Downsides to precious metals?

[Burt Gummer]

Was sitting at Rialtos downtown on SW 4th after a jobsite grabbing a beer a few weeks ago. Most would say it is second only in incidents to SW 2nd around Dantes for bad things in the SW side. When you take care of your own protection, fear doesn't really have to control your life.

A young couple at the bar "Can you believe some nut tried to carry a pistol in here!?"

Here I am grabbing a burger with a Kimber Pepper Gun in the breast pocket, a legal knife in my jacket pocket and an HK Compact 45 on my six.

All I could think was how could these simpletons could ever take action to protect themselves in a moment of truth.

No sign that says no firearms allowed. Bouncer checked my ID even though I came over on the Mayflower. Wasn't trying to get away with anything at all. If the policy is no carry (a sign or just verbal, or a wand), that is fine, I'll go somewhere else.

 

[Burt Gummer]

With the obvious and deliberate destruction of the dollar, interesting watch. S/G is not the end all. But pretty much anything other than the dollar going forward. In order to sell the gullible masses on financial tyranny aka gov-only crypto and control, the dollar must die like all the other previous fiat currencies. By 'the dollar' that includes anything now tied to it digitally also.

 

[Certaindeaf]

Man Pays $21,0000 Cash To A Guy In An Alley Selling Gold Bars - Are They Fake?

Investigators sent out a public warning to a community in California after a man in Redlands paid thousands in cash for what he thought were real gold bars.

97x.com

 

[OldBroad44]

Gold is a commodity like any other. The presumption that its value is more stable than paper currency depends on the assumption that the supply of circulating gold is fixed. In fact, the amount of gold in circulation in any given area or worldwide can vary dramatically. For example, when the conquistadors invaded the New World they stripped gold and silver out of the temples and shipped it to Spain. And the amount of gold and silver actually circulating in Europe skyrocked and their value relative to everything else dropped drastically.

Right now Russia, which is a major gold producer and has a huge stockpile of gold, has been sending massive amounts of gold from its stockpiles off in trade to get around blocks in its access to dollars and ordinary trade patterns because of Ukraine-war-associated sanctions.

In addition, this last growing season most countries who usually import the fertilizers used in commercial agriculture used up their stockpiles. Most countries including China and India are dependent upon imported fertilizer to support current populations. Its fairly likely that next year will see massive famines, with the price of food worldwide skyrocketing. When people are dying because of lack of food, a lot of the family wealth in the form of gold necklaces and other family valuables comes out and starts circulating.

 

[OldBroad44]

By the way, North America overproduces and exports food. And has its own fertilizers.

When a country is worried about its people starving the most effective thing it can do is ban exports of the most important grain staples. That way farmers are unable to cash in and sell rice on the world market, where the price may be skyrocketing, leaving their own citizens unable to buy rice at world prices and starving.

In July 2023, India, usually an exporter of rice, banned export of non-Basmati rice. Basmati rice is a more expensive special variety and not normally used as a staple or bought by poor people.

Powers that be in USA have jumped in and told Americans not to worry because most Americans who eat rice are eating rice grown in America, and we had a good harvest in 2023, and have plenty of rice. I think these reassurances are disingenuous. USA does NOT have a ban on the export of rice. So if there is a world-wide shortage that causes world prices to rise, American farmers will be selling more American rice onto the world market and American consumers will share in the high world rice price.

 

[wired]

By the way, North America overproduces and exports food. And has its own fertilizers.

When a country is worried about its people starving the most effective thing it can do is ban exports of the most important grain staples. That way farmers are unable to cash in and sell rice on the world market, where the price may be skyrocketing, leaving their own citizens unable to buy rice at world prices and starving.

In July 2023, India, usually an exporter of rice, banned export of non-Basmati rice. Basmati rice is a more expensive special variety and not normally used as a staple or bought by poor people.

Powers that be in USA have jumped in and told Americans not to worry because most Americans are eating rice grown in America, and we had a good harvest in 2023, and have plenty of rice. I think these reassurances are disingenuous. USA does NOT have a ban on the export of rice. So if there is a world-wide shortage that causes world prices to rise, American farmers will be selling more American rice onto the world market and American consumers will share in the high world rice price.

