Precious Metals

I’ve been buying a little here and a little there. More gold than silver just because the silver premiums are stupid in my opinion. In the past month I’ve been able to buy proof AGE’s at spot and sovereigns at 0.5% over spot, both of which are great, if you think that gold is going to continue to rise.

Honestly I think it’s amazing that we’ve limited inflation as much as we have, but can we really keep a lid on it for the next decade? I don’t think so.

So what say you, are you selling on the current high or are you still stacking? Silver or gold, and why?

PS. I also have stacks of lead and brass, more fun to play with, and probably a good way to store a bit of value.

I’m about the same as you. There is a lot of inflation now, in the stock market. When that bubble pops and all the money printing from the past 10 years catches up with us, I believe we are in for a world of hurt. I do not believe it can be stopped, history has shown us this as far back as historical records go. Will it be tomorrow or a decade from now? I don’t know, but I believe it will be sooner rather than later and everyone should be prepared by being debt free and having physical hard assets. The days of bread and circus are coming to yet another end....

I can’t afford gold, bought some silver here and there.....put most of my effort in food and food getting “stuff”.

THE PUNISHER said:

I can’t afford gold, bought some silver here and there.....put most of my effort in food and food getting “stuff”.

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Different types of preps, but starting even if you can’t ever afford gold is going to serve you well down the road.

Are you buying local or online? I have some scrap i need to cash in...

MCQUADE said:

I’m about the same as you. There is a lot of inflation now, in the stock market. When that bubble pops and all the money printing from the past 10 years catches up with us, I believe we are in for a world of hurt. I do not believe it can be stopped, history has shown us this as far back as historical records go. Will it be tomorrow or a decade from now? I don’t know, but I believe it will be sooner rather than later and everyone should be prepared by being debt free and having physical hard assets. The days of bread and circus are coming to yet another end....

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You do realize that when the bubble pops, all that "money" goes POOF! ?
It's gone. There is still a debt somewhere, but the money (the part that drives inflation) is gone. Bursting bubbles essentially unprint all that money. They are deflationary, not inflationary.

Bought some more silver yesterday. Can’t really afford gold personally. I try to get at least $20/$50 a month in silver and a little food and bullets as well.

Catfish said:

Are you buying local or online? I have some scrap i need to cash in...

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Online, haven’t found anyone near CLT that wants a reasonable premium.

JimP42 said:

You do realize that when the bubble pops, all that "money" goes POOF! ?
It's gone. There is still a debt somewhere, but the money (the part that drives inflation) is gone. Bursting bubbles essentially unprint all that money. They are deflationary, not inflationary.

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I could be way off, but I’ve come to the conclusion that today’s investment gains are so concentrated in classes that can’t effectively spend any more money than they already do, that those gains do not drive inflation. Put $1B into the economy through an increase to the min wage, that will cause inflation, but put it into market gains and it will not. This matters for the discussion only because if true, the loss of investment gains will also not cause deflation.

I invest in chrome. (Tools)

JimB said:

I could be way off, but I’ve come to the conclusion that today’s investment gains are so concentrated in classes that can’t effectively spend any more money than they already do, that those gains do not drive inflation. Put $1B into the economy through an increase to the min wage, that will cause inflation, but put it into market gains and it will not. This matters for the discussion only because if true, the loss of investment gains will also not cause deflation.

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Min wage increase is slightly inflationary. Even if all the people making min wage kept their jobs and hours at the higher rate, it would be a drop in the bucket compared to the size of our economy. And of course more will be unemployed and those left will get less hours because the min wage increase doesn't come with printed money to fund it. It comes from business revenue, which doesn't change when the law does.

What is inflationary is gov deficit spending ("stimulus") and additional creation of money out of thin air by the fed to loan to banks, and those banks loaning out the same money many times over (see "fractional reserve banking"). That's where the big money comes from and what drives inflation. Any time more money is created, either by literal or figurative printing or fractional reserve lending, the money supply goes up, and one way or another that money goes somewhere. Lately it is mostly going into asset bubble (stocks, real estate, collectibles, bonds, etc...) instead of consumer and industrial goods, so we aren't noticing the inflation too much. It is definitely there, and higher than the official numbers, but not nearly what the money supply increase would indicate that it should be.

I think you are mostly correct that the spending by the very rich doesn't react much to changes in their paper wealth/net worth.

JimP42 said:

I think you are mostly correct that the spending by the very rich doesn't react much to changes in their paper wealth/net worth.

