See what interest rate you can get on an unsecured personal loan and compare it to some of the good credit card deals... I think you would be surprised... also dont forget the fees for starting a loan (admin/startup fees etc)
Guys remember to read the FINE PRINT!!! I'm going to repost one of my posts in a similar thread: One thing to remember with credit cards vs personal loans is that a personal loan can be used for any legal purpose and is a fixed contract that you pay off over a fixed term for equal repayments. Credit cards are only 'supposed' to be used for consumer purchases, not bullion or stock market and most credit card contracts have a clause that says the bank can basically 'call in' the credit card balance at ANY time. With a personal loan, the bank can't call in the loan because it is a fixed repayment contract. That is why there is a premium interest rate attached to personal loans. Calling in credit cards is a real possibility for banks if there ever is a credit crunch v2.0. Just remember this before you start stacking credit cards.
Don"t quote me on this but i remember not long ago reading an article about Australians per capita having the largest debt liability in the world at present. With this being the case, a large percent of Aus stackers with mortgages, credit cards and or personal loans are buying PMs instead of paying extra on debt liabilities. So in reality we are purchasing with debt money are we not??? Go for it mate onwards and upwards.
I am contemplating a loan myself. TOTALLY not my style otherwise, but with silver going wild like this, I seem to have been thinking too long about it already. As long as the amount of silver required to settle the whole loan diminishes, keeping it seems sensible. I do believe in $400 silver, but I also believe in $35 silver, possible for a longer amount of time, before we get there. But do I just sit and wait for $35 to appear so I can find myself a bank to give me the loan? I might look for the my CC rates, and explore raising the limit though... Also tempting, being $20k up on a $35k 3-month deal, would be to wait just shortly, sell part of the silver, and have FREE SILVER IN HAND as a result. If you believe in triple digit silver like me, that's hard to do. Paying monthy on an old deal, just doesn't seem like fun to me either, even if in theory your assets grow multifold while doing so. Risky savings account.
Going into debt for something volatile is dangerous >_> Paying upfront means that at worse you'll be down to $0, not -$2000 @_@
No. Buy it hold it, protect yourself. Don't speculate unless you are a professional and if you were there would be better ways to do it.
Ask yourself what is wrong with the world at the moment? Now ask yourself if debt is any kind of answer? Debt and interest is the root cause of all troubles and more debt is never the answer. The only reason you would consider debt to fund physical PMs is if you have no savings, in which case you are probably already in debt. Doubling up on debt is nuts and isn't saving, it's speculation on short term gain. Buying only what you can afford is always the answer. Get out of debt, then save. All increases in buying pressure in Silver, including you borrowing to buy, will help add to the paper profits of other speculators and they will encourage people like you to get silver no matter what. However, this is a ponzi, with people who can not afford what they have, encouraging others to buy what they again can not afford just to drive the price higher so they can take some profit or feel good about their paper profits. Not unlike the Aussie housing market. But the more people like you say I want to borrow to buy physical silver "for the long term", the more people like me start to think it is time to get out because prices are going to fall when the "last fool" (a ponzi term, no disrespect) enters the market. If you want to bet on the direction of silver, but need to liquidate in a hurry in a downturn, try an ETF (asx: ETPMAG) with a stop loss limit applied. If you want the security of physical metal in your possession, buy only what you can afford and accumulate a position over the long term that you own outright. Edit: Here the fact sheet on ETPMAG. http://www.asx.com.au/documents/products/etfs_fact_sheet_physical_silver.pdf Disclosure: I don't own ETPMAG, but the more speculators motivated by greed that enter the market, the more I am thinking about it with trailing stop losses on the way up.
Price of gold and especially silver going up, yet gold and silver ratio toward dow is not falling. Funny
Exactly!...If you have a mortgage then anything you buy you are technically buying with debt. The trick is to let your debt work for you instead of working for you debt... You have to think outside the box. Most will consider a loan on a $700,000 depreciating asset (real estate) as safe... but a small loan/credit card on a rapidly increasing asset (silver) as risky.. I would have taken out a huge loan for silver if it were at all possible
Your confidence is unsettling. Maybe you made a good call at the time, but just as quick as silver went up it can come back down. Let's be realistic. You're playing in a market that is not only volatile because of it's relative size, but is also known to have multiple players attempting to manipulate the prices. Are you going to be able to move all of the silver you hold in time to cover your bill if it were to start falling? Hopefully you've at least sold off enough of your gains to cover your debt and are now debt free, and gambling with market gains alone.
uhmm ..no ... you might have shit your pants but I wouldnt... Lets say I bought $30,000 silver on credit at US$21 (worse case scenario 2008) ... now 3 years later total interest would be approx $10,000 ... total gains in US would be $36,000 .... So Grand Total profit = US$26,000 (after subtracting loan interest) So I made US$26,000 without any of my own money.... Now why would I be shitting my pants again?
Because at the time when silver dropped to $8.00 per oz - you would NOT have known where SPOT was going - for a long while it traded within a narrow range and didnt cross $20 til sep 2010. Only the strongest believers in silver would have still kept the silver on their credit card.
You totally missed his point. Of course you feel grand having taken that loan and made money. If you took the same loan and lost 26k you'd surely be feeling a bit different.
Ok then thats the difference between you and me.. and thats why you wouldnt take out a loan to buy silver.... If silver dropped to $20/oz next week I WOULDNT panic sell .. I would keep my silver and continue to pay the interest on my $35,000 credit card loan... I would be extremely confident of long term gains.. I dont play the panic sell game.
So the point is that if you buy silver on credit and you panic sell when it starts dropping then you are worse off?... I think that's obvious!! The point I was making is that if you take out a loan to buy silver with the view of keeping it long term then you cant go wrong
If you suddenly require liquidity in terms of fiat then you will be in trouble. You take out a 30k loan and suddenly you need to get another 10k really fast but the price of silver has gone down you will be forced to sell to find 10k and you'll be worse for it. It can happen if you lose your job; sudden medical expenses; other emergency. That's what they're saying. Of course you could hold it and make a profit 20, 30 years later but there are always the WHAT IF scenarios which people tend to forget just because they succeeded.
Fair enough.... each to their own... Im EXTREMELY bullish on Silver , hence my decision to buy 10,000oz last year.. Everybody I know said it was crazy/risky/stupid/ etc... To me it just seemed stupid to do anything else but buy silver!
