- Thread starter High Binder
- Start date
Re: Buying Gold/Silver?
Is everyone forgetting that our economy neither wants, nor needs a strong dollar right now?
China, with almost double-digit growth, is now trying to put the brakes on its economy in order to stave off inflation and keep its goods in the marketplace.
Is everyone forgetting that our economy neither wants, nor needs a strong dollar right now?
China, with almost double-digit growth, is now trying to put the brakes on its economy in order to stave off inflation and keep its goods in the marketplace.
Re: Buying Gold/Silver?
Well then... buy every ounce of gold you can!
http://lsb.scu.edu/~emcquarrie/goldadv.htm
Well then... buy every ounce of gold you can!
http://lsb.scu.edu/~emcquarrie/goldadv.htm
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Doug.</div><div class="ubbcode-body">Well then... buy every ounce of gold you can!
http://lsb.scu.edu/~emcquarrie/goldadv.htm </div></div>
Best that I can tell, that was written in 1996....
Anyway, I don't disagree with much of what he says, though a couple things don't "add up":
In 1926, Gold went for $20/oz. In 1996, it was $400/oz. so $10k in 1926 Gold would be $200k in 1996 (not $79k). Also, not sure where he got the 7% return on the stock market, as there are no references. Seeing as he made up the 1996 value of the $10k 1926 Gold, he may have made that number up, too?
I do like this quote and am in complete agreement - "Paper currency is not a store of value." Thus my statement above - "Fear PAPER".
Perhaps I am a pessimist in that I do not believe those in power have any intention of "fixing" the problems that we face today. We're in such bad shape that the best way to fix it would be to scrap it and start over (we will never, ever, be able to pay off the debt)! Whatever we end up with, Gold and Silver will have value in any Economy.
To illustrate why we can't EVER pay off our debt, let's pretend I'm the Fed and I lend you exactly one dollar. How in the world can you pay me back that dollar <span style="font-style: italic">plus interest</span> when I only gave you that single dollar?...
And don't worry, I own a shotgun
Thanks,
Bill
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Doug.</div><div class="ubbcode-body">Well then... buy every ounce of gold you can!
http://lsb.scu.edu/~emcquarrie/goldadv.htm </div></div>
Best that I can tell, that was written in 1996....
Anyway, I don't disagree with much of what he says, though a couple things don't "add up":
In 1926, Gold went for $20/oz. In 1996, it was $400/oz. so $10k in 1926 Gold would be $200k in 1996 (not $79k). Also, not sure where he got the 7% return on the stock market, as there are no references. Seeing as he made up the 1996 value of the $10k 1926 Gold, he may have made that number up, too?
I do like this quote and am in complete agreement - "Paper currency is not a store of value." Thus my statement above - "Fear PAPER".
Perhaps I am a pessimist in that I do not believe those in power have any intention of "fixing" the problems that we face today. We're in such bad shape that the best way to fix it would be to scrap it and start over (we will never, ever, be able to pay off the debt)! Whatever we end up with, Gold and Silver will have value in any Economy.
To illustrate why we can't EVER pay off our debt, let's pretend I'm the Fed and I lend you exactly one dollar. How in the world can you pay me back that dollar <span style="font-style: italic">plus interest</span> when I only gave you that single dollar?...
And don't worry, I own a shotgun
Thanks,
Bill
Re: Buying Gold/Silver?
It has been pretty clear for a few years that gold, silver and loaded ammunition (like .22LR) will probably bee a medium for exchange for people when the currency is valueless. Having a lot of rice and beans is a good idea too.
I have not moved everything out of the market because I don't know that the collapse will be so bad the government strips my accounts as happened in Argentina. So when a recovery occurs the dollar amount in the 401K will be worth something. Maybe. And I don't want to pay tax on it right now in a cash out. It would be first degree rape of the economic kind.
Buying gold has look foolish for many months, silver less so. In spite of that the little I bought afew months ago is whorth a whole lot more now than it was. What I bought for Y2K is quadrupled. Glad I held it.
But when the currency tanks and if there is a great depression, who will we be selling this gold to, and what are wee taking in exchange for the gold? Pesos?
It has been pretty clear for a few years that gold, silver and loaded ammunition (like .22LR) will probably bee a medium for exchange for people when the currency is valueless. Having a lot of rice and beans is a good idea too.
I have not moved everything out of the market because I don't know that the collapse will be so bad the government strips my accounts as happened in Argentina. So when a recovery occurs the dollar amount in the 401K will be worth something. Maybe. And I don't want to pay tax on it right now in a cash out. It would be first degree rape of the economic kind.
Buying gold has look foolish for many months, silver less so. In spite of that the little I bought afew months ago is whorth a whole lot more now than it was. What I bought for Y2K is quadrupled. Glad I held it.
But when the currency tanks and if there is a great depression, who will we be selling this gold to, and what are wee taking in exchange for the gold? Pesos?
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: crumpmd</div><div class="ubbcode-body">
But when the currency tanks and if there is a great depression, who will we be selling this gold to, and what are wee taking in exchange for the gold? Pesos? </div></div>
The collapse of an economy doesn't necessarily mean the collapse of governance and systems (banking).
Again it is simply store of value. If you have a commodity of greater worth than the fiat currency, and assuming that the government and systems were still intact, it would be a simple matter of the exchange of metal for fiat currency in order to go and do your shopping.
The best way to visually explain what a commodity of worth is relative to fiat currency is to hold a water balloon in both hands - as you squeeze one side it increases the volume in your other hand - yet the total volume has remained the same.
Same gig when you have a decline in a fiat currency and a rise across the board in alternative stores of value.
Using this same analogy you can see the point that was made above by WRM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">To illustrate why we can't EVER pay off our debt, let's pretend I'm the Fed and I lend you exactly one dollar. How in the world can you pay me back that dollar plus interest when I only gave you that single dollar?...</div></div>
Fiat money is <span style="font-style: italic">debt</span>. While not the case in practice - let's assume for a second that there was an equal amount of value behind that debt . If all debt were to be paid off at once, it would impossible to repay the interest on top of the principal because you would categorically have to create additional value. That can not be done. Truthfully there is less total value than there is total debt.
Therefore - and now to get back to the balloon - in the modern era wealth is a function of ones ability to do a better job of preserving the underlying value. As inflation takes over, while it takes more debt backed currency to equal the value that has been preserved, the underlying value itself never changes.
Note while one can argue that from a manufacturing angle this is not the case - raw materials are generally worth less than goods in process, which are worth less than finished goods - when you look at the relative value of all items across the board vs the cost in terms of fiat currency the paradigm becomes clear (tranched MBS come to mind - LOL).
Good luck
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: crumpmd</div><div class="ubbcode-body">
But when the currency tanks and if there is a great depression, who will we be selling this gold to, and what are wee taking in exchange for the gold? Pesos? </div></div>
The collapse of an economy doesn't necessarily mean the collapse of governance and systems (banking).
Again it is simply store of value. If you have a commodity of greater worth than the fiat currency, and assuming that the government and systems were still intact, it would be a simple matter of the exchange of metal for fiat currency in order to go and do your shopping.
The best way to visually explain what a commodity of worth is relative to fiat currency is to hold a water balloon in both hands - as you squeeze one side it increases the volume in your other hand - yet the total volume has remained the same.
Same gig when you have a decline in a fiat currency and a rise across the board in alternative stores of value.
Using this same analogy you can see the point that was made above by WRM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">To illustrate why we can't EVER pay off our debt, let's pretend I'm the Fed and I lend you exactly one dollar. How in the world can you pay me back that dollar plus interest when I only gave you that single dollar?...</div></div>
Fiat money is <span style="font-style: italic">debt</span>. While not the case in practice - let's assume for a second that there was an equal amount of value behind that debt . If all debt were to be paid off at once, it would impossible to repay the interest on top of the principal because you would categorically have to create additional value. That can not be done. Truthfully there is less total value than there is total debt.
Therefore - and now to get back to the balloon - in the modern era wealth is a function of ones ability to do a better job of preserving the underlying value. As inflation takes over, while it takes more debt backed currency to equal the value that has been preserved, the underlying value itself never changes.
Note while one can argue that from a manufacturing angle this is not the case - raw materials are generally worth less than goods in process, which are worth less than finished goods - when you look at the relative value of all items across the board vs the cost in terms of fiat currency the paradigm becomes clear (tranched MBS come to mind - LOL).
Good luck
Re: Buying Gold/Silver?
I don't know where all this talk about fearing paper and the imminent collapse of the dollar is coming from.
We now have a competitive dollar, not a low dollar. It is not that far devalued against the Euro and the Pound. And its performance against the Canadian and Australian dollar is not indicative of its true value because both those economies export a great deal of raw resources. The problem is that its discrepancy is too great against the Chinese currency, by 40-50%. If that adjustment can be made, and it's really an artificial adjustment anyway, then the value of our paper is not even close to a crisis.
I don't know where all this talk about fearing paper and the imminent collapse of the dollar is coming from.
We now have a competitive dollar, not a low dollar. It is not that far devalued against the Euro and the Pound. And its performance against the Canadian and Australian dollar is not indicative of its true value because both those economies export a great deal of raw resources. The problem is that its discrepancy is too great against the Chinese currency, by 40-50%. If that adjustment can be made, and it's really an artificial adjustment anyway, then the value of our paper is not even close to a crisis.
Re: Buying Gold/Silver?
"Fear paper" was only in rebuttal to "fear Gold"....
But what you are doing is comparing one Fiat currency against other Fiat currencies, and all of them are losing value against purchased goods (Gas, PMs, Food, etc.). Every Fiat currency has failed, or will eventually fail, due to hyperinflation. It's inherent in the system and just a matter of when. May or may not be during our lifetimes, but it will happen.
(Edited to add) I remember seeing 16.9/gal gas when I was a kid (born in '62), and when 1st class postage went from 4 to 5 cents. Is gas that much more rare/valuable, or is it that our Dollar is just buying less?
Cheers,
Bill
"Fear paper" was only in rebuttal to "fear Gold"....
But what you are doing is comparing one Fiat currency against other Fiat currencies, and all of them are losing value against purchased goods (Gas, PMs, Food, etc.). Every Fiat currency has failed, or will eventually fail, due to hyperinflation. It's inherent in the system and just a matter of when. May or may not be during our lifetimes, but it will happen.
(Edited to add) I remember seeing 16.9/gal gas when I was a kid (born in '62), and when 1st class postage went from 4 to 5 cents. Is gas that much more rare/valuable, or is it that our Dollar is just buying less?
