Buying Silver Bullion

[wscott577]

I am curious also, as to what type of coin and what age it is. May I ask how you acquired it or did you find it somewhere?

 

[SmawGunner]

Silver just dropped to $18.55. And gold dropped to $1236. BTFD

 

[Just Jim]

$1231 today, falling like a rock. Lol it is a rock.

 

[stratbastard]

Investing in silver. I thought it was a good investment so I started stacking. But I found out later that the price is heavily manipulated to force the price to be as low as possible. The price is kept low by major banks like JP Morgan Chase through a process of naked shorting. There are also companies out there that hold physical silver for you and offer shares of stock on their silver. This is a form of fractional reserve banking where these companies can create many paper silver contracts for every 1 oz of silver. Nobody knows what the ratio is. It could be 100:1 or 1000:1 or whatever they want. The gold spot price is manipulated the same way. If everyone tried to claim theirs with a bank run then very few people would actually get their silver. So if you dont hold it, you dont own it. Period.

The buying and selling of all the paper contracts has the biggest influence on the spot price of the physical. How do we know this is what is happening? Well when the price drops by $2 or $3 instantly for no reason at all then we know there is huge amounts of paper being moved. We certainly know that theres no way millions of ounces physical silver can change hands instantly. Once you realize the game they are playing with the spot price then you can take advantage of it by buying the dip. Or BTFD. Just have your cash standing by until you see a big dip of $2 or $3 and buy at the discount. It happens approximately once a month. This is a good method to accumulate a nice stack. But remember the price is always kept low which means as long as they are in control it will be a terrible investment. If they lose control and the price is allowed to rise to its true value then it will be a great investment. It just comes down to whether or not you think they will lose control some day. I am starting to think they will never lose control no matter how bad it gets and its a bad investment. Now I am looking at it more as a store of value instead of investment.

"Now I am looking at it more as a store of value instead of investment." And that is absolutely correct. PM's are NOT an investment, they are a HEDGE. They are a measured portion of one's wealth which is to be HELD against the strong possibility of a fiat currency losing all value. PM's sometimes have wild swings in fiat $$$ value, and for this purpose those swings are irrelevant. I would have no emotion if gold fell to $600 an ounce, just as I had no excitement when it went to $1900.

 

[Just Jim]

$1214 today if you would have bought a nice Colt SAA you would still have the same value for your fiat currency. Gold prices are manipulated.

 

[Martini_Up]

precious metals are insurance, not investments.

i'm long on copper, lead and brass for what that's worth.

 

[stratbastard]

$1214 today if you would have bought a nice Colt SAA you would still have the same value for your fiat currency. Gold prices are manipulated.

Of course gold values (as well as silver values) are manipulated... that is a big part of the argument towards HAVING them. Because more importantly the fiat currency is heavily manipulated: interest rates held down artificially by the Fed, paper currency with no backing being printed as fast as those presses can run. The only reason the Dow continues to flourish is everyone is now forced to speculate in the stock market or LOSE 1.7% (if you believe the government assessments) or 11% (if you believe your own eyes and the prices of food compared to last year) to inflation. Gold prices are artificially suppressed to hide the ACTUAL inflation occurring, as gold has always been the classic measure of inflation of the money supply. Realizing the fact that this manipulation IS occurring, and understanding WHY it occurs is enough to make the decision to own and hold physical PM's.
Every bit of paper wealth you own is being robbed of value with every dollar printed... as stated by Warren Beatty (as Bugsy Siegel in the movie "Bugsy") "It's only dirty paper".
The Colt SAA would yes be a FINE investment rather than holding dirty paper... ditto food, ammo, or any other useful hard asset. A person of limited means would be well advised to acquire these FIRST. However, those among say the middle class or above are faced with more decisions. There are a great many baby boomers out there who have amassed a nest egg over the last several decades... $500,0000, $2,000,000, or even more. Traditionally, as they age their investments become more conservative (meeting inflation or slightly better) to preserve that nest egg and reduce risk... this is no longer possible with manipulation of interest rates.
So... IF one in this position has ALREADY purchased all of the prep items needed in way more than sufficient quantities, what then? What if $1,000,000 or more in paper assets still remain? This is the time to strongly consider PM's to shelter that remaining wealth.
The value of gold does not change, and it won't change when or if it is ever up to even $10,000 an ounce. This is only a value RELATIVE to the value of the paper currency it is being compared to... it will purchase no more then in actual assets than it does now, or it did 200 years ago. A half ounce of gold would have purchased a very fine toga in Roman times. Ditto a very nice suit of clothes in the old west. Currently, it will buy you nice Brooks Brothers suit. It's value is very much the same, only the relative value to dollars has currently changed. It is not an investment which will someday allow the holder to purchase an increased amount of hard assets... it is a HEDGE, which protects your wealth from inflation and from a currency collapse to zero.

