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After WTSHTF - Precious Metals for the Rebuilding

5K views 29 replies 14 participants last post by  SouthTexasGuy 
#1 ·
I was fortunate enough to work as a contract geologist for several mining companies in Nevada. They typically give out silver and gold as rewards for safety and attendence to employees. Of course miners would sell to me at spot for "beer money" before the wife found out. I was buying around the late 1990s to early 2000s and have since quintupled my money. I sold some and recovered my cost basis and am keeping the rest as "portfolio insurnace" as the US dollar slips into oblivion in a blizzard of TARP and Stimulus printing at the Fed. We are likely to experience a new Great Depression imo or hyper-inflation (Wiemar-Style perhaps). So my precious metals are for the rebuilding that comes after other investments in stocks and bonds are blown away and the crisis has past. The precious metals are just one element of the entire overall prep-survival strategy (that includes being debt-free, arable land, multi-year stors of nonperishable food and basic necessities, ammo and firearms).





 
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#2 ·
I always thought wire was more sensible for metal barter. You can clip off bits to make change, coil it up for easy carrying, or make cute wireframe art out of it.

Unless you're dealing with trusted coinage, you're going to weigh it out anyway.
 
#3 ·
If there is a total economic collapse what is the guarantee that gold or silver will be worth anything at all? Frankly, if the monetary system is completely gone you couldn't buy 5 pounds of potatoes from me for less than 5 pounds of gold, or 10 pounds of silver.

I can't eat the gold or silver, can't heat my house with it, or gather or hunt food with it. Unless the person(s) you wish to do business with feel it has value it will not be as valuable as trading food, clothing or ammunition to get what you need.
 
#5 ·
If there is a total economic collapse what is the guarantee that gold or silver will be worth anything at all? Frankly, if the monetary system is completely gone you couldn't buy 5 pounds of potatoes from me for less than 5 pounds of gold, or 10 pounds of silver.

I can't eat the gold or silver, can't heat my house with it, or gather or hunt food with it. Unless the person(s) you wish to do business with feel it has value it will not be as valuable as trading food, clothing or ammunition to get what you need.
I don't intend to eat silver or gold - would defeat the purpose. Precious metals are for other purposes as we should already be prepared in other areas. But if you want to eat silver and gold, then be my guest. We know that people have used precious metals when currencies have collapsed. In the past we have seen people use precious metals to buy real estate during times of economic distress (i.e. Weimar Republic, Indonesia and Thailand - Asia Contagion, etc.).

As for food this is the reason we stockpile a multi-year supply of nonperishable food and basic necessities. This is also why we remain debt-free and never take out loans. This is why we stockpile a lifetime of firearms and ammunition (in my case perhaps a couple lifetimes worth). This is why we buy fertile rural land. Some people just don't get the point of preparation. Obviously the use of silver and gold as the ultimate money through 6,000 years of human history hasn't and won't likely ever change.

I have often found that those who complain and criticize those who stockpile precious metals, food, goods, guns, ammo, etc. usually are those who haven't made any preps or taken any precautions. Many count on the government to save them (anyone remember Katrina?). Preparation and survival is a multi-faceted approach of taking precautions in all areas of existence (including financial).

On a side note, I made enough on silver and gold that I sold some bullion to further finance the purphase of a new truck (GMC Sierra), additional stockpiles of non-perishable foods, firearms and ammo. I have quintupled my money in the last decade and still have silver and gold as part of my investment portfolio. Anyone think that the US dollar will increase in purchasing power? Especially now as the Federal Reserve is creating $Trillions out of thin air? When the banks finally decide to release that money into the market place we will likely see an inflation tsunami.
 
#7 ·
You don't have to buy precious metals at far below market price to make it pay.

I used to be in the mining industry. Even worked at the Homestake Gold Mine in Lead, SD.

I had no "insider" knowledge, just an interest in the gold market. I took a $10k inheritance and the interest and turned that $10k into $60k in the course of a year and a half. It was an opportune time, shortly after Nixon took us off the gold standard and the international market went nuts over gold. I sold a bit short as I sold gold bought at $125 and $140/troy ounce at about $700, gold peaked at the time at around $765. Wish I'd have played just a bit longer.