Cheers,
Bill
Re: Buying Gold/Silver?
I keep seeing mention of the "historic highs" that gold and silver are currently enjoying.
When inflation is factored in (and it has to be), gold and silver are <span style="font-weight: bold">nowhere near</span> their "historic highs".
I keep seeing mention of the "historic highs" that gold and silver are currently enjoying.
When inflation is factored in (and it has to be), gold and silver are <span style="font-weight: bold">nowhere near</span> their "historic highs".
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Goldie</div><div class="ubbcode-body">$1534.00
And this little piggy squeeled all the way to the bank. </div></div>Yes: Now is a good time to sell gold. (Because you don't make money until you sell it).
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Goldie</div><div class="ubbcode-body">$1534.00
And this little piggy squeeled all the way to the bank. </div></div>Yes: Now is a good time to sell gold.
Re: Buying Gold/Silver?
Not buying gold as have a supply from my wild days in the 1970 was working in AK and prospecting on week ends and free time has now TRIPLED in worth
Not buying gold as have a supply from my wild days in the 1970 was working in AK and prospecting on week ends and free time has now TRIPLED in worth
Re: Buying Gold/Silver?
How are people then converting their metal into money. Trying to sell it I would think can be somewhat dangerous. If you sell it to a retail buyer then you don't get the current spot and there are tax consequences. If you don't have a purchase receipt then the irs assumes you paid $0 for the PM and the tax rate is 28%.
i usually don't sell my stocks until they become a long capital gain - tax rate $15%.
How are people then converting their metal into money. Trying to sell it I would think can be somewhat dangerous. If you sell it to a retail buyer then you don't get the current spot and there are tax consequences. If you don't have a purchase receipt then the irs assumes you paid $0 for the PM and the tax rate is 28%.
i usually don't sell my stocks until they become a long capital gain - tax rate $15%.
Re: Buying Gold/Silver?
April 29 (Bloomberg) -- Central banks that were net sellers of gold a decade ago are buying the precious metal to reduce their reliance on the dollar as a reserve currency, signaling demand that may extend a record rally in prices.
As developing countries accelerate purchases, gold may reach $2,000 an ounce this year, compared with a record of $1,538.80 yesterday in New York, said Robert McEwen, the chief executive officer of producer U.S. Gold Corp. Euro Pacific Capital’s Michael Pento, who correctly predicted gold’s highs for the past two years, forecast a 2011 high of $1,600.
Prices reached a record 14 times this month on demand from investors seeking an alternative to the dollar after the currency slumped to the lowest since 2009, U.S. debt widened, and the Federal Reserve signaled April 27 that borrowing costs will remain near zero percent for an extended period. The economy in China, the biggest foreign holder of U.S. Treasuries, grew 9.7 percent in the first quarter.
“China is out to have more gold than America, and Russia is aspiring to the same,” McEwen said yesterday in an interview in New York. “When you have debt, you don’t have a lot of flexibility. China wants to show its currency has more backing than the U.S.”
In 2010, central banks became net buyers for the first time in two decades, adding 87 metric tons in official-sector purchases by countries including Bolivia, Sri Lanka and Mauritius, according to World Gold Council data. China, with more than $3 trillion in foreign-currency reserves, plans to set up new funds to invest in precious metals, Century Weekly reported this week. Russia purchased 8 tons of gold in the first quarter.
China’s Gold Reserves
China, which has just 1.6 percent of its reserves in gold, may invest more than $1 trillion in bullion, Pento said. “China wants to be an international player, and they need to own more gold than they currently have.”
The U.S. Treasury Department projects the government could reach its debt ceiling of $14.3 trillion as soon as mid-May and run out of options for avoiding default by early July. The Fed has kept its benchmark rate between zero percent and 0.25 percent since December 2008 to help stimulate the economy, driving the dollar down 11 percent against a basket of six major currencies during the past year.
“Until monetary policy changes, you’re going to continue to see gold go up,” said Michael Cuggino, who helps manage $12 billion at Permanent Portfolio Funds in San Francisco.
“Ultimately the best thing we can do to create strong fundamentals for the dollar in the medium term is first, keep inflation low, which maintains the buying power of the dollar, and second, create a stronger economy,” Fed Chairman Ben S. Bernanke said on April 27.
U.S. Reserves
As of April, China was the sixth-largest official holder of gold, with 1,054.1 tons, according to World Gold Council estimates. The U.S. has the most, with 8,133.5 tons, or 74.8 percent of the nation’s currency reserves, council data show.
Central-bank buying may have the same impact on gold as the introduction of exchange-traded funds, Cuggino said. Prices have more than tripled since the SPDR Gold Trust, the biggest ETF backed by bullion, was introduced in November 2004.
Central banks in emerging markets may aim to hold 2 percent to 8 percent of their foreign-currency reserves in gold, Francisco Blanch, the head of commodities research at Bank of America Merrill Lynch in New York, said in an interview.
Gold is “close to” its cyclical high, said Blanch, who expects the metal to average $1,500 this year.
Gold’s Enemies
“The enemies of gold are rising interest rates and a balanced budget,” said Pento of Euro Pacific Capital in New York. “I look for a summer swoon once Bernanke exits the bond market. You’re going to have a temporary rise in real interest rates.”
The Fed said it would buy $600 billion in U.S. Treasuries through June.
The Federal Funds rate would have to rise to “Volcker” levels before gold enters a bear market, said Gold Corp.’s McEwen, who expects the metal to rise to $5,000 over three to four years.
Prices have advanced 7.7 percent this year, extending a decade of gains in which gold jumped sixfold from a low in 1999. The all-time inflation adjusted record is $2,338.92, based on the value on Jan. 21, 1980, according to a calculator on the Web site of the Federal Reserve Bank of Minneapolis.
Former Fed Chairman Paul Volcker ended gold’s rally to a then-record $873 by raising borrowing costs to 20 percent in March 1980.
http://noir.bloomberg.com/apps/news?pid=20601087&sid=a3Pxj9OUMnsw&pos=4#
April 29 (Bloomberg) -- Central banks that were net sellers of gold a decade ago are buying the precious metal to reduce their reliance on the dollar as a reserve currency, signaling demand that may extend a record rally in prices.
As developing countries accelerate purchases, gold may reach $2,000 an ounce this year, compared with a record of $1,538.80 yesterday in New York, said Robert McEwen, the chief executive officer of producer U.S. Gold Corp. Euro Pacific Capital’s Michael Pento, who correctly predicted gold’s highs for the past two years, forecast a 2011 high of $1,600.
Prices reached a record 14 times this month on demand from investors seeking an alternative to the dollar after the currency slumped to the lowest since 2009, U.S. debt widened, and the Federal Reserve signaled April 27 that borrowing costs will remain near zero percent for an extended period. The economy in China, the biggest foreign holder of U.S. Treasuries, grew 9.7 percent in the first quarter.
“China is out to have more gold than America, and Russia is aspiring to the same,” McEwen said yesterday in an interview in New York. “When you have debt, you don’t have a lot of flexibility. China wants to show its currency has more backing than the U.S.”
In 2010, central banks became net buyers for the first time in two decades, adding 87 metric tons in official-sector purchases by countries including Bolivia, Sri Lanka and Mauritius, according to World Gold Council data. China, with more than $3 trillion in foreign-currency reserves, plans to set up new funds to invest in precious metals, Century Weekly reported this week. Russia purchased 8 tons of gold in the first quarter.
China’s Gold Reserves
China, which has just 1.6 percent of its reserves in gold, may invest more than $1 trillion in bullion, Pento said. “China wants to be an international player, and they need to own more gold than they currently have.”
The U.S. Treasury Department projects the government could reach its debt ceiling of $14.3 trillion as soon as mid-May and run out of options for avoiding default by early July. The Fed has kept its benchmark rate between zero percent and 0.25 percent since December 2008 to help stimulate the economy, driving the dollar down 11 percent against a basket of six major currencies during the past year.
“Until monetary policy changes, you’re going to continue to see gold go up,” said Michael Cuggino, who helps manage $12 billion at Permanent Portfolio Funds in San Francisco.
“Ultimately the best thing we can do to create strong fundamentals for the dollar in the medium term is first, keep inflation low, which maintains the buying power of the dollar, and second, create a stronger economy,” Fed Chairman Ben S. Bernanke said on April 27.
U.S. Reserves
As of April, China was the sixth-largest official holder of gold, with 1,054.1 tons, according to World Gold Council estimates. The U.S. has the most, with 8,133.5 tons, or 74.8 percent of the nation’s currency reserves, council data show.
Central-bank buying may have the same impact on gold as the introduction of exchange-traded funds, Cuggino said. Prices have more than tripled since the SPDR Gold Trust, the biggest ETF backed by bullion, was introduced in November 2004.
Central banks in emerging markets may aim to hold 2 percent to 8 percent of their foreign-currency reserves in gold, Francisco Blanch, the head of commodities research at Bank of America Merrill Lynch in New York, said in an interview.
Gold is “close to” its cyclical high, said Blanch, who expects the metal to average $1,500 this year.
Gold’s Enemies
“The enemies of gold are rising interest rates and a balanced budget,” said Pento of Euro Pacific Capital in New York. “I look for a summer swoon once Bernanke exits the bond market. You’re going to have a temporary rise in real interest rates.”
The Fed said it would buy $600 billion in U.S. Treasuries through June.
The Federal Funds rate would have to rise to “Volcker” levels before gold enters a bear market, said Gold Corp.’s McEwen, who expects the metal to rise to $5,000 over three to four years.
Prices have advanced 7.7 percent this year, extending a decade of gains in which gold jumped sixfold from a low in 1999. The all-time inflation adjusted record is $2,338.92, based on the value on Jan. 21, 1980, according to a calculator on the Web site of the Federal Reserve Bank of Minneapolis.
Former Fed Chairman Paul Volcker ended gold’s rally to a then-record $873 by raising borrowing costs to 20 percent in March 1980.
http://noir.bloomberg.com/apps/news?pid=20601087&sid=a3Pxj9OUMnsw&pos=4#
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Phil1</div><div class="ubbcode-body">April 29 (Bloomberg) -- Central banks that were net sellers of gold a decade ago are buying the precious metal to reduce their reliance on the dollar as a reserve currency, signaling demand that may extend a record rally in prices.
