Buying gold & silver?

[radderfire]

I was informed gold prices always increase during wars and economic downturns, apparently that's the best time to invest.

This is classic economic theory, but many commentators think gold and silver prices are currently being artificially supressed by use of derivatives on the Comex, i.e. the paper price is suppressing the physical price, hence lacklustre performance.

If you are going to buy gold and silver, the safest way is to buy physical. If you buy coins it can be a fun hobby too.

 

[radderfire]

Investing and losing 30% of your investment. Great inflation hedge.

This would depend on how well you can time the market from your own trading knowledge.

 

[mid_gen]

I don't really see how it's an inflation hedge? Inflation has increased recently and BTC has taken a bit of a dive... the previous BTC gains have been in a period of rather low inflation, where is the link to inflation?

The only thing Bitcoin is a hedge against is common sense. If the crypto bros were right, BTC should be a safe haven in times of economic turmoil, which it clearly is not.

Gold every time if you want an inflation hedge. Limited supply, and unlike Bitcoin or any other crypto, it has a material value and usefulness for a variety of industrial and cosmetic products. I nearly ought some sovereigns last year, but didn't in the end. Probably not the time now.

 

[radderfire]

The only thing Bitcoin is a hedge against is common sense. If the crypto bros were right, BTC should be a safe haven in times of economic turmoil, which it clearly is not.

Gold every time if you want an inflation hedge. Limited supply, and unlike Bitcoin or any other crypto, it has a material value and usefulness for a variety of industrial and cosmetic products. I nearly ought some sovereigns last year, but didn't in the end. Probably not the time now.

It is way too early to see Bitcoin perform as an inflation hedge in advanced economies, because we are very early in the adoption cycle. The fact of the matter is that economic turmoil is caused by the central banks being able to print unlimited amounts of money from thin air, it's like being able to pour an ocean into a bucket, and this causes the big rise in prices we are seeing now (as a trailing effect). If you had the whole economy on fixed-supply Bitcoin (non-debt based hard money, similar to gold), you would not have the economic turmoil in the first place, because the central bank would not be able to disrupt the system by pouring in unlimited debt-based money. It would be the end of the boom and bust business cycle. Ultimately, the central banks are just a wealth extraction mechanism for the banking sector, they aren't in the real economy and don't do much for it, mainly just extracting the wealth. This is why central banks, the ECB, the BIS, the Fed, the Bank of England etc all fear Bitcoin. It will eat their lunch.

 

[tom_nieto]

Should have invested in Bitcoin instead in 2015… oh well!

 

[mid_gen]

It is way too early to see Bitcoin perform as an inflation hedge in advanced economies, because we are very early in the adoption cycle. The fact of the matter is that economic turmoil is caused by the central banks being able to print unlimited amounts of money from thin air, it's like being able to pour an ocean into a bucket, and this causes the big rise in prices we are seeing now (as a trailing effect). If you had the whole economy on fixed-supply Bitcoin (non-debt based hard money, similar to gold), you would not have the economic turmoil in the first place, because the central bank would not be able to disrupt the system by pouring in unlimited debt-based money. It would be the end of the boom and bust business cycle. Ultimately, the central banks are just a wealth extraction mechanism for the banking sector, they aren't in the real economy and don't do much for it apart from extract the wealth. This is why central banks, the ECB, the BIS, the Fed, the Bank of England etc all fear Bitcoin. It will eat their lunch.

So, it's not an inflation hedge. Glad that's cleared up.

OP, stick to assets that have actual utility, like gold.

 

[200sols]

Should have invested in Bitcoin instead in 2015… oh well!

Of course every portfolio has room for high risk investments but usually they make up a small percentage of ones holidings. Putting all your savings into BTC is not a hedge against inflation it is basically sticking it all on red aka gambling.

 

[radderfire]

So, it's not an inflation hedge. Glad that's cleared up.

OP, stick to assets that have actual utility, like gold.

