why buy physical metals? (in practical terms)
 

Ok so I understand why one would be wise to protect their wealth by changing their worthless paper to metals. What I don't completely understand, and what my dad criticizes my metal collecting for, is what do we do with our silver coins/gold bars etc. once the currency finally does crash? Do we use it for trading for goods? use it to buy whatever new currency put in place?

Please help me form an arguement that will convince my father that he needs to start buying metals. He's sympathetic to the principles of it but is a very practical kind of guy. I've got him to read Ron Paul's book, etc so hes not exactly a moron but he suffers from what brought Hamlet down - inaction.

thanks, byrdman

Re: why buy physical metals? (in practical terms)
 

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</td> <td class="alt1" id="td_threadtitle_134615" title="Field Of Screams The cornucopia that America has always assumed has been replaced with plastic fruit and vegetables. We are living in an illusion of plenty. People are in denial. I remember preparing for Y2K for 14 members of my family. Why ? Because they wouldn�t listen to me and I wasn�t..."> Silver Musing XXXIX (http://goldismoney.info/forums/image.../multipage.gif 1 2)
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</td> <td class="alt1" id="td_threadtitle_113169" title="The Mighty Penny (or The Emperor Has No Clothes) (or A Penny For Your Thoughts) Or� I have several bricks of pennies and a couple of nickels. I also have many thousands of wheat pennies that I got for face a while back. They just sit there, waiting for the day when they may be valued enough more..."> Silver Musing XXXVIII
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</td> <td class="alt1" id="td_threadtitle_63378" title="A King Midas Or A Yankee Trader ? Think 1,000 Times I wonder what the silver situation will be like in the year 2016. Won�t we have many new uses for silver that we hadn�t yet discovered back in 2006, therefore increasing demand ? Even today we are continually finding new uses for silver..."> Silver Musing XXXVII
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</td> <td class="alt1" id="td_threadtitle_53786" title="Horsetrading And Bartering I can�t help but feel that we are heading into times of some great opportunities. The question is, will you be ready ? Horsetrading and bartering are definite skills that can and should be sharpened to a fine edge. While some can do well in buying and selling stocks..."> Silver Musing XXXVI
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</td> <td class="alt1" id="td_threadtitle_35555" title="Illusions And Reality We live in a world of illusions and reality. And many deceptions thrown in our path (thanks in great part to the media) to obscure reality. It might be best to explore some of these illusions before they collide with hard realities. For when they do collide, dangerous..."> Silver Musing XXIX
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</td> <td class="alt2" title="Replies: 16, Views: 1,053"> </td> <td class="alt1" align="center">16</td> <td class="alt2" align="center">1,053</td> <td class="alt1">Gold Silver - Precious Metals</td> </tr><tr> <td class="alt1" id="td_threadstatusicon_11918"> http://goldismoney.info/forums/image...thread_hot.gif </td> <td class="alt2">http://goldismoney.info/forums/images/icons/icon6.gif</td> <td class="alt1" id="td_threadtitle_11918" title="The illusion of Comex silver inventory available for delivery will continue until their bluff is called. When available silver has been consumed and the only quantity of silver is what the Comex figures say they have, their remaining silver would probably be changed into the unavailable category or..."> Silver Musing IX
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Re: why buy physical metals? (in practical terms)
 

Fact 1: The Federal Reserve and FDIC have said they can insure deposits but they can't insure purchasing power. Inflation is the name of the game.
Fact 2: In a world where nearly EVERY currency is fiat currency, unbacked by anything except "faith and confidence", PMs are the only way to preserve purchasing power.
Fact 3: In a world beset by deceit and corruption, if you don't hold it, you don't own it.

Money has been around since the beginning of time. It's so inconvenient to trade 1/5 of a cow for a chicken, etc. If our currency collapses, either (1) it will be replaced in short order by a new currency, in which case the purchasing power of PMs is preserved, or (2) in the absence of anything else people will return to what has historically been money: gold and silver, in which case the PMs themselves "become" the money.

Re: why buy physical metals? (in practical terms)
 

Oh, I also might point out this:

In the 80's the government changed the way they reported inflation. Right now they say inflation is about 3%. If you calculate it the way it was done a couple decades ago, you get at least 8-12%.

That means that anyone who has money in a bank getting 4% or whatever is LOSING PURCHASING POWER every day. Likewise, anyone who gets a measly "COLA" (cost-of-living adjustment) raise each year is also losing ground. They are being paid less the longer they work, in terms of purchasing power and not nominal dollars.

Re: why buy physical metals? (in practical terms)
 

1. I'll have it, you won't. That is the first thing I would tell him. Ask him what his gut reaction is to that. If he has no reaction because you are his son, tell him some person he knows and dislikes has gold and silver when the sh!t hits the fan, and he has none. What is his gut reaction to that?

