http://www.goldandsilverexchange.info/investment-potential.html Investment Potential of Gold versus Silver Should a person wanting to preserve wealth buy gold or silver? Which one has the best investment potential or multiplier, or are other factors in the choice between the two more important? Most people I talk to want to buy silver because they say it has a greater multiplier than gold or a better investment potential. They always site the numerous big name silver advocates when they say that silver has a multiplier of 11 to l, whereas gold will only multiply at a rate of 5 to 1. No doubt, in the natural, what they are saying has some validity, that silver will outperform gold in the long run. And when the dollar finally collapses and becomes worthless, silver and gold values will find their final resting places dictated by world-wide supply and demand. For example, using the arbitrary numbers of $10 per ounce for silver and $600 an ounce for gold, silver could easily reach $110 per ounce ($10 per ounce times 11 = $110) and gold could easily reach $3,000 ($600 per ounce times 5 = $3,000). Besides silver having a greater multiplier or investment potential than gold, many people site the second big reason for buying silver as the much greater industrial demand for silver than for gold. No doubt that argument has some validity also, but both of these major arguments totally collapse when the dollar collapses. Why? First, when the dollar collapses and has no value, and silver reaches that hypothetical $110 per ounce, and you have a mountain of silver in your living room, who are you going to sell it to, and what kind of currency are you going to get in exchange? Now realize, when the dollar reaches worthlessness as the German Marc did in Germany after World War II, our country will be in physical and financial chaos. People will use dollars to light fires to keep warm - - that will be about the only useful function of the dollar bill at that point. Bottom line - - there will be no currency for you to make money on your silver. Again the second big reason for buying a ton of silver, industrial demand, with no currency, and consequently no more commerce, manufacturing will shrivel up like a grape in the scorching sun. The investment potential of silver will be useless. Long ago, with the government's introduction of trade treaties like GATT and NAFTA, we have already sent to shipped over 90% of our manufacturing overseas or to Mexico. About the only manufacturing this country has left are the big three car manufacturers, General Motors, Ford, and Chrysler - - and all three of them are stumbling like blind men, dying of thirst in the desert, looking for a well of water. As I have mentioned before in my paper, 90% junk silver, that is the dimes, quarters, half dollars that were minted in this country up until 1964, are essential for barter. When the dollar collapses, people are going to need small denominated silver coins to buy smaller things like a loaf of bread, a dozen eggs, or a gallon of milk, and those dimes, quarters and half dollars will be ideal for those barter situations. You can't use your gold coins for those situations - - they are simply going to be worth too much per ounce to be practical. For example, how will people make change if you give them a half ounce gold coin worth $1,500 to buy a loaf of bread that costs $10? It just won't work. My basic recommendation is that people buy up to a half bag or a full bag of 90% silver coins for barter. A full bag weighs 55 lbs, and a half bag is about 28 lbs. But silver, along with its benefits, must be purchased in moderation for it has some very obvious disadvantages: weight, bulk, volume, storage, and portability. In the days that are soon to be upon us, we will be faced with financial and physical calamity that we have never experienced as a country or as a people. First, where are you going to store or hide hundreds of pounds of silver so a robber won't find it if he breaks into your home? And in the midst of the imminent financial chaos we will probably have to be mobile, and we need a practical plan to take our loved ones and our wealth with us if we have to leave quickly. None of the big name silver advocates address this problem. They think our country will never be in that kind of place, but they don't look at history, and they don't look at the reality of where our country and our dollar are headed. That said, what are you going to do with literally hundreds of lbs of silver in your house if you have to leave in haste, and on foot at that? What about its investment potential then? I have talked with many people over the years who have bought into this silver investment potential, carrot-in-front-of-the-horse scenario, and they have 5 bags of silver (275 lbs), 20 bags of silver (1,100 lbs) 37 bags of silver (2,035 lbs). One man bought 44,000 ounces of silver (2,750 lbs) and had it stored in a depository 2,000 miles from where he lived. Do you think he will ever see an ounce of it when the government closes the bank doors? On the other hand, if you have a good bit of wealth, you need to put the bulk of it into gold coins. Gold is a very compact store of value, and it is easy to store and very mobile if you have to leave quickly. As history teaches us, many Jews bought safe passage during the Holocaust to the United States or to Great Britain with a gold coin they had hidden in their clothes or on their person somewhere. Don't be duped into getting rich by buying a mountain of silver -- you might have to leave that mountain and all its investment potential to someone else. I think this is what make me stay with gold. What do you guys think?
