Gold & Silver

[eli polite]

what are your thought on precious metals ? I have been reading and doing my best to understand this market..

What would be you choice on best gains Gold, Silver, Platinum

 

[mtrmn]

Lead, copper and brass are what I've been investing in. I know, I'm no help....

 

[Veer_G]

Lead, copper and brass are what I've been investing in. I know, I'm no help....

You're fine, you're fine, you're just leaving more beans and bacon for those who have already rolled through those markets.

I think what mtrmn is saying is that precious metals are fine to a point as instability increases, but nothing next to a hot meal, clean water, a strong wall, and the ability to say "no" and back it up, once things have gone completely sideways.

 

[eli polite]

I understand that and trust me I have quite a bit invested in lead steel copper and brass also powder. But this is not about that.

Even if things went sideways after a certain amount of time things would eventually stabilize and I would want something to be there for kids/ grand kids and if things never go sideways I still want a solid investment and diversification. I also want what I can hold in my hand not numbers in a cyber world

 

[sharac]

Gold and Silver are either near or will bottom out in a flash spike around 1000-1150 for gold and silver ~15 there is a slight possibility that bottoms are in (Ukraine situation might cause skipping bottom crash) and nothing but gravy left until the game over date. You must realize that all markets are fully or at least semi rigged with gold being ubermanipulated. This sentence is for investing aka trading aka being prepared to loose everything in your account while chasing profits.

As to the real paradigm around both metals they are movable store of value and if you have already bought your lead and copper which provide baseline security and enable you to keep next in line such as food, water, property with ability to produce crops or animals and you still have excess wealth yesterday was best day to start buying shiny metal today is next best and tomorrow will be slightly worse day and price really doesn't matter that much. Still don't forget about forming groups with friends whom you trust and build communities around that as that will also be very valuable soon and for gods sake don't go on a show about that or yap about it to people who do not need to know as some dumbasses do .

 

[roggom]

If you look at trending data Silver remained flat at approx $5 /oz and Gold at $350-$400 for 10-15 prior to 2005. They have increased in value since, but the issue is the true intrinsic value of precious metals.

The silver American Eagle or Canadian coins can be purchased for approx $20-25 right now, but this is market value. You pay that price because you want the coin. Face value of the Eagle is $1, $5 for the Maple, intrinsically it pretty worthless other than a durable coin. The true value is relative to market stability, and historically the metals have retained value.

The good thing is precious metals have no borders, so a gold coin purchased in the US can be exchanged anywhere in the world, just depends on what the buyer will pay.

For me, I like silver as the purchase price is relatively cheap and I dont miss the investment.

 

[Bluejazz]

Silver, however all markets at this point are manipulated, including Libor interest rates, stock market, precious metals, CPI inflation index.
A couple good websites to read.
Jimsinclairmineset
Kingworldnews

 

[FS1]

If you are unskilled in gold trading making money is tough and hit or miss. Gold should drop to 800-1000 bucks when and if it bottoms. Politics, economics and war can all effect the outcome. Gold is not an investment it is a hedge.

This being said I think everyone should have 10% of their savings in gold. Not paper gold, physical gold. Not as an investment but as an insurance policy against economic disaster. And the coins should be US coins with a dollar value like the one ounce 50 dollar buffalo. The reason I say that is because the govt can make non jewelry gold illegal to own and you would be required to sell it to them at their price.

But the Buffalo is legal tender with a face value so it would not have to be turned in. They cost spot oz price but are legally spendable for fifty bucks as currency. Not that anyone would spend it, but it keeps the gold in your pocket

 

[eli polite]

I'm not interested in digital gold only bullion

I know that gold is being used in the technology manufacturing more and more because of its conductive properties I know they do there best to recycle old electronics but I have to think that quite a bit of it is just lost to the land fill. How does this play into the over all picture?

If I cant hold it in my hand I have no desire for it. At one point I had $30k in the stock market not all of it was initial investment Obviously. I had started putting in in there in my early 20's but it all disappeared pretty much over night. So now I have nothing in the market probably never will again

 

[Switchblade]

Those metals are played out. Palladium, and Platinum are the best for long term or mid term investment. All of them are diving a bit right now, so watch them drop a bit more, then buy them lower, but as I said, they are all in a fair drop for a little while so keep your eye on all of them, track them, then buy what you think is the best investment for the climb

 

[lobo56]

If you are unskilled in gold trading making money is tough and hit or miss. Gold should drop to 800-1000 bucks when and if it bottoms. Politics, economics and war can all effect the outcome. Gold is not an investment it is a hedge.