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Reminds me of the super rich billionaire dude (don’t recall his name, don’t care, but he did cause a stir) during the 2008 recession who said that if you want to stimulate the economy you inject money at the bottom where people will spend it. He said giving it to those who already have enough, or more than enough, won’t do much. He said that even the rich people only need to buy so many pairs of pants. In short, they won’t spend it and it does nothing.

I do agree that the inflation has mostly been in creating asset bubbles, stock buybacks and the what. Recently, though, I’ve been noticing big jumps in food prices, though this may have alternate causes as we were discussing yesterday.

I buy and hold both gold and silver whenever prices are attractive. Have no plans of selling either metal unless silver tops $30/oz. Then I'll unload the silver and probably convert to gold until silver gets reasonable again. Holding these two metals as bullion is part of my preps. I am not a collector and will not pay any premiums for "proof" or scarce items. I have a target amount of both metals based on a multiple of my monthly living expenses and when I reach my goals I just plan on holding. I don't try to time markets and I don't speculate in metals. There are better investment strategies for me.
I keep some lead on hand but only because I cast bullets. That's actually a pretty useful way to store lead.

I try to pick up silver eagles regularly,AR [email protected], reloading projectiles & brass once a year with my loose change..

August 2011 gold was $1,917. People bought it That day for That price. How'd that work out. Way too volatile for po folks.

BatteryOaksBilly said:

August 2011 gold was $1,917. People bought it That day for That price. How'd that work out. Way to volatile for po folks.

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Great point, and I think on a percentage basis, silver has been more volatile than gold. Precious metals are a tricky investment, a lot like gambling except that it’s not likely to go to zero. For those betting on the various cryptocurrencies it’s relatively low risk.

Don’t know about the price driven by speculation of silver and gold as an investment or such but looking at the cost to mine and refine per ounce over the past years roughly are estimated for production mining is between $800-$900 per ounce for gold and silver $10-12. Those are industry wide and do vary from area labor to mining ease. That being said when the laws of supply and demand shift in today’s market I would watch percentages of cost and buy/sell accordingly. Right now I’m on hold for either ...

I like silver and gold it's gods money, it can't be easily printed or made out of thin air like digital money can. My thoughts or questions I have been thinking about the past few years is. In this day and age with all out electronic tech that needs silver and gold parts. Will the gov and big business forever keep the price of PM down? In the past PM were only used for jewelery and money. I have been thinking that precious metals have become less precious and more industrial. If silver took off and went to $100 oz. What would be the fall out from that? The tech industry would panic. All electronic devices have some amount of silver or gold in them. Just some food for thought. What's your guys opinions?

JimB said:

So what say you, are you selling on the current high or are you still stacking? Silver or gold, and why?

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I invest in a long-term strategy, mostly in silver. Gold premiums are better, but silver comes in more manageable value single pieces (again looking to the long term for use).

Paging @NCFubar ,, he gave me really good advice on PM’s

NCFubar said:

Don’t know about the price driven by speculation of silver and gold as an investment or such but looking at the cost to mine and refine per ounce over the past years roughly are estimated for production mining is between $800-$900 per ounce for gold and silver $10-12. Those are industry wide and do vary from area labor to mining ease. That being said when the laws of supply and demand shift in today’s market I would watch percentages of cost and buy/sell accordingly. Right now I’m on hold for either ...

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Thanks, I hadn’t thought about the spread on production cost vs market price. With that input it may make sense to stack silver even though the premium is higher, just stack stuff that you can recover most of the premium on.

Some of you have some strange logic. "I can't afford gold". Why not? While $100 worth of gold won't weigh as much as $100 worth of silver they both still cost $100. If you have $100 to invest you can invest in one as easily as the other and it will take less space to store $100 worth of gold than $100 worth of silver. The real key is which one goes up in value and which one goes down.

"So what say you, are you selling on the current high or are you still stacking?"
both.
bought some in February, sold some this month.
"Silver or gold, and why?"
both.
well, i sold gold, not silver.
essentially, i buy when the chart trends down,
and sell when the chart is going up.
i don't have a "target" or "trigger-figure" price.
might sell some silver soon to finance Christmas.

Schattenreiter said:

Some of you have some strange logic. "I can't afford gold". Why not? While $100 worth of gold won't weigh as much as $100 worth of silver they both still cost $100. If you have $100 to invest you can invest in one as easily as the other and it will take less space to store $100 worth of gold than $100 worth of silver. The real key is which one goes up in value and which one goes down.

