Schaublin

Securing bullion at the best possible price has been my primary goal for a long time, but I am always considering my exit strategy. Like all of us, I am trying to position myself favourably for a myriad of possible future scenarios. One of which could well be the SHTF and in which case we are holding bullion and hopefully protected.

 

I am also thinking that a scenario could emerge whereby SHTF is avoided, but peoples confidence in fiat is significantly eroded due to a single/sequence of severe but temporary shocks to the monetary system and the price of PM's has risen considerably but not exploded.

 

Life goes on, people are scared, the internet is still working, CiD still buy and sell PM's and the holding of physical PM's is not commonplace but crucially, the fundamentals of gold and silver are understood by many. In this environment, I can envisage a strong market developing for high quality and unusual investment pieces for long term holding.

 

Meanwhile, I would be holding onto my core bullion to hedge against further shocks, but would offload investment pieces into the marketplace probably using a popular internet auction site.

I have read many posts on the subject of SHTF use of silver and gold in daily transactions for groceries etc. IMO it will not happen. Of course there are many types of SHTF but short of a true Mad max scenario, government fiat will be issued and used - even if it loses half of its purchasing power every week. We have many recent examples of currency collapse and people's behavior is similar in all cases.

1. Those with foresight (hopefully GEI members), see the writing on the wall and exchange their fiat for precious metals and/or stable foreign currencies while it is possible to do it at a good rate.

2. You plan a day of spending - pay your car tax, buy some groceries etc and buy enough local currency for these purposes.

3. Expensive items will be sold (or certainly advertised in OZ gold/silver/Yuan) in order that the price is understood.

The point is that gold/silver will not be used for everyday transactions but will be the ultimate store of wealth - with a bonus of increasing its purchasing power several times.

Old RB never gives up.

 

He's mentioned several times that he owned some sovereigns and sold at in 1980 at $800.

 

As far as I know he never said which country he was in and which currency he was paid.

 

I have a suspicion that he actually bought into the 79-80 price blowoff and has never got over it.

 

His argument against gold is always hopeless saying that holding gold from 1980 to 1999 was bad. Anybody with a rudimentary ability to read a graph can see that.

 

He never mentions the cycles or why what happened happened.

 

I think he has not studied gold carefully and he does not understand gold.

I sometimes go over to HPC to see if there is anything interesting being posted but Realistbear is such a buffoon - I think he is either someone with a low IQ or a shill for the bankers - who knows he may be both. His obstinate attachment to ridiculous economic models where fiat money becomes increasingly more valuable is actually rather pitiful,

Just watch: celebrities boycotting real gold and wearing the fake stuff.

 

Then a market for "ethical gold" will emerge.

Of course, white gold will be targeted first

Gold pirates wage a dirty, underground war - Times Online

An interesting article which implies that anyone buying gold is somehow responsible for what is happening there. The collapse of The mining industry in SA is due to the same reasons that Rhodesia went from a prosperous grain and tobacco exporter to an impoverished hell-hole in 25 years.

Perhaps the idea of 'blood gold' will be used as an excuse to restrict or prohibit private ownership. A few months of controlled media stories about gold hoarders damaging the economy tied in with horror stories like the one in The Times will smooth the way for legislation against the filthy perverts that hold gold!

Thanks Wren.

 

I am a little confused about the 35g being 1.5 oz. 35g = 1.1254 oz according to my calculator.

Yes, I read it and picked up on this mistake - simple errors like this tend to diminish my faith in any article.

I think ker might be taking his cue from EW here. Prechter has long doubted this gold bull and has called a low in 2012 for silver and gold, which would be his buying opportunity (he is not anti gold at all) but he is a fundamentalist EW chart adherant, 'it's what the charts call for'. Starts to remind me of the bible calling for the 'second coming'. We are all entitled to believe in what we will. Being wrong for the last 8 years on gold doesnt help convince me of Prechters 2012 call. But he could be correct.

Despite not wanting this fall to happen it would be what the bankers want, to shake out the gold bugs, then buy it all themselves. I remain cautious on buying gold at the moment but wont be selling at any price before 2016 anyway.

 

I also think that Prechter might have this call wrong this time as money may very well rush into gold next time we see another deleveraging. We also have to contend with a potential global currency crises which the EW charts may not have articulated for. Then there's the shorts and then there's China and the unwanted mountain of US dollar securities the world no longer wants to hold.

 

I personally dont believe in this stock market rally and would like the bear to awake from his nap as soon as that Dow 10/11 is met. I'm impatient to see what effect this will have on gold/silver this time, but have decided to be resolute and overcome impatience building a nice silver bullion/numismatic collection and the odd sovereign here and there or 1/4 ounce bullion. Silver still seems stupidly cheap to me for what it is and what it could be.

 

Good luck, everyone!

 

ps Credit to anyone who got back into stocks in March, and Prechter had that call spot on BTW...he also had the previous top called right on cue. So far it is only precious metals he has had badly wrong since 2001. Food for thought. Or indigestion rather.

Great post. I cannot pretent to understand the PPT/bullion leasing/Comex shenanegins but my instincts tell me that if significant delivery of physical is taking place by China/Saudi/Russia then we are entering new territory. It may have been easy in the past to shake out the bugs but now they are riding the dragon's tail. If the appetite is big enough and the pockets deep enough to buy sub 1000 USD then it might become interesting very quickly.