In the short term, it's a volatile investment, in the long term, it's an inflation hedge. Over time, as it becomes more widely adopted, it will become less volatile and the inflation-hedge property will become clearer. If it was adopted by a government as it's currency, like El Salvador, soon to be more, then once all Bitcoins have been mined, total supply would be fixed, and by definition there would be no inflation, and that's as good an inflation hedge as you can have!

 

[Chrisc]

This is classic economic theory, but many commentators think gold and silver prices are currently being artificially supressed by use of derivatives on the Comex, i.e. the paper price is suppressing the physical price, hence lacklustre performance.

If you are going to buy gold and silver, the safest way is to buy physical. If you buy coins it can be a fun hobby too.

Yeah exactly, I don't exactly plan on buying thousands of pounds worth. I'm thinking maybe invest £100-£150 every couple of months. Whether that be in some form of bar/coin form.

 

[silversurfer]

BTC is harder to call as it requires further development. Gold has a net positive investment by global central banks every year for the last decade or more, the largest richest entities there are in the market.
BTC does best when it spreads across a population even down to people with only a few dollars per day, if you can serve some purpose to a billion people then no matter what the product its going to be a great thing doesnt have to be perfect just regularly available I guess is what BTC stands for. Some countries have no currency at all, paper is often hijacked by the highest powers in a country and has no relation to capitalism.

gold/silver as an investment

Gold has no yield. I got sovereigns back from 2009 when they sold it to me under cost price, bargain but meanwhile its sat there and its only utility is an emergency asset. Price has most definitely risen since 2009, so its a speculative asset and price rises every time they undermine currency value, QE etc. inflation comes from deficit spending (like in wars) and we got trade and fiscal deficit so gold right now is correct to hold but its quite boring and it has no investment return.

Boring is good, one day gold will go hyper just like the 70's and early 80's and then I will be forced to sell because it'll be the same thing, inert boring never changes underneath the hype.


Investment - look at mining companies they'll pay a yield and so long as gold is trending upwards for the next decade all these mines have massive in ground asset reserves will become far more valuable then the debts of those companies. Equity over debt liabilities makes shareholders very rich. Its not as safe as plain metal but they will make gains far more then 100% I believe. a lot of inflation we see now is one kind of commodity or another, gold itself leans heavily on oil prices from all that heavy machinery

The wild thing I read recently was gold in energy production but Ive no idea if that takes off and adds to demand. Because its so unreactive and unique, it does have some industrial usage but the main driver of price is via poor governance of monetary standards so its a macro economic question. If they lost the reins on inflation and we're over 10% long term like occurred in the 1970's post Nixon shock then gold will spike I guess but I hold a gold fund for next decade as it should have a good bias to profit by.

 

[mid_gen]

In the short term, it's a volatile investment, in the long term, it's an inflation hedge. Over time, as it becomes more widely adopted, it will become less volatile and the inflation-hedge property will become clearer. If it was adopted by a government as it's currency, like El Salvador, soon to be more, then once all Bitcoins have been mined, total supply would be fixed, and by definition there would be no inflation, and that's as good an inflation hedge as you can have!

There's a fixed supply of a lot of things. That doesn't make them good inflation hedges.

Bitcoin is fundamentally useless as currency and won't ever be widely adopted. If it was, it would have happened by now. Its adoption is going backwards. One day the crypto bros will start to pull their money out, people will realise no-one actually wants a useless arbitrary token, and the whole crypto market is going to collapse like a house of cards.

The time to make money on crypto was years ago. Wait for the next tech fad.

 

[Feek]

This thread is specifically about gold and silver, not bitcoin or crypto. Let's at least try and keep it vaguely on topic please.

 

[Tom_ed1987]

I have a few sovereigns and silver Britannias. I bought them when the kids were born thinking it would be a nice thing for them to have when they're older.

Might buy a bit more each year from now on, as if(when) the queen passes on i feel it's likely the stuff with her portrait on in her final year might end up being worth a fair bit more than commodity value.

 

[radderfire]

This thread is specifically about gold and silver, not bitcoin or crypto. Let's at least try and keep it vaguely on topic please.