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I think the issue is that the premium on $100 worth of gold gets even more stupid than the premium on $100 worth of silver.

JimB said:

I think the issue is that the premium on $100 worth of gold gets even more stupid than the premium on $100 worth of silver.

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While freely acknowledging I know nothing about buying and selling of gold and silver if premium comes into play when you buy does it not also come into play when you sell it as well?

Schattenreiter said:

While freely acknowledging I know nothing about buying and selling of gold and silver if premium comes into play when you buy does it not also come into play when you sell it as well?

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It depends upon the product and sales channel, a lot of times you recover only a small portion of the premium when you sell. For example you might buy a 100oz silver bar for 105% of spot and the same dealer will offer to buy it back at 98% of spot. You might be better off selling to another individual, but that has is own problems.

When dealing with any investment do not think in term of dollars think in terms of percentages. If you gain $100 on 1 ounce of gold or $100 on 9 ounces of silver ... approximately $1450 total value with $100 per ounce gain on 1 ounce of gold to $11 per ounce (with 9 ounces held) is you’re making approximately the same rate of return on either of 7.5%. Same goes for stocks, mutual funds, etc. You do have more gold in physical amount but equal monetary value to start but value wise the same dollars invested.

There is a small value to value per piece for refining and minting that allows buying and selling of quantities to be more easily done. It’s easier to buy/sell (as well as store) 1, 5 or 10 ounce pieces of silver than say a 1,000 ounce ingot but you do get a break on price per ounce on larger units so you need to analyze your purchases/holdings by that factor also. I like to purchase silver in bars online from JM Bullion ... they run specials weekly on different pieces with quality breaks removed (you buy 1 or 1,000 at the same over spot price) and free shipping. The 10 ounce silver bars are a happy median of size and price and mix in 1 and 5 ounce bars for allowing smaller sale amounts (think of it in terms like penny, nickel or dimes to make change).

NCFubar said:

I like to purchase silver in bars online from JM Bullion

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Have any experience with Provident? They are running .39 over spot for 10oz bars from the secondary market through tonight. They always seem to have some promo running, probably the same at JM and Ampex and SD, but I’ve only used Provident.

JimB said:

Have any experience with Provident? They are running .39 over spot for 10oz bars from the secondary market through tonight. They always seem to have some promo running, probably the same at JM and Ampex and SD, but I’ve only used Provident.

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Never had any dealings with them but 39¢ over spot is a deal especially since it they have now required amount to purchase at that price and free shipping is $99 or more ... if I were buying I’d give them a try on a small order just to see how they work.

I tried a company in Houston (Nationwide Coin and Bullin) who had 1/10 Oz American Eagle at spot (yes spot on American Eagles) and bought their max of 10. It was the worst experience I ever had ... over 3 weeks to take possession even though they charged my account the 1st day and only communicated when I worried them. In the end I did receive 10 beautiful 1/10 Oz eagles that were worth $20 a piece more than I paid ... but it was a hassle. I’d only buy from them only on deals like that. JMB is way easier to deal with and using ACH eCheck I get a decent price and fairly quick shipment.

Ordered some, will let you know how it goes. Haven’t figured out how to pay them electronically, so it’ll probably be 10 days until delivery since I’m mailing a check.

I’ve bought gold from them before, all smooth, just never silver.

I hold some silver. Back when I had more fluid funds I would by some every couple of weeks. I used the dollar cost averaging scheme and didn’t worry about trying to time the market. When I invest, it’s for the long haul, I’m not a speculator. I consider metals as hedge against inflation and more importantly against hyper inflation. I really do believe that the PTBs are playing with voodoo fire when it comes to the USD and think that eventually something is going to cause the global markets to lose their appetite for it and get spooked.

NCFubar said:

Never had any dealings with them but 39¢ over spot is a deal especially since it they have now required amount to purchase at that price and free shipping is $99 or more ... if I were buying I’d give them a try on a small order just to see how they work.

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Forgot Bout this, have ordered several times from Provident. It’s slow, I send a check, they sit on it for 4 or 5 days and then start the shipping process which is another 4 or 5 days before it gets to the shipper, but the product has always been good. Have purchased GAE’s, gold maples, gold sovereigns and 10oz silver bars. At this point I’ve decided that they are GTG.