2. Ask him if he expects to die before the shtf. If he does, then I guess he should eat drink and be merry for tomorrow we die. If he thinks he MIGHT be around when tshtf, ask him what use is any of his stuff for barter? Tell him you prep on top of acquiring PM's....does he even do that?

3. Ask him if he expects greed to vanish when the shtf. If the ONLY thing people will be concerned with is filling their empty stomachs when the shtf, that means civilization was somehow bombed back to the stone age. In which case, why hang around? But if people will still have a lust for gold after the shtf, bad times will NOT stop people from wanting to acquire gold/silver. If you have it, people will barter for it.
Greed and the desire for a symbol of wealth will NOT vanish. It would only be stronger, actually.

I have ten to twenty more arguments. All better than those three, but those are the "visceral reaction" arguments.

.

Re: why buy physical metals? (in practical terms)
 

This is the answer in a nutshell. Good job, Cassius.

You can ignore all the follow-up posts which will try to explain to you the wisdom of owning PM, which was not your question.

Re: why buy physical metals? (in practical terms)
 

If you hold something useful you have the freedom to choose what to do. It doesn't have to be metal, it can be anything useful. But holding large amounts of anything else is rather impractical. If you hold paper money you have no choice.

Re: why buy physical metals? (in practical terms)
 

J Siclairs last interview he stated silver is goin to 30$ and thats about it-- I watched it and thats what he said. So go figure. Also theres one guy whos a retired coin retailer Kall Gronvall , you should hear what he has to say-- he has a website and has done goldseek and Byte radio. He makes a good point. My coin dealer says 200 is in the bag and possible 1000$ silver.

But actually where ya gonna store your wealth? no brainer no matter what pms do eventually.... :rose:

Re: why buy physical metals? (in practical terms)
 

sigh. thanks everyone, I will try to convince him to start holding PMs. Its hard being 18 and trying to take command of the ship so to speak, but I must, and I will. What scares me the most is the anticipation of feeling that I didn't do enough to save my loved ones.

No, we don't prep. Yes we have more than enough disposable income to do so. It pisses me off soo badly. Just today my dad comes home with a 5lb bag of rice exclaiming "Jeez 5lbs for 10$ I never knew rice was so expensive!" MORON!! its called inflation!!! its happening! didn't I tell you? Then I suggested buying as much as possible now, because why think that rice won't be 20$ or 30$ or 100$ in the future? he just kinda went away to watch "deadliest catch"....

I only have like 1000$ in my account maybe ill just spend it all on food, and like 10% on more silver. Why the hell not?

Re: why buy physical metals? (in practical terms)
 

Don't talk about "prep" to a non-prepper. Talk about keeping some extra food in the house, and stocking up when it's on sale. You need food anyway, and you can not only buy it cheaper, you also avoid an extra trip to the store.

Oh, and if you are only 18, don't try to act like an expert (even if you are). Try to act more like a butler.

Re: why buy physical metals? (in practical terms)
 

Printing reading material such as some of these posts might be a good idea. Just leave them laying around where family members can look at them. There's no guarantee they will but it's one more option.

In the meantime, one should prep ones self and if funds permit, get some for family as well.

Re: why buy physical metals? (in practical terms)
 

First things first you are to behighly commended for your abilty to grasp such a complex subject and realize a course of action must be taken and taken promplty ....If I was just half as smart as you at 18 my fortune would dwarf Bill gates and Buffet combined.


Second point you must understand...... YOU CANT CONVINCE ANYBODY OF ANYTHING .... ALL YOU CAN DO IS RESPECTFULLY REQUEST THAT THEY RESEARCH THIS MATTER MORE FOR THEMSELVES AND YOU WILL BE HAPPY TO ANSWER ANY QUESTIONS THEY HAVE. THAT IS IT.


My mom would tell me over and over..........AN EDUCATION IS WHAT YOU GET WHEN YOU DO LISTEN...EXPERIENCE IS WHAT YOU GET WHEN YOU DONT.

92% of the population is going to be taught by experince and for many that lesson will be FATAL.


All you can do is continue to education yourself, ask questions and prepare as best as your budget will allow. The smart will come around ....... those who dont. THE LAW OF THE JUNGLE WILL TAKE CARE OF THEM.


T

Re: why buy physical metals? (in practical terms)
 

Oh yeah....


Welcome to GIM ..... you are among good friends.


T

Re: why buy physical metals? (in practical terms)
 

Re: why buy physical metals? (in practical terms)
 

This is a 7 minute video....... it dosent get any simpler than this.

and make sure he listens very carfully to where the price of gold and silver was when this video was made....... let him stew on those numbers for a good while.

