Help for a new bloke.

[azpers]

Hi troops.

Have just joined the forum, and have a few general questions.

If I were to buy a quantity of silver (say 1000 ounces), at $20.00/ounce, and the price were to escalate to (say) $100.00 an ounce, what do I do with the silver. I would have an amount of metal worth $100,000, but how do I use it to buy groceries and petrol, and pay bills?

What happens if the price goes to say, $10,000.00 an ounce, plateaus, then begins to fall? Who will buy the commodity in a falling market?

 

 

[strenue]

Dealer will always buy your silver close to spot price, so if you need to move a large amount of silver fast that would be your option of last resort.

However the forums like this one are another great way to source or sell your silver.

 

Are you planning to focus on pure bullion silver or are you looking for semi-numismatic or numismatic type silver items?

[FTYBR]

What a truly horrible problem to have

In the scenarios you're describing, you most certainly won't be using silver or gold to buy groceries and petrol - this will never happen again...ever (IMO)

You will obviously be exchanging them for whatever unit of payment becomes acceptable at that time.

It's hard to get your head around this but.. silver and gold never go up or down in value - it will always be 1oz. Their price fluctuations in currencies represents the varying strength of fiat money / confidence in the system. If silver were $1000/oz then that means the dollar has weakened SIGNIFICANTLY and the prices of all commodities/food/oil will also be sky high. So doesn't necessarily mean you will be any wealthier than today.

As for offloading silver gradually during a moon shoot in dollar price, I guess that helps by having varying denominations to keep your options open.

Watch the prices relative to other assets (Houses/Dow etc)- that's the only way you'll be able to determine which assets to hold, at which time

[Carpe Diem]

Welcome mate.

 

 

If I were to buy a quantity of silver (say 1000 ounces), at $20.00/ounce, and the price were to escalate to (say) $100.00 an ounce, what do I do with the silver. I would have an amount of metal worth $100,000, but how do I use it to buy groceries and petrol, and pay bills?

 

You probably would not be able to buy groceries and gas with that silver unless the people of the world / economy at that time were so against paper (fiat) currency that people were looking for alternative ways to pay for goods and services.  

 

What you do with the silver is, in my opinion, take any rise in price as an opportunity to consider cashing out some of what you have with a view to using those profits for other things that will provide you a more stable life, such as paying off debt, buying some land or property etc.  In other words, I don't think it's wise to wait for a stellar rise before considering to sell or use your silver as money.  Set yourself a plan for where you want to be in your life in future and then let that dictate and drive your silver purchases and sales.

 

What happens if the price goes to say, $10,000.00 an ounce, plateaus, then begins to fall? Who will buy the commodity in a falling market?

 

It's just like any other investment in that there will always be speculators and people wanting to buy it because "a falling market" is an unknown time period when you're living it, so a drop from 10,000 to 9,500/oz will make some people see that as a buying opportunity, in the same way as recent drops below $1,300/oz for gold and $20/oz have signalled many on this forum to consider that a good buying opportunity.

 

It's my view that assuming we are living in "normal" economic conditions (i.e., those that you and I are living in today) where people can freely buy and sell what they want through different ways then you'll always find someone who is looking to buy your silver.  This comes back to what Strenue said - you'll most likely find dealers willing to trade at or close to spot.

 

However, if you're pessimistic about the future of the world in which we live, and believe that the continual devaluation of our currencies, erosion of wealth through taxation and other government methods are cause for concern, then I would think clearly about why you're buying precious metals, what you're buying (bullion or collectables) and ultimately never lose sight of what your end game is

[Kman]

It's supply and demand

 

If the price is high, the demand is high, so there will be places to sell/convert the silver back into another type of currency you can use to buy whatever.

[Stretch]

There's a few scenarios but the one I favour is an acute shortage of silver in about ten years time ramping up the spot making all silver bugs wealthy individuals.

Or a Weimar republic situation where the hotel porter buys his hotel he works in for a gold coin. Or one oz of gold buys several entire city blocks.

Personally I view my stack as an inflation hedge over the long-term and that's conveniently off grid away from governments grasping hands.

[Pete]

Silver is more likely to go to $1 per oz rather than $10,000 per oz  so I wouldn't worry too much about spending your great potential wealth.

[Danny-boy]

Silver is more likely to go to $1 per oz rather than $10,000 per oz so I wouldn't worry too much about spending your great potential wealth.

Always the voice of reason [emoji1]

[Stretch]

As I understand it peak oil/gold/silver it's all gonna rise together. Five to ten years is a realistic timetable perhaps?

[silversword]

I sometimes think that Pete's outlook alone could cause silver in his presence to spontaneously tarnish...

[Cointreau]

I sometimes think that Pete's outlook alone could cause silver in his presence to spontaneously tarnish...

I could give his silver a better home. A much more loving environment.

[HighlandTiger]

Silver is more likely to go to $1 per oz rather than $10,000 per oz  so I wouldn't worry too much about spending your great potential wealth.