As developing countries accelerate purchases, gold may reach $2,000 an ounce this year, compared with a record of $1,538.80 yesterday in New York, said Robert McEwen, the chief executive officer of producer U.S. Gold Corp. Euro Pacific Capital’s Michael Pento, who correctly predicted gold’s highs for the past two years, forecast a 2011 high of $1,600.
Prices reached a record 14 times this month on demand from investors seeking an alternative to the dollar after the currency slumped to the lowest since 2009, U.S. debt widened, and the Federal Reserve signaled April 27 that borrowing costs will remain near zero percent for an extended period. The economy in China, the biggest foreign holder of U.S. Treasuries, grew 9.7 percent in the first quarter.
“China is out to have more gold than America, and Russia is aspiring to the same,” McEwen said yesterday in an interview in New York. “When you have debt, you don’t have a lot of flexibility. China wants to show its currency has more backing than the U.S.”
In 2010, central banks became net buyers for the first time in two decades, adding 87 metric tons in official-sector purchases by countries including Bolivia, Sri Lanka and Mauritius, according to World Gold Council data. China, with more than $3 trillion in foreign-currency reserves, plans to set up new funds to invest in precious metals, Century Weekly reported this week. Russia purchased 8 tons of gold in the first quarter.
China’s Gold Reserves
China, which has just 1.6 percent of its reserves in gold, may invest more than $1 trillion in bullion, Pento said. “China wants to be an international player, and they need to own more gold than they currently have.”
The U.S. Treasury Department projects the government could reach its debt ceiling of $14.3 trillion as soon as mid-May and run out of options for avoiding default by early July. The Fed has kept its benchmark rate between zero percent and 0.25 percent since December 2008 to help stimulate the economy, driving the dollar down 11 percent against a basket of six major currencies during the past year.
“Until monetary policy changes, you’re going to continue to see gold go up,” said Michael Cuggino, who helps manage $12 billion at Permanent Portfolio Funds in San Francisco.
“Ultimately the best thing we can do to create strong fundamentals for the dollar in the medium term is first, keep inflation low, which maintains the buying power of the dollar, and second, create a stronger economy,” Fed Chairman Ben S. Bernanke said on April 27.
U.S. Reserves
As of April, China was the sixth-largest official holder of gold, with 1,054.1 tons, according to World Gold Council estimates. The U.S. has the most, with 8,133.5 tons, or 74.8 percent of the nation’s currency reserves, council data show.
Central-bank buying may have the same impact on gold as the introduction of exchange-traded funds, Cuggino said. Prices have more than tripled since the SPDR Gold Trust, the biggest ETF backed by bullion, was introduced in November 2004.
Central banks in emerging markets may aim to hold 2 percent to 8 percent of their foreign-currency reserves in gold, Francisco Blanch, the head of commodities research at Bank of America Merrill Lynch in New York, said in an interview.
Gold is “close to” its cyclical high, said Blanch, who expects the metal to average $1,500 this year.
Gold’s Enemies
“The enemies of gold are rising interest rates and a balanced budget,” said Pento of Euro Pacific Capital in New York. “I look for a summer swoon once Bernanke exits the bond market. You’re going to have a temporary rise in real interest rates.”
The Fed said it would buy $600 billion in U.S. Treasuries through June.
The Federal Funds rate would have to rise to “Volcker” levels before gold enters a bear market, said Gold Corp.’s McEwen, who expects the metal to rise to $5,000 over three to four years.
Prices have advanced 7.7 percent this year, extending a decade of gains in which gold jumped sixfold from a low in 1999. The all-time inflation adjusted record is $2,338.92, based on the value on Jan. 21, 1980, according to a calculator on the Web site of the Federal Reserve Bank of Minneapolis.
Former Fed Chairman Paul Volcker ended gold’s rally to a then-record $873 by raising borrowing costs to 20 percent in March 1980.
http://noir.bloomberg.com/apps/news?pid=20601087&sid=a3Pxj9OUMnsw&pos=4# </div></div>
Excellent read, thanks Phil.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Phil1</div><div class="ubbcode-body">April 29 (Bloomberg) -- Central banks that were net sellers of gold a decade ago are buying the precious metal to reduce their reliance on the dollar as a reserve currency, signaling demand that may extend a record rally in prices.
As developing countries accelerate purchases, gold may reach $2,000 an ounce this year, compared with a record of $1,538.80 yesterday in New York, said Robert McEwen, the chief executive officer of producer U.S. Gold Corp. Euro Pacific Capital’s Michael Pento, who correctly predicted gold’s highs for the past two years, forecast a 2011 high of $1,600.
Prices reached a record 14 times this month on demand from investors seeking an alternative to the dollar after the currency slumped to the lowest since 2009, U.S. debt widened, and the Federal Reserve signaled April 27 that borrowing costs will remain near zero percent for an extended period. The economy in China, the biggest foreign holder of U.S. Treasuries, grew 9.7 percent in the first quarter.
“China is out to have more gold than America, and Russia is aspiring to the same,” McEwen said yesterday in an interview in New York. “When you have debt, you don’t have a lot of flexibility. China wants to show its currency has more backing than the U.S.”
In 2010, central banks became net buyers for the first time in two decades, adding 87 metric tons in official-sector purchases by countries including Bolivia, Sri Lanka and Mauritius, according to World Gold Council data. China, with more than $3 trillion in foreign-currency reserves, plans to set up new funds to invest in precious metals, Century Weekly reported this week. Russia purchased 8 tons of gold in the first quarter.
China’s Gold Reserves
China, which has just 1.6 percent of its reserves in gold, may invest more than $1 trillion in bullion, Pento said. “China wants to be an international player, and they need to own more gold than they currently have.”
The U.S. Treasury Department projects the government could reach its debt ceiling of $14.3 trillion as soon as mid-May and run out of options for avoiding default by early July. The Fed has kept its benchmark rate between zero percent and 0.25 percent since December 2008 to help stimulate the economy, driving the dollar down 11 percent against a basket of six major currencies during the past year.
“Until monetary policy changes, you’re going to continue to see gold go up,” said Michael Cuggino, who helps manage $12 billion at Permanent Portfolio Funds in San Francisco.
“Ultimately the best thing we can do to create strong fundamentals for the dollar in the medium term is first, keep inflation low, which maintains the buying power of the dollar, and second, create a stronger economy,” Fed Chairman Ben S. Bernanke said on April 27.
U.S. Reserves
As of April, China was the sixth-largest official holder of gold, with 1,054.1 tons, according to World Gold Council estimates. The U.S. has the most, with 8,133.5 tons, or 74.8 percent of the nation’s currency reserves, council data show.
Central-bank buying may have the same impact on gold as the introduction of exchange-traded funds, Cuggino said. Prices have more than tripled since the SPDR Gold Trust, the biggest ETF backed by bullion, was introduced in November 2004.
Central banks in emerging markets may aim to hold 2 percent to 8 percent of their foreign-currency reserves in gold, Francisco Blanch, the head of commodities research at Bank of America Merrill Lynch in New York, said in an interview.
Gold is “close to” its cyclical high, said Blanch, who expects the metal to average $1,500 this year.
Gold’s Enemies
“The enemies of gold are rising interest rates and a balanced budget,” said Pento of Euro Pacific Capital in New York. “I look for a summer swoon once Bernanke exits the bond market. You’re going to have a temporary rise in real interest rates.”
The Fed said it would buy $600 billion in U.S. Treasuries through June.
The Federal Funds rate would have to rise to “Volcker” levels before gold enters a bear market, said Gold Corp.’s McEwen, who expects the metal to rise to $5,000 over three to four years.
Prices have advanced 7.7 percent this year, extending a decade of gains in which gold jumped sixfold from a low in 1999. The all-time inflation adjusted record is $2,338.92, based on the value on Jan. 21, 1980, according to a calculator on the Web site of the Federal Reserve Bank of Minneapolis.
Former Fed Chairman Paul Volcker ended gold’s rally to a then-record $873 by raising borrowing costs to 20 percent in March 1980.
http://noir.bloomberg.com/apps/news?pid=20601087&sid=a3Pxj9OUMnsw&pos=4# </div></div>
Excellent read, thanks Phil.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Graham</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Goldie</div><div class="ubbcode-body">$1534.00
And this little piggy squeeled all the way to the bank. </div></div>Yes: Now is a good time to sell gold. (Because you don't make money until you sell it). </div></div>
Actually, any high end experienced (successful) investor will tell you that you make money when you buy assets, not when you sell them. It sounds strange, but it is what it is.
Also, gold is (and has ALWAYS been) far more real as money than any form of paper money. So if gold goes up you don't have to sell it to realize that gain. Your gold currency is simply worth more (you don't have to trade it in for fake (or at least less real) money....it IS money.
And yes, you can buy/sell/trade in gold/silver at most owner operated stores (again, no need to sell/ convert to dollars to realize gains).
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Graham</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Goldie</div><div class="ubbcode-body">$1534.00
And this little piggy squeeled all the way to the bank. </div></div>Yes: Now is a good time to sell gold.
Actually, any high end experienced (successful) investor will tell you that you make money when you buy assets, not when you sell them. It sounds strange, but it is what it is.
Also, gold is (and has ALWAYS been) far more real as money than any form of paper money. So if gold goes up you don't have to sell it to realize that gain. Your gold currency is simply worth more (you don't have to trade it in for fake (or at least less real) money....it IS money.
And yes, you can buy/sell/trade in gold/silver at most owner operated stores (again, no need to sell/ convert to dollars to realize gains).
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Phil1</div><div class="ubbcode-body">
The Federal Funds rate would have to rise to “Volcker” levels before gold enters a bear market, said Gold Corp.’s McEwen, who expects the metal to rise to $5,000 over three to four years.
</div></div>
That is a big statement.
I would encourage everyone to really think about it, as it probably the single most thought provoking statement out of the piece.
If you subscribe to his view you need to really stop and think about what it means in context. For gold to go surge to:
$5,000 in 3yrs we are talking about an annual and compounding rate of 48.2%
$5,000 in 4yrs - 34.3%
Try to contemplate some of the likely domestic and global consequences if the dollar fell and gold rose along those lines.
Do you think we are still the WRC at that point? If so, for how much longer? Since oil is pegged to the dollar - what is the cost of oil? On just that note - what is the cost of food? How is unemployment? What are the residential and commercial property foreclosure rates? What is the strength of the average community bank (the hidy hole for your money)? (On that note anyone - particularly in smaller community spoken to a bank rep recently about the number of folks making large cash withdraws and the capacity of the bank to actually provide that cash on demand? I know that among several banks local to me - they are asking for a one week lead time if someone intends to withdraw large amounts of cash - and by that I mean right at $9,999. If you haven't already I would strongly encourage you to learn more about FDIC and realize that the 'insurance' is worthless. There is no master vault with the 'insurance' fund sitting there. In the event of loss they just turn on the printing press. Well if the loss was because of currency devaluation, do you want to reimbursed with newly printed - and now even further devalued - currency?)
