its worth. This is something that is in most people’s power, could you imagine if this week all the people that bought an iphone 5 bought 15 or so oz of silver?
There will come a time when we will unstack silver as it goes into that Rhino Horn price accendancy. Then we can rotate our assets into something else of increasing value. That will be a whole other site
This is the way I see it, a airplane pilot can not see his destination from the the sky so he relies on his instruments to tell him where he is going 100% of the time. In this climate that we are in, I say stick close to your instruments , in other words our experts like Marc Faber, Doug Casey, David Morgan, Mike Mahoney, James Turk just to name a few. These guys have the pulse of what is going on and have become very wealthy by doing good analysis. We are no where near the point of stopping stacking weather this is a manipulated market or not. Read your book of The Richest Man in Babylon and understand the principle of Dollar Cost Averaging regardless if your buying at $30 /oz or $300 /oz. The point is how wealthy do you want to be?
This once in a lifetime opportunity that we are experiencing and going to experience, God Willing, will be quite momentus. If you have geologist saying were gonna run out of silver and silver is inelastic (doesn’t go back to a point of beginning) then you better load up the boat now and until the whole scenario changes.
There are 4 phases of a wealth bull run. The first phase is Accumulation phase which can last for many years, 2 is the Mark up phase where the market moves up gradually in a 45 degree angle on a Monthly chart , then the 3 phase is the Distribution Phase where the market makes wild crazy moves and spikes in the 100′s of dollars and then tries to top (this is where the fools buy in and usually loose because the rise is over. Also this is where fortunes are made ), then the last phase is the Mark Down when the market has begin to sell off and goes back down to where it started from the beginning. Silver is very unusual and isn’t even in the beginning of the Mark up Phase yet and then your talking about Global sugar high and a market that is needed in almost every thing so when experts say the Greatest Transfer of Wealth in Human History , this is the ONE. This is not a quick fast 1-5 yr plan, this is over a long period of time. Just keep stackin, you will know when to cash out and if your saving too much and it’s hurting you then cut back and don’t hurt yourself.
I know this stuff because I’m a full time commodities trader and metals is something that I don’t trade on paper, only the real deal for me. Everything else, grains, meats, currencies, indexes, softs is all a paper transaction. Not the metals because it’s not enough metals to go around and one day that game will come to an end and who ever is left holding that bag will be the looser if their holding paper.
One thing that occurs for me when addressing this question of when to sell silver or gold is the matter of historic precedents. The metals have been rising in response to monetary policies unprecedented in history on this scale. And, in the case of silver, maybe there really is a shortage… So, when you ask the question, “How High will it go — there is really, in my mind, no road map per se… we’ve never been where we are headed before. How can technical charts explain a gap that will never fill because you’ve changed the whole paradigm in which the commodity exists?
So, I think that when and if the dollar goes to weimar worthless, you will simply use your silver in the place of that dollar or whatever currency is the realm of the day. The ounces will have some arbitrary value in the community and there won’t be any conversion involved. Even if some new global government comes along and issues a new fiat, will it be trusted any more than the old fiat? Few people will remember that when the Euro was introduced, it was allegedly ‘backed’ by 15% gold. And then the politicians changes the ratio until the fact it was supposedly gold-backed was no longer even mentioned.
Since the odds of any new world paradigm for money existing without politicians is about nil, the currency devaluation will repeat just as it has since before the denarius.
So I think you won’t have to worry about selling your silver. You’ll just use it like you do the cupro-nickel and frn units of today.
OK, all good stuff, but a definite, succinct, pat answer would be this:
Time to start selling is when they find a huge new asteroid that has millions of tons of Silver.
(Or a huge new mine of a similar size possibly…)
Anything that would indicate a big upspike in SUPPLY.
When their is blood on the streets.
SK16, Your post asked a seemingly simple question, but the answer depends on a LOT of other factors. At the root, the point at which you should stop buying is based on what you believe is the fair value of silver (for the sake of clarity I will assume you want to exchange silver for fiat dollars). Interestingly, the fair value of silver is whatever <i>you</i> think it is (welcome to a market-based economy) based on the following two questions:
1. At what fiat-denominated price is it worth converting a hard asset unit into a fiat unit?
2. What is your expected ROI of your proceeds?
Question #1: The big guys (mentioned by mbtrader) have been calling for medium-term price targets between $3500 and $10,000. Let’s assume these prices are valid. If you assume a 40:1 ratio, that puts the USD-denominated silver price between $87.50 and $250. That’s a pretty wide range. However, using these numbers, if you bought silver as high as $61/oz. you could still make over 30% gain on your trade. Is that a high enough return?
Question #2: The value of the dollar is falling (see my next point). If you believe that you can invest your dollars in something other than PM that provides a risk-normalized return that beats inflation plus dollar devaluation, then why are you in silver at all? (and let me know what it is, please; these smackdowns are wearing on my patience!)
