Go Back

Investors: Never Hold Your Breath

by Lobo Tiggre
Monday, June 28, 12:00pm, UTC, 2021

“Silver’s getting crushed today—I’m so sick of this!”

“Gold’s up but gold stocks are down—something’s wrong!”

“Silver should be $150 per ounce—$28 is an insult!”

I get comments like this all the time. I understand the frustration behind them, and sympathize. But I have to say that the emotional outbursts themselves worry me more than the price action that causes them.

In the first instance, Mr. Market doesn’t give an unloved rodent’s posterior for what we’re sick of. Buyers and sellers make their offers and prices are set by what clears. We have no say—nor should we—on what those buyers and sellers are willing to pay or accept.

Second, it’s as common as sand grains on the beach for the prices of resource company stocks to diverge from the price of underlying commodities. Nobody is saying that something is wrong because uranium stocks have risen dramatically over the last six months while uranium itself drifted lower (until recently). From “selling on news” to index rebalancing, there can be many reasons for mining stocks and underlying mineral prices to move in opposite directions for a time. This is a good thing for disciplined speculators.

When stock prices and underlying value diverges, there is opportunity.

(Also, it’s a big mistake to look at one index and say that “gold stocks are down.” Some may be—while more carefully selected stocks may be doing much better.)

Third, it’s wrong-headed to say that any given price “should” be whatever we want it to be.

Prices are whatever buyers and sellers agree to.

Might as well complain about the weather.

And while doing so, we risk missing the opportunities in the better miners, explorers, and developers today. Many deliver in spades with silver averaging near $25 and gold near $1,800 over the last year.

Just look at the one-year charts for gold and silver…



Note that the average gold-dollar exchange ratio over the last year is now north of $1,800. I don’t think this has ever happened before—not for a whole year. Same for silver’s average near $25.



Whatever they “should” be, these are great prices for companies that adapted to survive at silver-dollar exchange ratios below $20 and gold-dollar exchange ratios below $1,500.

Objectively, gold and silver prices are already great for the actual businesses of exploring for and mining these metals.

To be “insulted” by prices that other people are willing to trade at is to reject free markets—and to invite constant insult and misery into your mind.

Why embrace anger and angst when we can just focus on making money?

Well, I do value justice and fair play, so I might object that these markets are not entirely free. Prices are manipulated, so our wrath is righteous. As I’ve said before, I do see price manipulation in gold and silver.

But I see dishonesty and criminality in other markets as well.

I assume that there are bad actors in all markets.

This has one crystal clear implication:

If I insist on investing only in markets with zero manipulation, I won’t be investing at all.

It’s certainly my right to pick up my marbles and go home if I don’t like the bullies running a crooked game.

But fortunes have been made by savvy speculators in these markets, just as they are.

As my public track record shows, I’m making money in these markets now.

I’m not going to pick up my marbles and go home—not when the evidence says that I’m smarter and faster than the bullies.

Mind you, I’m not saying it’s wrong to complain about bad actors.

That’s fine.

I fully support efforts to foster better price discovery in the gold and silver markets.

For starters, those who agree can stop referring to COMEX futures prices as “the price of gold” or “the price of silver.” Call them what they are: futures contract prices.

And I hear that there are efforts afoot to more systematically report physical market-clearing prices.

I think this is great.

What concerns me is the high emotion I see among gold and silver investors who are making buy and sell decisions while in a torqued-up mental state.

This invites disaster.

All of my years as a speculator—and all the decades of experience my mentors have shared with me—tell me that dispassionate discipline is essential to successful speculation.

People experiencing constant rage at the markets can’t be making the cold, calculated decisions that maximize positive outcomes—or at least help avoid fatal errors.

Let me put it this way…

My wife and I just got our open-water diving certification. The coral reefs around Puerto Rico are teeming with beautiful aquatic life. But in order to gain the joy of “flying” among a rainbow of amazing creatures, one has to accept the risk of entering a hostile environment. It looks like clear, warm water, but it will kill you if you make a bad mistake. And yes, there are sometimes sharks in these markets—I mean, waters.



The number-one rule for all diving is to always breathe constantly and calmly—never hold your breath.

This is the very first thing they teach you. It’s stressed repeatedly throughout the training. It’s absolutely essential to remain calm and breathe steadily.

Many diving mishaps are survivable. Even running out of air need not be fatal, if one keeps calm and follows proven methods. But bad decisions can put you in the hospital. Panic kills.

The same need for calm, methodical decision-making applies to investing—especially the higher stakes of speculative investment.

Please consider this if you find yourself getting mad at the markets.

Remember that markets can neither know nor care about what we feel. We have to deal with that ourselves.

Stay calm.

Never hold your breath.

Discipline yourself to follow the methods that experience has shown produce the best results over time.

That’s how the most successful speculators I know have amassed their fortunes.

What methods?

There’s no single book that covers everything—I plan to write one someday. But Ben Graham’s The Intelligent Investor is a great start.

More specifically to our business:

I sincerely hope this guidance will be taken in the constructive spirit in which I offer it.

If you ever find yourself getting mad at me for not saying what you think I should, please remember that I’m not here to ingratiate myself. I’m not a cheerleader for our side. I’m here to identify investable trends as clearly as possible and offer the most useful guidance I can.

It’s better for our health as well as wealth to stay calm, keep breathing regularly, and never hold our breath.

That’s my take,



Think. Speculate.

Facts and insights to navigate the markets. Delivered FREE.

  • Free digest with fresh investment-related news and ideas on a daily basis.
  • Free reports on investment ideas for speculators.
  • Honest, unbiased trend analysis
  • Heads up on events, appearances, and other educational opportunities.

Forever Free subscription

  • Monthly Newsletter Subscription
  • Requests
  • Free Access to Blog
  • Books and More
My Take

$500 (SAVE: $100) for 1-year subscription

$50 for monthly subscription

  • Field Trip Invitations
  • Free Educational Media
  • Free Access to Blog
  • Books and More
  • Monthly Newsletter Subscription
  • Conference Invitations
The Independent Speculator

$3,000 for 1-year subscription

$1,000 for quarter subscription