ECON So is now the time to buy gold?

Dozdoats

On TB every waking moment

If You Can’t Hold It, It’s Not Really Yours

MARCH 13, 2023 BY MICHAEL MAHARREY 0 0
The failure of Silicon Valley Bank and Signature Bank reminds us of a very important truth — if you can’t hold it in your hand, you don’t really own it.

That’s why it’s wise to hold at least some of your wealth in hard assets like gold and silver that are in your direct possession or at least stored in a secure, allocated, segregated, and insured storage facility.

The FDIC insures bank deposits up to $250,000. If you have more than that in a financial institution, you could lose everything above that limit if a bank fails.

Depositors at SVB and Signature Bank lucked out. The government has made provisions to cover uninsured deposits. But there’s no guarantee that will happen when the next bank goes under.

And even if you don’t have more than $250,000 in the bank, you could easily find yourself locked out of your account. Just last week, a computer glitch caused money in some Wells Fargo accounts to disappear.

There are also more nefarious reasons you could lose access to funds. The Nigerian central bank recently limited bank withdrawals in order to incentivize people to use its new central bank digital currency. In 2017, India faced cash shortages when the government declared that 1,000 and 500 rupee notes would no longer be valid with just a four-hour notice. And during its crisis, the Greek government shuttered banks and seized some bank deposits.

Most people assume “that can’t happen here” in the US. But as we saw over last week, the US banking system is vulnerable to collapse.

The dirty little secret is US banks don’t hold your money in their vaults. They loan it out to other people. In the US fractional reserve banking system, financial institutions only have enough cash on hand to cover a fraction of their deposits. If too many people show up at the bank to demand their money at the same time, the bank will not have enough funds available to cover all of the withdrawals. This is why bank runs are so dangerous. They can cause a bank to go under.

When you put your money in a bank, you create “counterparty risk.” In a nutshell, it is the risk that a person or institution on the other side of a transaction might not fulfill its obligation – i.e. the bank doesn’t have the money to return your deposit.

Even if you pull all of your money out of the bank and stuff it under your mattress, you still have counterparty risk, as Mises Institute president Jeff Deist explained.

Even if you managed to withdraw all of ‘your’ money in physical cash from banks tomorrow and put it in your well-guarded safe at home, you are still a creditor to the Fed & Treasury. You still hold IOU paper with risk of loss.”

In fact, you’ve suffered significant losses in the value of your dollars over the last two years thanks to rampant price inflation.

Gold and silver carry no counterparty risk. They are tangible assets that you can hold in your hand. They can be bought and sold all over the world. Their value is recognized globally. While the price of gold or silver may fall, it will never fall to zero. Precious metals can’t default on their payments, they can’t commit fraud, and they can’t go bankrupt.

Of course, it’s impossible to lower risk to zero. If you store your gold and silver at home, you could get robbed. If you vault your precious metals, it is possible for that third-party storage entity to commit fraud, get robbed, or be destroyed by an act of God. Nevertheless, the counterparty risk introduced by storing your gold and silver is relatively low compared to the risk of a bank failure or rapidly depreciating fiat currency — especially in the current financial situation.

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banking, counterparty risk, gold, money, silver, SVB
 

Jeff Allen

Producer
I suspect many invest in Au/Ag before they should...or perhaps, more than they should at the time.
#1 food. Do you have at least 1 year of food for everyone who will be with you? If not...good luck lunching on your Ag/Au as NOBODY will trade their food for your tasty precious.
#2 bullets. Many have lots and lots of noisy tools...but few have the feed for them in adequate quantities. Think MANY tens of thousands of feedstock for anything remotely "serious" as in no functioning law enforcement. I guess you could lay your precious around the perimeter and draw off the goblins...or maybe not.
#3 band aids. Almost nobody has necessary stocks of training and equipment here before they run off buying "precioius". What good is precious if you dead? Your first born...dead because of a simple cut and no antibiotics after wound goes south. Precious not so precious then....but hey, fun to look at perhaps through tears?
Ag/Au can be vital to preserving wealth in a scenario where there is a currency collapse and a social rebuild. But anything serious....pretty useless IMO.
That having been said, my opinion is that the low severity reset is almost infinitely more likely than some dystopian horror where 95%+ die off....but, still possible.
J
 

Kathy in FL

Administrator
_______________
How do freeze dried FRN$ taste? :D

Calories first!

