Fibonacci Financial

Posts Tagged ‘Silver’

99.9%  SILVER COINS
Cannot Be Used in Everyday Exchange
BECAUSE they are TOO SOFT !
They are MEDALLIONS aka Collectors Items.

REAL “HARD” MONEY

For Hundreds of Years since around the late 1400s, the standard in Silver Coinage was set by the THALER (which the Brits & British Colonists called “Dollars”).  An excellent discussion of the renaissance of silver coin minting in Europe is Professor Antal Fekete’s article:

ARCHITECTURE FOR A NEW  WORLD FINANCIAL SYSTEM

To make Thalers hard enough for everyday exchange and use at regional Medieval Trade Fairs required that the silver be alloyed with enough copper.  The Thalers included approximately 7% copper. This Thaler Standard became THE standard (eg: even the Brits’ “Sterling” standard was close to the Thaler at 92.5% Silver and 7.5% Copper) for many centuries.  Then the Americans raised the bar in “Hardness” by adopting a 90% Silver and 10% Copper alloy standard in 1792.  To this day in the Silver Industry “Coin Metal” means a 90-10 alloy.  Below is a chart that amongst other things presents the Provenance of the US Dollar:

To understand what a US Dollar IS!, may I recommend the world expert on the subject – Dr. Edwin Vieira and his essay on the topic or his magnum opus Pieces of Eight.

When the US Federal Government Mint began minting gold and silver coins again in 1985 they knowingly minted coins that COULD NOT be used in every day exchange. Instead of following the US Coin standard (90-10 alloy) set by the Founding Fathers that had stayed the same from 1792 to 1964 they minted 99.9% pure medallions. All private mints fell right in line world wide. After all WHO wouldn’t want 99.9% pure coins? These coins are beautiful “Collectors Items” BUT they like the Dodo Bird will never fly high as mediums of exchange.

So what is a Silver Investor to do ?
Stay Tuned for More

But until then remember the Fibonacci Financial Mantra:
CAUTION:  There are a wide variety of ways to protect your assets and profit from the tidal changes taking place in the world economy ranging from the very conservative to the highly speculative.

But you need active professional guidance – Contact us at Fibonacci Financial.

Do not get the idea that you can trade or make investment decisions from our blog entries.  These blog entries are EDUCATIONAL  and are an introduction to our services and DO NOT constitute investment advice.

Everything is going UP UP and Away!

Gold is Up, Silver is Up, Oil is Up, Stocks are Up.
What Next?

Listen to this Tech|Ticker interview with Bob Prechter
Titled: Yes, Robert Prechter Is Still Worried About Deflation

One of several markets we are watching to help answer

the Inflation vs Deflation Outcome

of the current financial crisis is Silver !

In addition to Silver, we are watching to see which way the Stock Market and the CRB index break (see Stock Market Head and Shoulders formation from last weeks blog entry).

But remember the following Fibonacci Financial Mantra :

There are a wide variety of ways to protect your assets and profit from this tidal change ranging from the very conservative to the highly speculative.

BUT you need active guidance – Contact Us at Fibonacci Financial.

Do not get the idea that you can trade or make investment decisions from our blog entries.  These are EDUCATIONAL and an introduction to our services and DO NOT constitute investment advice.

Go to Cash NOW = Run don’t Walk!

The Commercials have been selling the Stock Indexes for 3 weeks now.  There has been a normal Bear Market retracement of the first leg down in this Bear Market in percentage & Elliot Wave terms.  Now is the time to go to cash.  The next leg down in this Bear Market will be devastating.  The Dow Jones Industrial Average will most likely go well below 6500.

The COT readings in the precious metals and daily sentiment are at a bullish extremes also.  Better prices will be forth coming.  We will add to our core holdings at much lower prices.

Where should you put your cash?  Contact us for tactics.

AGAIN

There are a wide variety of ways to participate in this opportunity ranging from the very conservative to the highly speculative.

