Buying gold and silver coins over stocks and bonds

[Fatal Jay]

I don't believe in investing in stock and bonds

I rather invest in gold and silver. Can anyone prove me otherwise?

 

[Albatross953]

Mad max scenario aside, can you eat it? Burn it? Shelter under it? Put it to work to earn you value?

Can you transport, protect, break it up for use In a end of world scenario?

If poop hits the fan, you best bet is skills...no debt...good tools....and a few months of supplies. Otherwise you're better off playing the game as is. Get ahead financially and stay there.

 

[dasein]

I don't believe in investing in stock and bonds
I rather invest in gold and silver. Can anyone prove me otherwise?

Gold bugs don't do that well historically compared to stocks, but have done GREAT over the last several years. You may be getting in at the top buying gold and silver today. Buying any commodities is a whole lot of work, just like stocks and bonds.

Why don't you believe in stocks and bonds? recommend starting with a plain old index fund to all new investors. Good luck.

 

[Tenacity]

I don't believe in investing in stock and bonds

I rather invest in gold and silver. Can anyone prove me otherwise?

In my opinion the BEST high risk investment is one that you have experience in, can forecast trends on, can manage, etc. All of these things allow for a RATE OF RETURN, now what that rate of return is depends on the investment. It could be in the stock market for 5% or 10% a year, it could be a business you own for a 250% return a year. It all depends on management.

Gold is not an investment per say that should be looked at for a RATE OF RETURN. Gold is mainly there to hedge against Inflation.

Your options for a potential high rate of return are Stocks, Bonds, Real Estate, A Business, or a Fund/Portfolio of a combination of these types of investments. You would decide if YOU or someone "smarter than YOU" would manage the investments.

 

[chuck-101]

Gold and silver are usually bought in bullion or U.S. / Canadian minted proof and used to hedge stock investments. You'd probably be better investing in a DOW or S&P mutual fund over the long run. I'd leave silver alone, it's extremely volatile.

The biggest advantage with gold is: if you need money there will always be someone who wants to buy it. For example, even Apple could get bad press and shares could fall over night. I don't think you'll ever see a headline that reads, "Gold prices fall 35% over night.".

Gold and somewhat silver are considered safer investments. However, imagine investing 100K in Microsoft in 1973 vs investing 100K in gold in 1973. With M.S. you'd be a billionaire or a multi-millionaire. Impossible with Gold and Silver.

 

[Bible_Belt]

I'd rather have guns than bars of gold. Any doomsday scenario where you have to rely on physical gold would be so dire that the value of firearms would skyrocket as well. Plus, you'd need at least one gun to protect your gold. And you'd have to rely on the existence of trade before you could convert gold to food; with a gun you could kill something and eat it.

Barring doomsday, guns still tend to do ok as an investment. If they are kept new in box and not fired, they tend to appreciate over time, although sometimes slowly. The fast profits in owning firearms comes from owning assault weapons and high capacity semi-autos that are just about to be banned, or at least the public fears that happening enough to drive up the price.

Another nice thing about guns as an investment is that they are extremely liquid. I think they've got to be the most liquid physical thing you can buy. Real estate can sit for years on the market without selling. Someone will buy your gun within the hour.

 

[chuck-101]

^^^

That's like saying, "I'd rather have a tin-foil hat than money".

Guns are nothing special. I can get a gun for $25 from any random street thug. It fires and does it's job. If I want a legal gun, I can look in the classifieds and there are hundreds to choose from. Literally a buyer's market. LoL

Maybe a rare Confederate musket from the civil war. Those are hard to find. But guns are mass produced and can only be sold to a limited market. An iPad or MacBook air unboxed would be better, since people will overpay and the market is not limited to those who can purchase and use them in the boundaries of the law.


EDIT: only sold to a limited market unless you want Feds knocking at your door asking why a firearm you sold was used in a crime and fell into the hands of a convicted felon. Also, selling a lot of firearms is gonna get "re flagged" by law enforcemnt these days and put you on list you don't want to be on.

MAYBE with a doomsday scenario in mind, stock up on ammo.. 9mm, 22 rounds, and 12 gauge shells would catch a decent price 12 months into a zombie apocalypse.

 

[Albatross953]

Actually a nice Browning over under 12, is not a bad investment. Provided you don't overpay (retail)

 

[chuck-101]

Yes. I heard Warren Buffet was investing in Browning guns. Silly me.