Moreover - look at the real argument over both the budget and the debt ceiling. Remember too that the budget game is BS - Y1 (the real operating year) contains few real cuts in spending. All savings is predicated on future years. Yet - no future budgets are constrained by previous budgets - thus, unless they pass a budget that cuts $1 Trillion plus (insert ginormous number here) - the first year - it is meaningless. Secondly, and with respect to the debt ceiling - the reasons they are giving the public for doing this aren't truthful. The reason is b/c 50% pay taxes in order to carry the other 50%. History has proven that if everybody has a little something society enjoys a greater degree of stability than if a large block of people have nothing. THIS is what it is all really about.
I would be leery of anyone claiming that we will see sustained 34% - 48% gains per annum in any one market.
If we do see a corresponding rise in all commodities however, ask yourself what that really means. If this turns out to be the case, figuring out a means to be self sustainable probably should have been a BIG part of anyone's plan.
Good luck
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Phil1</div><div class="ubbcode-body">
The Federal Funds rate would have to rise to “Volcker” levels before gold enters a bear market, said Gold Corp.’s McEwen, who expects the metal to rise to $5,000 over three to four years.
</div></div>
That is a big statement.
I would encourage everyone to really think about it, as it probably the single most thought provoking statement out of the piece.
If you subscribe to his view you need to really stop and think about what it means in context. For gold to go surge to:
$5,000 in 3yrs we are talking about an annual and compounding rate of 48.2%
$5,000 in 4yrs - 34.3%
Try to contemplate some of the likely domestic and global consequences if the dollar fell and gold rose along those lines.
Do you think we are still the WRC at that point? If so, for how much longer? Since oil is pegged to the dollar - what is the cost of oil? On just that note - what is the cost of food? How is unemployment? What are the residential and commercial property foreclosure rates? What is the strength of the average community bank (the hidy hole for your money)? (On that note anyone - particularly in smaller community spoken to a bank rep recently about the number of folks making large cash withdraws and the capacity of the bank to actually provide that cash on demand? I know that among several banks local to me - they are asking for a one week lead time if someone intends to withdraw large amounts of cash - and by that I mean right at $9,999. If you haven't already I would strongly encourage you to learn more about FDIC and realize that the 'insurance' is worthless. There is no master vault with the 'insurance' fund sitting there. In the event of loss they just turn on the printing press. Well if the loss was because of currency devaluation, do you want to reimbursed with newly printed - and now even further devalued - currency?)
Moreover - look at the real argument over both the budget and the debt ceiling. Remember too that the budget game is BS - Y1 (the real operating year) contains few real cuts in spending. All savings is predicated on future years. Yet - no future budgets are constrained by previous budgets - thus, unless they pass a budget that cuts $1 Trillion plus (insert ginormous number here) - the first year - it is meaningless. Secondly, and with respect to the debt ceiling - the reasons they are giving the public for doing this aren't truthful. The reason is b/c 50% pay taxes in order to carry the other 50%. History has proven that if everybody has a little something society enjoys a greater degree of stability than if a large block of people have nothing. THIS is what it is all really about.
I would be leery of anyone claiming that we will see sustained 34% - 48% gains per annum in any one market.
If we do see a corresponding rise in all commodities however, ask yourself what that really means. If this turns out to be the case, figuring out a means to be self sustainable probably should have been a BIG part of anyone's plan.
Good luck
Re: Buying Gold/Silver?
My biggest problem with the commodities market (besides the fact that the value of gold and silver is predicated upon a belief that someone else values it) is that even with the enourmous growth in gold and silver, you are going to be paying a large chunk in taxes at the end of the day, and will never, REPEAT, NEVER get the spot price. So lets say you got in on silver at $10 an ounce spot back in 08. I'll even be so kind as to not devalue your silver more by trying to guess what you paid over spot (and at those prices it was very high proportionatly). Let's say that in the market collapse you were lucky enough to be a person who had a grand lying around to buy it. So your investment would now be worth 5 times as much. Now let's go try to move $5k in silver. Looking for a quick price online I am seeing $40.71 per generic 1 oz(troy)bar (you get more for branded but pay more to start too). So your $5k just became $4071. Even with your reciept for tax purposes you are now paying that 28% on $3071 profit. you are now down to just over $2200. So you have doubled your money. No doubt it is a great investment compared to stocks or a lousy CD. However, let's look at gas over the same period. When the market tanked so did the price of gas, all the way to a national average of 1.61/gallon by december 08. We are now looking at a national average of 3.90 or so a gallon, 2.4 times higher. So what does your investment get you? The same amount of other goods as it would have at the time of investment.
As a certified whack job, ex-Ranger, consiracy theorist, and believer that it will all come tumbling down around me someday (much like my sanity must have a few years back) the best hedge is having the knoweldge to live off the land if need be, and being "armed to the teeth"(I love Fear and Loathing in Las Vegas). In a world gone mad silver and gold won't get you anything but dead. A well maintained rifle and a ruck sack full of ammo could get you lots of gold and silver. LOL.
How the hell did I end up having this conversation on Sniper's Hide again? And it's my first post!
My biggest problem with the commodities market (besides the fact that the value of gold and silver is predicated upon a belief that someone else values it) is that even with the enourmous growth in gold and silver, you are going to be paying a large chunk in taxes at the end of the day, and will never, REPEAT, NEVER get the spot price. So lets say you got in on silver at $10 an ounce spot back in 08. I'll even be so kind as to not devalue your silver more by trying to guess what you paid over spot (and at those prices it was very high proportionatly). Let's say that in the market collapse you were lucky enough to be a person who had a grand lying around to buy it. So your investment would now be worth 5 times as much. Now let's go try to move $5k in silver. Looking for a quick price online I am seeing $40.71 per generic 1 oz(troy)bar (you get more for branded but pay more to start too). So your $5k just became $4071. Even with your reciept for tax purposes you are now paying that 28% on $3071 profit. you are now down to just over $2200. So you have doubled your money. No doubt it is a great investment compared to stocks or a lousy CD. However, let's look at gas over the same period. When the market tanked so did the price of gas, all the way to a national average of 1.61/gallon by december 08. We are now looking at a national average of 3.90 or so a gallon, 2.4 times higher. So what does your investment get you? The same amount of other goods as it would have at the time of investment.
As a certified whack job, ex-Ranger, consiracy theorist, and believer that it will all come tumbling down around me someday (much like my sanity must have a few years back) the best hedge is having the knoweldge to live off the land if need be, and being "armed to the teeth"(I love Fear and Loathing in Las Vegas). In a world gone mad silver and gold won't get you anything but dead. A well maintained rifle and a ruck sack full of ammo could get you lots of gold and silver. LOL.
How the hell did I end up having this conversation on Sniper's Hide again? And it's my first post!
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: faulball</div><div class="ubbcode-body">
How the hell did I end up having conversation on Sniper's Hide again? And it's my first post! </div></div>
As far as first posts go that's got to be one of the best! Welcome!
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: faulball</div><div class="ubbcode-body">
How the hell did I end up having conversation on Sniper's Hide again? And it's my first post! </div></div>
As far as first posts go that's got to be one of the best! Welcome!
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: faulball</div><div class="ubbcode-body"> In a world gone mad silver and gold won't get you anything but dead. A well maintained rifle and a ruck sack full of ammo could get you lots of gold and silver. LOL.
How the hell did I end up having conversation on Sniper's Hide again? And it's my first post! </div></div>
Nice first post, welcome!
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: faulball</div><div class="ubbcode-body"> In a world gone mad silver and gold won't get you anything but dead. A well maintained rifle and a ruck sack full of ammo could get you lots of gold and silver. LOL.
How the hell did I end up having conversation on Sniper's Hide again? And it's my first post! </div></div>
Nice first post, welcome!
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: faulball</div><div class="ubbcode-body">My biggest problem with the commodities market (besides the fact that the value of gold and silver is predicated upon a belief that someone else values it) is that even with the enourmous growth in gold and silver, you are going to be paying a large chunk in taxes at the end of the day, and will never, REPEAT, NEVER get the spot price. So lets say you got in on silver at $10 an ounce spot back in 08. I'll even be so kind as to not devalue your silver more by trying to guess what you paid over spot (and at those prices it was very high proportionatly). Let's say that in the market collapse you were lucky enough to be a person who had a grand lying around to buy it. So your investment would now be worth 5 times as much. Now let's go try to move $5k in silver. Looking for a quick price online I am seeing $40.71 per generic 1 oz(troy)bar (you get more for branded but pay more to start too). So your $5k just became $4071. Even with your reciept for tax purposes you are now paying that 28% on $3071 profit. you are now down to just over $2200. So you have doubled your money. No doubt it is a great investment compared to stocks or a lousy CD. However, let's look at gas over the same period. When the market tanked so did the price of gas, all the way to a national average of 1.61/gallon by december 08. We are now looking at a national average of 3.90 or so a gallon, 2.4 times higher. So what does your investment get you? The same amount of other goods as it would have at the time of investment.
As a certified whack job, ex-Ranger, consiracy theorist, and believer that it will all come tumbling down around me someday (much like my sanity must have a few years back) the best hedge is having the knoweldge to live off the land if need be, and being "armed to the teeth"(I love Fear and Loathing in Las Vegas). In a world gone mad silver and gold won't get you anything but dead. A well maintained rifle and a ruck sack full of ammo could get you lots of gold and silver. LOL.
How the hell did I end up having this conversation on Sniper's Hide again? And it's my first post! </div></div>
Some thoughts...
Yes, someone else hast to value it, but gold and silver have been valued through all of recorded history, so it's pretty darn safe.
"Large chunk of taxes"... First, paying taxes on your investments is a good... no, GREAT thing because it means you made money. If you don't have to pay taxes, you didn't make money.
Second, if things really fall apart to the point that you need your rifle to survive, I'm not paying taxes (on silver they don't know I have) to the people who put me in that position to begin with.
"Never get the spot price"... No, but I'll never sell at the spot price either so it's a moot point. You can sell silver eagles on ebay all day long, and they actually go for a bit higher than the retailers I bought them from, so no loss.