This being said I think everyone should have 10% of their savings in gold. Not paper gold, physical gold. Not as an investment but as an insurance policy against economic disaster. And the coins should be US coins with a dollar value like the one ounce 50 dollar buffalo. The reason I say that is because the govt can make non jewelry gold illegal to own and you would be required to sell it to them at their price.

But the Buffalo is legal tender with a face value so it would not have to be turned in. They cost spot oz price but are legally spendable for fifty bucks as currency. Not that anyone would spend it, but it keeps the gold in your pocket

Does that go for Silver also? Silver dollars versus Silver Rounds?

 

[Maggot]

The reason I say that is because the govt can make non jewelry gold illegal to own and you would be required to sell it to them at their price.

All my gold and silver fell in the river when my guns and ammo sank. Its a bitch, but Ill survive.

 

[Bluejazz]

Edited, will repost later

 

[Bill Larson]

I say and own some of each....for if the shit does hit...... in coins of 1/10 oz. for gold and pre-60`s silver...... reason for smaller denom. gold...me thinks it could buy water groceries and get you thru a gate.....

 

[Trapshooter12]

If you buy Gold or Silver buy it in physical form and not on paper stored someplace. I work with a Tin Foiler that took his 401K money and bought Gold at $1500 an ounce and now look at it. The only thing is that all of his is on paper stored in some vault in CA he hopes.

Gold will go up again like it has in the past how high is anyones guess. The Mines in North Eastern Nevada have been letting people go because of the down turn right now. But there are also new Mines coming on line in the next few years.

Oh yeah the Nut Job I work with was also telling me last year that for every large middle eastern city that got bombed Gold was going to go up 50K per city.

 

[Veer_G]

Oh yeah the Nut Job I work with was also telling me last year that for every large middle eastern city that got bombed Gold was going to go up 50K per city.

I can just hear them chanting for a sea of glass NOW!

 

[Bluejazz]

I think there needs to be research done by members on here if they want to comment on the precious metals market.
The US has increased its debt to over 17 trillion , with over 1,400 trillion unbacked over the counter derivatives worldwide. The US alone has over 200 trillion in unfunded liabilities such as social security, federal, state and local pensions, medicare, ect.
Markets are manipulated in regards to the Libor interest rates , the Federal Reserve is the only buyer of US debt, monetizing our debt. The precious metals market is manipulated as well, in order to make the dollar look strong, and the stock market is held up in order to make it seem like we are not in a depression. Banks are confiscating depositors money all over the world, in order to bail out bankrupt nations, and it will eventually be coming to the US. China, Russia, and the BRIC nations are getting out of the dollar and setting up to trade oil in other currencies besides the dollar. China is importing more gold than ever before in order to back their currency with gold, and replace the US dollar as the world currency. They are getting out of the dollar and buying hard assets all over the world.
Do your own research, and decide for yourself what you need to do.

 

[Mike_Honcho]

Few thoughts:

Metals are not money, they are merely a portable store of value. The US dollar is merely a piece of paper backed by the US Gov. The US government has defaulted before and will default again. The US Gov has confiscated gold before - and likely will again. Going heavy into metals may have some merit when looking at a market that is likely one the verge of a meltdown. However, given the likelihood of confiscation in the event of such a meltdown - not so much.

Metals are also highly manipulated.
How Gold Price Is Manipulated During The "London Fix" | Zero Hedge
Gold Price "Manipulated For A Decade", Repeatedly Slammed Lower, Bloomberg Reports | Zero Hedge
Here Is The FT's Gold Price Manipulation Article That Was Removed | Zero Hedge

Everything I am reading shows the continuation of the existing trend - QE will continue (logically I don't see how this stops) and metals will continue to be suppressed. In fact if you look at the CBO's own estimates through 2023 there isn't much upward pressure on interest rates (artificially low through the period). I have also read that within 18 months gold could be backed down to @ $990.00 / oz.

Remember, it is ALL about preservation of the Petro Dollar.

If the Petro dollar stays intact and metals are used as a long term hedge - sure. If metals are acquired in some reasonable amount to facilitate trade as a 'what if' - sure. Putting a lot of money in metals? If it gets that bad, you ain't getting out of the country with it, and Uncle Sugar will confiscate it.

 

[techbrute]

I think there needs to be research done by members on here if they want to comment on the precious metals market.
The US has increased its debt to over 17 trillion , with over 1,400 trillion unbacked over the counter derivatives worldwide. The US alone has over 200 trillion in unfunded liabilities such as social security, federal, state and local pensions, medicare, ect.
Markets are manipulated in regards to the Libor interest rates , the Federal Reserve is the only buyer of US debt, monetizing our debt. The precious metals market is manipulated as well, in order to make the dollar look strong, and the stock market is held up in order to make it seem like we are not in a depression. Banks are confiscating depositors money all over the world, in order to bail out bankrupt nations, and it will eventually be coming to the US. China, Russia, and the BRIC nations are getting out of the dollar and setting up to trade oil in other currencies besides the dollar. China is importing more gold than ever before in order to back their currency with gold, and replace the US dollar as the world currency. They are getting out of the dollar and buying hard assets all over the world.
Do your own research, and decide for yourself what you need to do.