 

[Just Jim]

http://goldprice.org/gold-price-history.html

The bubble is bursting.

Your hedge doesn't work out well if you add inflation. Better to invest than to hedge, you only have so many years to make it all work out.

 

[Just Jim]

This guy explains it better than I can.

"Gold, invested $1000 per year starting in 1980 at the average annual price (London). At the end of 2013 you have a total of 79.43 ounces, today it would be worth $96.7k. Your total unadjusted dollar commitment over the years is $34k, for an annualized yield of right at 5.5%. That's at the value of gold right now, which is overheated and heading down but .. ok. You didn't quite triple your money, took you 34 years to do it too. It's also worth noting that at 5.5%, gold doesn't even hold its own until the price bubble in 2009, which means for 29 of the 34 years in question you would have had more if you simply opened an account with your local credit union or S&L. In fact for most of the time the value of your gold would have been less than half of what a savings account would have given you, as things are, even with the recent price runup, you beat it by maybe a percent.

On the other hand, had you invested $1000 per year with a simple buy-and-hold strategy and put it into a simple index fund on the S&P 500 your nest egg would be worth $245.5k, which is something over seven times what you put in and about 2 1/2 times what your gold did. That's simply 'buy and hold', and note that this DOES NOT INCLUDE the yield for 2013 since 2014 isn't over and I'm doing an annualized sinking fund estimate. But if we were to add in the S&P performance for 2013 to date the number comes to $330k.

Now if you have an IQ above what your average crustacean displays you would have tripled that number by simply parking the bulk of your assets during the high-risk years, which is of course what smart folks actually do by investing in well managed mutuals. Course that would require you not wasting your money on nonperformers like Gold. So yeah, on the one hand we walk away with 80 ounces of rapidly depreciating krugies worth maybe $96k today, on the other hand we wind up with three quarters of a million dollars, with which we can buy lots of krugies and maybe even a few lap dances for our luckless, benighted friends."

Not bad for twenty bucks a week.

 

[Martini_Up]

....<snip>
So... IF one in this position has ALREADY purchased all of the prep items needed in way more than sufficient quantities, what then? What if $1,000,000 or more in paper assets still remain? This is the time to strongly consider PM's to shelter that remaining wealth..... <snip>...it is a HEDGE, which protects your wealth from inflation and from a currency collapse to zero.

All of your assets - $1,000,000 - in PM is a poor choice. It should viewed as insurance against currency collapse and 15% is plenty for that.

 

[stratbastard]

All of your assets - $1,000,000 - in PM is a poor choice. It should viewed as insurance against currency collapse and 15% is plenty for that.

Martini, I agree with that 15% number. I misspoke by not adding "sheltering SOME of that remaining wealth", implying that the entire $1,000,000 should be in PM's. The number one does choose should be consistent with the worry-some times one is in. I have a higher percentage today than I would have had 20 years ago.

 

[Just Jim]

I posted the history of gold so you can understand why I tell people it's all about timing. Buy at your own risk.

 

[stratbastard]

This guy explains it better than I can.

