How should you look at silver and gold coins?
You’ve got to be careful listening to the media and yes even Fox news when it comes to silver and gold. Silver and Gold in my opinion can be good investments but I look at them as good investment for different reasons than what is being portrayed in the media. Yes silver and Gold can be used as a hedge against inflation but in my opinion that’s the wrong way to look at these precious metals. I’m an investor to me silver is a much better investment than gold is and my reason for saying that is because at the moment silver is being used up. Silver is consumed whereas gold is typically hoarded (put away in a safe).
Understanding our current world and why I think gold is over priced
In 1971 President Nixon saved America and the world in fact from going bankrupt. President Nixon severed the link between gold and paper money. No more would be people be able to purchase gold at a fixed price. Gold and paper money we’re now separated. From that point on in history Countries could now control their own money supply. The real reason for this is because throughout history the gold system has always failed. One side gets too much of the gold and system created crashes and burns.
This system does not exist in fiat paper money system instead government and the people decide where and how the money should flow. The problem with the fiat money system is inflation on the flip side the problem with gold system is deflation. Both pose serious threats but in the minds of most the gold problem is far worse. Inflation means there’s too much deflation means there’s not enough. The great depression showed the world that when gold (which at that time was also paper money) goes into hiding even the developed world will starve.
Jesus sold for 30 pieces of silver
Paper money cannot go into hiding because if it does the government will create more which ultimately will cause inflation which also affects those that hoard money. This is where purchasing gold and silver comes in. If the government prints more money some people say it’s best to purchase gold. But in a real investors mind gold only makes sense if you expect the fiat monetary system to fail. If you remember even in the bible story Jesus was sold for 30 pieces of silver. So the question you should ask is why wasn’t Jesus sold for 30 pieces of gold? The answer is because it’s hard purchase everyday things with Gold.
Having Gold is like walking around town with only $100 usd bills in your pocket. Sure you can do some big business but the everyday shop owner won’t be able to make change for you. On top of that people might want to rob you. The profit made from silver and gold doesn’t hit people until they try to sell it back for fiat paper money profit. This same people that sold you the gold take a percentage on both ends. Do you follow me here?
So let’s say I buy a silver coin for $44usd an once and the price of silver raises to $50usd an once the next day and I try to return that silver coin to the dealer for profit the dealer will most likely offer me back $45 an ounce. Because he will charge me 10% for buying it back from me. This also exists when people are trying to exchange Gold for silver. This is why the fiat monetary system was created and this is why it’s important that a country controls its own money supply. Because a person from a gold rich country can walk into the United States and do this transaction all day and rob the American people blind with all their fees.
Understanding the silver and gold market
This is why I keep telling people to stop falling under Ron Paul’s spell. I’m sure he means well but he clearly did not do his research when it comes to silver and gold and that market. We the people give gold, silver and fiat paper money value anyone telling otherwise hasn’t done their historic research. It took many years for people to even accept gold as a form trading and then once accepted pirates started emerging and sharks of all types than finally lands and borders were created and rules and laws were established. In order to keep these laws in order countries needed to control their money supply we are in that age now and I hope we don’t return to the old world of slow growth and long deflationary periods.
Final thoughts on Gold and silver coins
My final thoughts to you are if you expect our monetary system to fail purchase gold and silver coins and hoard them, buy a safe and put them in there in case of emergency. If however you don’t expect our monetary system to fail look at silver and gold the way you would any other investment. Personally I like silver right now more than I like gold because as it stands now silver is consumed whereas gold is not. Gold as it stands now is dug up from the ground and put in safes all around the globe. There is so much gold around the world collecting dust it’s not even funny.
Gold is way over priced and the only thing that could save it is if our monetary system crashes and even then I highly doubt people will accept it right away in fact it would probably be better to stock up on guns food and supplies before wasting your fiat money on gold and silver coins. Thanks for reading this post I want to point out again that I do not give any financial advice everything you’ve read in this post is based on my opinion and is not to be confused with your reality. Thank you!