I was not joking. If your debt is paid off and you still have that kind of money floating around looking for a home to be spent on, a tool like a freeze drier will provide the return on investment now rather than have to wait for a hypothetical return at some future date.

You can buy food now and freeze dry it for long term storage at a lower cost than at inflated prices in the future.
 

Dozdoats

On TB every waking moment
You can buy food now and freeze dry it for long term storage at a lower cost than at inflated prices in the future.

Definitely an option- one of many. So little time, so many choices.

ETA - I still have my Y2K stock of stored food, Mountain House and LDS etc stuff. It's likely I will be gone before that is. Every person has a different set of considerations and decisions to make.
 
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Southside

Has No Life - Lives on TB
I suspect many invest in Au/Ag before they should...or perhaps, more than they should at the time.
#1 food. Do you have at least 1 year of food for everyone who will be with you? If not...good luck lunching on your Ag/Au as NOBODY will trade their food for your tasty precious.
#2 bullets. Many have lots and lots of noisy tools...but few have the feed for them in adequate quantities. Think MANY tens of thousands of feedstock for anything remotely "serious" as in no functioning law enforcement. I guess you could lay your precious around the perimeter and draw off the goblins...or maybe not.
#3 band aids. Almost nobody has necessary stocks of training and equipment here before they run off buying "precioius". What good is precious if you dead? Your first born...dead because of a simple cut and no antibiotics after wound goes south. Precious not so precious then....but hey, fun to look at perhaps through tears?
Ag/Au can be vital to preserving wealth in a scenario where there is a currency collapse and a social rebuild. But anything serious....pretty useless IMO.
That having been said, my opinion is that the low severity reset is almost infinitely more likely than some dystopian horror where 95%+ die off....but, still possible.
J
Jeff,

All B/S aside, NOBODY is ready. PM's or not, ammo or not, food or not, we are not ready. I know I am not. Do I have a lot of food, you bet. Ammo. Yes sir. PM's? some of that too. But the cajones to say I am prepared for what is coming? Not a chance.

I pray we are all able to find a way to work together and help each other when it all goes south.
 

West

Senior
Jeff,

All B/S aside, NOBODY is ready. PM's or not, ammo or not, food or not, we are not ready. I know I am not. Do I have a lot of food, you bet. Ammo. Yes sir. PM's? some of that too. But the cajones to say I am prepared for what is coming? Not a chance.

I pray we are all able to find a way to work together and help each other when it all goes south.

Agree 110% good stuff said.

Just add, faith. I feel that if my faith is strong and my body still alive to work, then I'm a force with faith. No faith, mostly alone and eating nothing but can foods....yeah I don't want to live like that. Would rather leave that existence.

Keep the faith and lord bless us to make it work, and our gardens/fresh stock with our naighbors to make it all work out. Hopefully with fresh meats and veggies in our pots!
 

shane

Has No Life - Lives on TB
Jeff,

All B/S aside, NOBODY is ready. PM's or not, ammo or not, food or not, we are not ready. I know I am not. Do I have a lot of food, you bet. Ammo. Yes sir. PM's? some of that too. But the cajones to say I am prepared for what is coming? Not a chance.

I pray we are all able to find a way to work together and help each other when it all goes south.
When TSHTF all of us will inevitably have, and painfully discover, numerous "if only" regrets of things, skills and relationships we should have, and could have, gotten much more of. Some very easily beforehand if we'd of only better anticipated those future SHTF needs more accurately and realistically.

My daily goal is to try and minimize both the quantity & severity of those inevitable regrets that me and mine will later suffer.

Every day of 'normalcy' is a blessing to do so, as someday soon things will be so bad for so many, with their families suffering so grievously and needlessly, that most will eagerly give their right arm in that day to turn the clock back just two weeks to of done things all so differently.