Depending on the investment aims of the OP, then bitcoin and crypto may well be relevant. If he wants a long term investment that will perform well, then he is better off with Bitcoin, if he wants a fun hobby that will hold its value and maybe make some ok returns, then gold and silver coin collecting might be better. My real opinion of gold and silver is that the market is heavily manipulated by the big banks using futures contracts, so the performance has been pretty lame. If their scheme collapses, which could happen, then gold could see a sudden big jump in value, say 5x to 8x. Both the YouTube channels I mentioned do cover this manipulation. I am pretty confident that Bitcoin will strongly outperform both gold and silver over the coming years, and mid_gen's comments above won't age well, but for the sake of the thread I won't comment much further on Bitcoin. The reason for this is you can send Bitcoin over the internet, but you can't send gold. If the OP wants to invest in gold and silver, then physical is the safest option, or perhaps bullionvault, and I would not touch an ETF, because in reality you don't really own the gold and you are subject to a lot of legal traps from the banks.

 

[moon man]

I foolishly bought 1k of stock in these shares ,thet have done terribly and due to a reverse takeover are on the Canadian stock exchange now ,its one of those where you refuse to sell at a loss just in case ..............
edit ,not excited about the latest rise looking at that volume

Patagonia Gold Corp is a Canada-based mineral exploration company. The firm is engaged in the exploration, development, and production of gold and silver projects in the southern Patagonia region of Argentina, Chile, and Uruguay. It also holds interests in mineral exploration companies, which are involved in the identification, acquisition, development, and exploitation of mineral projects. Some of its projects include the Calcatreu, Cap-Oeste, El Tranquilo, La Josefina, La Manchuria, and La Valenciana.

 

[dowie]

Over the long term, i.e. years and not months. In the short term, i.e. months, Bitcoin is highly volatile with frequent plus or minus 30% moves, but over time it keeps going up as the central banks keep printing money, and when you look at the graph over years, it basically curves up and the short term moves become insignificant.

That didn't answer the question about it being a hedge against inflation guess maybe it's a better subject for another thread though.

 

[radderfire]

Sorry that didn't answer the question about inflation, but I guess if you don't know/can't answer it then best to leave it there as the thread is about gold really.

If you'd like to start a new thread in the crypto sub-forum asking why Bitcoin has not acted as an inflation hedge in the past few months then I'd be happy to answer there, but as you say, best to leave it here so as not to derail this thread too much.

 

[potatolord]

Should have invested in Bitcoin instead in 2015… oh well!

I wish I'd patented the wheel in 6000bc.

 

[silversurfer]

I foolishly bought 1k of stock in these shares ,thet have done terribly and due to a reverse takeover are on the Canadian stock exchange now ,its one of those where you refuse to sell at a loss just in case ..............
edit ,not excited about the latest rise looking at that volume

Patagonia Gold Corp is a Canada-based mineral exploration company. The firm is engaged in the exploration, development, and production of gold and silver projects in the southern Patagonia region of Argentina, Chile, and Uruguay. It also holds interests in mineral exploration companies, which are involved in the identification, acquisition, development, and exploitation of mineral projects. Some of its projects include the Calcatreu, Cap-Oeste, El Tranquilo, La Josefina, La Manchuria, and La Valenciana.

Commodities is generally volatile super high risk. A fund of a range of companies should work if the sector has a valid trend. Price of gold can half at some point and I say that while being bullish, look at the 1970's graph

 

[radderfire]

Commodities is generally volatile super high risk. A fund of a range of companies should work if the sector has a valid trend. Price of gold can half at some point and I say that while being bullish, look at the 1970's graph

Very unlikely the price of gold will see much downside in the next year or two in my opinion, as the price is being artificially suppressed by a phoney paper market. If this fraudulent activity was not happening, then gold would have been going up in response to rapidly rising inflation, but as it is, it's just being pushed back down by unbacked paper derivatives contracts. At some point this manipulation may no longer be possible, and you will see an impressive rise in the gold price, up to proper "natural" levels.