"So what does your investment get you?"... By my numbers, quite a bit, but let's even go with yours...
Yes, many goods have risen in price, but my house hasn't. In fact, even with your numbers, my house just got 50% cheaper for the portion I can pay with silver. Add in "my" numbers, and silver's continued rise, and my house will be paid off in no time.
"knoweldge to live off the land if need be, and being "armed to the teeth"... AMEN!! I totally agree, but I see preparedness as a multifaceted thing. I have twenty some well maintained rifles, ammo to feed them, food for my wife and friends, etc., but I also have investments that love collapses.
So while someone with your mindset will survive, someone with mine will survive and then retire during the collapse.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: faulball</div><div class="ubbcode-body">My biggest problem with the commodities market (besides the fact that the value of gold and silver is predicated upon a belief that someone else values it) is that even with the enourmous growth in gold and silver, you are going to be paying a large chunk in taxes at the end of the day, and will never, REPEAT, NEVER get the spot price. So lets say you got in on silver at $10 an ounce spot back in 08. I'll even be so kind as to not devalue your silver more by trying to guess what you paid over spot (and at those prices it was very high proportionatly). Let's say that in the market collapse you were lucky enough to be a person who had a grand lying around to buy it. So your investment would now be worth 5 times as much. Now let's go try to move $5k in silver. Looking for a quick price online I am seeing $40.71 per generic 1 oz(troy)bar (you get more for branded but pay more to start too). So your $5k just became $4071. Even with your reciept for tax purposes you are now paying that 28% on $3071 profit. you are now down to just over $2200. So you have doubled your money. No doubt it is a great investment compared to stocks or a lousy CD. However, let's look at gas over the same period. When the market tanked so did the price of gas, all the way to a national average of 1.61/gallon by december 08. We are now looking at a national average of 3.90 or so a gallon, 2.4 times higher. So what does your investment get you? The same amount of other goods as it would have at the time of investment.
As a certified whack job, ex-Ranger, consiracy theorist, and believer that it will all come tumbling down around me someday (much like my sanity must have a few years back) the best hedge is having the knoweldge to live off the land if need be, and being "armed to the teeth"(I love Fear and Loathing in Las Vegas). In a world gone mad silver and gold won't get you anything but dead. A well maintained rifle and a ruck sack full of ammo could get you lots of gold and silver. LOL.
How the hell did I end up having this conversation on Sniper's Hide again? And it's my first post! </div></div>
Some thoughts...
Yes, someone else hast to value it, but gold and silver have been valued through all of recorded history, so it's pretty darn safe.
"Large chunk of taxes"... First, paying taxes on your investments is a good... no, GREAT thing because it means you made money. If you don't have to pay taxes, you didn't make money.
Second, if things really fall apart to the point that you need your rifle to survive, I'm not paying taxes (on silver they don't know I have) to the people who put me in that position to begin with.
"Never get the spot price"... No, but I'll never sell at the spot price either so it's a moot point. You can sell silver eagles on ebay all day long, and they actually go for a bit higher than the retailers I bought them from, so no loss.
"So what does your investment get you?"... By my numbers, quite a bit, but let's even go with yours...
Yes, many goods have risen in price, but my house hasn't. In fact, even with your numbers, my house just got 50% cheaper for the portion I can pay with silver. Add in "my" numbers, and silver's continued rise, and my house will be paid off in no time.
"knoweldge to live off the land if need be, and being "armed to the teeth"... AMEN!! I totally agree, but I see preparedness as a multifaceted thing. I have twenty some well maintained rifles, ammo to feed them, food for my wife and friends, etc., but I also have investments that love collapses.
So while someone with your mindset will survive, someone with mine will survive and then retire during the collapse.
Re: Buying Gold/Silver?
I have been silver for 5 years now. I do not see myself stopping with how suppressed the price has been for nearly 30 years now. I did buy some gold, but traded it for silver while the GSR was still around 60:1.
I also own Great Panther, PSLV, FCX, SCCO, and another one I just picked up yesterday but can't recall the ticker.
Great Panther I have owned since the IPO, and will hold onto it and buy it on dip's like yesterday.
FCX I bought when they announced their contract in the Philippines. It has since split and doubled.
SCCO I picked up about a month ago, as their dividends are pretty decent.
The new one I picked up is Kodiak a discovery firm, they are owned by another mining outfit, but contract out all over Canada.
I'm still buying all of these. I'm an Investor, not a trader. I want my wealth to grow, and to keep providing return's while adding liquidity to these companies so they can operate. I help them, and they help me.
That is something that bother's me, is that most modern guy's only want their quick return's and end up killing whatever industry they are playing with. That's not Capitalism. That is Mercantilism.
I have been silver for 5 years now. I do not see myself stopping with how suppressed the price has been for nearly 30 years now. I did buy some gold, but traded it for silver while the GSR was still around 60:1.
I also own Great Panther, PSLV, FCX, SCCO, and another one I just picked up yesterday but can't recall the ticker.
Great Panther I have owned since the IPO, and will hold onto it and buy it on dip's like yesterday.
FCX I bought when they announced their contract in the Philippines. It has since split and doubled.
SCCO I picked up about a month ago, as their dividends are pretty decent.
The new one I picked up is Kodiak a discovery firm, they are owned by another mining outfit, but contract out all over Canada.
I'm still buying all of these. I'm an Investor, not a trader. I want my wealth to grow, and to keep providing return's while adding liquidity to these companies so they can operate. I help them, and they help me.
That is something that bother's me, is that most modern guy's only want their quick return's and end up killing whatever industry they are playing with. That's not Capitalism. That is Mercantilism.
Re: Buying Gold/Silver?
I bought 40 to 50 troy ounces for $5.30 per ounce years back and in July I will sell them. I am generating money to buy a house at that time. Please go up as high as they can.
The reason I bought silver is because my dad told me I was stupid for buying 1 troy ounce just to see what it was about; my dad went nuts telling me how stipid it is to buy silver. Now he told me it was a great idea now. Now, I know it is time to sell. LOL
I bought 40 to 50 troy ounces for $5.30 per ounce years back and in July I will sell them. I am generating money to buy a house at that time. Please go up as high as they can.
The reason I bought silver is because my dad told me I was stupid for buying 1 troy ounce just to see what it was about; my dad went nuts telling me how stipid it is to buy silver. Now he told me it was a great idea now. Now, I know it is time to sell. LOL
Re: Buying Gold/Silver?
Today CME raised Margins again, with another Margin hike planned for the 9th. Expect the price to level off at the lowest of about $36. My suggestion, buy Physical while it's on sale.
Today CME raised Margins again, with another Margin hike planned for the 9th. Expect the price to level off at the lowest of about $36. My suggestion, buy Physical while it's on sale.
Re: Buying Gold/Silver?
Pullback is here...time to start buying silver...
http://seekingalpha.com/article/268330-p...back?source=msn
Pullback is here...time to start buying silver...
http://seekingalpha.com/article/268330-p...back?source=msn
Re: Buying Gold/Silver?
I bought 5 and a 1/4 ounces back when it was 950 and ounce just about 7 months ago I believe. Probably not going to sell for a couple more months. Greed is a killer, but people think it will go even higher, so I guess it won't kill me to hold on a little longer.
I bought 5 and a 1/4 ounces back when it was 950 and ounce just about 7 months ago I believe. Probably not going to sell for a couple more months. Greed is a killer, but people think it will go even higher, so I guess it won't kill me to hold on a little longer.
Re: Buying Gold/Silver?
Is it legal to buy and sell silver/gold outside of a retail market???
I mean God Forbid the IRS doesn't get it's cut.
I may be interested in buying a few kugerans or gold coins to add to my silver collection...
But if you pay $1500 an oz and gold drops, best just to hold onto it.
Everything I have heard is that Gold is w here you store your money during bad economic times, it will never lose "Value", it may lose the "Value" you paid for it but it will still have value and is a good way to store money du ring hard economic times.
With me going back to work I still have 20k in savings and I want to find a place to invest it, long term - maybe some property in Oklahoma or Texas.
Is it legal to buy and sell silver/gold outside of a retail market???
I mean God Forbid the IRS doesn't get it's cut.
I may be interested in buying a few kugerans or gold coins to add to my silver collection...
But if you pay $1500 an oz and gold drops, best just to hold onto it.
Everything I have heard is that Gold is w here you store your money during bad economic times, it will never lose "Value", it may lose the "Value" you paid for it but it will still have value and is a good way to store money du ring hard economic times.
With me going back to work I still have 20k in savings and I want to find a place to invest it, long term - maybe some property in Oklahoma or Texas.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: ArcticLight</div><div class="ubbcode-body">Is it legal to buy and sell silver/gold outside of a retail market???
I mean God Forbid the IRS doesn't get it's cut.
I may be interested in buying a few kugerans or gold coins to add to my silver collection...
But if you pay $1500 an oz and gold drops, best just to hold onto it.
Everything I have heard is that Gold is w here you store your money during bad economic times, it will never lose "Value", it may lose the "Value" you paid for it but it will still have value and is a good way to store money du ring hard economic times.
With me going back to work I still have 20k in savings and I want to find a place to invest it, long term - maybe some property in Oklahoma or Texas. </div></div>
All of my local coins shops deal exclusively in fiat funny money. I would check out you local coin ships and see what they say. You should not be paying taxes on these transactions. Even the 1099 form is no longer required. If they ask for ID, find another shop.
I'm in AZ, YMMV.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: ArcticLight</div><div class="ubbcode-body">Is it legal to buy and sell silver/gold outside of a retail market???
I mean God Forbid the IRS doesn't get it's cut.
I may be interested in buying a few kugerans or gold coins to add to my silver collection...
But if you pay $1500 an oz and gold drops, best just to hold onto it.
Everything I have heard is that Gold is w here you store your money during bad economic times, it will never lose "Value", it may lose the "Value" you paid for it but it will still have value and is a good way to store money du ring hard economic times.
With me going back to work I still have 20k in savings and I want to find a place to invest it, long term - maybe some property in Oklahoma or Texas. </div></div>
All of my local coins shops deal exclusively in fiat funny money. I would check out you local coin ships and see what they say. You should not be paying taxes on these transactions. Even the 1099 form is no longer required. If they ask for ID, find another shop.
I'm in AZ, YMMV.
Re: Buying Gold/Silver?
i buy from a local dealer i have known most of my life he doesnt gouge and its cash and carry.
i buy from a local dealer i have known most of my life he doesnt gouge and its cash and carry.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Nidstyles</div><div class="ubbcode-body">
All of my local coins shops deal exclusively in fiat funny money. I would check out you local coin ships and see what they say. You should not be paying taxes on these transactions. Even the 1099 form is no longer required. If they ask for ID, find another shop.