Panic Early, Beat the Rush!
- Shane
 
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West

Senior
My goats spread the black nuggets of life evenly across our fields. Have to stack the cows and horse pies and apples in a pile to age properly!
 

Dozdoats

On TB every waking moment
Few agree with me when I say that even a full ounce of silver concentrates too much value for most uses.

Time will tell if I am right or wrong ...
 

West

Senior
Few agree with me when I say that even a full ounce of silver concentrates too much value for most uses.

Time will tell if I am right or wrong ...
Yes.

But that's why we made scales and the penny weight measurements.

:D

Nothing that you didn't already know, but for the newbies...


Best...
 

TxGal

Day by day
Though about it, or a little silver. We've been putting more $ into tangibles, instead. A little more long-term food storage (thank you to the LDS folks!), new boots and spares (work boots and mud boots) for both DH and I and spares for our kids when they come up to help. A 3rd battery chain saw, more leather work gloves, more winter hats/gaiters, winter work coats, etc. Almost forgot to add we're picking up stocker fish in a few weeks for all of our ponds, too.

We got ahead on livestock needs, feed and supplements, wormer for the cattle, garden needs...the list of back-ups to back-ups needed on a homestead is endless. Havings spares for everything really adds to peace of mind.
 
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Groucho

Has No Life - Lives on TB
Dabble in PM's after you:

Pay off all debt. This includes house, car, cards and anything else that demands payment. Get out of debt.

Have your personal health under as much control as is possible. Get your weight under control, make sure you exercise, if you have to take meds for BP, diabetes, etc, lay in a stock of the meds. Exercise and get in the best shape you can.

Get some friends of like mind. 2 or more folks of like mind can be a blessing.

Have at least six months of usable food stocked. Usable means, stuff you eat and enjoy. Trust me, you won't enjoy MRE's nor will you be able to be regular. Put water in here. You can't live long without water. Lots of water plus a way to purify water.

There are other things you should be working on like a usable garden, getting a reasonable stock of hand tools and knowing how to use them. Have at least one alternative source of power for heat, light and cooking.

Firearms. Your call

Last on the list should be PM's IMHO.
 

Kathy in FL

Administrator
_______________
Dabble in PM's after you:

Pay off all debt. This includes house, car, cards and anything else that demands payment. Get out of debt.

Have your personal health under as much control as is possible. Get your weight under control, make sure you exercise, if you have to take meds for BP, diabetes, etc, lay in a stock of the meds. Exercise and get in the best shape you can.

Get some friends of like mind. 2 or more folks of like mind can be a blessing.

Have at least six months of usable food stocked. Usable means, stuff you eat and enjoy. Trust me, you won't enjoy MRE's nor will you be able to be regular. Put water in here. You can't live long without water. Lots of water plus a way to purify water.

There are other things you should be working on like a usable garden, getting a reasonable stock of hand tools and knowing how to use them. Have at least one alternative source of power for heat, light and cooking.

Firearms. Your call

Last on the list should be PM's IMHO.

Yes. In my opinion, if you don't have the above taken care of, PMs are nothing but a false sense of security that will likely not go as far as you think they will.
 

Demodave

Veteran member
We have a very small percentage in pm's

Bought with the thought process of having physical possession of value, and to hand down to our kids and grand children.

Day to day and month to month(s)
provisions are already established.

Diversification of assets are also on the mind
 

bracketquant

Veteran Member
Every presidential election year the government prints a new edition of this book- United States Government Policy and Supporting Positions (Plum Book)

It lists a number of jobs filled at THE PRESIDENT'S sole discretion. You're fired. Remember that line? Or you.re hired.

But nothing happened.

So try again with what Donald couldn't do ........
Did he rid us of the Federal Reserve Bank? And, if he tried, would he still be alive?

Filling, or not filling, any number of job positions is not going to make a (debased) dime's worth of difference.
 

Hfcomms

EN66iq
Yes. In my opinion, if you don't have the above taken care of, PMs are nothing but a false sense of security that will likely not go as far as you think they will.