"Gold, invested $1000 per year starting in 1980 at the average annual price (London). At the end of 2013 you have a total of 79.43 ounces, today it would be worth $96.7k. Your total unadjusted dollar commitment over the years is $34k, for an annualized yield of right at 5.5%. That's at the value of gold right now, which is overheated and heading down but .. ok. You didn't quite triple your money, took you 34 years to do it too. It's also worth noting that at 5.5%, gold doesn't even hold its own until the price bubble in 2009, which means for 29 of the 34 years in question you would have had more if you simply opened an account with your local credit union or S&L. In fact for most of the time the value of your gold would have been less than half of what a savings account would have given you, as things are, even with the recent price runup, you beat it by maybe a percent.

On the other hand, had you invested $1000 per year with a simple buy-and-hold strategy and put it into a simple index fund on the S&P 500 your nest egg would be worth $245.5k, which is something over seven times what you put in and about 2 1/2 times what your gold did. That's simply 'buy and hold', and note that this DOES NOT INCLUDE the yield for 2013 since 2014 isn't over and I'm doing an annualized sinking fund estimate. But if we were to add in the S&P performance for 2013 to date the number comes to $330k.

Now if you have an IQ above what your average crustacean displays you would have tripled that number by simply parking the bulk of your assets during the high-risk years, which is of course what smart folks actually do by investing in well managed mutuals. Course that would require you not wasting your money on nonperformers like Gold. So yeah, on the one hand we walk away with 80 ounces of rapidly depreciating krugies worth maybe $96k today, on the other hand we wind up with three quarters of a million dollars, with which we can buy lots of krugies and maybe even a few lap dances for our luckless, benighted friends."

Not bad for twenty bucks a week.

AGAIN, gold is not an investment, it is a HEDGE... insurance. If you spent $1000 a year total since 1980 on car, home, and life insurance yet never have an accident, was that money wasted? No. It is there to cover you catastrophically in CASE. And I too would NOT have "invested" in gold regularly since the year 1980. There WERE far too many OBVIOUS better choices which would yield higher returns, and I participated in them -mutual funds, real estate, business ventures. It is only in RECENT years in which sheltering that wealth has become vital... in which the Fed is manipulating interest rates and diluting the money supply. In the recession of the 1980's, I had certificates of deposit paying me 16%. In THIS worse recession, try to get even 0.5%. There ARE NO mutual funds, certificates of deposit, etc... today which would now perform even REMOTELY like the ones you describe. Describing returns made over the last 34 years in different venues, when rates were still allowed to react to the market more naturally, still misses the point. If you can see that the dollar today is going down and is on it's last legs, then PM's become attractive (as a hedge, not an investment). If you don't, they don't.

 

[Grunwald]

This guy explains it better than I can.

"Gold, invested $1000 per year starting in 1980 at the average annual price (London). At the end of 2013 you have a total of 79.43 ounces, today it would be worth $96.7k. Your total unadjusted dollar commitment over the years is $34k, for an annualized yield of right at 5.5%. That's at the value of gold right now, which is overheated and heading down but .. ok. You didn't quite triple your money, took you 34 years to do it too. It's also worth noting that at 5.5%, gold doesn't even hold its own until the price bubble in 2009, which means for 29 of the 34 years in question you would have had more if you simply opened an account with your local credit union or S&L. In fact for most of the time the value of your gold would have been less than half of what a savings account would have given you, as things are, even with the recent price runup, you beat it by maybe a percent.

On the other hand, had you invested $1000 per year with a simple buy-and-hold strategy and put it into a simple index fund on the S&P 500 your nest egg would be worth $245.5k, which is something over seven times what you put in and about 2 1/2 times what your gold did. That's simply 'buy and hold', and note that this DOES NOT INCLUDE the yield for 2013 since 2014 isn't over and I'm doing an annualized sinking fund estimate. But if we were to add in the S&P performance for 2013 to date the number comes to $330k.

Now if you have an IQ above what your average crustacean displays you would have tripled that number by simply parking the bulk of your assets during the high-risk years, which is of course what smart folks actually do by investing in well managed mutuals. Course that would require you not wasting your money on nonperformers like Gold. So yeah, on the one hand we walk away with 80 ounces of rapidly depreciating krugies worth maybe $96k today, on the other hand we wind up with three quarters of a million dollars, with which we can buy lots of krugies and maybe even a few lap dances for our luckless, benighted friends."

