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Author Topic: Got gold?  (Read 181025 times)

Silver

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Got gold?
« Reply #15 on: April 28, 2004, 01:33:25 pm »

Quote
May I ask what determines the price of gold and silver "today" and what if anything would you or could you do to affect the price of that gold and silver?

Supply and demand, of course, but there is almost certainly manipulation as well.

What could I do?  Nothing.  I'm way too small to have any effect.  Right now, I buy the dips.

But if I were a large criminal enterprise dating back 2 or 3 centuries, and I had access to
a few hundred tons of silver or gold, or even better central banks would "lend" me a few
hundred tons of gold for 1% per year, I could do a lot of things.  I could sell a bunch of the
gold and invest the proceeds in financial instruments returning 5% or more.  Zero-risk money,
with profits measured in billions.  Now, I have to pay, at least in theory, that "loaned" gold
back someday, so it's important to make sure that the price of gold doesn't go too high, or
all my profits are wiped out.

The easiest way to hold down the price of a commodity is by naked short selling.  That means
you promise to sell someone a bunch of stuff that you don't have.  It's not legal, and it's certainly
not ethical, but it's a great way to drive down prices.  Joe Blow, the little investor, says "I'll pay
$100 today for the right to pay $7 an ounce to buy 5,000 ounces of silver next month."  Criminal
Enterprise says "I will sell anyone who wants it for $50 per 5,000 ounce contract the right to buy
10 million ounces of silver next month for $6 an ounce."
No one takes the bet, as no one wants to buy 10 million ounces, but the price gets driven down to
the neighborhood of $6, even though there are people who are willing to pay $7.

There are lots more subtle and complicated ways to fix commodities markets, that's just a simplistic
example.  It also happens to be close to the present reality of silver markets, where 8 huge short-sellers
in the silver commodities market hold positions equivalent to several years mine output of silver.  They
almost certainly don't have it, but they have enough money, and just enough silver, to make the bluff work.
For now.

Other things that can be done, not by me, but by some, to affect prices of silver and gold:
1) Claim that inflation is low when in reality it is dangerously high.  People move to gold
during times of inflation, moving the price up.
2) Continually denigrate and insult any and all who buy or own gold.  Sneer at "gold bugs."  Call gold a "barbarous relic" and pooh-pooh its utility as money.  
3) Have central banks announce that they plan to sell large, like 500 ton, quantities of gold every year for the next 5 or 6 years.  Dumping big quantities of any commodity on the market lowers the price.  No other commodity owner tips their hand by publicizing what they plan to sell or buy, but central banks routinely do so.They are clearly not acting to get the best value for their assets, so what are they trying to do?
4) Make it illegal to own gold.  Confiscate it, then devalue the currency.

The list is long, but my time is short.  I need to earn some money so I can buy some more gold.

Peace,

Silver
 
« Last Edit: July 16, 2005, 06:37:22 am by Silver »
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Dull'Hawk

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Got gold?
« Reply #16 on: April 28, 2004, 02:10:32 pm »

So, is this what is happening to the price of precious metals now?  What if someone (like me) wanted to buy silver (or gold), but could only scrape up $50 or so?  Am I just out of luck?

Kent
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Silver

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Got gold?
« Reply #17 on: April 28, 2004, 02:38:59 pm »

Quote
So, is this what is happening to the price of precious metals now? 
Perhaps.  Perhaps not.  I can't be sure.  No one, except those practicing the manipulation, can be sure.

Quote
What if someone (like me) wanted to buy silver (or gold), but could only scrape up $50 or so?  Am I just out of luck?

Absolutely not.  In fact, you are in luck, as both gold and silver took big drops in price today.  Call Camino, tell them you want to buy a 0.1 troy oz gold Eagle, and you'll spend about $50.  I don't know what they have for small orders of silver.  I imagine that they could sell you some 1 oz Silver Eagles, for $8 each or so, but I really don't know for sure.

The gold and silver manipulations wreck the fortunes of "small" speculators, small being people who can afford to lose $10k or more and not take a lifestyle hit.  Think of it as a money pump, moving money from speculators to bullion banks.  For micro buyers like you and me, the manipulation lets us buy for less than if the free market were at work.

Peace,

Silver
« Last Edit: July 16, 2005, 06:38:51 am by Silver »
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Bear

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Got gold?
« Reply #18 on: April 28, 2004, 02:55:40 pm »

Quote
The gold and silver manipulations wreck the fortunes of "small" speculators, small being people who can afford to lose $10k or more and not take a lifestyle hit. Think of it as a money pump, moving money from speculators to bullion banks. For micro buyers like you and me, the manipulation lets us buy for less than if the free market were at work.

The important word here is speculator. Don't do it. No one on this board is likely
to be well connected enough to get the important info, or get it soon enough, to be
useful. You will end up being fodder for the bigger concerns.

OTOH, buying small amounts over time for the purpose of preserving the value of your
savings, is a good idea. Both the gold and the silver markets have been manipulated,
but as more people get into buying precious metals, the manipulators have less
effect. Also note that the manipulations are NOT permanent. Market forces eventually
correct the price.

If you have $50 to spend, you might consider getting 1 oz silver ingots "rounds" from
some place like California Numismatic Investments. http://www.golddealer.com These
are not coins but .999 fine silver ingots that happen to be round. :)

If you bought silver rounds with your $50, you could "spend" some of it without having
to use all of it at once. This is something you can't do with a single 1/10 oz eagle.

