Buying Gold

[jedi]

Has anyone done any research into this? When the SHTF and the dollar losses all it's value I would like to have some gold on had (not in a portfolio or some safety box at location xyz) in case I need to trade for ther things. In addition having some gold at least keeps my "savings" safe (to a certain degree) and should soceity fall apart once it does come back up and the paper money is safe again I can just re-convert to paper.

A quick search on the net found this:
Gold - Buying Gold Bars - Buy Gold Bars - Buy Gold Bullion

Just ot sure how safe this is? If anyone has any recommendations on doing this? etc.
Thanks

 

[melensdad]

I would STAY AWAY from gold bars, ingots, etc. How do you trade with a 3 oz ingot when you need a tank of gas, 2 diet Pepsi and a Hostess Ho-Ho? I would buy gold coins that don't have collector value. Smaller is better. Another option is to buy wedding rings of 18k gold. They can often be had pretty cheaply, they are easy to store, and you can essentially buy them by weight.

When Argentina's economy collapsed, gold was traded not at 'spot' price but at junk jewelry prices.

Just something to consider.

 

[jedi]

Thanks for the info.
Looking at gold on 2 fronts.
1) for trading which means going to small coin, jewelery route
2) for welath protection which means perhaps gettin bars "bullion" i think.

The "bullion" is what scares me since the feds did confiscate it before from us in the 30s. Have not read up on it all but basically if I buy bullion is it registered somewhere? Or cn I buy and "lose in it in the lake". =)

 

[indyjoe]

I'm not saying that anyone I know had gold. However, what they bought was paid for with cash and the name and address on the receipt was faked. Couple of reasons, government confiscation being one of them. The other would be robbery if the true name or address was located with the quantity sold.

For trade, "junk" silver is a good choice. That is 90% silver coins from 1965 and earlier. They are easily identifiable as legit.

However, you can't eat gold. Make sure you have food, supplies, etc. it place before putting money into precious metals.

 

[melensdad]

OK gold is great if we have INFLATION.

But what if we have DEFLATION? How will gold fair in deflation?

There are signs of it now. Wage cuts. Housing prices dropping. Rent prices dropping. Prices of consumer hard goods dropping. Car prices dropping. I'm not seeing guns/ammo prices going down and I expect energy costs (gas/diesel) to go up, but there are lots of other items that are going down.​

 

[barber613]

I don't agree about buying coins with collector value for use when the SHTF. When it come down to it, the melt value is all the gold/silver is worth. Then again I am not a coin collector either.

 

[CarmelHP]

For trade, "junk" silver is a good choice. That is 90% silver coins from 1965 and earlier. They are easily identifiable as legit.

1964 and earlier, 1965 is cupro-nickel. Also, there are gold and silver bullion coins that have an assay content on the coin and are highly recognizable. I wouldn't trust someone with gold rings, I don't have a method to assay them.

Collectible coins are a losing proposition if you have to use or sell them at bullion prices. That doesn't make sense. If you need to make smaller denomination use tin snips and start cutting as they did throughout the ages.

 

[CarmelHP]

OK gold is great if we have INFLATION.

But what if we have DEFLATION? How will gold fair in deflation?

I think Barack is taking care of any deflation worries. Give a brother a chance, he's printing money as fast as he can!

 

[melensdad]

I think Barack is taking care of any deflation worries. Give a brother a chance, he's printing money as fast as he can!

So what? I don't mean to sound snotty but seriously you have to look at our economy ALONG with other nations and the world. We are not in a vacuum. If we were then printing money would cause inflation. If the EU and other major nations do the same thing (and most are doing that) then we effectively are in a zero sum game. The only way inflation works is when our currency is devalued against other major currencies. But if the other major nations are in a similar economic situation (and they are) then we all stay "on par" with each other. Take a look at Japan and their problems for the past decade. It could easily happen here and across Europe, and it will NOT be inflation. I think there is actually a very good risk of entering a deflationary cycle.

 

[vanillagorilla]

New guy joining in! Hope you dont mind. As far as the president goes- HOPE and CHANGE! My Humble Opinion, the only people making money with gold are the people selling it every half hour on TV.

