Time for stackers to review the lessons of 2011.

Discussion in 'Silver' started by Shaddam IV, Jul 24, 2020.

  1. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    That won’t disrupt anything.

    Edit to add: actually it would have a huge negative impact on China’s economy
     
    Last edited: Jul 28, 2020
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  2. Holdfast

    Holdfast Well-Known Member Silver Stacker

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    ^Some commentators have been saying there is a shortage of change (everyday coin) in the USA, some say, banks are hoarding change
    and pre-empting a US digital currency.
     
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  3. Shaddam IV

    Shaddam IV Well-Known Member Silver Stacker

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    Jislizard brings up another good point - Do you have a selling strategy worked out before you actually desire or need to sell? Good to have a plan there too.
     
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  4. sgbuyer

    sgbuyer Well-Known Member Silver Stacker

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    I plan to just cart in my stack to the local dealer offering the highest price.
     
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  5. Ronnington

    Ronnington Member

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    great thread

    Myself personally, I'm of the opinion there could well be a return to the Gold standard... and if you divide the total M2 Currency supply currently by the amount of Gold central banks currently hold, you get conservative figures of US$9,000 per oz Gold...

    What are your opinions of exc
     
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  6. STKR

    STKR Well-Known Member Silver Stacker

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    This guy gives some good insight into why there's a coin shortage:
     
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  7. Ronnington

    Ronnington Member

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    great thread

    Myself personally, I'm of the opinion there could well be a return to the Gold standard... and if you divide the total M2 Currency supply currently by the amount of Gold central banks currently hold, you get conservative figures of US$9,000 per oz Gold... and upwards of US$15,000 per oz

    Why do you advise exchanging coins for bars in your stacks? In a SHTF scenario, I like the idea of having at least 60% of coins to bars in my stack, as in a hyper-inflation environment like in Venezuela, a 1oz Silver bullion coin will buy one week's worth of groceries for an average-sized family

    What are your thoughts on the usdebtclock.org figures for dollar-to-Silver ratio now of US$4,062 per ounce?

    In 1913 the dollar-to-Silver ratio was US$2.65 per ounce, but the actual price was about US$0.80 per ounce......

    going by that, could we see US$800+ per ounce Silver?
     
  8. alor

    alor Well-Known Member Silver Stacker

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    when a country has shortage of coins, they will be soon revolution to follow
     
  9. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    The dollar weakens everyday now. Wont be long.
     
  10. alor

    alor Well-Known Member Silver Stacker

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  11. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Not a chance.

    Completely irrelevant today. :)
     
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  12. Ronnington

    Ronnington Member

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    why not a chance? If Governments are forced to go back to a Gold standard (which they could be) those are the figures and Gold will have to be re-valued to back the currency supply.

    Why do you think it's irrelevant today?

    I'm not after an argument, just interested in hearing all views with explanations :)
     
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  13. Markco2

    Markco2 Active Member Silver Stacker

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    If Gold is so irrelevant today, why do rich people hoard it as if it has some value?
    Do they see it as some sort of insurance policy.
    Why do reserve banks hold Gold?
    Why bother mining it if there is no value?

    I would suggest we are going to have some form of reset with global currencies.
    IMO, Gold will be included in the basket.
    Would they try a confiscation process before that event?
    Not likely.
    No one will give up their gold.

    mmm....shiney, I really don't understand your thinking.
    I also don't believe in the MMT theory working.

    Cheers Markco2
     
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  14. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Because government's can't be forced to adopt a gold standard, they can only choose to adopt it and they won't because it would mean two things, they'd be revenue constrained and they'd lose national sovereignty over their currency. The only way we'd ever go back to some commodity-backed currency is if we abolish the State.

    Because the historical gold/silver ratios were based upon currencies being pegged to a gold standard. So if you do want to look at the ratio you'd only be interested from 1971 onwards, or possibly from 1913 onwards. Before those dates the ratio is now irrelevant to our circumstances.

    You probably mean policy decisions based upon MMT being successfully implemented. MM Theory itself is simply an explanation of how our modern monetary system currently operates.
     