Everyone knows I am a diehard gold and silver bug but I am in basic agreement here. Gold and silver have an important role but that is basically on the other side of an acute crisis. You need food, water, shelter, security and other essentials put away before a crisis as they are hard to come by during a crisis. The caveat to that is you should have some silver as we will go to a barter economy for awhile and there is always a black market of sorts or perhaps a farmer with extra eggs or apples that doesn’t want paper.

Primarily though the function of metal is to preserve your stored wealth through a collapse so you have something to work with on the other side when you can pick up on assets fairly priced. But first you have to make it through to the other side.

When I was a young officer a grizzled colonel told us to forget about the fantasies being told us during the Reforger exercises of flying overseas and dropping down on warehouses full of new armor and equipment. He told us ‘When the balloon goes up you go to war with what you’ve got’. Likewise for us when the collapse is fully upon us we also go to war with what we have.

Use every opportunity not only to be your own central bank but also your own warehouse and hone your skillsets.
 

Dozdoats

On TB every waking moment
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Hfcomms

EN66iq
Good day for the paper prices. I don’t think I can remember a $70 daily move in gold before. Silver was up over $1 and that has happened many times. When gold acts like this it’s indicative of major problems in the bond and currency markets. Triple digit daily gold moves are coming and when that happens its off to the races. We are really getting into the end game here.
 

Southside

Has No Life - Lives on TB
Good day for the paper prices. I don’t think I can remember a $70 daily move in gold before. Silver was up over $1 and that has happened many times. When gold acts like this it’s indicative of major problems in the bond and currency markets. Triple digit daily gold moves are coming and when that happens its off to the races. We are really getting into the end game here.
I agree. Credit Suisse is in the throes of implosion is my guess.
 

nadhob

Veteran Member
Good day for the paper prices. I don’t think I can remember a $70 daily move in gold before. Silver was up over $1 and that has happened many times. When gold acts like this it’s indicative of major problems in the bond and currency markets. Triple-digit daily gold moves are coming and when that happens it's off to the races. We are getting into the end game here.
Big money needs time to liquidate. Thus, you see days in the market where hopium prevails early, but by the close or the next day, it's gone. Sellers taking what they can. Fox Business brings on a lot of high-powered investors, and an overriding theme seems to be precious metals, stocks, coins, bars, whatever, more so than ever before.
 

Boomer Sooner

Contributing Member
The Spot Price of Gold Bullion jumped $64.30 per ounce today (+3.34%), reaching a cost of $1987.30 per ounce during regular market-day trading. Once the market closed,
 

West

Senior
In 2008 it was a boom to the "we buy gold stores"

2023 we all just by gold/PMs now. I've noted several of my associates who own hock shops, they still buy gold and silver coin and bullion and jewelry, but funny they only resell the jewelry, the PM coin and bullion is MIA.

I razz them about it and they say they know nothing. I once knew something years ago, but forgot too!
 
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nadhob

Veteran Member
So if the Credit Suisse deal falls apart, gold will go bonkers on Monday as this contagion spreads. People who are following this story in finance are comparing it to the financial crisis of 2008. Bob Moriarity, a well-known pundit of the markets came out and said, No Way....More like 1929!!!
 

TKO

Veteran Member
So if the Credit Suisse deal falls apart, gold will go bonkers on Monday as this contagion spreads. People who are following this story in finance are comparing it to the financial crisis of 2008. Bob Moriarity, a well-known pundit of the markets came out and said, No Way....More like 1929!!!
Gold will not be allowed to go much over 2K/ounce. Take that to the bank. My guess is it hits 1980, going down, and goes down again from there.
 

TidesofTruth

Veteran Member
What makes this a bit different this time around is . . .