Re: why buy physical metals? (in practical terms)
 

Those numbers are crazy. Let's see Silver cross the old 50 dollar top first. As for Sinclair's 30 Dollar WAG I would imagine he is using a $2000 or so target for Gold. Since Gold and Silver have appreciated more or less the same since the 250 Gold bottom I would have to think Silver would at least keep pace with Gold from here. At least.

Re: why buy physical metals? (in practical terms)
 

Yeah, but if you do this, make sure to edit out your post where you call your old man a moron! :wink:

Re: why buy physical metals? (in practical terms)
 

YO TA...Good stuff...I love your pep talks.....Put me in coach...I'm ready to play!! :favorites21:

Re: why buy physical metals? (in practical terms)
 

Hopefully by buying the metals themselves you will be less apt to take profits prematurely. Hopefully. :bear_wub:

Re: why buy physical metals? (in practical terms)
 

HH you gotta hold back for now you are THE SECRET WEAPON!!! when the silver rocket takes off.... there will be scores of buyers on bended knee willing to pay through the fricken nose for what we got........ an asset that carriers no counterparty risk that is recognized all over the globe.


Then....that is when the fun begins.


TOP DOGS FOR LIFE!!!

Re: why buy physical metals? (in practical terms)
 

Re: why buy physical metals? (in practical terms)
 

Yes, I finally got in! Long time lurker here, (yes, Twisted Avatar, I know I'm amongst good company here :s1: ) first post.

I have thought about this possible "transition" for sometime, and while it is certainly true that whatever government that will be in charge the US after the USD has collapsed will TRY to put in a new currency immediately, AT THAT POINT, WHO WILL STILL BE DUMB ENOUGH TO BELIEVE THEM?

Really, even for the sheeple, after having experienced the collapse of the USD, many, if not most, will have somewhat wised up and and "authority figure" that tries to quickly rush in another paper currency will just get booed off the stage. If the USD collapses, gold and silver, along with anything of recognizable value (jade, emerald, ruby...) or usage (smokes, bullets, machetes) will be accepted in place of money.

NO PAPER will be accepted in the immediate aftermath of a currency collapse.

Think about it.

Re: why buy physical metals? (in practical terms)
 

Thanks TA, your one intense dude! (or girl?? best not to assume things)

my to do list:
1)continue talks with the parents (bought dad Schiff's Crash Proof for fathers' day.)
2)visit the local coin shop.
3)sell a few of my guitars (i have way too many and they will fetch a pretty penny. whats the use for more than an acoustic anyway to sing the blues on when SHTF.)
4)start buying bulk foods with my own damned money.
5)hide my measly stash. of pm's that is. not mary jane, shes already taken care of...

Re: why buy physical metals? (in practical terms)
 

..........................


T

Re: why buy physical metals? (in practical terms)
 

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Re: why buy physical metals? (in practical terms)
 

Like old US senator Daniell Webster said in 1839:

"Only one in 10,000 can FIGURE out they are getting robbed by INFLATION!"

Re: why buy physical metals? (in practical terms)
 

because it sure looks nice

Re: why buy physical metals? (in practical terms)
 

Look at it from their perspective. This is the first economic down-turn you're going through. Depending on how old they are, they've been through several already Let's not forget the Vietnam war, where people had to take turns for gas, people actually got out into the streets and burned their draft cards, and economically things were really bad. We're not even close to that. Obviously, they made it through those downturns and have the experience to make it through others. You (and I) don't have any experience. The only right thing to do is to take the lead and do what you can with limited means, and if SHTF, say, like some natural disaster hit (earthquake, hurricane, tornado, flooding, snowstorm, depending on where you live, then you're prepared, and then they'll have experience in trusting you. We're just a bunch of kids to them. I wouldn't even bother "converting" them. You've had your say, I'm sure they get the point, so talk about something else. The world is just a show.

Re: why buy physical metals? (in practical terms)
 

Practical considerations on PM ownership for folks who aren't GIM-crazy-people:

Negative Real Interest Rates
Currently we are in a rare period of negative real interest rates. That means the return from a safe investment is lower than the rate of inflation. So if you buy a bank CD that pays 3% when inflation is at 6% (for example) you're not making 3% you're losing 3%. Worse, money that isn't bearing interest is losing 6%. If on the other hand you invest in a commodity (e.g. silver, gold) the commodity will tend to keep its value against inflation.

High Risk Environment
Currently we are in a credit environment of escalating default risk. All sorts of banks, loans, and investments are defaulting. Nearly any investment has some default risk and in environments like this those risks are higher. Even rare risks of a negative currency event or government default are higher in this sort of environment. Gold and silver are a pure asset that is not anyone else's liability--they have zero default risk as they cannot default. They are well suited for wealth protection in high risk environments.

Demand
Because of the above factors more and more people are moving into the safety of gold and silver. This demand for precious metals will tend to increase their value beyond just the inflation rate.