Here's a good place to start.

http://www.businessinsider.com/countries-with-largest-gold-reserves-2013-12?op=1

I want to have a China Paranoia jar where you have to put a dollar in it if you pull a chicken little impression and say China in the same statement.

We owe China money due to trade deficits, mostly. What happens to banks when the borrowers don't pay back the money? They go under. China has too much invested in sending junk over here for them to try to topple us. If we reneged on our debts, their country would be crushed.

 

[Mike_Honcho]

The BI article is misleading. If a country doesn't physically possess it - they ain't got shit (Germany)
Germany Has Recovered A Paltry 5 Tons Of Gold From The NY Fed After One Year | Zero Hedge


As for China, the US defaulting and destroying China - yeah, wouldn't say that. In fact that mindset is the same mindset that thinks one or two quarters ahead instead of a decade or 50 - 100 yrs ahead. China and their populous can withstand far greater hardships for a much longer period while maintaining continuity of government than the US......

 

[Bluejazz]

What you are missing is that the market will not be as easy to manipulate as it use to be.
China is in the process of setting up their own exchange to replace the COMEX, LBMA. at some point the MANIPULATORS will loose control, as this is changing into an international market.
As far as China not dumping our debt, ask yourself if you would take a 20% loss (haircut) in order to destroy your enemy. China is in the drivers seat, and don't kid yourself. China could dump our debt at anytime and inflict great hardship on our bond market, and us, and they would easily survive. They are in the process of exchanging all the dollars they own for hard assets such as mines, steel, Ag land, ect.
Do your own due diligence, and plan accordingly.

 

[FS1]

Does that go for Silver also? Silver dollars versus Silver Rounds?

Ia no expert when it comes to metal trading, but junk silver (old coins with no collector value), will be easier to spend in small quantities. Also they are recognizable, and there content is known. Old silver will be much more negotiable than ingot silver in a crisis.

All my gold and silver fell in the river when my guns and ammo sank. Its a bitch, but Ill survive.

I am sure this will happen to many folks, but don't get caught with it.

China, India and the Arabs are all buying gold big time right now, so I am told. Gold has always had value, and it always will unless someone finds a shitload somewhere.

 

[Phil1]

China Gold Demand Rising 25% by 2017 as Buyers Get Wealthier - Businessweek
China Gold Demand Rising 25% by 2017 as Buyers Get Wealthier
By Nicholas Larkin April 15, 2014

Gold demand in China, which overtook India as the largest user last year, will rise about 25 percent in the next four years as an increasing population gets wealthier, according to the World Gold Council.

Consumer demand will expand to at least 1,350 metric tons by 2017, the London-based council said in a report today. Growth may be limited this year after 2013’s price decline spurred consumers to do more buying last year, it said. China accounted for about 28 percent of global usage last year, the council estimated in February.

Buying accelerated last year as prices slumped 28 percent, the most since 1981, and the nation became the top buyer in place of India, where import restrictions curbed demand. China’s economy will expand 7.4 percent this year, economists surveyed by Bloomberg estimate. While that’s set to be the least since 1990, it’s still more than double expected growth in the U.S.

“Whilst China faces important challenges as it seeks to sustain economic growth and liberalize its financial system, growth in personal incomes and the public’s pool of savings should support a medium-term increase in the demand for gold, in both jewelry and investment,” Albert Cheng, Far East managing director at the council, said in a statement accompanying the report.

Gold for immediate delivery climbed 10 percent to $1,320.33 an ounce this year by 6:39 a.m. in London, according to Bloomberg generic pricing. The metal slipped to an almost three-year low of $1,180.57 in June, extending a drop from a record $1,921.17 set in September 2011.
Gold Financing

By the end of 2013, about 1,000 tons of gold may be tied up in financing deals in China, in which commodities including copper are used as collateral for credit amid restrictions on lending, said the council. Most of the metal locked up in such deals have been built up since 2011, it said.

China has 170 cities that have at least 1 million inhabitants each, and the middle class will expand more than 60 percent to 500 million in the next six years, according to the report. About $7.5 trillion is held in bank accounts and household allocations to gold remain “small” at about $300 billion, it said.

