So Who Still Thinks Gold & Silver Are Great Investments ?

[sixgun]

Yes these so called expert pundits blow with the wind. At some point when gold has had a good run, they will say it is heading much higher, a couple of weeks later after the usual suspect pound the price down they say gold is going sub-$1000. So at the point when investors might be selling they are saying buy and when the shrewd investor might be buying they say to sell. People then get sent from pillar to post and end up losing their money.

[Lowlow]

8 minutes ago, Pipers said:

This is why most people lose money and they are bad investors.  The investor looks at the markets he then chooses the market he likes, the one that has a already risen, the one that Bloomberg and nearly all the pundits are stating is the best to invest in.  The punter puts his investment into the hot market only for that  market to fall within 2 years.  What the pundits do not tell you is they  do not make money telling investors to invest in dull markets.  Also the professionals need to unwind there positions so using Bloomberg plus pundits to bring inspired money to the table is a tactic used.  Example how many people invested in oil at or over $100 before the big sell off!!   I never once heard bloomberg stating oil was over priced!

The reason most "investors" lose money is they think it's all about things going up and down in price, believe they can choose the bottom and sell the top, don't understand opportunity costs, and don't understand their own psychology in the markets.  Fear and greed drive markets, and "investors" who try to trade in the markets do worse than chance (on average).

[Abyss]

The higher the US stock markets goes and the lower the price of sliver and gold goes the more I want to convert my fiat currency into precious metals. I only started stacking PM recently but the education learn from understanding the history of PM and the emergence of fiat currencies is like waking up from the matrix. I not advocating going all in on PM any surplus fiat currency spent on PM I own no shares on any mutual funds and have no interest in investing in the stock market or chasing hot money.

PM not investment but store of wealth. The more individuals start waking up from the Matrix and don't want to hold fiat currencies lead to the paper markets not being able to suppress the price of PM and in turn PM prices will go parabolic and when that day comes do you really want to be holding onto your 10 shares Apple and Amazon.

[Lowlow]

4 hours ago, Abyss said:

The higher the US stock markets goes and the lower the price of sliver and gold goes the more I want to convert my fiat currency into precious metals. I only started stacking PM recently but the education learn from understanding the history of PM and the emergence of fiat currencies is like waking up from the matrix. I not advocating going all in on PM any surplus fiat currency spent on PM I own no shares on any mutual funds and have no interest in investing in the stock market or chasing hot money.

PM not investment but store of wealth. The more individuals start waking up from the Matrix and don't want to hold fiat currencies lead to the paper markets not being able to suppress the price of PM and in turn PM prices will go parabolic and when that day comes do you really want to be holding onto your 10 shares Apple and Amazon.

Good post Abyss.

I think people would be wise to purchase at least their "fair share" each year, which I would define as the amount of silver that was mined last year divided by the number of people on earth.

(852,100,000 ounces mined in 2017 divided by 7.6 billion people equals approx 0.11 oz, about as much as pictured)

[Lowlow]

If you want to go crazy and buy 10 ounces of silver, as much as is mined per person per 100 years, then by all means go crazy lol ..

[HawkHybrid]

if a venezuelan bought gold this time last year would they be

1. better off

2. worse off

3. neither better or worse off

 

gold dropped 5% so as a trader the venezuelan is worse off in

monetary terms. this does not show the full story as an

investment. managing to maintain 95% of it's monetary value,

gold allowed the venezuelan to get a manoeuvre advantage

versus others who held bolivars linked assets, etc. do people

who buy insurance complain each and every time they lose on

that trade?

imo investment is more than monetary movements on paper.

 

HH

[Silvergirl]

Buy low and average over time....this financial farce will blow up someday!

[vand]

Prices have declined, it is undeniable, and if your measure of a good investment is its 3-12 month return then I can see how you would be disappointed.  I'm more interested in where the price will be in 5-10 years' time. You can't buy past performance if you have been out of the market, nor can you dodge it if you have been in the market. Common investment advice is that if might need your money any time in the next 2-3 years then stick to cash. Metals are a long term game, and unlike conventional assets they only reveal their hand when they need to.

[vand]

My view is that PMs definitely ARE an investment.

However, that is only a secondary role.

