Tuesday, May 10, 2011

Silver and Gold and the Human Need for Predictability


Gold
in New Zealand dollars: $1905.34 per oz
Previous all time high: $1955.10 per oz

Silver in New Zealand dollars: $47.47 per oz
Previous all time high: $48.58
per oz


So the Great Correction appears to be over and now is the time to buy the precious metals again.

So say the soothsayers of charts and trends.

It has been somewhat fascinating to read and listen to the commentary, from my usual sources, about the latest upside move and last weeks big correction, followed by this weeks early signs of a reversal.

To be fair, most commentators will never give a solid predication on what price a metal will go to at a certain time. But I can't help but get the feeling that more than a few I have listened to this week are calling loudly from the rooftops that they nailed the Great Correction in commodities last week.

From my reading of the comments before the crash, only two of the people I read and listen to were confident that the parabolic rally was going to correct within a few days. One was Ben Davis of Hinde Capital, a regular on King World News.

Does this mean I listen to or act on everything Ben says about precious metals from now on? Probably not, but when I require advice from a pool of sources, I am more likely to seek him out.

Because there are so many voices out there, I have begun to write down in my diary the names of anyone who makes predictions in the short term and the prices they call for. I will try to keep a track on how they perform.

After all, don't various sacred texts tell us to "stone false prophets"? Nowadays this means to filter them from your list of wise Commentators.

I have said before that I am not in this to trade precious metals like the Big Boys. I know when I'm out of my depth. However, I don't like people who try to 'talk their book' and attempt to deceive (willingly or not) those who are naive in the precious metals arena.

I have a few people I can trust and that trust takes years to cement.

My only recommendation to you is to obtain those same wise heads around you and be prepared to listen when the time comes. Own your decisions and don't blame the spruikers if you get it wrong.

We all like safe and secure predictability, especially if it means we can make money and that our wealth is at least preserved.
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Articles of interest:


Havens for rich tax avoiders will cripple New Zealand
See article
here

NZ Herald


Anatomy of Silver Manipulation - How Low Can It Go?

See article here
Seeking Alpha
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The Anglo-Far East Company
The Original Private Bullion Custodian
Your reference: an-001
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