The nation’s consumer gold demand increased 32 percent to 1,065.8 tons last year, the producer-funded organization said in February. Jewelry purchases of almost 669 tons accounted for 30 percent of the global total and will reach 780 tons by 2017, according to today’s report. Annual bar and coin demand could near 500 tons by 2017, 25 percent above last year’s record.
Bullion Reserves

China’s gold reserves total 1,054.1 tons, making it the fifth-biggest holder by country, according to the council. Bullion accounts for about 1.2 percent of its total reserves, compared with about 70 percent for the U.S. and Germany, the largest owners.

China’s government lifted a ban on bullion trading and opened the Shanghai Gold Exchange in 2002. Huaan Asset Management Co. and Guotai Asset Management Co. won state approval last year to list the country’s first gold-backed exchange-traded products.

“We have witnessed astonishing increases in demand for gold from consumers across the country,” Cheng said. “The cultural affinity for gold runs deep in China and when this is combined with an increasingly affluent population and a supportive government, there is significant room for the market to grow even further.”

To contact the reporter on this story: Nicholas Larkin in London at [email protected]

To contact the editors responsible for this story: Claudia Carpenter at [email protected]; Brett Miller at [email protected] Dan Weeks, Sungwoo Park
China Gold Demand Rising 25% by 2017 as Buyers Get Wealthier - Businessweek

The world consumption of new gold produced is about 50% in jewelry, 40% in investments, and 10% in industry.
Gold - Wikipedia, the free encyclopedia


This chart is also an important reminder, though, that China is not, as it's so often described, "America's banker." China holds the largest share of U.S. debt but less than a quarter of the total $5.6 trillion in foreign-held debt.
This surprising chart shows which countries own the most U.S. debt

 

[EventHorizon]

you lost your money in the markets because you don't know how to manage an open position. If you think having 'stuff' in your hand will somehow prevent the same from happening then you'll lose again. If you buy metals then there's a good chance you'll find me on the other side of that deal. Thank you in advance for that money. I promise to spend it wisely.

investments no joke. Stop thinking about 'SHTF' and trading it for food etc. The best source of real wealth gain is private equity into businesses you understand and can apply some level of control. The rest ought to be short-medium term plays with CLOSE attention and knowledgeable risk management processes. I've worked in the financial services and around trading desks almost my whole career.

 

[Foul Mike]

FS1 #22 I agree with junk silver coins. What is the best way to get them? FM

 

[FS1]

FS1 #22 I agree with junk silver coins. What is the best way to get them? FM

Pawn shops and coin dealers that deal in scrap. I don't know if they are allowed to melt them down or not, I would think not. But when you find a shop you like they will save them for you.

Vending companies use to be a good source also but i doubt they get much anymore. You even see folks selling on craigslist now and again.

 

[WRM]

I have some opinions on PMs... many do not agree with these opinions, but I stand by them. This is my "Fourth Quarter 2013 Precious Metals Report", which was "published" on January 2nd. I am not a PM dealer, and I do not charge for my report, so have no direct financial interest.

"Fundamentals", and the "Quarterly Precious Metals Report" | ModernCoins.com Forum (MCF)

You could say that I am bullish gold, uberbullish silver. If you have any questions or would like to discuss further, please let me know.

Cheers,

 

[Pester]

The rest ought to be short-medium term plays with CLOSE attention and knowledgeable risk management processes.

Can you give a descriptive example of this? Not lengthy nor overly detailed. Thanks.

 

[sharac]

Open trading account, throw away 5k dollars and short USD Index for let say 500USD worth (leveraged of course). If it breaks down (which is possible in the next few weeks) you will make some money which can then be used for whatever if it doesn't you need to have stops in place and/or pay CLOSE attention to it and better luck next time (you'll loose some of the 500USD depending on stop level and how CLOSE you were paying attention) and then rinse and repeat either until amount of money earned is satisfactory (unlikely i might add) or until 5k is gone (more than likely).

If one were to estimate odds on winning with upper idea and Las Vegas Casino i'd say go to Las Vegas at least there you get free booze and perhaps a bit more bang for your buck (literally). First option will bring tears to your eyes and second a stories to tell and a happy grin to your face (at minimum). In business terms it would be said that risk/reward is better in Vegas than "Wall street".

 

[SniperCJ]

At the risk of another 'thrashing' by the local 'financial guru' (to remain nameless, as well as clueless...)

Gold and silver (et al) are extremely volatile. Their only value is based on what another person will give you for it and the entire market is based on fear.

Sure, the last few years, up until the bottom fell out, was pretty good for both gold and silver. But the bottom did indeed fall out and the peak was based on nothing but fear of a collapsing economy.

