The False Myths of Gold & Silver Bulls Promulgated by Gold & Silver Bears by JS Kim - SmartKnowledgeU Published : May 12th, 2011 | |||
For those that think gold and silver bulls are perpetually long gold and silver no matter the present condition of the PM markets, that is a patently false notion. In light of the recent steep silver correction, an asset that periodically has steep corrections every year (the majority of which are induced and engineered by corrupt bankers) does not a bubble bursting make. Personally, I have been a gold and silver bull since 2005 (admittedly a little late to the party but still far enough ahead of the curve). Since that time, I have grown to know many precious metals bulls that were bulls for an even longer period than I. And what I’ve learned is the following. Those among us that understand the Central Banker effort to transfer wealth to the top 1% of people in their country through their Ponzi reserve fractional banking schemes, their constant schemes to devalue fiat money, and their unfair manipulation of stock markets, have NEVER advocated staying long at all times in all precious metal assets during the current gold and silver bull. Despite bankers’ allowances for paper gold and paper silver to be substituted for physical gold and physical silver in their Exchange of Futures for Physical (EFP) transactions and their clever invention of unregulated paper derivative commodity products that are hardly backed by any physical product, gold and silver has rebounded every year from banker attacks to keep trending higher. And the uptrend is still not only intact but it is intact and strong. In fact, among all those I know that have been long-term gold and silver bulls for at least 6-10 years, all of us adequately manage the volatile downside engineered manipulation of gold and silver futures quite well most times with temporary hedging strategies that combine shorting gold and silver, cashing out, and/or buying puts on mining stocks/ETFs. Yes the intelligent silver/gold bulls among us will always have core positions in gold/silver whether that core position consists of just the physical metals, a fraction of the mining shares, or a combination of both physical and mining shares. But the intelligent silver/gold bulls will also fully expect banker manufactured price suppression schemes executed against gold and silver to occur every year without fail as well. However, since we have understood this global fiat monetary crisis for so long and have accordingly been precious metal bulls for many years now, due to our cost basis in gold and silver that remains far below the banker-manufactured steep drops in the price of paper gold and paper silver, the recent steep drop in silver is rendered nearly irrelevant (for example, for my newsletter subscribers that have been with me since the launch of my newsletter, the cost of silver, even after this dip, at $38 a troy ounce today, is still more than a couple hundred percent above our cost basis). For some odd reason, gold and silver bears often assume that gold and silver bulls are unidirectional traders that always buy gold and buy silver no matter what direction gold and silver are heading and that they continue to blindly buy into short-term peaks. This assumption, besides being patently false, is an assumption with very little merit. Sure, there may be some among gold and silver bulls that buy heavily into short-term peaks but there are likely far more investors, from a historical perspective, that have heavily bought into short-term peaks in major stock market indexes right before they collapsed than those that have committed the same error with precious metals markets. Consider this April 23, 2008 article in which I warned of a very strong possibility of an imminent severe crash in US markets. Just 18 trading days after I posted the article, the US markets began a 50% decline, yet the majority of comments that followed my article reflected very strong bullish sentiment towards the US markets. I consider myself a gold and silver bull yet have never suffered huge losses even in years when my newsletter portfolio has been heavily over weighted in gold/silver mining shares and gold/silver mining shares ended the year heavily down. For example, in 2008, when stock markets crashed, I managed my Crisis Investment Opportunities newsletter so that it still returned a small gain versus the very large 38%+ losses of most global major indexes and the very substantial -28.56% loss of the PHLX Gold/Silver Sector Index. In the following year, when the PHLX Gold/Silver Sector Index rebounded significantly and returned a very substantial +37.55%, I still managed the downward volatile periods in gold/silver to end the year with an even greater +63.32% return. A couple of weeks ago, on April 26, 2011, I sent a very comprehensive warning to my Platinum Members. A very brief excerpt of that warning is below: “I can’t see the bankers letting this opportunity go to waste, now that they have sold down silver by 10% already…As they say, to catch a criminal, you have to think like a criminal, so here is what I think will transpire the rest of this week. If I were a banker, silver at $50 absolutely mortified me and gold over $1,500 further mortified me. If I were a banker, I knew that if I didn’t cap the rise yesterday, there was going to be no way out from the huge short positions I hold in gold that expire in June and the huge short positions I hold in silver that expire in May and July. Thus, my best plan, and probably only hope, to exit those gold and silver short positions, is to attack gold and silver right now. Furthermore, if I were a banker, I would also take down mining shares as much as I could right now to keep people from investing in them in the future, especially with all the talk about the underperformance of the mining shares’ performance when compared to the metals. Drag down the mining shares now and that should keep people out of the mining shares for a while.” | |||
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