BUT you need active guidance – Contact Us at Fibonacci Financial.

Do not get the idea that you can trade or make investment decisions from my blog entries.  These are an introduction to my services and do not constitute investment advice.

Long Term Market Success and Wealth Accumulation Requires Patience

Currently All Markets are in Flux.

(Except recent recommendation to buy the US Dollar)

We are waiting for large declines in Gold and Silver before adding to core positions.

We are waiting for a short term decline then a final advance in the current bear market rally in stocks.  This will give us a final opportunity to liquidate stocks before the next killer decline.

While we wait, meditate on these wise words from the most famous stock trader of all time – Jesse Livermore.

“Cash was, is, and always will be – king. Always have cash in reserve. Cash is the ammunition in your gun. My biggest mistake was not in following this rule more often. Time is not money because there may be times when your money should be inactive… Often money that is just sitting can be later moved into the right situation and make a fortune. Patience-Patience-Patience. Patience was the key to success – Don’t be in a hurry.” – Jesse Livermore. How To Trade In Stocks, 1940.

Yes Dear Reader, Silver and Gold rallied after the COT Sell Signal.

One of the advantages of following the COT reports is to help determine which breakouts are the beginning of a new trend and which are not.  With the COT reports providing a sell signal on Silver, I give this rally low odds.

Also, The Commercials (insiders) set up their positions early and against short term trends.  Patience, patience

The odds still favor a failed rally attempt in the precious metals and not the start of the next major leg up in a bull market move.

FYI – while Gold and Silver represent a significant part of the Core holdings in our portfolio right now, they were acquired at substantially lower prices.

What Are All Those XXXX’s and OOOO’s on the Charts?

( No Dear Reader They Don’t Represent Hugs n Kisses! )

Several readers have indicated that they are not familiar with the point and figure charts that I use for illustration purposes in the blog.  John Murphy (world class technical analyst) provides an excellent overview of Point and Figure charting on his web site StockCharts.com.  If anyone is interested in why I use these “old fashioned” P and F charts drop a comment requesting additional information.

Do not get the idea that you can trade or make investment decisions from my blog entries.  These are an introduction to my services and do not constitute investment advice.

I Just Received A Short Term Sell Signal From My COT Guru !!!

Therefore, my skepticism about a Silver (SLV) breakout to the upside and inflation will probably prove correct.  If Silver breaks out to the down side, we may still see an opportunity to accumulate Silver at bargain basement prices.  It may also mean that we may be getting close (most likely a few months) to the next deflationary down leg.  The main event still to come before then next Deflation Tsunami will be the end of the stock market rally which still has legs (in spite of a near term pullback or consolidation).

Stay tuned

PS: Yes I love Silver and believe at some point in the next 10 Years it will sell at least 10 times its current price.  BUT I still haven’t accumulated all I want.  Therefore, I love to see Silver GO DOWN IN PRICE !

Worst case scenario for Silver is that it doesn’t bottom out till 2012.  To me that just means 2 more years to buy it at great prices. 

While we have had  the break out of the Gold Silver ratio and of various Commodity indexes in infationary directions, we still have not seen a break out of silver.  Here is an updated point and figure chart of SLV the silver ETF.

The information regarding Commercial (insiders) and Speculator positions published in the Commitment of Trader (COT) reports on Friday still support the contention that this is a bear market rally in the precious metals also.

What Are All Those XXXX’s and OOOO’s on the Charts?

( No Dear Reader They Don’t Represent Hugs n Kisses! )

Several readers have indicated that they are not familiar with the point and figure charts that I use for illustration purposes in the blog.  John Murphy (world class technical analyst) provides an excellent overview of Point and Figure charting on his web site StockCharts.com.  If anyone is interested in why I use these “old fashioned” P and F charts drop a comment requesting additional information.

Do not get the idea that you can trade or make investment decisions from my blog entries.  These are an introduction to my services and do not constitute investment advice.