Question #1 & #2: Money (think gold and silver) is a defined as both a store of value and a means of exchange. Currency (think paper) is defined as a means of exchange only. Historically, all money has survived; all fiat currencies have failed. Many (most?) posters on this board believe that the USD is not different and will eventually return to its true value (i.e. zero). If you also believe this, then there is NO price at which it is worth converting to currency and therefore NO price in which it is not worth stacking (with mbtrader’s caveats).
I personally believe that the dollar is doomed. It is mathematically impossible to pay off our debt even if you implement confiscatory tax rates; and without paying off our debt, the dollar cannot survive (as a side note, I believe all non-voluntary taxes are confiscatory–google Fair Tax). Since the dollar is doomed, I will keep stacking until TEOTWAWKI. Then I’ll reassess my investment options.
I think the right mindset is not to stop stacking just because the value of silver goes down in currency terms, the question is if you’d rather have these currencies, or silver. I would choose the latter.
The correct answer is no one knows for sure. It’s somewhat tiring hearing the so-called experts predictions not coming to fruition year after year. The fact that you stack puts you well ahead of most. Too often I think we get more than a little greedy and caught-up in what might be. Do what makes you comfortable. I have to remind myself that silver was $50 an ounce almost 40 years ago and that doesn’t even allow for inflation. Allow yourself to live your life and be happy. Don’t go into debt.
When your toes up 6′ deep!
I think its best to stand back after a while and evaluate your range of supplies. Its hard to stop allocating fiat to stacking ag when its such a bargain but its good to have a range of stock like food and water,fuel etc. I have neglected other prep stuff for silver because I was so late in the game to start the stack (2010) but not as late as the masses. Working on the basics now to even things out then will resume the stack as long as this ponzie scheme stack of cards holds itself together.
Though the Austrian School, to which I heavily lean, abandoned the pragmatic metric of wage-centric valuation analysis (Adam Smith) in favor of marginal utility, I nevertheless find it too alluring to dismiss because of its ‘macro-economic’ elegance. From that perspective, in the three centuries prior to the 19th, a day’s avarage labor had evolved to equate at an ounce of silver (5 shillings, 1.25 dollars). That quantity of silver further broke out to ration two days of average decent sustenance.
In current American banknote terms, therefore, the real-time wage-centric ‘price’ of silver is now about 160 banknotes to the ounce. From this perspective, then, if the cost of living remains un-elevated, that would be my ‘fair-price’ cut off. But, given that the banknote scheme is systemically inflationary, 160 is only current maximum. As the quantity of banknotes expands, that ‘target’ rises proportionally.
I have a target price of $56 when it hits that I am unloading 1/2 my stack to get my initial capital outlay back. After that whatever is left will ride the wave and I will do the same again at $112 or close to it 1/2 of what’s left goes to market.
That will leave maybe 132 ounces of silver and 8 ounces of gold to ride out the storm.
Not enough to retire on but enough to do some shopping with.
Taking a profit has to be part of the process.
I consider silver to be both saving and investment (thus also riskier) vis-a-vis gold. Gold is saving, with silver you’re also buying a commodity which will become very scarce and which has little substitutes.
In the end timing is everything. I’m watching the G2S ratio might sell the little gold I have and put it into silver. I’m patient there. We can get a situation where gold is more desirable but silver is much more prevalent (in the small business sphere I mean) or completely vice-versa. Both cases silver looks good.
Oh BJF said 500 oz would be enough…….. Considered to be worth some 3 yrs down the road and landed after “the tunnel” (hehe) which was the reset.
If you want to survive a lifetime I reckon go gold:silver like 75:25, if you think you’ll still be able to actually work and/or run a business go gold:silver like 25:75.
If you’re crazy like me consider selling your gold for silver at the highest ratio we going to get for the coming decades. Good luck on timing there hehe….
Best,
R3K
Buy until silver becomes unavailable at any price.
MORE GREAT INFO:
I forget where I read it, but it sounds like a good figure, that SILVER RECYCLING will be cost effective at around $280/oz. So I make that a range of $250-$300 per ounce, market price. This assumes a few things:
1. No Inflation (so the figure needs adjusted UP for inflation)
2. There is no revolutionary (cheap!) process for extracting Silver from common Silver bearing items.
3. No huge finds are made that skew the mining ratios as pertains to Gold. Or big Gold & Silver finds.
So let’s assume that we have moderate to strong inflation, and nothing new for recycling, so I would guesstimate that we could see a leveling off in Silver Prices maybe over $300, without any “crash” scenarios unfolding. But that is just MY GUESS, plus the math that I used to figure it! If no one gives MATH or REASONING, then ignore.
I will continue to stack (or save in money) while I can afford it.
@ SunRay09 , now is not the time to be trying to take a profit, big players of the metals are taking profits along the way because they can afford to do it. A real stake in this game is somewhere around 1,000 oz- 5,000 oz of silver to hold on to and 20 oz of Gold, just to be comfortable. Taking profits in the lower ranges should not be now, but in the future, this is a long term play.
I am with ricin3000 I have a little gold and will be selling just a little somewhere high on the GTSRatio to trade in my gold at profit to buy more silver which I think has much greater upside for obvious reasons here.
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Orion.
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