5

Looking at https://money.stackexchange.com/questions/11165/silvers-massive-drop-week-of-9-18-11 and similar questions about a specific drop or rise in the value of a security/stock/metal/etc. an on-topic question?

This isn't a buy/sell recommendation, but it is very localized in time. In this case, the drop of the price of silver on 9/18/2011. Should this be closed because of that? Or is understanding the reason for historical drops in valuation of an asset a worthy subject for money.se?

  • It's also not very related to personal finance. – Nicole Sep 24 '11 at 6:46
  • @Renesis People do trade in stocks and commodities. It's not the lack of a personal finance angle that concerns me, but the highly speculative nature of commenting on any short-term movements. – Chris W. Rea Sep 24 '11 at 11:35
5

If nothing else, this is very subjective and has no "correct" answer. The talking heads on TV like to try to come up with reasons that the market did this or that today, but what it comes down to is that (for a price drop), more people wanted to sell than buy at the current price. Each buyer and seller has their own individual reasons for their action. In order to be on topic, the question should be broader than a particular day/week/year. Something like Why don't the prices of gold and silver always move together?

4

It is very localized and very speculative. Unless someone who answers is the one who sold a large amount of silver and effectively contributed to the price drop, no-one will be able to provide a real answer to this question.

4

Even if there were an exact answer "X commodity rose because the Z crop was wiped out by locusts" or some agreed upon cause/effect, it's too localized in time and of little if any value long term, not the kind of question that makes much sense here.

1

In general, I wouldn't classify these questions as "too localized". My understanding of the term that it applies to questions where the answer would be of interest/valid for a set period of time, usually one short in length (e.g. "When is the Zenga IPO?" would be too localized, becuse after Friday, no one would care). Price movements that are particularly sharp or seemingly counter-intuitive are of historical interest and don't necessarily have a shelf life. Not every such question is going to be like that, of course, but many will.

I do agree, though, that these questions may not be suitable for this site, as I supsect that, more often than not,they generally would be fundamentally unanswerable. The best one could honestly answer would be"The drop/rise was generally attributed to ..."

A blanket ban on these type of questions may be going too far, but at the same time, trying to specify acceptable forms of this question would be difficult. Further discussion towards whether we should accept these questions seems to be needed.

0

I completely disagree that these questions are "too localized." Both of the recent silver questions address its volatility relative to different investments. Silver is more volatile than both the S&P and gold, but for different reasons. Its volatility depends on the size of the market, as well as what the commodity is used for.

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