I had one friend who lost his marriage by selling/mortgaging/borrowing every last penny he could to play the same market. Lost his marriage (wife frightened about losing her "security") but is now independently wealthy. We both saw the boom coming.

I don't call the Great Depression in the U.S. enough of a SHTF scenario for gold or silver to really be worth it, try post-WWI Germany or Cambodia in the '70's to see where precious metals really shine as the ultimate hedge. Or, being a Jew in Nazi Germany. Diamonds worked there, but for pennies on the dollar. Still, it beat the alternative.
 
#10 ·
I ran across an old American Rifleman the other day. I had filled out an order form for silver but not sent it in. It was 12$ an oz. then (7-8) years past. It is now 22-26$. Wish i had sent the form then. When our economy functions silver is valued at 1/16 the price of gold. Using this standard that has generally worked for the history of the US, silver should be in the general price range of 83-92$ an ounce now. At this time silver is very under priced and the opportunity for financial gain is great. Granted it will take some time for things to settle out. Black Blade has his assets diversified, money and staples. No matter how small the investment it is a virtually gain situation guaranteed.
 
#11 ·
And that's fantastic SJohnson, you had a $10K inheritance, BlackBlade got his through work incentives and buying direct from miners at discount prices.

So how does the average guy do it? Mortgage his house to buy gold? Take out a loan? Rob a bank? In order to buy the precious metals I woulld have to short myself somewhere else and that is not going to happen. As I stated previously I do have some old silver coins and I have no intentions in getting rid of those any time soon. But it is not in my plans to spend my resources to buy gold. Maybe if I had an inheritance so it didn't affect my normal bottom line, but to try and come up with $10k otherwise is simply not in the cards.
 
#12 ·
Like I said, a friend sold/mortgaged/borrowed every penny he could find. He gambled that the time was right, and won. Big.

Not saying it's for everyone, or even anyone. But it can be done.

Here's a game that can be fun. Play commodities/stocks/whatever with imaginary money. Assume some windfall, say $10k. "Play" the market, keep good books, "pay" fees, taxes, etc. Fantasy Wall Street, much like fantasy football.

But unlike fantasy football, you just *might* find yourself prepared to turn the fantasy into reality. The time might come. Just sayin'.
 
#13 ·
Like I said, a friend sold/mortgaged/borrowed every penny he could find. He gambled that the time was right, and won. Big.

Not saying it's for everyone, or even anyone. But it can be done.

Here's a game that can be fun. Play commodities/stocks/whatever with imaginary money. Assume some windfall, say $10k. "Play" the market, keep good books, "pay" fees, taxes, etc. Fantasy Wall Street, much like fantasy football.

But unlike fantasy football, you just *might* find yourself prepared to turn the fantasy into reality. The time might come. Just sayin'.
Sorry not my cup of tea. I would just as soon keep my house than risk it speculating on gold or silver.

Just curious, did you know the Marlboro Man died of lung cancer?
 
#14 ·
Did Obama die the same? ;) A shame.

(The pic is a photoshop of Mr. Obama as the Marxboro Man ;) ) Nuttin' to do with Marlboro :D

"You're in Socialist Country"

:rofl:
 
#17 ·
It doesn't take much. You can buy some fractional ounces of gold or an ounce of silver here and there (usually at a coin shop) and it builds up over time. I had started out buying a little bullion at a time spending a couple hundred every couple weeks or every month. I just kept a discipline of buying this way (dollar cost averaging) over the years. I just happen to now be in a position where I don't worry about unemployment or the economy, or even if the Government goes tits up and Social Security is cancelled in the future.

 
#20 ·
I wish I had some real gold for backup but the only gold I have now is sorta copperish with laquer around the primer and the bullet. Gold as far as I care at the moment. The soft stuff will come later on when I'm better off. For now I'll bunk up with the blade, he can keep his and I'll keep mine. I'll bet a "me" could offer something he needs while a "black blade" could offer something a "me" needs until it's time for seperate ways. As long as like minded people work like ants it'll all be good.
I think I spell better when I'm drinking, odd.
 
#21 ·
BB, beware. Charlotte pipe is your friend. I was reminded by a friend today as he handed me a copy of executive order 6102 when the banking cartel used the office of the presidency to rob the American serfs of thier wealth. Don't think they wouldn't do it again!!!!!
 