EDIT: sorry for the sarcasm. A particular firearm could be a collectors; piece, etc.. But let's face it, unless you're a licensed arms dealer or collector of rare antique firearms, you're not gonna make million dollars buying and selling guns. LoL

 

[synergy1]

Lets talk about real life for a bit:

Lets say in 2011 you had a good chuck of change, like 50,000 and wanted to put into one investment. You read the compelling articles from zero hedge calling for hyperinflation, and that gold wasn't a bubble, and invested all your money in gold at 1371 $/oz. Another person didn't buy into Zero Hedge's stupidity and parked all of their cash in a basic S&P 500 index fund ( it costs nothing and no research is necessary).

Fast forward to today. The world hasn't burned down, hyperinflation never occurred, and the dust has settled. You start to change your mind, you meet a special lady friend, and decide to buy a place. Time to cash out!

The gold bug His investment has dropped. His 50,000 $ is now worth 42,000 dollars. He can write off his losses.

Stock market dude His investment has appreciated to 79,000 dollars, less long term cap gains and its closer to 76,000$.

Stock market dude can put 50,000 into a nice house or condo, and still have a nice cushion to live off of. The world hasn't ended, he has money left over money, and a nicer house.

The problem with gold bugs is they always wait for the end of the world, and it never comes. In the meantime, while reveling in their self induced pessimism, they lose out on real things in life. Stock market dude now has a real house, and real money to support himself. Gold dude just lost his annual raise and has to work harder.

Some people might fire back and tell me I cherry picked my time frames. There are instances where you could look towards gold and find better returns there. But if you were to agglomerate all the long term returns from gold and the stock market, the later always wins.

Further, I don't feel gold would be a store of value in a doomsday senario. Water, heating oil, food, guns and business would again have more value than an arbitrary currency. If a municipality is starving or lacks clean drinking water, a gold bullion isn't going to solve that problem. A group of people who roll their sleeves up and makes **** happen will.

This is why I invest in the stock market.

 

[Tictac]

Metals are, at best, a hedge against either inflation or currency devaluation (which are the same thing if you think about it). I keep gold/silver at 3-5% and even then it doesn't do all that well.

There is no way that buying a lot either gold and or silver will keep up with a stock portfolio or even a stock and bond portfolio. There are dozens of studies that prove this over all investment time horizons from a year to a hundred years.

 

[Bible_Belt]

There is no way that buying a lot either gold and or silver will keep up with a stock portfolio or even a stock and bond portfolio. There are dozens of studies that prove this over all investment time horizons from a year to a hundred years.

We've been in a bull market for 100 years; of course that's what analyzing past data will show. If you're so positive that gold will never go up, then why aren't you shorting it? If it's not going up, then you can write uncovered call options all day long and crank out cash like it's monopoly money. Soon you will have all the money in the universe.

In 2013 Obama ordered Homeland Security to make massive ammunition purchases. Ammo disappeared from store shelves. The value of what was left immediately increased 2-3 times. And it was liquid as hell. Stick an index card on a gas station bulletin board and buyers would call all day. Lead can be a precious metal, too.

 

[dasein]

And don't even get me started on brokers' fees.

1. This is why I have recommended index funds for new investors in the two latest threads here... no commission, no hassle, liquid, easy.
2. Commissions are dirt cheap today compared to the past, where you been?
3. All decent 401ks have low risk options.
4. The Dow was at 2000 in the late 80s, near 18000 today. There is no lower risk, more liquid alternative for retirement savings with equivalent ROI. You don't take a loss when you don't sell.
5. Most brokers are also insurance licensed and sell lots of annuities, fixed and variable. I sold nothing but bonds during a particular three year period. You make up in volume what you lose in commissions. A two million bond trade is a decent commission. You are usually better off buying bond funds than fixed annuities, but IMO the index fund is still the king of retirement savings.

 

[taiyuu_otoko]

I don't believe in investing in stock and bonds

I rather invest in gold and silver. Can anyone prove me otherwise?

If you mean invest as in buy now in order to sell later at a higher price, gold and silver is a lousy investment.

Unless you mean over the "long term" like 10-20 years, then it's still not a no-brainer, as it's heavily manipulated.

You'd get better play out of commodities. That is if you want to buy something NOW and sell it later for more money.

Bonds are a completely different animal.

