So if your parents decided to set you up with a fund for when you were older by buying into silver on the day you were born how well off would you be? This will make a good argument for buy and hold OR it may dis-spell that very theory. So i was born in 1976 November and at the time of my birth silver was $4.20 USD an oz. Adjusted for inflation and using todays price of $14.15 USD an oz i would be down a grand total of $4.45 an oz as the inflation adjusted oz price is $18.60. If we could stick to USD it may save a whole lot of extra math (should you care to play of course).. So in my particular scenario my parents would have made a GIGANTIC mistake as inflation eroded all their hard saved silver . EDIT: i am using USA inflation as it seems to fit best with us using USD to price our silver.
Long term silver price charts tell the story as far as investment potential is concerned. Silver is a means of saving money, and if viewed that way it makes sense. Then there’s the hobby, collectible side. But as a means of storing and accumulating savings, it’s a good thing. Unlike fiat, I think twice before “spending” silver. I’ve got a kilo of post 1946 shillings in an old plastic box. It just sits there. If that was the equivalent in fiat I would spend it. So to me, silver is mainly about saving, and a little bit about collecting.
We're almost the same age! 1976 is a very different world. There is an extra 3 billion consumers of silver today that didn’t exist in 1976. It costs nothing to print USD, but gold and silver cannot be printed, and must be dug out of the ground. Silver is also generally not recoverable from electronics as we have seen the Japan government is unable to obtain the required amount of recycled silver for the Olympic medals - https://mainichi.jp/english/articles/20180902/p2a/00m/0na/012000c Cost is probably not even a factor in this campaign, for all we know, it maybe cheaper just to buy silver for the medals. The next 40 years will look nothing like the last 40 years.
Hmm wonder what would have been better $40 invested in, Gold, generic savings account or stocks Presume stocks would be killing it.
In ancient time, silver is money and gold is used for jewellery. So silver is the real enemy of fiat.
Saw an ebay listing for a 50g platinum bar with purchase receipt dated 26th November 1974 showing that it was purchased for $402! Is it strange that a 1974 US made bar is in grams? Anyway, the spot price for this same bar today is $1255. I'm quite sure $402 is a lot of money back then in 1974 because houses only costs tens of thousands at that time. https://www.ebay.com/itm/Newport-Me...r-99-95-bullion-COLLECTORS-RARE-/202424820376
Precious metals have never been a good long term investment. You are very likely to be disappointed if you view them as such. You want real estate, business growth potential, and paper assets for that. Sure, metals jump up every once in awhile to account for all of the printed currency, but it is hard to predict when that will happen. You don't logically want a lot of your portfolio sitting idle and waiting - even if that seems safe. You'd rather have most of it getting dividends, rental income, business commerce, etc etc. The metals are simply a defensive hedge against inflation (or hyperinflation), nothing more. That is why they are in the portfolio - at least for me. And yes, it is fun to have something physical that you can hold, that doesn't need title/insurance/taxes/etc.... and which could probably be passed to heirs a bit more under the radar than paper or titled assets. You ideally want to be suited to weather any of the four economic climates ("seasons"): inflation, deflation, fast economic growth, and slow/declining economic growth. If you read Ray Dalio, his stuff will detail this. He is much more into gold than Buffet or many other hedge giants; they will say paper asset gains will make up for their occasional stumbles while Ray is more focused on never having struggles. However, even he wouldn't say he is expecting the gold to be the big winner of the overall his or anyone's portfolio in the longer term. He simply expects it to be a gainer when other parts are losing, and minimizing losses in those bad times is key to long term capital maximization.
A product one buys, to sell it later like it was when bought, is never an "investment". An investment is buying / improving production equipment, to make the product better and/or produce more. So precious metals aren't investments, neither are dollars, euro's, silo's grain and the oil in storage tanks. What does make "good" and "bad" then? Well simple: the price you paid and the price you sell at. So precious metals *CAN BE* a good long term storage of value, if YOU make the good decisions (at which price to buy, and sell). The metals itself are dead, they don't determine anything of the outcome. So that "have never been" just completely misses the point. For ex I bought silver when its USD price was $30-32. That was a BAD decision. It wasn't the choice of silver that was bad, but the price that I was willing to pay. It *COULD HAVE BEEN* a good decision if I had sold at $49. I didn't. It just wasn't my goal to sell in such short time again, my intention was to save in silver. And the last point of my story, is buying a monsterbox at todays price, at halve the price I paid in the beginning. It *CAN HAVE BEEN* a bad decision too, see, again - it doesn't depend on the metal, but on what others did before me, and will do after me. I view silver as a means to a goal, that's what any money, any storage of value is, an inbetween step to what you really wanted. There is only one difference between a precious metal and a fiat currency: with a fiat currency your stored value completely depends on the central planning, while with a precious metal, this is only in a degree, for silver very small, for gold somewhat bigger, and for the rest you depend on others trying the same as you. I prefer the latter above the former. IF I have to lose value, I rather prefer to lose it to another stacker than to that asocial / immoral bunch of crap that we know as "State" and "government".