</div></div>
Like Denars and the like?
I also noticed that this week Silver lost 27% and Gold lost 4%. I was about to buy some last week but glad I didn't.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Nidstyles</div><div class="ubbcode-body">
All of my local coins shops deal exclusively in fiat funny money. I would check out you local coin ships and see what they say. You should not be paying taxes on these transactions. Even the 1099 form is no longer required. If they ask for ID, find another shop.
</div></div>
Like Denars and the like?
I also noticed that this week Silver lost 27% and Gold lost 4%. I was about to buy some last week but glad I didn't.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: High Binder</div><div class="ubbcode-body">I also noticed that this week Silver lost 27% and Gold lost 4%. I was about to buy some last week but glad I didn't. </div></div>
More on the history of silver:
"Silver has suffered its worst one-week drubbing since 1980, when an infamous alleged attempt by Texas's Hunt brothers to corner the silver market came undone. This week's brutal tumble sent silver-futures prices down to $35.28 an ounce from nearly $50 in just five trading days, and has left Wall Street pros and individual investors dazed, some dealing with sudden losses." and more at:
Silver-Mad Small Investors Fueled an Epic Rise and Fall
"Behind silver's historic collapse is a market that came loose of its moorings, fueled by speculative traders, many of them small investors who may have jumped in at just the wrong moment." Those who recently invested in metals big including Silver just took a huge loss if they sold and turned the paper loss into a real one. As small inexperienced investors often do. Almost as if someone executed a well implemented plan to take their nest-egg cash.
A short true story: <span style="color: #009900">When silver prices hit a three-decade high last week, David Zornetsky decided to do some buying. Searching for a job, the 31-year old in Beacon, N.Y., hoped to use gains from silver to finance a move to New York City and to pay down student loans. "I had been hearing that silver could go up to $150 an ounce this year," says Mr. Zornetsky. "I don't understand," exclaims David, whose silver investment fell about 25%. "Silver is supposed to do very well this year."</span>
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: High Binder</div><div class="ubbcode-body">I also noticed that this week Silver lost 27% and Gold lost 4%. I was about to buy some last week but glad I didn't. </div></div>
More on the history of silver:
Silver-Mad Small Investors Fueled an Epic Rise and Fall
"Behind silver's historic collapse is a market that came loose of its moorings, fueled by speculative traders, many of them small investors who may have jumped in at just the wrong moment." Those who recently invested in metals big including Silver just took a huge loss if they sold and turned the paper loss into a real one. As small inexperienced investors often do. Almost as if someone executed a well implemented plan to take their nest-egg cash.
A short true story: <span style="color: #009900">When silver prices hit a three-decade high last week, David Zornetsky decided to do some buying. Searching for a job, the 31-year old in Beacon, N.Y., hoped to use gains from silver to finance a move to New York City and to pay down student loans. "I had been hearing that silver could go up to $150 an ounce this year," says Mr. Zornetsky. "I don't understand," exclaims David, whose silver investment fell about 25%. "Silver is supposed to do very well this year."</span>
Re: Buying Gold/Silver?
Artic-
one quick thought, the Great Stock Market crash in 1929 was while an 'R' was in office. Its a tad more complex than what some talk radio gurus would have it be.
Teaching a man to fish-
Thats a great concept, stacking gold, stuffing money under a mattress can only get you so far. I think it would be better to have the MEANS to gather wealth, in whatever form, than a pile of what you hope will be valuable in some post zombie, end of the Mayan calander, Bill and Ted's most excellent adventure world.
When it comes to gold or silver the value has been corrupted by unfettered speculation. Traditionally Gold and Silver's value was fixed by governments. Now its 'fixed' by how many people clamor for it.
It can climb quickly as the sheeple get nervious and reflexively buy in. But it can fall twice as fast as the professional speculators take their profit and look for the next commodity to buy in cheap.
It happened in pork. It happened in wheat. It routinely happens in oil. Once a small investor learns the difference between demand and consumption a much wiser investment can be made.
Oh just a few thoughts for the gold and silver hoarders....ahh investors-
Just how much do you think you need to weather a collapse of paper money?
How much do you have?
Artic-
one quick thought, the Great Stock Market crash in 1929 was while an 'R' was in office. Its a tad more complex than what some talk radio gurus would have it be.
Teaching a man to fish-
Thats a great concept, stacking gold, stuffing money under a mattress can only get you so far. I think it would be better to have the MEANS to gather wealth, in whatever form, than a pile of what you hope will be valuable in some post zombie, end of the Mayan calander, Bill and Ted's most excellent adventure world.
When it comes to gold or silver the value has been corrupted by unfettered speculation. Traditionally Gold and Silver's value was fixed by governments. Now its 'fixed' by how many people clamor for it.
It can climb quickly as the sheeple get nervious and reflexively buy in. But it can fall twice as fast as the professional speculators take their profit and look for the next commodity to buy in cheap.
It happened in pork. It happened in wheat. It routinely happens in oil. Once a small investor learns the difference between demand and consumption a much wiser investment can be made.
Oh just a few thoughts for the gold and silver hoarders....ahh investors-
Just how much do you think you need to weather a collapse of paper money?
How much do you have?
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: oregon</div><div class="ubbcode-body">
A short true story: <span style="color: #009900">When silver prices hit a three-decade high last week, David Zornetsky decided to do some buying. Searching for a job, the 31-year old in Beacon, N.Y., hoped to use gains from silver to finance a move to New York City and to pay down student loans. "I had been hearing that silver could go up to $150 an ounce this year," says Mr. Zornetsky. "I don't understand," exclaims David, whose silver investment fell about 25%. "Silver is supposed to do very well this year."</span> </div></div>
Articles like these are what contribute to the financial ignorance of Americans.
Did speculators take profit? Yes. Were margins increased? Yes. Was it over valued? Lets talk about that in context of what the article presented.
In the '80s bust, Silver was @ $50.00 / oz - that's $135 / oz today.
In January of 1979 Treasuries were 9.10% and Prime was 11.75%
In January of 1980 Treasuries were 10.80% and Prime was 15.50%
In January of 1982 Treasuries were 14.59% and Prime was 16.25%
In January of 1985 Treasuries were 11.38% and Prime was 10.50%
Treasury rates didn't fall below 9% until May of 1989. Again, Treasuries are where our fiat money comes from.
We never paid off the borrowing from the 70's and 80's. Now we need to have similar rates of return to ratchet in the debt created by the spending of the last decade.
Treasuries today are @ 3.5% and Prime is @ 3.25%. Furthermore in 1980 there was no question about our credit rating or that we would remain the world reserve currency. Things are uh... a bit different now.
If you can time bottom on metals - now is GREAT time to buy.
Good luck
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: oregon</div><div class="ubbcode-body">
A short true story: <span style="color: #009900">When silver prices hit a three-decade high last week, David Zornetsky decided to do some buying. Searching for a job, the 31-year old in Beacon, N.Y., hoped to use gains from silver to finance a move to New York City and to pay down student loans. "I had been hearing that silver could go up to $150 an ounce this year," says Mr. Zornetsky. "I don't understand," exclaims David, whose silver investment fell about 25%. "Silver is supposed to do very well this year."</span> </div></div>
Articles like these are what contribute to the financial ignorance of Americans.
Did speculators take profit? Yes. Were margins increased? Yes. Was it over valued? Lets talk about that in context of what the article presented.
In the '80s bust, Silver was @ $50.00 / oz - that's $135 / oz today.
In January of 1979 Treasuries were 9.10% and Prime was 11.75%
In January of 1980 Treasuries were 10.80% and Prime was 15.50%
In January of 1982 Treasuries were 14.59% and Prime was 16.25%
In January of 1985 Treasuries were 11.38% and Prime was 10.50%
Treasury rates didn't fall below 9% until May of 1989. Again, Treasuries are where our fiat money comes from.
We never paid off the borrowing from the 70's and 80's. Now we need to have similar rates of return to ratchet in the debt created by the spending of the last decade.
Treasuries today are @ 3.5% and Prime is @ 3.25%. Furthermore in 1980 there was no question about our credit rating or that we would remain the world reserve currency. Things are uh... a bit different now.
If you can time bottom on metals - now is GREAT time to buy.
Good luck
Re: Buying Gold/Silver?
Well the borrowing we failed to pay off was during the 80's and after an 8 year respite resumed in even grander style. The 70's was all about a bit of chump change.
timing a bottom is how most daytraders ended up broke. Real talk, small investors have NO clue when any commodity will suddenly have some 'profit taking'. Its minnows swimming with mega sharks.
If you didnt buy 800 dollar gold I'd recommend buying other metals, like copper and lead.
Best anyone can do is dabble a bit with the hope that when you are ready to cash out some computer somewhere hasnt already triggered another massive selloff.
Its like your wedding day, it doesnt matter if it was sunny the day before, a hard rain on THE day is a calamity.
Again the question is just how much of this speculator enflamed silver or gold will you need if the 'fiat' comes crashing down?
I'd be looking for a way to GET gold and silver AFTER the crash.
Well the borrowing we failed to pay off was during the 80's and after an 8 year respite resumed in even grander style. The 70's was all about a bit of chump change.
timing a bottom is how most daytraders ended up broke. Real talk, small investors have NO clue when any commodity will suddenly have some 'profit taking'. Its minnows swimming with mega sharks.
If you didnt buy 800 dollar gold I'd recommend buying other metals, like copper and lead.
Best anyone can do is dabble a bit with the hope that when you are ready to cash out some computer somewhere hasnt already triggered another massive selloff.
Its like your wedding day, it doesnt matter if it was sunny the day before, a hard rain on THE day is a calamity.
Again the question is just how much of this speculator enflamed silver or gold will you need if the 'fiat' comes crashing down?
I'd be looking for a way to GET gold and silver AFTER the crash.
Re: Buying Gold/Silver?
notquiteright - Wheat is still "Pretty much" in 1984 dollars. Now maybe that changed in the past year or 5...but in 2006 I did a report on it for my agriculture class.
OK So lets use my silver as an example. Bought it in 1980 at say $1800 for 1500 coins (1946 dimes). $1.20 in 1980 dollars.
Fast forward to today, I saw it a few weeks ago at $2.85 per coin and I sold some to a fellow shooter so I have 1000 coins left.