 

[vanillagorilla]

If you want a good bet for saving or making money, buy ammo.

 

[DiamProducer]

As far as gold buying is concerned I would recommend a couple things. First off STAY AWAY from coins unless you only buy for the scrap value. Remember when you are buying to figure in the Karat value of the gold as well. I have been in jewelry for the past 6 years, and am currently buying up alot of gold. Not for SHTF though. Again the most important thing is to figure in the karat of the gold. For example, you have a 14k chain that weighs 1 oz. If gold is at $900 an ounce your chain is only worth $525 scrap value. Buying by the gram is the easiest way once you can have the calculations down. If anyone has any questions please feel free to email me and I will go into this with a little more detail. I would also suggest buying silver instead of gold. You can get 1 oz silver bars for around $14-15. Now these are easier to trade because of the $13/oz silver price. Silver market fluctuates with gold market so you're staying around the same value wise. Again anyone with questions please PM me

 

[CarmelHP]

No, that's not how inflation works. It has nothing to do with other currencies. Inflation relates to buying power relative to goods and services, not currencies. If you keep printing money and handing it out those dollars chase goods and services so prices rise. Goods and services have some elasticity but are ultimately finite. No so with fiat money, the will to print it is boundless.

So what? I don't mean to sound snotty but seriously you have to look at our economy ALONG with other nations and the world. We are not in a vacuum. If we were then printing money would cause inflation. If the EU and other major nations do the same thing (and most are doing that) then we effectively are in a zero sum game. The only way inflation works is when our currency is devalued against other major currencies. But if the other major nations are in a similar economic situation (and they are) then we all stay "on par" with each other. Take a look at Japan and their problems for the past decade. It could easily happen here and across Europe, and it will NOT be inflation. I think there is actually a very good risk of entering a deflationary cycle.

 

[melensdad]

No, that's not how inflation works. It has nothing to do with other currencies. Inflation relates to buying power relative to goods and services, not currencies. If you keep printing money and handing it out those dollars chase goods and services so prices rise. Goods and services have some elasticity but are ultimately finite. No so with fiat money, the will to print it is boundless.

I can agree with you but only to a point. We now live in a worldwide and very interdependent economic system. All currencies are interwoven we don't just stand alone today. Our buying power is related to goods we buy and is related to the volume of money in the system, but if we are buying foreign goods (most of what we buy is not domestic) and if those other nations are also practicing inflationary policies then both nations may be in the same relative economic spiral. Further, we are dependent upon the value of their currency in a relative sense to the value of ours if we are trading partners. Your scenario presumes we live in an economic vacuum, that was reasonably true during the "great" depression era but is no longer true today. My scenario presumes we live in a world economy AND that the major players are suffering a somewhat similar fate.

 

[CarmelHP]

Now, if we're printing more money and they're printing more money, then, worldwide, there is more currency chasing the same goods. Prices rise. Econ 101.

I can agree with you but only to a point. We now live in a worldwide and very interdependent economic system. All currencies are interwoven we don't just stand alone today. Our buying power is related to goods we buy and is related to the volume of money in the system, but if we are buying foreign goods (most of what we buy is not domestic) and if those other nations are also practicing inflationary policies then both nations may be in the same relative economic spiral. Further, we are dependent upon the value of their currency in a relative sense to the value of ours if we are trading partners. Your scenario presumes we live in an economic vacuum, that was reasonably true during the "great" depression era but is no longer true today. My scenario presumes we live in a world economy AND that the major players are suffering a somewhat similar fate.

 

[melensdad]

Now, if we're printing more money and they're printing more money, then, worldwide, there is more currency chasing the same goods. Prices rise. Econ 101.

Then explain why prices are actually dropping on many goods. You are not factoring in the over capacity of the system, the dropping wages, and many other factors. All of that is covered in Econ 202.

