Withe very few exceptions, I’m completely out of the stock market as of today.
Bought gold and will buy more gold all this week.
Enjoy the ride everyone. I’m out.
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Gold broke another all-time high today.
Nick, what is the best way to start out investing in gold? ETF, mutual fund, gold mining stocks, physical gold, other? Just curious. I am not exposed to precious metals at all right now and have been thinking about dipping a pinky toe into it.
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What’s your take on silver?
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While we wait for the precious metals guru to respond, I know he was a fan of FSM, a silver mining company. They have been fairly volatile. Not sure if he still recommends them or not.
Take possession of physical gold. Particularly, 1 ounce U.S. Buffalos and Eagles.
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Is a person expected to pay over the par value of gold when buying common coins?
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I could have liquidated nearly all my stocks at the end of the year and bought silver. I didn’t. I bought gold. And my reasoning was that I came to realize that the rest of the world is pretty nervous that Biden weaponized the dollar, which the world has agreed to use as its reserve currency. This was a disastrous mistake on Biden’s part because if the world stops using the dollar, Americans lose big time.
Just because you CAN take someone’s money, doesn’t mean you should. Biden complains that it is wrong for Russia to take Ukrainian land simply because they can, but then goes and takes Russia’s money.
It gets worse. Every other nation on earth saw this and realized that the U.S. has a huge advantage over every other nation because the U.S., and the U.S. alone, can print the world’s reserve currency. For years, this was wonderful. We could print the world’s reserve currency, spend it on ourselves, and export the inflation (caused by printing) around the world.
Now the rest of the world knew this, but put up with it. But now that Biden took it further and weaponized it by stealing from the Russian people, it caused every other nation to get nervous and ask themselves: What if we go afoul of what the U.S. wants? The U.S. stole Iran’s money (Obama correctly gave it back) and now Biden stole Russia’s money. The U.S. could steal our dollar-denominated assets too.
At that point, I knew what was going to happen next and so dumped everything into gold. Why? Because I predicted what this nervousness would cause all theses nations to do: First they would start to trade with each other in their own currencies. And second, central banks around the world, realizing that Biden made the dollar toxic, would look for some other way to store wealth in their vaults. And what have all central banks around the world stored in their vaults?
Hint:
It isn’t diamonds. Diamonds are not rare.
It isn’t oil. Oil is too dirty.
It isn’t wheat. Wheat goes bad.
It isn’t uranium. Uranium is dangerous.
It isn’t silver. Silver takes up too much space.
It’s gold.
Central banks around the world have always stored gold. So when Biden wrecked the honor of the U.S. dollar, I knew there would be huge buyers of gold. The biggest buyers ever: central banks. I was right. Central banks are buying gold at record pace and still are. It is what they have to do in preparation of dumping the dollar.
I’m not going to fight all the central banks of the world. So I did what exactly what I knew they would do. I dumped my paper crap (dollars, stocks, bonds)… and bought physical gold.
Now for your question about silver.
Silver is a good buy (I bought some this week) as it is really cheap right now, especially compared to gold (silver/gold ratio). And silver has industrial uses, especially in the green movement with EVs and solar panels. But it doesn’t have central banks around the world buying it. Why? Silver takes up 128 times the space of gold for the same dollar amount. And central banks aren’t about to build vaults that are 128 times as big as the ones they have. Imagine having to rebuild Fort Knox to make it 128 times larger. That’s not going to happen. Silver is a great buy in the long term because it is a physical store of wealth that Biden can’t steal from you. But gold is what is in the vaults of every central bank around the world. Gold is the true reserve currency and has been for thousands of years.
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So kinda circling back to my questions, why do you recommend buying gold in coin form? Is there not a premium added for the stamping of the coin? Can one just buy straight up gold in pure form as a physical asset, not as a coin, but as a “chunk” if you will?
Sorry for the questions, just not real familiar yet with investing in gold or other precious metals directly.
Interesting take, thanks for the detailed response.
There is no such thing as a chunk of gold. The closest thing to it is a raw nugget that has never been melted down and turned into anything.
Gold is mostly sold as coins or bars. There is very little premium (price you pay above the melt value of the metal to cover someone turning it into a coin or bar) on a bullion coin, and even less on a bar of gold.
Coins have a slight advantage over bars. Coins are often graded (in plastic slabs). This gives you a little bit of numismatic value (value because the coin is rare) as well as identifies the coin clearly so that later you (or your heirs) can sell it easily online. The grading/slabbing assures buyers of exactly what they are getting.
Remember, gold, unlike most everything else, is fungible. It is the exact same price all over the world.
Bars are not graded/slabbed for the most part. So they are harder to sell as online buyers are more leery.
Another reason to buy coins is that coins are popular with people all over the world. Humans have coin collections, not bar collections.
Also, there is no sales tax on U.S. coins in most states because you aren’t really buying a U.S. gold coin when you pay for it in dollars. You are exchanging dollars for coins, just as you would if you asked for 4 quarters in return for your dollar bill.
Also, every coin show in the world transacts in cash. That means you can buy and sell anonymously.
Coin shows are held everywhere. There is one in a couple days in Colorado Springs that I’m preparing for tonight. Anyway, it’s one of the few ways you can store wealth without anyone knowing about it.
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Aside from New Mexico where we pay over 8% on precious metals, including US gold and silver coins. What bs!
Yes, and that’s why you should go to coin shows. I’ve been to hundreds of coin shows and never been charged sales tax. The profit margin in the precious metals business is about 2%, so there would be no way to sell any gold or silver in NM if we actually paid that tax. We don’t.
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Here are some other advantages of silver and gold, and some differences:
Both are compact (albeit heavy) stores of value. Gold, however, is worth significantly more per ounce than silver and it is also the denser of the two metals, making the volume of gold worth far more than an equal volume of silver. So gold is easier to store, transport, and hide.
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Silver and gold – especially gold – are nearly indestructible and will last thousands of years. If you are storing gold in your home and your home burns to the ground, your gold melts into gold. It’s freakin’ indestructible
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Gold in particular is difficult to counterfeit because it is one of the heaviest metals. Fake bars can be detected by simply measuring their specific gravity.
Silver and gold are considered 100% fungible in that one ounce of silver or gold anywhere in the world is worth what every other ounce is worth.