Their primary role is as insurance and a hedge against paper asset destruction. In common parlance we buy insurance to protect us from tail end risks, but that doesn't mean that if you are holding onto an insurance policy and those tail end events come to pass and premiums skyrocket... you can't sell some of your excess holdings for a very princely sum. That's just playing the game.

 

Owner occupied housing is also an investment, and don't let anyone else try to convince you otherwise. Life is full of certain sunk costs, and a roof over your head is one of those. You can choose to buy that roof or rent it, but you must choose one or the other. Buying and eventually owning your home over time lowers your monthly costs and eventually improves your cashflow, which is just the same as buying into business that produces a cashflow, but of course it must be viewed in the light of the opportunity cost of what else you could be doing instead with that home equity.

[Lowlow]

3 hours ago, vand said:

My view is that PMs definitely ARE an investment.

However, that is only a secondary role.

Their primary role is as insurance and a hedge against paper asset destruction. In common parlance we buy insurance to protect us from tail end risks, but that doesn't mean that if you are holding onto an insurance policy and those tail end events come to pass and premiums skyrocket... you can't sell some of your excess holdings for a very princely sum. That's just playing the game.

 

Owner occupied housing is also an investment, and don't let anyone else try to convince you otherwise. Life is full of certain sunk costs, and a roof over your head is one of those. You can choose to buy that roof or rent it, but you must choose one or the other. Buying and eventually owning your home over time lowers your monthly costs and eventually improves your cashflow, which is just the same as buying into business that produces a cashflow, but of course it must be viewed in the light of the opportunity cost of what else you could be doing instead with that home equity.

Interesting, thanks for posting that.

I see precious metals as a sort of last refuge.

Thinking about assets from the most basic level, precious metals are one of the very few assets that you can actually own, outright, with basically no risk.  Even something that seems very stable such as a piece of real estate that has been completely paid for with no mortgage or liens against it, even that has the possibility of loss.  When it comes down to it, that real estate is only yours because of a recorded deed at a courthouse somewhere, and anything that's just a piece of paper like that can be taken from you.  All paper assets including futures contracts, options contracts, stock in companies, bonds, it's all subject to possible loss either because of counter-party risk or other reasons.  On some level even the cash money in your bank is subject to loss, nothing says that depositor insurance has to pay off, or even that the currency has to retain any value.

Few things have real tangible value in the investment world.  Gold and silver are two of those things that do.  No matter what happens, if you have gold and/or silver in your possession, and you can protect it from physical theft, then you have an asset.  It doesn't matter what world governments do, or other people, or the courts, or anybody, it doesn't matter what the financial world does, the economy, gold and silver is what it is.  Gold and silver has no counter-party risk ... every single bank in the world could go under, every corporation could fail, every government could come tumbling down, and you would still have gold and silver which is worth something to other people in the world.

There are almost no other non-perishable, easily transported assets that you can say that about.

When I see gold and silver, I see food.  When I count out Mercury dimes, I'm not thinking "10 cents", "20 cents", "30 cents", "40 cents" ... I'm thinking "fresh trout", "cup of soup", "piece of bread", "handful of grapes", "bowl of wheat", ... because gold and silver can be traded for food.  It's like food that can be stored indefinitely without fear that mice or bugs will ruin it, or that it will spoil, etc.

[vand]

I simply see PMs are a superior form of long term wealth preservation. Over a shorter term they tend to behave more like commodities in relation to fiat currencies, but over longer time periods they have a track record of at least preserving purchasing power.

The short term fluctuations are actually helpful in this respect because it allows you to employ cost-averaging to outperform the flat market price, giving a cumulative effect which should not be underestimated over years and decades. 

Conventional wisdom says that market volatility = risk which is why TPTB want to manage and remove all volatility from paper asset markets, but that is playing Wall St's game. How are you going to buy cheaply if the price never drops? I say: embrace the volatility and adopt a strategy that takes advantage of it.

Furthermore, because they cannot be destroyed or diluted, they have a habit of spiking in price during significant economic crises as paper assets, giving the patient accumulator of PMs the chance to use them to acquire other depressed assets.

You want to be the person selling life jackets as the Titanic is sinking, right?