Silver’s a worthy gold rival

[bhvostal]

Silver’s a worthy gold rival

Silver will continue to win investors’ attention along with gold

"Year to date, silver prices have gained about 26%. Gold’s 12% rise pales in comparison. The white metal is also 40 times cheaper than gold. It doubles as both a precious and industrial metal and most of the silver used in industrial applications is consumed rather than recycled."

Silver

~ Brian

 

[cordex]

Both are overvalued compared to other commodities at the moment. Not a great time to buy.

 

[bhvostal]

Agreed. What commodities do you presently like, from an affordability standpoint?

~ Brian

 

[cordex]

Agreed. What commodities do you presently like, from an affordability standpoint?

Personally? Brass and lead.

In all seriousness, I'm looking for a relatively liquid store of value that is more stable than cash. Traditionally that has been gold and silver, but I don't like buying at the top of a bubble. I haven't found a better commodity that is desirable in enough circumstances to be relatively liquid, scarce enough to be value-dense and currently undervalued.

 

[WILSON]

Both are overvalued compared to other commodities at the moment. Not a great time to buy.

You're absolutely correct, of course.

But collecting silver bullion is a lot of fun, and it seems to be a relatively innocent form of gambling.


JMO...

 

[snowrs]

The only gold and silver I am saving is in my teeth.

 

[451_Detonics]

Agreed. What commodities do you presently like, from an affordability standpoint?

~ Brian

Ammunition...

I have a more than fair supply of silver, in fact I have given some thought to selling some but I don't really need the money for anything right now. If the economy does collapse however pre-64 silver coins will be useful. However...I really believe as a barter item 22 rimfire ammo will have good value as well. Most farmers have a 22 rifle but few keep more than a box of ammo in the drawer. Trading ammo for produce sounds like a winning plan to me.

 

[bhvostal]

Personally? Brass and lead.

In all seriousness, I'm looking for a relatively liquid store of value that is more stable than cash. Traditionally that has been gold and silver, but I don't like buying at the top of a bubble. I haven't found a better commodity that is desirable in enough circumstances to be relatively liquid, scarce enough to be value-dense and currently undervalued.

Makes sense. Thanks.

~ Brian

 

[bhvostal]

Ammunition...

I have a more than fair supply of silver, in fact I have given some thought to selling some but I don't really need the money for anything right now. If the economy does collapse however pre-64 silver coins will be useful. However...I really believe as a barter item 22 rimfire ammo will have good value as well. Most farmers have a 22 rifle but few keep more than a box of ammo in the drawer. Trading ammo for produce sounds like a winning plan to me.

Considering I live in a large farming(mostly) community, 22 rimfire ammo as a commodity makes a lot of sense. Thanks for the advice.

~ Brian

 

[joslar15]

Both are overvalued compared to other commodities at the moment. Not a great time to buy.

Today in the Asian market, gold hit $1624.80 and as of 20:49, it is trading at $1614.00. Why do you think this is a bad time, considering our situation and the economic situation in Europe?

 

[tooleman]

I prefer to take stock in aluminum cans. Hell most people will give them to you and around my parts they trade $.75 per 100# Not bad for free..... Plus it gives me time to play with my air powered can crusher. I can fit 100# in a plastic rubbermaid tub. although it sure does make for a heavy load.

 

[cordex]

Today in the Asian market, gold hit $1624.80 and as of 20:49, it is trading at $1614.00. Why do you think this is a bad time, considering our situation and the economic situation in Europe?

First of all, I'm not an expert and my comments should not be taken as financial advice.

Typically gold and other precious metals are considered a long-term hedge against inflation - a way to store wealth such that it won't lose too much value, or won't lose value quickly - not an investment which is expected to rapidly increase in value. As a hedge, it only really works if you invest steadily over time or buy at just the right time.

The wild increase in gold and silver prices recently has lead some folks to look at precious metals as an investment that will continually go up quickly, which has only fueled the increase in prices. This is a very common pattern for bubbles. People expect short-term performance to imply long-term performance but at some point people stop wanting to (or being able to) invest in a given commodity or sector and then the bottom drops out. The people who bought early in the bubble and sold at the peak do very well. The people who buy in late might never recoup their entire investment, or might have to wait a very long time for inflation to catch up in order to do so.

If you are buying precious metals today, you're buying after prices have already increased drastically. That doesn't mean that gold won't go up more - even much, much more - but it does mean that other commodities which have not increased as quickly as precious metals are a better value at the moment.

It is easy to read record high prices for gold as a sign that things have changed fundamentally, but inflation-adjusted values for gold's peak in 1980 put the cost of an ounce of gold in 2011 dollars somewhere between $1,620 and $2,300 depending on how you account for inflation. The value then fell within 5 years to around $750 and in 20 years to about $475 on the same scale. The same kind of thing could very well happen again, and I would hate to lose 76% of my investment because I bought and sold at the wrong times. Remember, unrealized gains aren't worth anything, so if you buy at $1,600 today and the price goes up to $8,000 an ounce a year from now that seems great for you. But if two years from now when you sell the price is $500 an ounce, you haven't really gained anything.

http://www.fintrend.com/inflation/images/charts/Gold/Gold_inflation.jpg

On the other hand, there may well be reasons outside of typical investment/hedging that would inspire you to buy precious metals. Some folks are worried about TEOTWAWKI and believe that having precious metals on hand is an essential part of preparing for that. Whether gold and silver are worthwhile investments for that really depends on what kind of societal collapse you believe will happen.

 

[joslar15]

At 12:01 today, the gold spot price is $1642.55

Just to put this into perspective, the price of gold has doubled since Obummer became POTUS. The world has seen that the debt ceiling debacle is more of the same and FRNs continue to lose value.

 

[rhino]

It's too late for me for gold. Someone with more cash assets could probably still do okay. Maybe.

Right now, non-perishable food and water storage are probably a better investment, especially when our credit rating gets downgraded to AA and things start to get ugly.