Silver and Gold

The warden says,
the exit is sold,
If you want a way out - silver and gold.
Silver and gold.

-from Silver and Gold by U2

I keep telling people to buy gold (and silver … which I think will have a longer term upside as the Au/Ag ratio is way skewed to the high side right now).  After I pronounce this small piece of now seemingly commonplace investing wisdom, I will usually get asked one of two questions (or both):

1) Yeah, but why do they keep going DOWN?

2) I have tried to buy gold (or silver) and cant find it anywhere without it being 30-50% above the spot market price.

Precious metals are getting crushed like everything else by hedge fund deleveraging.  These funds are having to dump everything of value to meet their margin calls (paying back borrowed money they have plowed into stocks, etc. that are now way down in value).  Mostly they are dumping paper contracts to buy gold and Read more