Bear



 
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Silver

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« Reply #19 on: April 28, 2004, 03:26:11 pm »

I agree completely.  I am not a speculator and I advise everyone I know not to be.  They don't listen, and speculate in stocks and mutual funds with "equity" taken from their bubble-priced house, but I tell them anyway.

Speculation is for people with so much money that they can afford to lose big chunks.  

As for investing $50, while I like gold, I note that Goldmasters sells $1 face value US silver coins (dimes and quarters minted before 1965) for $4.47, today, when silver took a big hit.  So you can buy about 7.15 troy ounces of silver for $44.47.  Shipping and handling will bump that up, so if you can afford more, go for it now, and spread that S&H charge across more coins.  But you can definitely spend $50 and get either silver or gold.

Peace,

Silver
 
« Last Edit: July 16, 2005, 06:40:09 am by Silver »
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Delos

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« Reply #20 on: April 28, 2004, 09:53:21 pm »


I just looked at www.kitco.com and guess what?

I think with gold falling to nearly $382 today, it's an excellent opportunity to strengthen your position. IMO, this is a green light to BUY!
 
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Hasher

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Got gold?
« Reply #21 on: April 28, 2004, 10:11:24 pm »

I have long squirreled away a little silver here and there and it is starting to become a nice littel stash. As Silver mentioned I buy when the price dips. I am holding it for the long term say like 30 years. Recently i have begun to aquire the 1/10th oz gold Eagles. Not much of a start but it is somthing for the future.
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Nedda of the Hill

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Got gold?
« Reply #22 on: April 28, 2004, 10:33:52 pm »

What about ordering coins thru a local jeweler's shop?

Has anyone else used the gold or silver pool at Kitco?  It sounds good to me since I only have a little bit of money here and there to play with, but I want to know if I can really trust them.
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NortonRyder

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Got gold?
« Reply #23 on: April 29, 2004, 12:03:43 pm »

I was in the Silver Pool at Kitco for about a year. When I had acquired a couple of hundred ounces, and some spare cash I converted the pool into metal. I found them to be prompt, courteous, and very plesant to deal with. I did have a number of questions, on the insurance, and shipping, and they answered those via e mail, very promptly.

I don't know about other states, but I've talked with several dealers here in Arkansas and the big problem with buying local is the 8 - 9 % additional premium you pay in SALES TAX. In Arkansas, metal purchases are taxed, so buying over the internet is, in essence, purchasing at a discount.

I really haven't calculated the percentage for Insurance and Handling, but I believe their handing fee is a flat rate, so the more you buy the less you pay, as a percentage. I liked the idea of being able to build a 'stash' a little bit at a time. I'd by 10 or 20 ounces in the pool, when I had a little spare cash. Over the course of a year, it adds up.
 
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Delos

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« Reply #24 on: April 29, 2004, 01:45:36 pm »


My gold dealer, a jeweler, doesn't charge me sales taxes on bullion purchases.

He is something of a self-governor!

:D  
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Bear

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Got gold?
« Reply #25 on: April 29, 2004, 03:21:17 pm »

Quote
What about ordering coins thru a local jeweler's shop?

Nedda, if the local jeweler will give you a good deal, then by all means, work with him and pay cash.
YMMV, but not all jewelers are interested in doing this.

Bear
 
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enemyofthestate

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Got gold?
« Reply #26 on: April 29, 2004, 03:42:11 pm »

Quote
Nedda, if the local jeweler will give you a good deal, then by all means, work with him and pay cash.
YMMV, but not all jewelers are interested in doing this.
Try local coins shops too.  I've bought quite a few gold coins thru a local dealer. He has better margins than most mail order or internet dealers, too.
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unstructuredreality

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Got gold?
« Reply #27 on: April 29, 2004, 03:48:13 pm »

Just my 2 cents, or oz's?!

I'd say the best advice is to keep it as simple and straight forward as possible, like Bear says, bit by bit over time, consistently is a good idea.  Once it gets complicated you can guarantee your investments will be watered down.  Buy straight, not options and know that the fundamental value will remain through the fluctuations and manipulations.  People tend to get into big trouble working options.  Leave gold pure and simple.  I also have silver in case I need to "have change" for the loaf of bread.  I have a nice deep hidden floor safe to keep a bit of my accumulations that couldn't be seen even if you were actively looking for it, but spread most of it around in other places.   For the past couple of years I've been giving gold for birthday presents to my younger family members, while they won't know what to do with it now, I have a feeling it will be appreciated later on.  Besides it's shiny and kids love shiny.:)

Peace and Good Day
« Last Edit: April 29, 2004, 04:06:22 pm by unstructuredreality »
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ZooT_aLLures

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Got gold?
« Reply #28 on: April 30, 2004, 10:31:14 am »

unstructuredreality,

Quote
Besides it's shiny and kids love shiny
Yeah but so do the crows of state, and those crows already made the personal possession of gold for investment a crime once in order to effectively rob the public to get themselves out of trouble.
And I myself believe they could and would do so again under the vestige of "terrorists are using gold as money" or some other such nonsense......

(edited in for clarity)
This is not to say that one shouldn't buy gold or silver, but only that one should be aware that at some point the crows of state might want "their" gold back, and therefore plans should be made to avoid being forced to do so.
 
« Last Edit: April 30, 2004, 10:39:20 am by ZooT_aLLures »
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rockchucker

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Got gold?
« Reply #29 on: April 30, 2004, 11:05:50 am »

So far, my "precious" metal stash consists chiefly of various chunks of steel, tiny gilded cylindrical lead ingots, and short brass tubes. ;)  
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