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Time to start hedging the dollar?It could be hit 35%. Time to buy silver??

By sleepin'dawg ·
An odd thing is happening. Something rare is happening with interest rates; just before an election interest rates are rising and that is far from normal. China and Japan own almost half of all US debt, $3.1-$3.3 trillion dollars between them. OPEC is threatening to start pricing oil in Euros.
Warren Buffet is $18 billion long on silver bullion and they do not call him the Sage of Omaha for nothing. The Soros interests are buying silver and gold. Greenspan raises interest rates going into an election??? What is happening???

The last time something similar happened was back around 67-69 when the gold price was floated and it rose from $37 to approx $380. Then came 79-80 and gold took off to almost $800 propelled by the Iran crisis and other uncertainties. Silver rose to the $52 range. Right now gold is around $410 and on that basis silver should be at $24-$26 but its not. It's trading around $6-$6.50 but if gold takes off again silver will be right behind it but the profit potential for silver is much greater than for gold. If gold hits $800 silver could be up into the $52-$60 range.

For my part I have enough confidence in my research that I just purchased 10,000 ounces. Even if it only goes up $1, I will make a 16.6% profit and it is almost certain to do that before the end of the year. If it hits my projection then I'll be laughing all the way to the bank. I bought bullion but on Friday I also bought futures and options and thanks to leverage the profit potential is even greater. If my profits on the bullion hit 10X the profits on the futures and options could be as much as 40X or higher. The beauty of futures and especially options is you only need 10% down.

If you go this route make sure you use your margin to add to your holdings as the value mounts but be damn sure to have trailing stop loss orders in place and make sure the stop loss amount is less than the daily limit move for silver. The bullion investment is a pretty safe bet and you should be able to recoup your investment with minimal risk of losses but while the futures and options route has the greatest profit potential it is not advisable for the faint-hearted or neophytes. If you don't know what you are doing you could be badly hurt. My advice to anyone going into futures and options is to check out pricing on bulk orders of MaaLox, Gelusil, Rolaids and Tums; you'll probably need them, at least until you've gained experience.

Right now I'm into lumber futures and options and thanks to this years crop of hurricanes it looks like I will be seeing profits over 60X and I'm not even 100% leveraged but my stops are all in place and I check them every morning. The potential for silver could be even higher especially if there is any kind of a panic. Note there are no guarantees in any of this although the straight bullion purchase looks good because silver is undervalued. Again I cannot emphasize too strongly to stay the **** away from futures and options if you do not know what you are doing or have any doubts. I've been playing them for 15 years now and I've been fairly successful but they can still make me a bit nervous.

If you don't have any experience with them I would recommend staying away or starting on something less volatile than any of the precious metals. Wheat, corn and soybeans are good starting points but stay away from cattle and pork bellies, as they can sometimes be worse than the metals. By the way, the hurricanes have made orange juice interesting but it's perhaps a bit late to get into that now. It's worth checking out, however.

My advice is never put more than 10% into any one investment and never more than 5% if it is speculative in nature and definitely never more than you can afford to lose.
When someone like Warren Buffet buys $18 billion dollars of silver bullion you know something serious is about to happen. My first reaction when I heard the news was that he was trying to corner the silver market like the Hunts did back in the 70's but the Hunts were chasing their egos and kept buying into a rising market. Buffet has been quietly acquiring his position for some time now and hasn't unduly disturbed anything except for perhaps the Soros interests which seem to be following behind. Neither of these guys are known for taking wild unsubstaniated risks and Buffet is not one to let himself be carried away on an ego trip.

Whatever you decide, use a discount broker, negotiate commissions and confirm them in writing before you lay out any money. You can buy mini contracts of 1000 ounces. Good luck because whatever you decide it looks like the dollar is in for a rough ride. In Canada, investors are nervous because the Canadian economy is tied to the US so closely and a lot of its strength is reliant on the Canadian dollar being valued @0.75 US. If the US dollar goes down it would be great for our US imports but could beat the **** out of the export markets.

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