Invest in growth stock mutual funds. Not as cool as holding a gold coin, but overall less volatility and basically as risky as you want it to be.

 

[WRM]

Physical precious metals are a store of wealth, with a history of performing that function for thousands of years, and should not be confused with an "investment". Stored outside of the banking system, they have no "counterparty risk", as compared to paper assets, which all have counterparty risk....

Without knowing how much the OP is interested in purchasing, I would go with my "standard" recommendation - Silver American Eagles and/or Silver Maple Leafs, by the ounce, tube, or monster box. Plop your Federal Reserve Notes on the counter of a reputable dealer, walk out with your "stack", store in a secure location, and forget about it....

Silver Price Forecast 2014: Monetary Collapse and Silver?s Not So Orderly Rise | Hubert Moolman on SILVER and GOLD

Cheers,

(Edited to add) I am NOT a certified financial planner. These are my opinions only, and what one does with this information is solely their responsibility....

 

[Shoottothrill]

This is really all confusing. In layman's terms is it better to have cash buried in the backyard, or some silver or gold coins?

How could the government confiscate privately held gold?

What is the best investment in the event of a true SHTF scenario? I'm thinking canned food and ammo?

 

[sharac]

Definitely gold and silver probably deep under old rusty nails just like your weapons cache.
Simply by issuing a law requiring selling at a fixed price all items from this law to government and at the same time criminalize possession of said items after certain date.
Friends whom you trust with your life and then all of the bare necessities like water source, food source, food producing property and means to protect those from others and last but not least some common sense and luck.

 

[Forgetful Coyote]

Yes sir I agree with the above, although Ive had a bit of schooling on it, the US and world economy is about confusing as it gets. Now I know this is gonna sound stupid and simple to people like Mr EventHorizon, Mr Bluejazz, and Mr Sharac(I was raised on getting beaten if I didnt add in a Mr/Ms/Mrs but dont know your real names so I apologize if it sounds strange but its hard-wired into my vocabulary just like "yes sir/no sir/yes ma`am/no ma`am" to every adult I talk to), but for instance, why the hell is this market looked at as gold(which is "precious" as plenty have said and NOT unlimited in quantity) having a variable cost/value based on USD, or any country`s PAPER currency for that matter(which is obviously potentially unlimited in quantity ie the country and/or counterfeiters can make as much as they want) instead of the other way around with paper currency having a variable cost/value based on gold/silver/what-have-you?

As far as a SHTF scenario, maybe Im in the wrong, but Im looking more at investing in a reliable water source, means of food production as stated above, most especially plenty of guns/marksmanship practice/ammo, and even more so plenty of true friends/family you can really rely on who have plenty of guns/marksmanship practice/ammo to protect whatever food and water source you have(or gold you have stored that someone might decide is now their`s if they can get to it). Like the saying says, "when the going gets ugly, the ugly get going". A SHTF scenario is gonna bring out the worst of the worst in people who normally would not resort to such ways. It is really a very similar psychological/sociological idea as what some in the military refer to "you dont rise to the occasion, you fall to the level of your training." Maybe my view of society has been darkened from living up here in the big city of ATL but true either way. "People" are likely gone behave much more like animals overall. If things go tits-up then no sooner would the robbers and bandits be crawling the cities and roads in search of a big fat target. Natural selection will kick in soon after and instead of robbers and bandits, its groups, or very large groups of robbers and bandits with all of them armed to the teeth. Then I wouldnt be surprised to also see some upstanding, honest men to put their foot down and form their own vigilante groups to protect their`s and their neighbor`s interests. On a whole I`d say the bad-intentioned have the good-intentioned outnumbered though thats more dependent on individual city/location. My family would be pretty daggum well-off in a crisis considering the ultra-secluded backwoods location of our house and the 12-acre lake right in the backyard on our the property if you ask me. Petroleum would probably become difficult to come by but hey the red man didnt need it so why do we? As of now though we would be in trouble if 20-30 armed bandits rolled up guns ablazing shouting "this place is ours now". If the country was in a situation where that could be expected though, we would most definitely be preparing for it.