I agree with a lot of what you are saying, but commodities are absolutely investments. An investment is simply value spent for future benefit. It has to be some sort of value (money, time, resources, etc) that is spent with the realistic hope of achieving a gain of some sort future benefit (financial, aesthetic, health, happiness, etc etc). The five financial investment (aka asset) classes are bonds, stocks/equity, real estate, commodities, and money market. Precious metals are commodity and/or money market (depending which metal and how you look at them... gold mainly money, silver kinda blended, and the others mainly commodity). I'm not sure how you could say that metals or other commodities listed above are not considered an investment. Their being physically static or not consumed while you hold them isn't relevant... the bottom line is that value is being spent for something, and future benefit is hoped for. Do you mean that they are not a growth/dividend paying investment and they don't generate regular cash flow? I would agree fully with that. ...I would maintain that gold and silver have never been a good long term investment. They are defensive, mainly just hedge against inflation. They have excellent short term periods when they account for inflation of currency supply (usually the same periods and shortly after when equities markets crash). The problem is that nobody know when those periods are going to arrive. Some try, ie when Warren Buffett bought tons of silver... which he no longer holds today (although that was probably not as big a percent of his hedge fund's portfolio as you'd think). For most of us, though, to tie up huge percentage of your portfolio in metals might keep up with inflation, but hoping for a metal values spike like 2012 or 2009 is much more likely to have you missing out on many other opportunities while you wait. That's not to mention you might still even miss the historically short peak times to sell the metals before they start going down or sideways on the graphs again. Unless it is a time period where you are very very confident in a stock market pullback and you want to risk a bit, then an allocation of 20 pct or less in metals makes the most sense to me... probably around 10pct or less for most people. You want to have most of your money free for new opportunities or in long term investments with better potential and track record (equities, bonds, real estate, your own business, etc... depending on the market conditions). If you take a look what one share of BRKA was worth when you were born versus now, then be prepare to be amazed, lol.
With your "view", one can drive to the baker to buy a bread and claim that he invested in bread. Since he took the risk of a crap baker, a crap bread, a car accident and when eating choking on the bread. I see an investment simply as putting money into production means, as to achieve a higher production and / or an improvement of the product as to increase profit. The associated risk is failing that goal, because the money put into the production means, was then wasted / lost. If you buy a silver or gold coin or bar, or jar eurocoins, you just buy dead pieces metal and if you receive more or less back than you paid then someone else lost or gained the dollars you received. In short: it's a zero sum story, while an investment increases or decreases on the global level of the story.
I look at things from an economical perspective: the perspective of producing and trading, and since PM is just dead metal and a dollar note is dead paper - it produces nothing, it adds nothing, gain or loss can only origin from some1 elses loss or gain, in other words: zero sum story. A machine that costs $X and increases production minus cost of production (which includes the machine), is a gain without a loss elsewhere, it's not zero sum, it added more goodies. And the opposite outcome, if the machine fails to increase production, or even causes it to decrease, is just a loss for the buyer of the machine, not for anybody else. The remaining question then is why some name buying>stockpiling products that are just dead, "investment". Maybe they have something in common with governments / State crap, that bunch thieves also names all they buy "investment", while all they do is just... spend what they stole. There is no production added, it's just a property shift. Any eventual risk, and any eventual return or loss is just the same risk a thief has when stealing. A risk that is completely irrelevant to the subject. The risk of REAL investment is related to production, not to stockpiling existing.
What do 100 price charts reveal about the investment history of bullion? True, the past doesn’t predict the future. Accumulating 999 is a good way of saving money. But as an investment, I’m not convinced.
Saving is an important part of a well rounded investment strategy. It's not a "to the moon" investment but it has it's place.