I wonder though if gold could become increasingly monetized [in the minds of investors/nations] to the point where the gold exchange standard will be re-instituted. The problem facing the trading system today is that is has been destabilized by the collapse in the US. The response to this collapse looks likely to further destabilize the free-floating currency system. If this does not necessarily lead to hyper-inflation, it may well still lead to currency crises where governments try to devalue their currency which would then see capital flight from one to another. Out of this kind of chaos, I can see the practicality of gold as the stabilizer of world trade reasserting itself [the value of which cuts across all cultures].

 

Personally, I see the price of gold eventually doubling from here within a couple of years time [though it will remain volatile to both sides] , which would effectively reflect certain currencies devaluing by a half. As for a new gold exchange standard, it could be SDRs backed by gold to which currencies would be pegged and stabilized.

IMO this is very important. After the upheavals of the past year with banks going tits up and QE printing presses running 24/7 and some exposure even on the controlled media to gold, I would imagine that the monetization of gold (in people's minds) is already starting to occur.

that's why I have been busy over there recently, couldn't resist after the majority of idiots slated pm's for the last few years.

I have noticed some of your posts on HPC - you are doing good work refuting some of the nonsense that is posted there. I do worry that some of the posters seem to be deliberately trying to frighten newbies into not acquiring PMs. These posters are initially plausible but later their purpose becomes clear - to use any argument, however ridiculous, to convince waverers that PMs would be confiscated/be worthless/in a bubble etc etc.

I must confess, I am curious as to why some posters seem obsessed with trying to dissuade others from buying PMs. Generally it is in the interests of central banks to take this position not ordinary people......Hmmm.....

azazel just sent you a PM

And while i am biting... you think Gold is going to 500USD and the gold silver ratio will widen to 100+

You do realise this means sub 5USD per oz silver

It costs most producers more than that just to get the stuff out the ground

Mines would close at that level and above ground stocks such as they are would disappear very quickly.

In short sub 5USD silver aint gonna happen.

I agree with your sentiments but I am not sure you were wise to 'rise' to the foolish talk of Ker. It is human nature to seek out opinions which resound with your own but wise to try to understand conflicting opinions - but only when these opinions are articulated by people with intelligence who back up their claims with solid information. There was a poster on HPC called realist bear - he was obviously a fool who had only partially grasped what was happening re the collapse. Ker does not even seem to partially understand - and more importantly, does not seem to want to learn so let him live in ignorance.

I seems to me that many believe there will be a pull-back to 800 or 750 - or even lower as the (false) dawn of recovery is talked about. For Bullion Vault or Gold Money accounts where trading spreads are not too high, there may be a case for selling now and buying in at the lower price ( if you have the nerve) but for physical with the wide spreads I cannot see any point in selling unless you believe that the price is going very low in the near future.

I was in my local tool shop yesterday chatting with the owner and it seems that sales are picking up a bit on high-cost woodworking tools. The interesting thing is that he says that people are paying with cash or debit cards NOT credit cards as they say they may as well buy tool X now as they are getting bugger-all interest on their savings. Makes sense but I was really surprised when he said that many have commented on a fear of high inflation to come. This is Joe - public who are not supposed to be so savvy!

I wonder how much spending in the high-street is now being done by such people - my suspicion is that it is making a big difference to what would otherwise be a deep fall in spending.

I think part of the problem that has got us into this mess is the desire by people to make money off trying to trade into and out of financial instruments. We need to go back to a society where we work hard to produce & sell physical things, rather than financial instruments that enable some to gain as others lose. You have made money out of buying a option then selling it for more, but think to yourself someone somewhere has been on the other end of that deal and has lost money. Trading is quite similar to gambling in my eyes, someone wins - someone loses.

Yeah but... I agree totally with this sentiment - it is self evident that gambling is a zero sum game but people have to eat! I sold my property in the Summer of 07 - good timing and luck and use the cash to support myself via trading. I am unemployed and see no prospect of ever working again. My background is in mech engineering but after years of unemployment , I went to Russia and studied Russian for 4 years at University - I lived on the income from my apartment while there. I did get some work here as an interpreter for a few years but gradually this work was taken by native Russian speakers from the Baltic states - because they are cheap and easy to hire and fire.

If I had the opportunity to use my skills and contribute to society, I would but I cannot so I do what I can to survive and so does everyone else.

My point is that everyone has to make the best of living in a decaying society. When we reach a critical point of poverty and repression, there will be a revolution and the cards are shuffled anew!

I am another refugee from HPC - a lurker there for over a year. I returned from living in Russia two years ago and felt in my bones that the standard of living here in the UK bore no relation to the productive work being done. My background is in engineering - with a mid-life change to language as engineering employment was impossible to find. Thanks to the gold thread and links from it, I have steadily improved my understanding of economics - thanks to all who contributed especially Goldfinger. I sold my property last April and invested partly in Gold - physical and Bullionvault.

I am sorry that there seems to be some sort of censorship at HPC and will be spending less time there now that have I found this new niche for the gurus!