OTOH if you were meaning to use gold as a HEDGE (against an economic collapse), that's something different altogether.

If you're hedging, I'd be spreading it around.

Gold

Silver

Bullets

A few dependable guns

water

a huge hole in the ground with an air filtration system so you can hide from people that will come and steal your stuff

GREAT relationships with your neighbors

lots of canned food

Even the most "end-of-the-world-is-nigh" folks are only in gold about 10 percent.

 

[chuck-101]

I can kill a zombie with a gold bullion cube. But with that said, I 9mm would do better.

Seriously, stocks can be safe of one does their homework. I'd suggest learning the CANSLIM method which was devised by the founders and Meryll & Lynch and Barron's Weekly.

 

[Fatal Jay]

^
that's what makes me weary, seems like the market is manipulated. Even when it comes to bonds and cfos

 

[speed dawg]

Espi, I respect that you are a low-risk guy, as I tend to be that way myself. I live slow and steady personally, it is a big philosophy of mine. But I would encourage you not to avoid ALL risk, especially while you are still reasonably young. My (ironically) Vanguard 401K is set up to shift every 10 years that I get older in order to decrease that risk. I believe it's 80% stock/20% bonds right now, and will go 60/40 after 35, and so on. I almost enjoy watching it go up and down, but since I started working, it is up. Over the long haul, the stock market goes up, it's almost fact.

Also, I had a MAJOR break in life go my way because I purchased a piece of real estate when people told me I was crazy. 3.5 years later I sold it and netted 100K, which was huge for me.

All I'm saying is, you have to gamble a little to make it big, but unlike table games in casinos, we do have the information to help us make good decisions.

 

[Poonani Maker]

America is flatlined for a while now. After flatline, IS decline. I won't say WHY, but it's already DONE. There really is no return...For America. Other countries are possible flourishing spots, so, gold, being transportable on a plane, then, you'll be in good shape when flight is necessary, IF the country you're going to will have you as a citizen, that is, or you could simply invest in that country you think will flourish.

 

[dasein]

Espi, I'm a lawyer, not a retail broker these days, and never said to hire a broker, just for new investors to start with a no-load index fund. Commission rates are -in fact- way down across the board compared to the past, and the retail brokerage business is nothing compared to what it used to be as a result. It's DISCOUNT brokers offering dirt cheap commission rates that are flourishing, and this likely won't change.

Once again, you don't lose when you don't sell, and this makes an index fund king of retirement savings for almost all average people without specialized knowledge over an entire career.

One final thing, be very careful taking "quotes" from financial people such as Bogle and others at face value until you know and thoroughly understand where their bread is buttered and what axe they are grinding. I have no axe to grind on this, just 28 years of experience and knowledge as a broker, banker and financial lawyer.

 

[speed dawg]

If "you don't lose when you don't sell," then all the bad mortgages would just be a paper loss and the black abyss of 2008 would never have happened. I'm not sure why you don't seem to agree with me on this.

If the share price goes down from $10 to $5 a share, you have lost money in your investment, whether you sell or not. It's a very simple concept. You have what you have. A loss is a loss. A gain is a gain.

The mindset that an actual loss of value in any asset is only a "paper loss" is the way creative accounting starts.

There are no paper losses when it comes to investing. There is only lost or gained money.

I disagree. Investing is about VALUE, not money. The things you own have a certain worth, and if it's the right things, they out-perform money. It's true when he's says you can't lose if you don't sell, because if you had stayed in the market, and sold later, you'd make money. The black abyss of 2008? That happened because people couldn't make their payments, so the banks couldn't make theirs.

When you say the house always wins, shoot that's an entity worth investing in, in my mind.

Notice how very few companies bother matching or even contributing to an employee's 401(k)? That's done in purpose, too. Again: the rich man stays rich and powerful by taking more and giving less and repressing the masses. Lie to them...cheat them...steal. Do whatever you gotta do. Just tell them that lieing, cheating, and stealing is GOOD for them. Make them believe in it. Because most will never challenge or question the system.

I don't know man, seems to be a very jaded view of things you have there. Every company I have ever worked for matches at least some of your 401K.

I think you are talking more about bad PEOPLE, not all corporations in general. Bad people make bad companies, and they typically don't last. There's a middle ground, and it's somewhere between GMC (who gives its workers everything because of the unions) and the type of companies you are talking about.