 

[sharac]

Actually you are correct that in fact there is basic metric of fiat currencies being measured against Gold - even by central bank standards (confirmed by stockpiles of it, swaps/lending of it and manipulation of its price aka measurement of fiat solidness). Problem is governments do not like this metric nor at market value (even if you assume its not manipulated) nor at any other derived value (for example ratio of debt/gold holdings, money stock/gold holdings, actual non-lent/nonperforming gold in stock). Why? Because fiat means trust and trust means in the end faith of any given individual on this Earth that piece of paper or metallic coin with face value actually has value and furthermore that its redeemable for goods/services at that face value. You shake faith of enough individuals into this value you shake the system (check out M2 money velocity FRED site - it shows why there is stagflation in the US/world and how QE did not spill into main street and that it was and is in fact a lifeline for Wall Street and bankers) but if you shake too much to the point that faith is lost you crash the system you will get instant hyperinflation (no shadowstats ~10%y inflation in US is NOT hyperinflation) and immense destruction of currency.
To make it short, although every central bank owns gold, transfers gold with military precision, protection and resources, that all respect and listen to BIS, they perform countless rituals at transfers (melting, smelting, stamping, "enriching with tungsten", geographically dispersing it, storing it at financial centers etc...) they would like everyone to believe its a relic of old days an unimportant pieces of rock whose only purpose is to sit somewhere in the dark and cause costs for its owner. People are gullible and buy pretty much any bullshit thats thrown at them long and hard enough (something always sticks...).

For an average Joe gold and silver must be looked not as a holy grail but as a vessel in which to store ANY EXCESS value which you are either unwilling or unable to spend today - of course in their physical form and in your "pocket" not somewhere on paper or system (even bank safe as far as i know by the new laws in US is not safe as you are prohibited to store cash and gold - though i'm not 100% on this or if this is a law or some bank specific rules).

Trading anything in electronic/paper form is Rigged Casino game which can be played sometimes but its harder and harder to do effectively and one can loose quite substantial amount of money in such endeavors (i don't know a person who has not had his first account blown up and had to transfer some more to keep it rolling).

 

[Forgetful Coyote]

Okay Ive read your most recent post twice now Mr Sharac and Im still having trouble understanding. Gonna take me a bit to take all that in.


<<<<Obviously not the smartest guy in the room, atleast not today lol.


On a sidenote, what do yall think of bitcoins? Any possibility that it could become a dominating currency in some countries?

 

[sharac]

Fiat (paper, virtual like bitcoin) means that there is trust involved. People trust that 100USD is 100USD and can at any given time purchase something they need. USD is backed by US ability to produce, to enforce its policy and general expectation that if you have 100USD you will be able to purchase anything/anywhere/anytime (world reserve currency). Mark the keywords, backed by, expectation. Its a game of trust as long as its there USD is there it can vary a bit depending on general perception/trust but as long as its widely accepted there is no problem.

Central banks role is to "manage currency on a national level" to simplify they manage how many bank notes are out there but more importantly how much credit/"virtual money" is available for banks to give and people/businesses and lately governments to take on. Problem is that most of the governments (who control central banks mind you - except in US where privately owned central bank controls government - but thats another topic ) have used John Maynard Keynes theories and abused them to hell and back (in essence theory states that shocks in macroeconomic environments can be more easily bridged if government intervenes and lowers the amplitude of a (usually) crash and makes it less severe) and have essentially bastardized this what is short term medicine into standard practice. Analogy would be a strong painkiller which helps at any given moment but at the same time hooks you up on it and you become essentially a drug addict.

Gold was and is a vessel of wealth it stores value by being limited, portable and shiny . There are other stores of value (real estate, fine arts, diamonds, collectibles etc...) but none with such history and widespread acceptance. You can easily transform 1oz of gold into pretty much anything, anywhere but you can hardly transform castle in France or Mona Lisa painting in certain parts of the world into anything of value - imagine taking MonaLisa to backward Amazon tribe and trying to get piece of meat or fruit for it - might work but i bet you'd get a little bit more for her in NewYork ).

Governments who abuse their currency (devalue it through reckless expansion of its volume) are of course doing everything and anything possible to prevent public from realizing this (zero interest rates kill 401ks and other pension plans etc...) as its in essence an organized theft, megaponzi if you will.

 

[FS1]

Governments who abuse their currency (devalue it through reckless expansion of its volume) are of course doing everything and anything possible to prevent public from realizing this (zero interest rates kill 401ks and other pension plans etc...) as its in essence an organized theft, megaponzi if you will.

The deficit spending snow ball has been rolling down the hill for three decades now. As with any downward rolling snowball the farther it rolls down the hill the bigger and less manageable it gets. Make no mistake about it, Reagan started deficit spending as a viable economic policy. He launched the snowball (supply side economics) yet he is heralded by the right as their political god. Everyone celebrates the great economy we had under Reagan. But few if any will admit that that great economy was financed by some of the debt we have today.

People have a tendency to blind themselves with their own political views. Thus Reagan is a hero. Our problems will never be fixed by politics or a single party. Only a united and determined people can solve these issues. Something that seems just too impossible right now. Wake up partisans before the snowball swallows us all.

BTW gold has been slowly dropping this week.