Surely if he can afford 44,000oz of Silver, he can also afford a massive plot of land and a place to bury it.
It's all about risk assessment. In the unlikely event of SHTF where would you go? Everywhere will have the same problem. Might as well stay at home, ration the food and sit on the hoard. I don't think there will be blood on the streets and I don't see a financial collapse anywhere in the next 10 years or so. I should have time to sell the silver at a profit and buy my boat. If SHTF I won't have to worry about transporting my stash as it will be long gone. I will always have a bit of gold and silver around but I intend to buy silver now, reap the rewards and convert it into gold when the conversion rate is in my favour. And get my yacht.
Only problem is currencies will never be allowed to collapse and we have all been witness to that already. This coming from a Gold bug~unfortunately REDBACK
And yet many currencies have collapsed historically. Why did they collapse if the powers that be had the ability and desire to prevent that?
Um, what exactly do you think is going on? Maybe not in the next 10 weeks, but 10 years? How long do you think these institutions, as a few random examples, will last: Losses since August 2006: Lloyds: -94.54% (-58.10% in past year) Barclays: - 76.85% (-53.08% in past year) RBS: -96.83% (-54.15% in past year) I like the yacht idea. Good luck with timing your purchase well.
Venezuela wants the gold they have spread around the world back. The bank of England has 99 tons of it. That's gotta hurt. Wonder what happens if they don't actually have it?
To me the question isn't 'which' pm to buy, but what percentages. I buy both, currently I'm about 70/30 Gold heavy. I'm trying to lower the ratio to 50/50. If Silver would drop into the mid 30's I'd get there in a heartbeat, but as it stays hovering around 40 and Gold taking some decent dips, I may be stuck 70/30 for a while.
I've heard this silly argument many times before. Firstly the author is forgetting that gold and silver is real money, always has been and always will be. So when the dollar collapses people say silver is dumb coz you cant eat it or dumb logic like that. but the bartering phase of swapping bread for tomatoes quickly finds a problem when the guy with tomatoes says I already have bread what else you got?. So very quickly the bartering turns to gold and silver simply because we need money to be the means of transactions so that we can purchase what we need. so there will be plenty of buyers of our silver and there will not be a currency to exchange into because if the dollar collapses no-one will trust any other currency but gold and silver.
I still think that silver is the best PM to have, followed by rice, Spam, rolled oats, etc and THEN Gold. Silver is more easily recognised and negotiable than gold, and in the long run, you gotta EAT!!!! JMO OC
Neglected the thread in the dragon frenzy, not ignoring your question! I could live without any of those institutions that you have mentioned, sure the prices of others will go up in response to them collapsing but we are used to price rises, that's what tells us we are living in a free and prosperous country, or that there has been a cyclone, flood or bushfire somewhere on the continent. When the Bottle shop goes bust and Coles shuts its doors there may be a hint in the populace that all is not well. Collapse is one thing, that is like someone dropping dead of a heart attack. What we have here is more like a long term drunk, the organs are failing and the writing is on the wall but the drunk can keep going for years in this state before the end. We have a government taking our money and using it to promote the status quo. We have a complacent population who would rather blame everything on immigrants than take a long hard look at themsleves. When there is a riot it will be against the foreigners, not the banks or the Government who have a hand in all this. I can see it happenning but there are no bankers being lynched in the streets at the moment and everyone is looking to them to help save the situation. It will take a long time for that to turn around, I may be out by a year or two but I just don't see the Australian population doing anything about it, she'll be right mate! I will safe out to sea by then.
"When the Bottle shop goes bust and Coles shuts its doors there may be a hint in the populace that all is not well." A small aside here. Our daughter is a Produce Manager in a major Queensland COLES store. She was in the thick of Cyclone YASI, and from her we have learned that COLES, and I am sure Woolworths, have a well thought out 'disaster plan' to cover just about everything and I am willing to bet that includes what we have in front of us. Alternative sources and transportation were in place, and the store was empty one day and back in business 2 days later. Even the Bank back in the '80s, had a well rehearsed disaster plan that extended all the way to nuclear war. All computer data is backed up in real time to an off-site storage, and the data centre operations can be duplicated in a day. OC