I sell them now say, $2.85 and I get $2850.
2011 - 1980 is 31 years. Assuming money doubled every 6 years, but lets say TEN just to be safe, I should have had $8000 had I invested in bonds or some such that had a hefty return.
Instead I'm sitting on $2500 worth of silver.
Now had I bouight these at say, 40 cents for each dime and only paid $500, returning $2500 is still not a great investment, it's not "Bad" but the market and savings accounts and/or bonds would have a better return.
Precious metals are where you "Store" money to survive an economic downturn.
I'm looking at dumping $30k into an IRA, not precious metals, If I was to buy gold it would be when the economy is good and the price of gold is down.
Good economy - good gold price
Bad economy - bad gold price.
In fact you'd be better off buying stock in a gold MINE vs buying the metal itself.
notquiteright - Wheat is still "Pretty much" in 1984 dollars. Now maybe that changed in the past year or 5...but in 2006 I did a report on it for my agriculture class.
OK So lets use my silver as an example. Bought it in 1980 at say $1800 for 1500 coins (1946 dimes). $1.20 in 1980 dollars.
Fast forward to today, I saw it a few weeks ago at $2.85 per coin and I sold some to a fellow shooter so I have 1000 coins left.
I sell them now say, $2.85 and I get $2850.
2011 - 1980 is 31 years. Assuming money doubled every 6 years, but lets say TEN just to be safe, I should have had $8000 had I invested in bonds or some such that had a hefty return.
Instead I'm sitting on $2500 worth of silver.
Now had I bouight these at say, 40 cents for each dime and only paid $500, returning $2500 is still not a great investment, it's not "Bad" but the market and savings accounts and/or bonds would have a better return.
Precious metals are where you "Store" money to survive an economic downturn.
I'm looking at dumping $30k into an IRA, not precious metals, If I was to buy gold it would be when the economy is good and the price of gold is down.
Good economy - good gold price
Bad economy - bad gold price.
In fact you'd be better off buying stock in a gold MINE vs buying the metal itself.
Re: Buying Gold/Silver?
Junk silver (gold) isn't the same thing.
While the value of the 0.07234 oz of silver per dime has gone up, so has the fuel costs for trucking to the smelter, the energy and payroll costs of the smelter, the regulatory costs for the smelter...
Junk silver and gold have value as trade (see notes on Argentinian collapse), not so much as the PM commodity.
FWIW - Using the Gubbermint's Calculator $0.10 in 1946 = $1.15 in 2011
Here are three competing articles from this morning that everyone can either rally around or throw stones at depending on which side of the fence they are on.
Zillow Reports Home Values Continue to Decline by 8%
Keep in mind what it means when you read that 28.4% of all mortgages are under water - up from 27% in Q4 of 2010. If the banks are foreclosing and feeding them out into the market (reduction in total 'overvalued' mortgages) and the rate is still climbing at an annually adjusted rate of 4.2%, there is a compounding effect that is driven by non real estate conditions.
What if the Gold Market Crashes?
Basically - the PM market is over valued and based on history, it is predictable. Note - none of the historic values are adjusted for the time value of money.
More Confident China Confronts US
Think about what the US argument really is here - we owe you $1.2 trillion dollars and we want China to alter the value of Chinese fiat money against the value of US fiat money so as to help the US pay off it's debt to the Chinese (and the rest of the world) with our devalued dollar (effectively write down the loan that you made to us). Oh by the way, we're broke again, and up against the limits of our credit card. I know we've been borrowing money in the 3.5% range - what do you say you inflate the value of your currency against our devalued currency and then cut us another check for a couple hundred billion?
Good luck
Junk silver (gold) isn't the same thing.
While the value of the 0.07234 oz of silver per dime has gone up, so has the fuel costs for trucking to the smelter, the energy and payroll costs of the smelter, the regulatory costs for the smelter...
Junk silver and gold have value as trade (see notes on Argentinian collapse), not so much as the PM commodity.
FWIW - Using the Gubbermint's Calculator $0.10 in 1946 = $1.15 in 2011
Here are three competing articles from this morning that everyone can either rally around or throw stones at depending on which side of the fence they are on.
Zillow Reports Home Values Continue to Decline by 8%
Keep in mind what it means when you read that 28.4% of all mortgages are under water - up from 27% in Q4 of 2010. If the banks are foreclosing and feeding them out into the market (reduction in total 'overvalued' mortgages) and the rate is still climbing at an annually adjusted rate of 4.2%, there is a compounding effect that is driven by non real estate conditions.
What if the Gold Market Crashes?
Basically - the PM market is over valued and based on history, it is predictable. Note - none of the historic values are adjusted for the time value of money.
More Confident China Confronts US
Think about what the US argument really is here - we owe you $1.2 trillion dollars and we want China to alter the value of Chinese fiat money against the value of US fiat money so as to help the US pay off it's debt to the Chinese (and the rest of the world) with our devalued dollar (effectively write down the loan that you made to us). Oh by the way, we're broke again, and up against the limits of our credit card. I know we've been borrowing money in the 3.5% range - what do you say you inflate the value of your currency against our devalued currency and then cut us another check for a couple hundred billion?
Good luck
Re: Buying Gold/Silver?
Treasury Auction To Take US Over Debt Ceiling by Monday
<span style="font-weight: bold"><span style="font-style: italic">The Obama administration has asked Congress to raise the limit, warning that failure to act could lead the government to default by Aug. 2--and could spook investors even before then.</span></span>
People need to really grasp the fact that there are only three alternative scenarios:
1. Radically cut the budget by trillions of dollars and pay this off. Remember 50% of the people live off of the other 50% of the people in this Country - that is a recipe for civil unrest.
2. Default - likely we would go to the world and say we can not pay, we need to change the terms of the debt. This will send the entire world into a tail spin for some time. It will also likely be the end of the dollar as the world's reserve currency.
3. Inflate it away (devalue the dollar even more). This has been the standard play of the US but we need to realize that the rest of the world is no longer interested in helping pick up the tab associated with this inflation. This too will likely mean the end of the dollar as the WRC.
<span style="font-weight: bold"><span style="font-style: italic">The federal budget deficit widened in April, with the government spending $ 40.49 billion more than it collected last month, a Treasury Department report said Wednesday.
The deficit was the 31st monthly shortfall in a row. With seven months of fiscal 2011 elapsed, the government has spent $869.90 billion more than it has collected.
Even the most aggressive plans wouldn't wipe out budget deficits for years, meaning that debt will continue to mount. </span></span>
2010 Total US Revenues $2.33 Trillion.
Based on 2010 Revenues - this mean an increase of 37% just to cover the existing deficit.
Are you interested in paying 37% more taxes?
This is unsustainable.
Good luck
Treasury Auction To Take US Over Debt Ceiling by Monday
<span style="font-weight: bold"><span style="font-style: italic">The Obama administration has asked Congress to raise the limit, warning that failure to act could lead the government to default by Aug. 2--and could spook investors even before then.</span></span>
People need to really grasp the fact that there are only three alternative scenarios:
1. Radically cut the budget by trillions of dollars and pay this off. Remember 50% of the people live off of the other 50% of the people in this Country - that is a recipe for civil unrest.
2. Default - likely we would go to the world and say we can not pay, we need to change the terms of the debt. This will send the entire world into a tail spin for some time. It will also likely be the end of the dollar as the world's reserve currency.
3. Inflate it away (devalue the dollar even more). This has been the standard play of the US but we need to realize that the rest of the world is no longer interested in helping pick up the tab associated with this inflation. This too will likely mean the end of the dollar as the WRC.
<span style="font-weight: bold"><span style="font-style: italic">The federal budget deficit widened in April, with the government spending $ 40.49 billion more than it collected last month, a Treasury Department report said Wednesday.
The deficit was the 31st monthly shortfall in a row. With seven months of fiscal 2011 elapsed, the government has spent $869.90 billion more than it has collected.
Even the most aggressive plans wouldn't wipe out budget deficits for years, meaning that debt will continue to mount. </span></span>
2010 Total US Revenues $2.33 Trillion.
Based on 2010 Revenues - this mean an increase of 37% just to cover the existing deficit.
Are you interested in paying 37% more taxes?
This is unsustainable.
Good luck
Re: Buying Gold/Silver?
^^ The whole system has been unsustainable since 1913.
^^ The whole system has been unsustainable since 1913.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: High Binder</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Nidstyles</div><div class="ubbcode-body">
All of my local coins shops deal exclusively in fiat funny money. I would check out you local coin ships and see what they say. You should not be paying taxes on these transactions. Even the 1099 form is no longer required. If they ask for ID, find another shop.
</div></div>
Like Denars and the like?
I also noticed that this week Silver lost 27% and Gold lost 4%. I was about to buy some last week but glad I didn't. </div></div>
Actually now would be the right time to buy. You don't buy it on the highs. You buy on the dip's to bring your dollar cost averaging down.
PM's are not an Investment to make money off of. They are a store of wealth. They have Intrinsic value from their properties and their scarcity. I could lay a very elaborate rational behind the reasoning for buying them, but odds are that you will not listen.
I will say this, when Inflation from QE 1.5 and QE 2 finally start coming into play in about 5-7 months from now, you will wish you bought some beforehand when it was still cheap.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: High Binder</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Nidstyles</div><div class="ubbcode-body">
All of my local coins shops deal exclusively in fiat funny money. I would check out you local coin ships and see what they say. You should not be paying taxes on these transactions. Even the 1099 form is no longer required. If they ask for ID, find another shop.
</div></div>
Like Denars and the like?
I also noticed that this week Silver lost 27% and Gold lost 4%. I was about to buy some last week but glad I didn't. </div></div>
Actually now would be the right time to buy. You don't buy it on the highs. You buy on the dip's to bring your dollar cost averaging down.
PM's are not an Investment to make money off of. They are a store of wealth. They have Intrinsic value from their properties and their scarcity. I could lay a very elaborate rational behind the reasoning for buying them, but odds are that you will not listen.
I will say this, when Inflation from QE 1.5 and QE 2 finally start coming into play in about 5-7 months from now, you will wish you bought some beforehand when it was still cheap.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">How are people then converting their metal into money. Trying to sell it I would think can be somewhat dangerous. If you sell it to a retail buyer then you don't get the current spot and there are tax consequences. If you don't have a purchase receipt then the irs assumes you paid $0 for the PM and the tax rate is 28%.
i usually don't sell my stocks until they become a long capital gain - tax rate $15%. </div></div>
Why would you sell it for fiat? Unless you are over-extended and need to pay bill's there's no reason to. There are no taxes on PM's. It's not an equitable transfer if you hold and use the Physical. Under the current tax code it's viewed as a direct barter exchange, which is non-taxable as there's no transfer or creation of debt. You should really read the tax code more. Equities are considered debt based, which is why you are paying taxes on the returns.