When to Sell
I think the simple answer of when to sell an asset is when you find a better use for that money (keeping in mind the above factors).

However also ask yourself if you were to put your money in real estate property, when would you sell? Often the answer to that is "never." You might just keep property in your estate and pass it along to your kids. Precious metals might be thought of in just the same way. They are a safe way to preserve wealth. They might be considered property that has no property tax and very low maintenance costs.

Re: why buy physical metals? (in practical terms)
 

I'd be happy seeing solid 20 let alone 100 or 1000, the only way you see three digits is a real failure to deliver to commercial industry.

Re: why buy physical metals? (in practical terms)
 

You bring up great points I hope folks will read.
Heres another senario:
We have a decent amount of real estate my wife and I bought on our own, not Mc Mansions just 2 nice houses with one in a resort area with 21 acres.
Now for the killer, they are in Michigan and you cant sell a house here not to mention a summer home to save your ass.
One is paid off and the other is 3/4 paid off but that makes no difference, they cannot be sold as there are no buyers and I'm not going to give them away.I will burn them first.
Michigans current canaidian governer's best idea to solve the problem is to raise property taxes and any other tax on the handful of people who still have a job.
Michigan was in a death spiral 2 years ago, now its in a straight line plunge.
I wish I diden't have paid off property, I wish I would have sucked the equity off all of it, saved it, and never botherd doing the "right thing" and just cashed out as much as I could.
Go out west, burn my SS card and claim to be from south america.

Re: why buy physical metals? (in practical terms)
 

here is some gold being sold at spot price in orlando

http://orlando.craigslist.org/clt/739319995.html

Re: why buy physical metals? (in practical terms)
 

My first post and IMO these are great commandments to 'live by'!

Re: why buy physical metals? (in practical terms)
 

That is nasty bombshell that NO ONE is taking about: Property taxes. As the local town economy starts to sink they are blow the taxes skyhigh to stave off bankrupty and snap the financial spine of those who did take part in the maddness (sociolism at it finest).

I half way live with one foot out the door right now.......cause when it happens I am gonna throw this baby right back to them jump in my car with my PM's I will not spend my horde trying to hold on to loosing propersition

When you get out west.....tell them you have a cousin from Jersey coming to set up shop with ya:smile:


T

Re: why buy physical metals? (in practical terms)
 

Anytime my Tek........happy to be of service.:smile:


T

Re: why buy physical metals? (in practical terms)
 

Byrdman, obviously you have a computer or you wouldn't be here. Set up an Excel spreadsheet covering the last 2 years showing the closing monthly prices of 1000 shares each of the following "blue-chip" stocks: Citicorp, Bank of America, Ford, GM, Merrill Lynch, Bear Sterns.

Then show the total paid for all the stocks if invested in gold and/or silver over the same time period. Print it out and hand it to your Dad and ask if he's knows why the stocks tanked and the metals rose.

Presuming your father's a good father, he'll either have an explanation or he'll start looking for one.

Re: why buy physical metals? (in practical terms)
 

NO! It is for preserving wealth. Preserving buying power. It is to be used once we get through the currency crash. If twenty ounces of gold will buy a decent new car today, then it (most likely) will once we're into the Amero or whatever they roll out on us next.

Re: why buy physical metals? (in practical terms)
 

You will always be welcome my Friend.usflag
I hope you like Wyoming!

Re: why buy physical metals? (in practical terms)
 

A dude is an unmarried man. A married man is subdude! :D

Re: why buy physical metals? (in practical terms)
 

Should I change my name? Just picked up the wife (married 24 years) at the airport. She went to Greece and Italy. I get 2 fishing weeks in return.

Re: why buy physical metals? (in practical terms)
 

Gold, in practical terms - is the best store of value because it takes up less space then a stack of bills.

Just tell your dad he needs to make room for you to grow.:smile:

Re: why buy physical metals? (in practical terms)
 

Re: why buy physical metals? (in practical terms)
 

I've always felt we would see a high in silver of $265.

Don't ask me why, for you people who have read my posts over the years are familiar with what I call "premonition". Don't ask me what the rest of the financial landscape will look like at that time in the future. Inflation/deflation=the same result. Empty stores with few expensive items. What seems 'deflationary' to us is just loss of middle class status, welcome to the rest of the struggling world my fellow american flunkies, ie uncle sam, u just lost ur platinum charge card and will be audited soon..

who will be the weakest link? the sheep, the old, the weak. there are too many of them to count. Gpond's great "Money Grab" is here.

I just had another long talk with my sister to dump a small portion of her stock portfolio and buy physical gold. She wants to do it, everyone else around her talks her out of it..

It's like people are brain dead today and we are living in some stephen king novel..

we're broke.