When the US Government removed our FRNs off the Gold Standard it did not just have the Dollar being an Autonomous value. And it had little to do with the full faith and value of the United States Government. The Dollar's value was implicitly pegged to the value of the US productivity and to be honest the Dollars Value is solely dependent upon the perceived Productivity and ingenuity of the American Worker. The US Government then proceeded to do everything in its power to erode that value. Everything from education to various welfare and regulation on all business large and small has been systematically eroded and that has devalued our currency. What we saw in 2008 was the first rumblings of the result of that devaluation. But what we saw happen during the Covid (never let a crisis go to waste) and the coincidental reduction in prosecution in drug crime is the biggest onslaught against our monetary system ever. Handing out free money has a much more devastating effect on FRNs NOT just from dilution of the money supply. But far worse, It is the disincentivizing the workforce to work and work competitively, and business to be honest about the surety of their books. The destruction of our workforce is what is destroying the FRN and with nothing else to peg the Dollar to the Dollar can be printed ad nauseum, handed out to whatever crisis it is needed for and we death spiral. Productivity decreases, Lying about productivity and the surety of the books increases and more crisis' both fictional and real increase.

Many good post here but in that your own wealth value can be pegged to several different things in the same manner. Yes PMs are a great way to preserve value. But those who don't have or very little of their own "Gold standard" can also peg their value to supplies but that only last so long. Bu what you can do is as the US has done for the last 52 years is to peg your wealth to your own productivity. Unfortunately the means of that value is changing rapidly however the old personal skills and means of production are ageless. Do not allow this government to disincentivize you.
 

nadhob

Veteran Member
Gold will not be allowed to go much over 2K/ounce. Take that to the bank. My guess is it hits 1980, goes down, and goes down again from there.
In quiet times, Gold can be manipulated in the direction one wants to see it go. Gold is global, thus when you have international turmoil, any attempt to manipulate is a short-lived buying opportunity, for someone...
 

TKO

Veteran Member
In quiet times, Gold can be manipulated in the direction one wants to see it go. Gold is global, thus when you have international turmoil, any attempt to manipulate is a short-lived buying opportunity, for someone...
Who is the "one", though? It ain't me. I'd love to see gold at 3K/ounce.
 

West

Senior
Gold is going back to the value it was for hundreds of years. It's at least a months wages for a vary skilled or vary savy person.

Or a ounce of gold will by you a hand made and tailored suit, shoes and hat.

Today the average wages earned by high skilled individuals or alike is around $5000 a month. Upper end.

Depending on how hard of times we go threw sooner or later, it (ounce of gold) may buy you a month of room, board and company.

I'm calling for $5k gold and at least $100 silver. Especially if we go into a major depression. Or currency collapse. That's on the low end.
 

TKO

Veteran Member
Gold is going back to the value it was for hundreds of years. It's at least a months wages for a vary skilled or vary savy person.

Or a ounce of gold will by you a hand made and tailored suit, shoes and hat.

Today the average wages earned by high skilled individuals or alike is around $5000 a month. Upper end.

Depending on how hard of times we go threw sooner or later, it (ounce of gold) may buy you a month of room, board and company.

I'm calling for $5k gold and at least $100 silver. Especially if we go into a major depression. Or currency collapse. That's on the low end.
Lord love you!!!!!
 

Southside

Has No Life - Lives on TB
Gold is going back to the value it was for hundreds of years. It's at least a months wages for a vary skilled or vary savy person.

Or a ounce of gold will by you a hand made and tailored suit, shoes and hat.

Today the average wages earned by high skilled individuals or alike is around $5000 a month. Upper end.

Depending on how hard of times we go threw sooner or later, it (ounce of gold) may buy you a month of room, board and company.

I'm calling for $5k gold and at least $100 silver. Especially if we go into a major depression. Or currency collapse. That's on the low end.
I do believe you are short on the 5K. Silver, though, is the one that will shine! Currently, depending on who's #'s you believe, silver is being extracted from the ground at a 6(or 8) to 1 pace to gold. In the near future, I can see the 90 to 1 ratio drop precipitously!
 

nadhob

Veteran Member
I think Silver is the place to be....Besides being an industrial metal and thus having an inherent demand cycle, as an investment metal its ratio to Gold is in the 90's....Once they begin to "run" together with that being the driver, you might see it back to it's traditional 50-ish spread.
 
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