Well I still have 150 lbs of Covid era rice to burn though so Im good for the next 7 years or so.

 

[Capn Jack]

Ah, Sooo. Any Top Raimen?

 

[wired]

Ah, Sooo. Any Top Raimen?

No comment

 

[gmerkt]

Just a few years ago premiums were not as high as they are now.

Premiums are down again, not as many retail panic buyers.

Gold is a commodity like any other. The presumption that its value is more stable than paper currency depends on the assumption that the supply of circulating gold is fixed. In fact, the amount of gold in circulation in any given area or worldwide can vary dramatically. For example, when the conquistadors invaded the New World they stripped gold and silver out of the temples and shipped it to Spain. And the amount of gold and silver actually circulating in Europe skyrocked and their value relative to everything else dropped drastically.

This is all good stuff. There is a lot of precious metals material drifting around the cosmos. Astronomers have opined that gold, silver, platinum, etc., are concentrated matter that blew out from celestial phenomena that exploded. So, if some smart people with deep pockets can harness a certain asteroid that happens to contain concentrations of PM, that might affect value of existing, above ground metals here on earth. This sounds far-fetched, but in the future, who knows.

Right now Russia, which is a major gold producer and has a huge stockpile of gold, has been sending massive amounts of gold from its stockpiles off in trade to get around blocks in its access to dollars and ordinary trade patterns because of Ukraine-war-associated sanctions.

This might be an explanation for why gold has stagnated between 1,800 and 2,100 for the past couple of years. It shot from 1,200 in 2019 to 2,050 in 2020, propelled by panic situations. Then it stalled to its present range. The Russians sell it, yet the Chinese and other central banks buy it. It's kind of put a floor under gold for the time being. Situations change. It's only been 20 to 30 years ago that central banks were unloading and selling gold, condemned as a barbaric relic. Other counties who can afford it are stocking up on gold; the US is stocking up on debt.

What do I know. But I don't put much faith in gold promoters predicting $5,000 gold next year or the year after that.

In addition, this last growing season most countries who usually import the fertilizers used in commercial agriculture used up their stockpiles. Most countries including China and India are dependent upon imported fertilizer to support current populations. Its fairly likely that next year will see massive famines, with the price of food worldwide skyrocketing. When people are dying because of lack of food, a lot of the family wealth in the form of gold necklaces and other family valuables comes out and starts circulating.

Well, I'd say that is one of the reasons Indians traditionally stock up on gold, to have a source of wealth when everything goes off the rails.

 

[gmerkt]

Basmati rice is a more expensive special variety

Yum, I love Basmati rice pudding. I know, heretic.

Powers that be in USA have jumped in and told Americans not to worry because most Americans who eat rice are eating rice grown in America, and we had a good harvest in 2023, and have plenty of rice. I think these reassurances are disingenuous. USA does NOT have a ban on the export of rice. So if there is a world-wide shortage that causes world prices to rise, American farmers will be selling more American rice onto the world market and American consumers will share in the high world rice price.

Isn't this a similar dynamic as with oil? Don't US producers throttle back on shale oil production when world oil prices dip? Which helps drive up domestic fuel prices. The similarity being that external markets create a gaming opportunity for domestic producers and arbitragers.

 

[pdx210]

Seems like - especially now - liquidating to cash potentially creates more problems than it's worth.

Problem?

 

[OldBroad44]

I'd say that is one of the reasons Indians traditionally stock up on gold, to have a source of wealth when everything goes off the rails.

Right. In fact, much of the gold and silver Europeans plundered from the Americas stayed only transiently in Europe. It ended up in India and China. Europeans coveted the spices and silks that came from the East. The East, by and large, coveted nothing from Europe. Europe produced nothing they needed. They didn't even consider Europeans civilized. So they would sell their spices and silks only for gold and silver.

Shades of the same attitude came out when Ghandi visited Britain and reporters asked him what he thought of Western civilization. His response? "I think it would be a good idea."