I can go to any Farmer's Market locally to me and trade silver for whatever I wish. Most local producers in my area will take gold and silver. Even my local gunsmith will do work for silver. The only people that are required by law to work with fiat are the Corporation's that operate with a credit line.
There are no law's that make using any sort of commodity illegal for usage of money.
Read the fiat you carry around. It say's right on it, that it is only meant for payment of debt's. Fiat money in legal terms is treated as a transference of debt.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">How are people then converting their metal into money. Trying to sell it I would think can be somewhat dangerous. If you sell it to a retail buyer then you don't get the current spot and there are tax consequences. If you don't have a purchase receipt then the irs assumes you paid $0 for the PM and the tax rate is 28%.
i usually don't sell my stocks until they become a long capital gain - tax rate $15%. </div></div>
Why would you sell it for fiat? Unless you are over-extended and need to pay bill's there's no reason to. There are no taxes on PM's. It's not an equitable transfer if you hold and use the Physical. Under the current tax code it's viewed as a direct barter exchange, which is non-taxable as there's no transfer or creation of debt. You should really read the tax code more. Equities are considered debt based, which is why you are paying taxes on the returns.
I can go to any Farmer's Market locally to me and trade silver for whatever I wish. Most local producers in my area will take gold and silver. Even my local gunsmith will do work for silver. The only people that are required by law to work with fiat are the Corporation's that operate with a credit line.
There are no law's that make using any sort of commodity illegal for usage of money.
Read the fiat you carry around. It say's right on it, that it is only meant for payment of debt's. Fiat money in legal terms is treated as a transference of debt.
Re: Buying Gold/Silver?
Can you give me the IRS reference to your statement that pm capital gains are not taxable? Everything that I have read points to a flat 28% tax rate. The government does this to dissuade the purchase of pm.
Can you give me the IRS reference to your statement that pm capital gains are not taxable? Everything that I have read points to a flat 28% tax rate. The government does this to dissuade the purchase of pm.
Re: Buying Gold/Silver?
I think its a good investment particularly if you're already well diversified and you have a large savings. Savings accounts are a thing of the past and are about worthless for anything other than contingency fund. The banks want your money but are unwilling to adequately compensate you for its use. I wouldn't put all of my eggs in one basket though.
I think its a good investment particularly if you're already well diversified and you have a large savings. Savings accounts are a thing of the past and are about worthless for anything other than contingency fund. The banks want your money but are unwilling to adequately compensate you for its use. I wouldn't put all of my eggs in one basket though.
Re: Buying Gold/Silver?
Savings accounts are a good place to park your dollars...the problem is that every day they are parked there, you are losing purchasing power due to inflation. Pm were supposed to be a hedge against inflation because their price is no longer tied to the dollar. Pm currently are acting like a durable commodity, and like any commodity are susceptible to "tulip mania". Who knows what the actual sticker price of silver should be...
Savings accounts are a good place to park your dollars...the problem is that every day they are parked there, you are losing purchasing power due to inflation. Pm were supposed to be a hedge against inflation because their price is no longer tied to the dollar. Pm currently are acting like a durable commodity, and like any commodity are susceptible to "tulip mania". Who knows what the actual sticker price of silver should be...
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">Savings accounts are a good place to park your dollars...the problem is that every day they are parked there, you are losing purchasing power due to inflation. </div></div> I'm leery about savings accounts for one reason...we all witnessed just a few years ago just how responsible banks really are. That and with the manufactured economical "fluff" spewing from the news, I think our economy and banking system is still a house of cards. I'll only trust those dumbasses with some of my liquid assets. Makes you wonder if a hole in the ground isn't a safer place.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">Savings accounts are a good place to park your dollars...the problem is that every day they are parked there, you are losing purchasing power due to inflation. </div></div> I'm leery about savings accounts for one reason...we all witnessed just a few years ago just how responsible banks really are. That and with the manufactured economical "fluff" spewing from the news, I think our economy and banking system is still a house of cards. I'll only trust those dumbasses with some of my liquid assets. Makes you wonder if a hole in the ground isn't a safer place.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">Can you give me the IRS reference to your statement that pm capital gains are not taxable? Everything that I have read points to a flat 28% tax rate. The government does this to dissuade the purchase of pm. </div></div>
http://en.wikipedia.org/wiki/Internal_Revenue_Code_section_1031
This is why using Physical is the best way to go about dealing in PM's. Bank's make large order transfers in gold and silver. No matter the price, it's used as money. Therefore it's technically an exchange for like item's, and thusly non-taxable.
If you are paying taxes on your silver purchases or exchanges for fiat funny money, you are doing it wrong.
The only way I would ever recommend anyone to deal with equities in PM's is with the miner's. Everything else should be done in physical. That is unless you are going to be a trader playing with the ETF's, and then you are getting railed with FICO and capital gain taxes anyways.
There are no gains in the physical PM market, as they do not generate revenue or capital. They are a store of wealth, and are used as monetary transfer without debt.
Not saying this directly towards you, but there is a lot of ignorance about PM's going around these days.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">Can you give me the IRS reference to your statement that pm capital gains are not taxable? Everything that I have read points to a flat 28% tax rate. The government does this to dissuade the purchase of pm. </div></div>
http://en.wikipedia.org/wiki/Internal_Revenue_Code_section_1031
This is why using Physical is the best way to go about dealing in PM's. Bank's make large order transfers in gold and silver. No matter the price, it's used as money. Therefore it's technically an exchange for like item's, and thusly non-taxable.
If you are paying taxes on your silver purchases or exchanges for fiat funny money, you are doing it wrong.
The only way I would ever recommend anyone to deal with equities in PM's is with the miner's. Everything else should be done in physical. That is unless you are going to be a trader playing with the ETF's, and then you are getting railed with FICO and capital gain taxes anyways.
There are no gains in the physical PM market, as they do not generate revenue or capital. They are a store of wealth, and are used as monetary transfer without debt.
Not saying this directly towards you, but there is a lot of ignorance about PM's going around these days.
Re: Buying Gold/Silver?
Unless I am wrong I thought PMs were classified as collectibles. Collectibles are taxed at 28% if a gain is realized when sold. S.1367: Fair Treatment for Precious Metals Investors Act was proposed to help investors with this unfair tax. To my knowledge it has not passed. Since PMs are classified as collectibles any gain realized at barter is subject to taxation. Unless you trade one PM for another PM, like for like will not hold true. No taxes are paid at purchase.
Unless I am wrong I thought PMs were classified as collectibles. Collectibles are taxed at 28% if a gain is realized when sold. S.1367: Fair Treatment for Precious Metals Investors Act was proposed to help investors with this unfair tax. To my knowledge it has not passed. Since PMs are classified as collectibles any gain realized at barter is subject to taxation. Unless you trade one PM for another PM, like for like will not hold true. No taxes are paid at purchase.
Re: Buying Gold/Silver?
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">Unless I am wrong I thought PMs were classified as collectibles. Collectibles are taxed at 28% if a gain is realized when sold. S.1367: Fair Treatment for Precious Metals Investors Act was proposed to help investors with this unfair tax. To my knowledge it has not passed. Since PMs are classified as collectibles any gain realized at barter is subject to taxation. Unless you trade one PM for another PM, like for like will not hold true. No taxes are paid at purchase. </div></div>
No, Investment grade PM's are classified as money. They are the basis for the FOREX XAU and XAG tickers, and used as base transaction currency that does not involved the transfer of debt, or promissory on loan's.
The Investment Act was a scam to close the Like Item loophole. That's all it ever was. The problem was that during that Congress, gold and silver were relatively quiet, so there was no push for them to use it. It's only been the past two quarters that gold and silver have been really getting loud.
If you go back and look at the argument made by the Supreme Court for the shooting down of dealer's required to file 1099's for gold and silver purchases, and the Constitutional role of PM's in the first place, you will see why any such effort to tax gold or silver is doomed to fail. It just isn't legal, and there's no court in the US that would dare push for such a ruling. Like I said before, if you are paying taxes on your silver and gold, you are doing it wrong. It's non-taxable.
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Richard II</div><div class="ubbcode-body">Unless I am wrong I thought PMs were classified as collectibles. Collectibles are taxed at 28% if a gain is realized when sold. S.1367: Fair Treatment for Precious Metals Investors Act was proposed to help investors with this unfair tax. To my knowledge it has not passed. Since PMs are classified as collectibles any gain realized at barter is subject to taxation. Unless you trade one PM for another PM, like for like will not hold true. No taxes are paid at purchase. </div></div>
No, Investment grade PM's are classified as money. They are the basis for the FOREX XAU and XAG tickers, and used as base transaction currency that does not involved the transfer of debt, or promissory on loan's.
The Investment Act was a scam to close the Like Item loophole. That's all it ever was. The problem was that during that Congress, gold and silver were relatively quiet, so there was no push for them to use it. It's only been the past two quarters that gold and silver have been really getting loud.
If you go back and look at the argument made by the Supreme Court for the shooting down of dealer's required to file 1099's for gold and silver purchases, and the Constitutional role of PM's in the first place, you will see why any such effort to tax gold or silver is doomed to fail. It just isn't legal, and there's no court in the US that would dare push for such a ruling. Like I said before, if you are paying taxes on your silver and gold, you are doing it wrong. It's non-taxable.
Re: Buying Gold/Silver?
Great thread guys.
Investing in PMs isn't a bet against America, it's a bet against Washington D.C. Washington D.C. is not America, nor does it represent our countries best interests, IMO.
FWIW, we are open to accepting silver rounds as trade for any optic we sell. .999 silver rounds or bars. For those of you who bought and owned early this is a good opportunity to convert your value into equipment. We will pay spot price per ounce in trade for discounted optics.
Just putting it out there.
Scott
Great thread guys.
Investing in PMs isn't a bet against America, it's a bet against Washington D.C. Washington D.C. is not America, nor does it represent our countries best interests, IMO.
FWIW, we are open to accepting silver rounds as trade for any optic we sell. .999 silver rounds or bars. For those of you who bought and owned early this is a good opportunity to convert your value into equipment. We will pay spot price per ounce in trade for discounted optics.
Just putting it out there.
Scott
Similar threads