 

If silver drops to $1 an oz, then all the mines will close, creating a worldwide shortage of silver. Which will cause the price to rise all the way up to $10,000 on oz.

 

Hold your nerve boys and girls......

[HelpingHands]

I think $10,000 is more likely than $1.

If the $ goes into hyperinflation then everything priced in $s would go to the moon. The DOW and other markets would shoot straight up, not down. People will say remember when $10,000 was a lot of money but now it only buys you an oz of silver.

[Pete]

If silver drops to $1 an oz, then all the mines will close, creating a worldwide shortage of silver. Which will cause the price to rise all the way up to $10,000 on oz.

 

Hold your nerve boys and girls......

Dream on !

$50 an ounce would be terrific but I am not holding my breath.

[lightjaw]

When I first got into silver and gold, and I read all the stuff I could online, I thought "wow silver and gold are in short supply! Its going to run out!" Etc etc. Now my opinion has changed a lot. Are we going to get hyper inflation? Probably not. Is silver going to hit £500 an ounce? Probably not.

For me silver is just this, a hedge against everything going tits up, even though we will probably bumble through whatever crisis is on the next horizon without the world turning into a scene from mad Max.

Put some of your money into silver and gold and it will always be worth something. It should only be some of your money though. I am aiming for a lot more money in dividend paying shares than in silver and gold. £1000 in shares gets you 5% dividend pa. £1000 in silver gets you no dividend but does allow a good nights sleep as you know you have an emergency stash.

Edited for too many "probablys"

[HighlandTiger]

Dream on !

$50 an ounce would be terrific but I am not holding my breath.

LOL, I was being the teeenist bit tongue in cheek with my comment. But I do think $50 an ounce will happen in the next 10 years. 

 

 

 

I like the fact that silver and gold is "off the grid" so to speak. when it comes to declared savings. 

[Kman]

Dream on !

$50 an ounce would be terrific but I am not holding my breath.

 

The way they devalue money a pack of chewing gum will probably be $50 in 10 years lol. 

[John]

Looking at the ratio of silver to gold price, historically around 12/16 to one, and the current 60 2 one ratio, your might see some correction which would reflect the real value of silver. 

The many uses of silver do also add to it's intrinsic value.

Plus, it's nice stuff to have around!

[Cornishfarmer]

Does that mean silver will go up, gold will come down or meet somewhere in the middle

[John]

The prices we see are fixed by the higher ups, silver is the most condutive metal on the planet so it's use in electronices are many. maybe this is why the spot price is so low in comparison to gold. The higher ops want to make cheap electronics to sell to the server class.

Some say there is less silver than gold above ground!

If the real price were to be reflected on a supply/demand pardigm and not fixed, who knows what the price might be, probably north of todays price.

The truth will come out in the end.

[Danny-boy]

Agreed John, the truth will come out in the end.

I don't know if it will be 2 years or 20 years, either is fine by me.

I'm not so interested in the spot price, more what it is worth against other items like fuel / food / housing. It's no good silver going to £50/oz if petrol is £5/litre.

We shall see, but the real value of silver shall prevail.

We have already decided that if silver does go parabolic, this forum is being changed to....

www.theearlyretirementforum.com [emoji1]

[crazy hippo]

invest in wheelbarrows, the unsung financial victors of the Weimar republic lol

 

seriously... if or when silver gets to 5 digits cash will be used as toilet paper, your thinking $1 one chocolate bar, try thinking $1000 notes for a chocolate bar.

take a look at zimbabwae’s trillion dollar notes.

 

sliver for me was never abut being rich, forget that... silver is about PRESERVING your wealth. some will say that when the world crumbles, that those on their feet will be wealthy, but define wealth. does your stack fit with your personal morality, the ethics to which you adhere? what is wealth in relation to need and want.

 

ask yourself, are you prepared to be one of the few who isn’t starving when people around you go hungry?

 

Stacking isn’t about numbers, or collecting pretty coins, well not always, but its about your personal outlook on life and preparedness.

 

i guess what I’m saying is that, 10,000 100,000 a million isn’t going to be your biggest problem.

 

PS a true Islamic state would have its economic foundations on a bi metal currency, basically gold and silver, with no import and export duties permissible. 

so in theory you could take your stack, have it melted and give it to a local mint/trade it for usable silver coins. and then currency convert when you return home from legal tender to legal tender.

 

but then again I’m prepared for a worst case scenario.

[Danny-boy]

ask yourself, are you prepared to be one of the few who isn’t starving when people around you go hungry?

Yes, I think I'd be fine with that as long as my family and close friends were ok.

If people are not prepared, then they should be prepared to reap the consequences.

The Ricky Gervais analogy of the lazy mouse and industrious mouse springs to mind, just with a different outcome.

[silversword]

The truth will come out in the end.

Probably when we are all long gone, dead and buried...

[John]

The wheels of justice grind slowly but they grind to dust.

Or do they?