The Second Article in the Silver Phoenix series has been published.

To read it just look for the Ezine widget towards the bottom of the right hand column.

In Your Humble Partner’s Opinion Demanding “Coin Metal Silver” Is THE Most Revolutionary Act That Can Be Performed At This Time To Move The U.S.A. Back To Sound Money.

Share Your Thoughts

It was really fun writing The Silver Phoenix Rises Again but embedded in the entertainment were some very serious, in fact revolutionary, recommendations – the take aways !

(if you haven’t read The Silver Phoenix Rises Again, please read it first)

The Primary Purpose of the article was to inspire action (your action dear reader) towards the remonetization of silver.  Remonetize silver and the remonetization of gold will follow as night follows day.  Ergo a return to sound money which is the foundation of a truly free and prosperous society.  The inimitable Harry Browne made the recommendation to always take the direct route to freedom in his classic How I Found Freedom in an Unfree World.  An example of indirect action would be to buy stock in B-Mart and plan to attend an annual shareholders meeting when you got extremely bad service.  The direct and rational action would be to walk across the street to Target.

The Political Route ? (1)

So what would be the direct route to remonetization of silver?  Join a political party and attempt to add sound money goals to the party platform (this means joining and then influencing the platform committee).  Then run for national office (House of Representatives).  IF  you win, draft legislation and stump for a consensus of rational support in congress…………………… Wrong!

The Societal Route – Individual Action (2)

The direct route would be to simply start using silver as money not just as an investment vehicle.  Currently, those of us who buy silver bullion coins or bars are using silver as a “Secondary Media of Exchange”.  To buy a candy bar or pay for services rendered we must first go to a coin shop and convert the silver (secondary media of exchange) into Money (in the US that would be Federal Reserve Notes or in colloquial terms “Dollars”).  Then we buy the candy bar or pay for services with a direct media of exchange (money) – dollars or euros or yen.  To start using silver as money (as a direct media of exchange) means to actually use it as the primary exchange item.

Actions

I am going to start paying my business partners each month with 10 ounce silver bars for up to 5% of what I owe them.  That would be paying for services with silver as money.  You could start by paying 10% of  your kids or grand childrens allowance with pre 1964 silver us coins.  This would give you the opportunity to share the history of the constitutional dollar with them.  Use it as a teaching moment to share our heritage with the next generation. (If anyone wants me to draft a short history of the constitutional silver dollar for their kids and grand children, let me know).  Be creative and share your ideas with us here.

Coin Metal

Now this is a small but vital first step.  Unfortunately, most of the physical silver out there can’t be used as coins in everyday transactions.  99.9% pure sounds great BUT it is not durable enough to be used as money.  So we need someone to start minting “coin metal” silver coins.  Coin metal silver coins would be 90% silver and 10% copper.  Each silver coin would have 1 full ounce of pure silver and .11 ounces of copper.  The coin would weigh 1.11 troy ounces and would be very durable and usable for many years in everyday transactions.  I am currently working on that project unless someone beats me to it – hint hint (I am a money manager and personal financial coach not a mint master).

Anyone interested in these “Coin Metal” silver coins please share your email address and I will keep you posted.

Silver is THE doorway to sound money – just open it and walk down the yellow brick road. 

Let freedom ring with the sound of silver in every ones pockets.

YOU HAVE THE POWER TO CHANGE HISTORY – USE IT – INFECT TWO OTHER PEOPLE WITH THE SILVER VIRUS BY SPREADING THE MONEY AROUND.

Rocky Mountain Illumi Naughty Dictionary definitions:

1 Political Science – The art of acquiring with a gun through governmental action what you can’t acquire on a voluntary basis through dialogue and a hand shake.  Always a win/lose situation.

2 Volitional Science – The art of acquiring what you want through dialogue and a hand shake.  It is always a win/win outcome.