  15. Markco2

    Markco2 Active Member Silver Stacker

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    I do not see how the current system can continue to operate under this format as being sustainable. Something will have to give and I think the US stock market is primed to be the first major casualty causing a cascadian affect across the globe. In other words, total meltdown.

    You cannot continue to lend to zombie companies to be the driving force of the market through institutional lending. That's nothing more than a false economy. The real economy will get flattened and we will witness major upheaval, civil unrest, social calamities, caused by government intervention and the outcome will be rebellion. I put no trust in governments. That's a good reason to hold gold.

    Cheers Markco2
     
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  16. Ronnington

    Ronnington Member

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    I disagree.

    The possibility of going back to the Gold Standard has been under discussion among finance outlets and the mainstream finance media since April. It's not going to be the Politicians decision to go back to the Gold Standard to back the world reserve currency (which will change from the US$ to likely a digital currency from another country, maybe China or Russia), it’s going to be the Market decision. What else is capable of backing the next world reserve currency?...

    Gold has historically proven to work as Money, because Gold already proved itself as a viable reserve to back currency. That’s why a lot of Central Banks buy Gold, hold a lot of Gold - and in the case of China, Russia and some other big countries - have been actively increasing their Gold reserves over the last few years... because they are preparing for a return to a Gold-based monetary system that works, instead of this Petro-dollar Fiat system that isn’t and doesn't work.

    The politicians don’t want the Gold Standard because it forces them to balance their books better. Voluntarily? Nope. They will most likely be forced into it, in order to regain trust in a digital Fiat currency again. When the global Fiat collapse occurs, what will be the alternative?

    One thing is certain - there will be an enormous vacuum and people will be looking for the thing they believe they can trust the most. I guarantee you it won't be any government/bank issued paper or digital currency. Anything like that will be instantly rejected. Most will lean toward the thing that has a proven track-record and is very easy to understand. Politicians won't choose to go back to a Gold standard. They could be forced to go back to a Gold standard. Big difference.
     
  17. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    That's right. It will take politicians to be courageous and have a thorough understanding of how our modern monetary system works. Wish us luck.

    The biggest stumbling block will be the electorate though. Most people are completely ignorant as to how our modern system operates, or are stuck in a mind-set that is a century old, or are politically motivated to impose their values onto others.
     
  18. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    If you're interested in that debate I recommend you visit the Modern Monetary Theory thread, or even The Truth About Money Printing thread and a few others (I can't find the one about the USD as a reserve currency but it's also relevent) in the Markets and Economics sub-forum. My responses would be just repeating what I've (and @leo25 among others) posted over there so it would be a tedious rehash for me. Have a read through what's there and once you've done that then please post your ideas there.

    Just remember, the market doesn't make the rules, doesn't make the currency and doesn't have the guns. For all means hold gold (and crypto-currencies) to protect your purchasing power, just forget everything else the gold bulls have maintained. ;)
     
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  19. Ronnington

    Ronnington Member

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    I don't see how the paper-to-Silver and paper-to-Gold ratios on usdebtcock.org are irrelevant at all in these times of extreme Quantitative Easing.

    If anything, it's more relevant than ever before and worth keeping an eye on, considering more paper currency was printed from March-June 2020 than during the entire 2008-2010 Global Financial Crisis.

    In my opinion I don't think we will see a Gold-to-Silver ratio less than 18, but G-to-S ratio of under 35 is certainly possible. Before the Bretton-Woods standard of 1944-1971 and before the Gold Species and Gold Exchange Standard from 1821-1944 the Gold-to-Silver ratio consistently ranged from as low as 6-to-1 up to 17-to-1

    I would be very surprised if it dips below 18 though in the future. But I would obviously welcome it with open arms :D
     
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  20. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Basically, historical ratios are irrelevant because we don't have a commodity currency any more and sovereign debt is irrelevant because national governments are not revenue constrained any more. So ignore those fundamentals. For sure it's absolutely critical to hold gold etc in your portfolio, just make sure you're holding it for the right reasons. And one of those reasons definitely is governments flooding the market with extra currency which dilutes your purchasing power.

    As I said, head over to those other threads if you'd like to talk in more detail about debt, money printing etc. :)
     

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