There are two kinds of Gold & Silver Investors.

The first group bought because the prices were rising and they hoped prices would continue to go up so they would book some profit. The second group bought because they realized that something is deadly wrong and that sooner or later the music will stop, the financial system will collapse, or come to a halt and we'll get to live with all the goodies which come with a bank holiday.

Since September 2011 both groups have been caught and locked into the same correction and bottom formation. It happened that through massive intervention Authorities and Bankers actually not only managed to stop the rising price of Gold but could even bring it down to $1160.
The fact that during all these months the big boys (Russia and China) welcomed the cheaper gold price and used the opportunity to buy massive quantities of Gold seems to escape the reasoning process of the investors belonging to the 1st group.

The fact that the demand for Silver Eagles was so astronomically high that the mint had to stop the sales on several occasions, also failed to be noticed.
Even the fact that today everybody knows that Gold was rigged (just like the Libor, Interest rates and Oil were/are rigged), doesn't seem to make the slightest difference.

The 1st group only looks at the price. Price used to be $1920 and now it's only $1220 . And that is a 36% top to bottom loss. Therefore the reasoning is that everybody who bought or was advising to buy Gold at $1920 was deadly wrong. They at least could have sold their Gold at $ 1880 and have bought it back at the bottom or $ 1080 , couldn't they.!?

Instead of looking at the facts, the 1st group is unhappy as can be and even considers selling out the positions. After all, price has come down instead of going up...and isn't price always right. So this was a bad investment !? Or was it not?

This is where the misreasoning starts. Gold is Gold and therefore the ultimate money without any counter party risk. It's real intrinsic value doesn't fluctuate. What does fluctuate is the PAPER PRICE or better the rigged price on the Futures markets.

We had a similar situation on a smaller scale during the 1960's with the Gold Pool. It took billions of losses for the Central Banks and Banks before they capitulated and the music stopped. There was a bank holiday (it lasted for a week) and Gold not only doubled its paper price but subsequently rose to $ 850. The price of Gold rose by a factor of 26.50 !

Note that at that time the road to $ 850 was also paved with corrections and many investors jumped out of the pan because they could not stand the heath or failed to be patient. Note that those days were also paved with manipulations and that at certain times the paper price of Gold looked terribly bad. Some corrections were larger than those lived from 2003 until today.

The investors of the 2nd group however UNDERSTOOD what was happening and are patient. They were the ones who made a fortune because they remained invested all the way to the top in 1980-81. That was when after Reagan got elected, Volcker increased the Interest rates to 18%.  
This was also so for the holders of Gold & Silver mines. As a matter of fact, during those years most Miners could be bought at ridiculously low prices. Prices were actually so low that the 1st dividend which was paid , often covered the initial investment.

This time however, because of the fact that we have a global problem, I expect it to be a different story with Global Hyperinflation. The storm will be a lot stronger and it will be a lot harder to survive financially. Things will get crazy! (they already are).

In the end I expect the situation to be totally different than during 1980-81 because this time over, the debt levels are so astronomically high, that it has become impossible to rise interest to levels like we had during the eighties. If interest rates were to rise to 4% - 5% , the system would already collapse in a Flash.

Don't forget we have a paradigm shift where safety is far more important than short term profits. Be aware that the day the chickens come home to roost the good investment instruments like the Swiss franc, Gold, Silver, Oil,...will bounce back and soar if not they will at least preserve your purchasing power.

Have a GREAT day,

Goldonomic