#22 ·
Given current events around the world and in Washington DC, we watch as QE2 gives way to QE3 and eventually QE5 through QE
as the global economy slips over the edge into oblivion. The dollar dives, race riots break out as welfare checks and food stamps are reduced or even stopped, stock markets around the world collapse and unemployment rockets higher as the Chinese and other foreign interests see no benefit in holding devaluing dollars as reserves .............. while hard assets become items to preserve value and for barter. Silver and Gold prices soar to new records (not daily but minute by minute), those in debt are suddenly unable to pay debts as the dollar collapses and only those who are debt-free and well supplied living in remote small communities or very rural areas are left largely unscathed. The Powers That Be (PTB) remaining in control of any semblance of a functioning government will have no choice but to declare nation-wide martial law with demoralized troops issued "shoot to kill" orders on looters, criminals, defenseless citizens, anyone who may appear to be a threat. Armed Gangbangers move outward from the inner cities into the suburbs raping, pillaging, destroying and murdering as they go. The military (national gurad and standing armies) abandon their posts to be with their families (as they did during Katrina). The US Government falls - Chaos ensues - Everyman, woman and child for him/herself.

George Soros laughs - and scapegoats The Tea Party Movement - The Leftist Propaganda Ministry Media (CNN, NBC, ABC and CBS) gleefully joins in its witch hunt against fiscal Libertarians-Conservatives who have warned of such an outcome. Uneducated masses demand "something be done" and sell their freedom and liberty for percieved security. The Constitution of the Untied States of America is "officially" declared null and void. Conservative and Libertarian politicians are rounded up and taken to Fusion Centers - some simply "disappear". FEMA Camps are set up for the "Safety" of scapegoated sympathizers of The Tea Party Movement, known Libertarians and Conservatives. Western Mountain States and isolated communities around the antion will become the last bastions of remaining liberty. A new Civil War begins as Progressives align with foreign Socialist Regimes to gain total power and control. A New World Order (NWO) is born. The American Dream is dead - Welcome to Mad Max.

It will most likely start out like this - For your Sunday viewing pleasure:

+ YouTube Video
ERROR: If you can see this, then YouTube is down or you don't have Flash installed.


http://www.youtube.com/watch?v=2N8gJSMoOJc&feature=player_embedded
 
#23 ·
If You’re Losing, Change the Rules

By October 3, 1979, silver hit $17.88 an ounce.4 The two major U.S. exchanges, COMEX and CBOT, started to panic: They held a measly 120 million ounces of silver between them, an amount typically delivered in a busy month.5 With silver prices pushing to new heights as new buyers rushed in, the exchanges became fearful that a default (inability to deliver) was imminent.

The silver rush continued to accelerate, led by the Hunt brothers and their Saudi Arabian business partners. The Commodity Futures Trading Commission (CFTC), the government’s futures watchdog, had become seriously alarmed at the prospects of a shortage on the exchanges, and tried persuading Bunker Hunt to sell some of his silver.

The billionaire resisted, believing that silver was a long-term play with an integral role in the future global economy. The CBOT, backed by the CFTC, finally decided to put a stop to the Hunt brothers’ buying—by changing its rules.

Margin requirements were suddenly raised, and traders could hold no more than 3 million ounces of silver futures; those holding more were placed in forced liquidation. Bunker Hunt cried foul, accusing exchange board members of having a financial interest in the markets—an accusation that would later be proven true.

Then, the U.S. Federal Reserve and its chairman, Paul Volcker, added to the Hunt brothers’ troubles by strongly encouraging banks to stop making loans for speculative activity.

On January 7, 1980, the other major U.S. exchange, COMEX, changed its rules also. Investors were limited to 10 million ounces in futures contracts, and any amount above that had to be liquidated by Friday, February 18.6 On the very next trading day, Monday, January 21, as silver reached a record high of $50 an ounce, the Hunt silver hoard peaked at a mind-boggling $4.5 billion, (that’s $43.5 billion in Shadowstats CPI-adjusted 2011 dolars!)5

On the same day that silver hit $50 and silver futures topped out at $52.50, gold’s price set a new record of $850 and gold futures peaked at $892. COMEX, terrified that it would be forced into default, announced—with the backing of the CFTC—that trading in silver would be limited to liquidation orders only, eliminating any buyers.