 

[EventHorizon]

SHTF and Gold and all that CRAP

So here's my view on this and perhaps it'll be pooh-poohed by most but it may just save a couple people some money they couldn't afford to lose..

Many folks say Gold is good for SHTF. Bullshit. In the 'end of times' scenario most are envisioning (man, what a great job hollywood and Beck have done on us) money won't count for crap. What WILL count are THINGS that people need - tools, food, weapons, medicine, shelter, safety of armed and organized groups etc and the personal skills needed by most but held by few - medical, building, fixing shit etc.

However, if one approaches life with a framework of probable outcomes and rational decision-making, then sinking your hard earned dollars into shit like that will mean the following:

1. you will never retire because you're sinking your hard earned money into assets that rarely accumulate enough and predictably so that you can cash out and live well.

2. you get sick, you're fucked. I earn a very good income - some is salary/bonus the rest is income from investments. If i or someone in my family gets really sick with long-term chronic illness I'm assuming I'm going to be paying out tens of thousands of dollars to either stay alive or keep someone alive. If I can't work then we're really fucked. All the gold coins, ammo and freeze dried food in bug out bags won't mean diddly squat unless my doctors are all mad preppers.

3. So, what's left? A LOT. Investing is not for the stupid or lazy. Investing can be done stupidly and lazily but then you will lose your money. There are no 'cliff notes' worth a damn (sorry Pester, your request was just not worth taking seriously. There are whole books and studies on risk management). We all have some exposure to specific industries and products. Mine is tech and financial services with a good slice of sales/marketing thrown in. I invest in things I understand at the product level - banks, financial instruments, organizations that I see as being very effective sales/marketing machines that will generate revenue and market growth etc. On top of that, I spent a few years understanding and practicing technical analysis of stock prices. I filtered out what seemed like crap and too complicated methods that I couldn't understand and practiced what I was comfortable with and then started to put my money on my analysis - ALWAYS USE RISK MANAGEMENT of your positions. If you don't know what that is, get a book and read it. I like books by Dr. Elder on this and approaches to trading in general.

4. Don't be ignorant. You have to learn, understand and analyse what's going on in your chosen industry/product/company and the macro forces that affect them and the effects on the investments you've made. To those who say, 'man, I don't have time for that...' well, look at the alternative...

5. Private Equity. This is the money maker. For those who have the liquid funds then find a business, partner or something that you can understand, assist in, and invest in and make the business grow. Owning and growing is better than earning and saving IMHO. I've got 3 private equity vehicles that I take part in on the side. One of them is looking like it will balloon very nicely with about 20x of my original investment at IPO. On another, I lost a ton of money, it hurt - like hell, but I learnt my lessons and I moved on.

My SHTF scenario doesn't involve zombies or roaming bands of cannibals. It involves not sending my kids to university, not being able to get them healthy if they fall ill, becoming ill myself and not being able to provide for my family etc. THat's what I plan for because those things have a higher probability of occurrence.

Hope some of that helped, if you found it offensive - I can live with that too.

 

[WRM]

Good points - PMs are for after you have all of the other bases covered - food/water/security/medical supplies/etc.

Silver is a roller coaster this morning, after trading in a tight band for the past three days.... That's why I said store it and forget it - watching the "price" can drive you crazy! Don't think of the value of your stack in FRNs, but rather ounces....

Cheers,

 

[Mike_Honcho]

EH has some great points.

Conversely if you haven't already, look around the web for FerFAL's Argentine Economic Collapse story. The gentleman tells the story of the slow implosion of the Argentine Econ in the 1990's. He lived in a smaller metro area and was a gov employee, so he always had a job. He discusses the value PMs as the Gov kept reissuing devalued fiat and inflationary pressures continued to mount.

Alternatively, if you have read much of Selco's blog (SHTF School) - RE: living in Bosnia during the unpleasentness - I don't recall him discussing PMs. He on the other hand talks I a lot about skill sets, violence, and the lack of food.


The big picture take away, when people discuss some form of instability it can run the gambit. A slow motion event where there is still a functioning Gov and societal constructs, yes there may be a place for PMs. A rapid descent and utter chaos, maybe not. The common theme to both was food and the lack of security. In Argentina the food was exported to raise cash. In Bosnia what food there was, was controlled by strongmen.

 

[Mike_Honcho]

The deficit spending snow ball has been rolling down the hill for three decades now. As with any downward rolling snowball the farther it rolls down the hill the bigger and less manageable it gets. Make no mistake about it, Reagan started deficit spending as a viable economic policy. He launched the snowball (supply side economics) yet he is heralded by the right as their political god. Everyone celebrates the great economy we had under Reagan. But few if any will admit that that great economy was financed by some of the debt we have today.

Just 3 decades?

