Posted on 04/04/2012 8:26:23 AM PDT by appeal2
Last week Peter Grandich and I made the call that this week the precious metals markets would get hammered. We noticed that holiday weeks usually bring thinly traded markets, which are ripe for manipulation and elitist raids. No sooner did we post the interview from Thurs. 3/29, then wham! The precious metals markets are behaving like Paul Volcker was just appointed Chairman of the Fed. Don't get us wrong, Bernanke is no Volcker, but this, like everything in life, is temporary...nothing has changed!
Only a fool invests in precious metals. Gold and silver are a hedge and not an investment. You buy gold and silver for the same reasons you buy fire extinguishers, guns, and ammunition.
You buy them because you might need them, not because you plan on selling them someday.
So why are those “we buy gold” people still standing on the street corners?
Yeah, how silly to buy PMs when there are all those perfectly sound fiat currencies to invest in and that sound stock market that is such an accurate reflection and predictor of the economy.
“You buy them because you might need them, not because you plan on selling them someday.
“
You sure about that? People make plenty money selling PMs. I did/do.
Also, he's discounting the fact that government spending and currency devaluation will only increase at an ever accelerating rate.
The paper manipulators are careful not to short the price down into this area, or they would end up selling literal tons of Gold which they simply do not possess.
Physical PMs are a terrific investment. The paper 'froth' on top of it - however - is a dangerous, fraudulent trading environment. Buy your PMs of choice and keep them close: but don't bother trading the paper versions.
SLW is a buy, right here right now.
You buy gold and silver for the same reasons you buy fire extinguishers, guns, and ammunition.
—
I wish my wife was more into the latter and not the former. ;-)
I own all of what you used as an example...fire extinguishers, guns, and ammo...but I own those for different reasons than I buy precious metals. I make money with precious metals...gold is perhaps one of the safest investments one can make...the consumer demand for gold has out paced the new supply of gold for over a decade..that alone makes it a good investment.
Of course there are times to sell and the re-buy but precious metals are great to invest in...and easy.
I knew when I got three calls from bullion dealers yesterday that danger was approaching. I sold 1/3rd my gold at $1750, think we could see sub-1600.
I’m just sitting and waiting for now. Usually right at the start of the year or later in the year is the weaker time, better time to buy.
I will buy all you sell!
I will buy all you sell!
I just checked Coinflation.com. Silver’s not getting hammered. It’s still in the $31 range.
I agree though. I’ve bought nothing but junk silver (and a dozen silver eagle proofs I got cheap). I’ve never sold a single coin.
I get them to eventually spend, not sell.
Ehhh. You shouldn’t, really. You don’t know me. The stuff is not rare, all you have to do is pay for it. There are dozens and dozens of bullion dealers, they are in general phenomenally reliable.
I believe it is a mistake for “acquirers” of silver/gold to NEVER sell any. You never know what the mechanics of selling are if you never sell. It is a PITA.
I also believe that silver needs to spend at least 2 more years above $30 to prove it can hold $30. That’s just my belief. That is the long term nature of silver. Silver really only left $10 behind in 2009 and spent 1/3rd of 2008 under $10. This is rarefied territory for silver. (I’ve only collected silver since 1965 so maybe I am a complete idiot with my views)
Further on down the line, I think these metals will do well in terms of dollars, and I will probably never be all the way out of them. But I also believe that green cash dollars will be able to buy some very serious assets very cheaply in a severe deflation. Which I don’t think is over.
Have no fear. If the April close is below the June of last year close, go to cash. Move forward each month.
If a sell is triggered, chances are it will be a whipsaw and you’ll have an opportunity cost as you buy back at a slightly higher price the following month.
But there’s a 20% chance or so that you’ll avoid the big drop and be able to buy back at a 50% discount in a couple of years. The black swan effect.
This presumes you are in something liquid like futures or GLD ETF. This may not work on physical metal if the transaction is costly.
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