Not bad for twenty bucks a week.

cherry picking a time period to prove a point is extremely dishonest. The guy picked 1980 as a starting point, which is also the peak of the last buying panic. There were events that occured some of which cannot occur again while others are extremely unlikely and would have much less impact if repeated.
The first is Nixon closing the gold window which really amounted to the US defaulting. This happened in 1971 and until that moment gold was officially fixed at $35 per oz. This will never happen again.
There was another event which is far less known but also very significant, and that is UK selling roughly half of its gold around 1980. There are those who believe that this was the mechanism used to crush the price of gold back then. The sale was announced in spring of 1979 with a later announce gold sales by the IMF. Interstingly enough by the time the gold was sold its price has already been crushed by roughly two thirds and the prime minister is remembered as the fool who sold at the very bottom.

Martin Armstrong made an interesting comment - that gold is not a hedge against inflation but government. When inflation happens most assets will go up in price vs paper currency. When governments fail all bets are off.

Additional point on comparing gold to S&P. When you buy gold and hold it yourself there is no counterparty risk - you are not relying on anybody else remaining solvent nor honest. With anything on Wall St you are dealing with titans of virtue such a Corzine and Madoff.
I am also willing to bet that when that comparison was made the author simply looked at the closing quotes for the day without any regard to expenses and taxes along the way. Lets not forget that the S&P 500 invested via a mutual fund would have annual expenses associated with it. Also the 500 stocks contained within the index change and each such change creates a taxable event which will not show up on price quotes nor charts.

 

[Just Jim]

No way I am going to buy gold. I wouldn't take it in trade under any circumstances. If I have extra money it goes into use able collectables. I am old enough to have seen the history of how gold is manipulated and how fake coins and bars are in the market.

I might take silver

 

[Grunwald]

Whatever lets you sleep at night.
5 years ago I could not see the value in holding precious metals. I've changed my mind mostly due to the fact that gold (and silver) were always considered valuable by our species.
Could that change? Sure, as at one point in time aluminum was also very valuable but not so much today.
The important thing putting your money into something that will make you feel secure. A friend of mine has a son that is quite well off and he used a chunk of his cash to buy 640 acres of land and a bar (brick size) of gold. The land is worth multiple of what the gold is worth.
The very rich invest in art amongst other things. Way beyond what most of us can afford.

 

[nehalemguy]

Older thread but it was still a fun read.

Plus silver today was $15.33 and gold $1,116.

E

 

[Oathkeeper1775]

Older thread but it was still a fun read.

Plus silver today was $15.33 and gold $1,116.

E

And money spent (wasted) on a movie ticket, popcorn, and a soda is in someone else's hands.

 

[Cortes]

Avoid withdrawing large sums like $5000 from your bank at once because the banker will ask you why you are withdrawing so much and they will document it. Break up your withdrawal amounts to avoid the banks record keeping.

While the above recommendation is technically correct in that it may avoid BSA reporting, it is also a federal crime known as Structuring or in bank parlance, Smurfing. If you do a web search on these terms you can find many instances of people losing their cash or assets from forfeiture by the Gov after being accused of this practice. There is software in place to catch Structuring, so I don't think it will help avoid the transaction reports anyway. In addition, bank employees are encouraged to fill out the reports for amounts less than $5000 just to be on the safe side.

While I'm not a gold or silver stacker as my farm sucks up all my money, I do buy a lot of farm machinery on Craigslist. I just tell the teller exactly what am using the money for. I want those cash transaction reports to be accurate, don't want them guessing. If you are going to buy $12,000 in gold and silver, consider taking the cash out all at once. You may be safer.

Where Structuring really gets people into trouble is when making deposits. The feds really want to collect their taxes.

 

[45alive]

I am not a Market Analyst, but I know Gold and Silver is a good alternative to $Cash$ and it's a valuable commodity. Lots of folks now will take Gold or Silver over paper and its good to Barter with as well. So that's why all the Whacko Environmentalist's A.K.A. Lobbyist Pawns are shutting down all forms of Gold Mining , even Hobbyist Gold Miners !