 

[OldBroad44]

Isn't this a similar dynamic as with oil? Don't US producers throttle back on shale oil production when world oil prices dip? Which helps drive up domestic fuel prices. The similarity being that external markets create a gaming opportunity for domestic producers and arbitragers.

Yes, to a certain extent. But the situation is complicated by the fact that while all refined pure gold is created equal, all unrefined oil is not. American shale oil is light sweet. Most of the American oil refineries are designed to refine heavy crude. That's what comes out of conventional drilling operations in America and the Middle East. South American and Russian oil is even heavier and cruder. The light sweet American shale oil is very high grade stuff, but the refining capacity for it is limited. So, the American oil industry needs to build refining capacity for it and/or convert some of its existing refineries. Meanwhile, we are approximately oil independent. But because of the limited refining capacity for our beautiful shale oil we export some of it and import a little real sludge from Russia or S America to mix with our shale so it can be refined in traditional refineries.

Another factor is that American oil companies used to turn most of their profits into growing their production capacity and less of it as payouts to shareholders. Shareholders are now demanding a higher percent of the profits. So while American oil production is still expanding, its at a slower rate than before.

So far, the American producers are able to sell on the world market. However there is law already passed that would allow the president to outlaw oil exports. If the president chose to do that, the world and US oil prices would diverge, with the American price being way under the world price. Come to think of it, that may be why investors are demanding a bigger share of the profits now. With that law existing and threatening free trade in the world oil market they may be less willing to defer their profits to some day in the future.

 

[Longwalkhome]

There isn't a safe place to put your wealth as the reset takes place. If you think you have one then good luck on keeping it secret.

I used to think gun collections were a safe bet but of course government has ruined that with new laws and controls.

Add in thousands of new IRS agents to come after your wealth so there isn't much chance of keeping it.

You will be happy with nothing and eat your bugs.

 

[hongkong2]

 

[GWS]

Man Pays $21,0000 Cash To A Guy In An Alley Selling Gold Bars - Are They Fake?

Investigators sent out a public warning to a community in California after a man in Redlands paid thousands in cash for what he thought were real gold bars.

97x.com

There's a sucker born every minute

 

[gmerkt]

So far, the American producers are able to sell on the world market. However there is law already passed that would allow the president to outlaw oil exports. If the president chose to do that, the world and US oil prices would diverge, with the American price being way under the world price. Come to think of it, that may be why investors are demanding a bigger share of the profits now. With that law existing and threatening free trade in the world oil market they may be less willing to defer their profits to some day in the future.

I've been wondering at US Government U-turns in oil policy. During the Nixon administration circa 1973 and later during the Carter administration circa 1979, exporting American oil would've been heresy. They were beating the drum for energy independence. Also, whatever happened to conservation? There was the 55 mph national speed limit toward that end. CAFE standards were imposed on new vehicle manufacture. Since that time, people have given up small cars for larger pickups. In droves. I can only assume light trucks have lower CAFE standards than small sedans. I suppose conservation doesn't help oil company profits, and building small sedans is less profitable for the auto companies than luxurious light trucks. Both of which have gangs of lobbyists.

 

[gmerkt]

Gold is a commodity like any other. The presumption that its value is more stable than paper currency depends on the assumption that the supply of circulating gold is fixed.

One other thing to think about here is that the world population, so far, has been ever expanding. So there are more people to spread the supply around among.

Which is kinda the same principle as expanding fiat currencies. Which has been subject to much abuse. It's faster, cheaper and easier to manufacture paper and ink it than it is to mine gold.

 

[Alexx1401]

There's a sucker born every minute

When I read stuff like this I can not find it in me to feel bad for them.

 

[Burt Gummer]

There is a reason I have stuck w/ just .999/.9999 silver coins. I am a coin dummy myself. "Collector coins" or whatever they are called - too much knowledge required.

For instance, I found a 1974 Liberty Dollar Coin, Eisenhower Front, Eagle back in a drawer today. Looked on FleaBay to get an idea of its worth. Priced from $4 to $2300 - all look the same to me.