Silver is a Dog(?) And the World Is Not Coming To an End

You can’t click 4 pages on the internet without running into a story about silver.  Bubble/mania/value play on the demise of the US Dollar/indication that the imperialist Fiat pigs have lost control/ grab your guns, ammo and canned food/  blah blah blah.  Meanwhile, compared to some other high-flyers, silver is a total dog, underperforming the really bubbleicious Party-Like-It’s-1999 momo champions like $LULU, $OPEN, $SINA and $TZOO.

YOGA >> Monetary Metals

So why is it that we pay so much attention to silver?  Why is it that you don’t see articles in the FT, WSJ and on CNBC about how LULU is a bubble, or about how OPEN’s rise must mean that maitre’d positions will be eliminated in the future (UNEMPLOYMENT WILL SOAR! /sarcasm) as online restaurant bookings take over the planet?  Why doesn’t anyone write about how LULU’s meteoric ascent implies that our society will be over-run by spandex-encased yogis chanting ohms and eating wheat grass while reaching a zen like state in their “soaring eagle” poses? (side note: my favorite post is “blogger hunched over computer”)

Do people realize that SLV is an absolute pig when compared to SINA?  “WTF is SINA?” you ask – who knows – I think it means “silver” in Chinese (disclaimer: I made that up. SINA does not mean “silver” in Chinese, it means “Google of the East, only if Google were much much better”).  All you need to know is China + Internet =

SINA makes Silver Look Bad

 

As you can see from the chart, SINA’s rise puts silver’s to shame.   So does OPEN’s (6 month):

 

OPEN vs SLV - 6 months

 

and here’s the same OPEN-SLV chart for the last 12 months:

 

SLV vs OPEN 12 month chart

 

What’s my point?  First off, OPEN has a remarkably similar trajectory to silver, yet we don’t try to draw conclusions from OPEN’s chart like “the demise of the US Dollar is near” or “our society is heading for an apocalyptic collapse that will make The Road look like Disney World.”

 

Too Bad Viggo Mortenson Wasn't Hoarding Silver

 

Silver is part of the momentum rally.  It’s one of the Friggin Picassos – it’s a momo favorite.  Enjoy the ride – profit – but don’t go off the deep end and delude yourself into thinking that it means we’ll all be lugging around carts full of canned food, sawed off shotguns under our soiled trenchcoats, as we wander from one post-apocalyptic wasteland to another looking for fuel, shelter, and a better life now that we’ve defeated the Imperialist pigs and their Fiat experiment.

-KD

disclosure: I am long SLV.  I have taken day trading positions in LULU on occasion recently.  I have not touched any of the other names in this post.

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