We at least need to go back and include Nixon b/c things were so bad the US defaulted to the rest of the world - yes, taking the US off the gold standard is called defaulting.

But we really need to go back at least to LBJ and his Great Society Program, b/c those programs as rolled forward have done nothing but made width swaths dependent on the Gov teet for nearly 7 decades.

While Reagan was a turd with different chunks, there is no question that revamping the tax code led to growth. How that growth was managed and who received the lion's share of the tax breaks is another subject. In general though you are correct. The 'Right' has tried canonize Reagan when in reality his record shows he wasn't as advertised.

 

[srtsam]

For me
Buying Gold, silver, platinum are Looooonnnnnngggggg term investments. My thought on this is as the world population grows demand will continue to grow and there is only so much of the stuff in the planet. Just think if you bought gold and silver in the 60's, 70's 80's 90's you get the point. 30 years from now people will be saying how they wished they would have bought gold in the early 2000's, when it was cheap at 1500-2000 per ounce. Hell there are folks damn near killing themselves everyday panning for flakes of gold in a river.

 

[FS1]

The best security in that situation would be to be unknown, out of the cross-hairs and just plain invisible. Because no matter how well manned or armed you are, if you are known to be fortified and provisioned. You will eventually be over run by the large number of folks who are not. This is why I am amazed at the preppers you see on the tube showing off their prowess. They have just become a known, well supplied target.

Of course food and water are going to be the primary needs in crisis. With shelter and arms the next two on the list. Its obvious that food and water will be a great source of barter. But who is going to want to give up food. Having some precious metals will be to everyone's advantage who hopes to survive the crisis. There has always been barter always, and gold and silver are great for that. Gold and silver has always had value and it looks like it always will.

 

[FS1]

For me
Buying Gold, silver, platinum are Looooonnnnnngggggg term investments. My thought on this is as the world population grows demand will continue to grow and there is only so much of the stuff in the planet. Just think if you bought gold and silver in the 60's, 70's 80's 90's you get the point. 30 years from now people will be saying how they wished they would have bought gold in the early 2000's, when it was cheap at 1500-2000 per ounce. Hell there are folks damn near killing themselves everyday panning for flakes of gold in a river.

Golds value has never changed it is the same as 1000 years ago. Its paper money that changes value, not the gold.

 

[catswithguns]

I'm too old to care about SHTF stuff, don't really want to wipe my ass with leaves. I sure can't imaging zeroing in on a starving bunch of kids. Surviving is a lot different than living. As far as gold and silver, I buy it every month, mostly for its liquidity. My best friend died at 44, had all sorts of investments. Most solvent dead man I've ever known. To each his own.

 

[Pester]

sorry Pester, your request was just not worth taking seriously. There are whole books and studies on risk management). We all have some exposure to specific industries and products.

My question was less related to risk mitigation and risk management strategies but on how you define the timing and nature of "short-medium term plays".

 

[dmike]

In 1964 one of your grandmothers lost a dollar bill behind the dresser and the other lost a dollar coin (made of 90% silver at that time) behind the dresser. Both lost a dollar that day. You find both dollars today, somehow the silver coin is now worth $20. Silver isn't going up, the dollar is going down. In 64 gas was .30/gal. Both dollars got you 3 gallons then, not now.

The number of printed dollars has gone up by over 20x since 1970. silver production is a lot harder to increase.

 

[EventHorizon]

My question was less related to risk mitigation and risk management strategies but on how you define the timing and nature of "short-medium term plays".

The short and mostly unhelpful answer is that it depends on the nature of the financial instrument you're investing in, it's price volatility (and the volatility of the underlying asset if there is one), your risk appetite and skill level. To illustrate, some define short-term as minutes or even seconds, other as weeks. I invest in a mixture of equities and options. I sometimes hold an equity position for a matter of a couple of weeks. This is about my usual short-term horizon. For options it can be for a few days to even a few months depending on the time duration left in the option and whether I'm doing a 'trade' or riding a trend. For me, medium term is never more than a quarter. Anything more than that and I consider it long-term investment. I don't believe in the general trend of prices being up and being passive in the market. Seen too many events to believe in that as reliable.

 

[diverdon]

I'm too old to care about SHTF stuff, don't really want to wipe my ass with leaves. I sure can't imaging zeroing in on a starving bunch of kids. Surviving is a lot different than living. As far as gold and silver, I buy it every month, mostly for its liquidity. My best friend died at 44, had all sorts of investments. Most solvent dead man I've ever known. To each his own.

I am sure your friend did not plan to die at 44. I am sure he planed a long and prosperous life. I have certainly spoke to some 60-70 year old people who wish they had saved a little more.