With no new buyers, the price of silver could not go up. So this rule was basically the same as saying, “Until this rule is lifted, the price of silver will only go down.” Of course, silver began to plummet, and on that same day so did gold.

On Silver Thursday, silver dropped from $15.80 to $10.80 an ounce. The stock market also crashed, fueled by rumors that the Hunt brothers would liquidate stocks in order to cover their silver losses. Because most of their silver bullion had been purchased at under $10 an ounce, the Hunts were still ahead of the game on their physical silver. But in the futures market, where their average purchase price was near $35 an ounce, it was a different story.

It became easy for the government to label the Hunt brothers as market manipulators—both in the court of law and in the easily swayed court of public opinion. Bunker Hunt filed for personal bankruptcy and was charged with trying to corner the silver market. He settled with the IRS for $90 million and was fined an additional $10 million by the CFTC.7

Why were the Hunt brothers torn down? Gold and silver are the canaries in the coal mine: Their spiking prices reflected the public’s loss of confidence in fiat currencies—like the U.S. dollar. So, the government and banking establishment had a vested interest in keeping gold and silver prices from exploding.

Continued: http://www.marketoracle.co.uk/Article27513.html


Black Blade: Are we due for some "intervention" perhaps? Not just in silver but all commodities. The USD is caught in a death spiral. Just can't create $Trillions out of thin air without consequences. Those dollars have to go somewhere and now with foreign holders of our debt selling and funds (like PIMCO) shorting government paper (Treasuries and Bonds), what other alternative than commodities? The Euro - are you kidding me? The PIIGS have made the Euro toxic waste. The Yen? After decades of negative growth topped with a natural disaster and nuclear reactors gone critical, the Japanese won't provide much cover either. Going to be tough to cap precious metals but rest assured, powerful interests will try. I think they will fail because after several decades of using every mechanism in the arsenal to cap silver and gold prices, it is like a coiled spring ready to break loose.
 
#24 ·
Thanks Blade for the "what if" film.

You cant keep printing money out of thin air. Knowing what happenned in Germany after WWI, maybe one should borrow heavily and buy commodities (Food, gold, silver , lead and lead delivery devices :) ) and pay them back with worthless greenbacks.

A loaf of bread...pony up stacks of 100 dollar bills equal in size to the loaf.

As Betty Davis said in a movie a long time a ago.."Fasten your seat belt, its going to be a bumpy ride."
 
#26 ·
You cant keep printing money out of thin air.
The Fed started doing that to help finance the war against the Confederacy. The practice was revived with a vengeance when Roosevelt's Raw... er, "New" Deal decided we could buy our way out of the Depression with funny money, which we're still printing by the railcar-load...

Meanwhile, Confederate money is worth more than its face value, and has appreciated steadily over the years.

Of course, like gold, there's only so much authentic Confederate currency to be had, and you can't just wave your hand and create more. *Any* finite resource will do to anchor a currency; gold is pretty and portable, giant stone wheels are a little awkward to deal with.

The "primitive" societies that rated their wealth in terms of livestock don't look so silly now. If your cow dies, at least you can eat it. Try doing that to a stack of Federal Reserve Notes. Well, you probably *could* eat a stack of greenbacks, but you'd probably want some horseradish to go with it...
 
#25 ·
Or, the Hunt brothers tried to force the market and got caught holding the bag. There's two sides to EVERY story. It ain't as cut and dried as all that.

My personal opinion is that the Hunt Bro's tried to corner the market for personal gain and got caught. Commodity (industrial) silver wasn't worth what they were trying to force it to be at that time. The Hunts were not savant nor heroes. Capitalist manipulators, perhaps.
 
#28 ·
Im storing Twinkies. Ever notice how on the older Twinkies, the expiration date has a month and day but no year? Thats because they never expire! The true expiration date would have to be expressed in scientific notation!

When the earth succumbs to nuclear war, or is hit by a comet...3 things will remain.

1.) Cockroaches
2.) Twinkies
3.) Gunco members with guns, ammo and Twinkies!

Twinkies.....its the new gold replacement!
 
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