Bear in mind I am not saying that we will see a worldwide massive DEFLATION, but what I am saying is that there is a case to be made that seriously questions IF we will see that massive INFLATION or hyper-inflation that so many are predicting. Realize that in the economic world, when stock brokers shout BUY BUY BUY it is usually the time to SELL. When real estate agents shout SELL SELL SELL then there is money to be made by buying. And now we see lots of pundits shouting that INFLATION IS IMMINENT so I simply am calling to question the reality of WORLDWIDE interdependent economics that could actually lead to DEFLATION. Not saying it will happen, just questioning the possibility and making a reasoned position that it is just as likely as hyper inflation.

 

[CarmelHP]

Then explain why prices are actually dropping on many goods. You are not factoring in the over capacity of the system, the dropping wages, and many other factors. All of that is covered in Econ 202.

Well, I'm grad I went for that Ph.D. in Business then.

I wish I was seeing this deflation. The prices seem to be pretty stable. There has been some adjustment downward after a huge speculative run-up over a relatively short span. The massive over speculation in fuel (since 2004), which is a component cost of almost every product has also been reversed with crude oil prices now at roughly what they were in 2004 before the massive bubble. After having credit tightened and and oil fall rapidly, and unemployment rise quickly, we've actually seen surprisingly very little downward movement in prices. Looking at the CPI monthly data, housing, fuel and transportation all saw big declines yet the annual rate is still at 1.7% increase for all other items. That is not a deflation, not even a large adjustment. The programmed spending scheduled has just started however. When those dollars are spent the money supply will rise rapidly, while spending on the supply side has decreased so while capacity is falling money supply will be increasing. In addition, there will be massive disincentives to produce because people will be paid to be unproductive, or investment capital will be sucked into government uses through borrowing contracting the productive sector.

 

[Chefcook]

I have been buying more silver than gold. Gold is too valuable to use for trade. Gold at $900 or $1000 an ounce, an ounce of gold is a coin a little bit larger than a quarter. Like melensdad said how are you going to trade that when you need lesser goods. Pre 1964 silver coin is 90% pure silver and very easy to obtain. I have gotten some off ebay for less than spot. I kinda see it like this. If an ounce of silver is $10 (hypothetically) Then a dime is a dollar a nickle is 50 cents a quarter is $2.50 and so on. This could be used easily in trade. I see gold more like a nest egg or savings account. You would before using it to trade have to find a source to break it down and that might be difficult. I would hate to find myself stuck in a position where my family was starving and I had to give away a $1000 in gold for a meal. IMO silver is the way to go...


You guys are talking econ 202 how about History 101, In Nazi Germany Hitler printed large quantities of money to finance his war machine. This devalued the Mark and caused massive inflation. A loaf of bread for 1000000 marks. Paper in only the ghost of money and not money itself...A wheel barrel full of paper is worthless when your family is hungry...

 

[melensdad]

I wish I was seeing this deflation.

Cars, trucks, houses, rent, retail clothing prices, commercial real estate, commercial rent.

Here is an interesting article to consider, it explains the overall concept: CAN DEFLATION BE PREVENTED?

Here is a timely article, posted by Reuters 2 hours ago:
U.S. would need more borrowing if deflation sets in: Summers | Reuters

Deflation is briefly mentioned as a possibility in this article, posted in the Washington Post today: The Ticker - Summers: White House Stimulus Action May Have Stabilized Consumer Spending - Economy Watch *

News from India suggests that inflation fears are overblown and deflation is likely: Goodbye inflation, hello deflation!

The BUSINESS STANDARD predicts deflation: Inflation slips to 2.43%, experts predict deflation

Ireland's Irish Times says deflation is already starting: Deflation of 1.7% driven by interest, rent and clothing - The Irish Times - Fri, Mar 13, 2009

News from Switzerland saying that the Swiss are selling off currency to try to prevent deflation: EUobserver

And another from Switzerland saying deflation is starting: Swiss Central Bank Sounds Deflation Alarm, Targets Franc - DowJonesNewswires - Onet.pl Biznes - 12.03.2009

Forbes reports the European Central Bank is not predicting deflation but is saying that prices are dropping: ECB's Mersch sees disinflation in '09, no deflation - Forbes.com

News show that China is seeing both CPI and PPI dropping, but is not yet claiming full deflation: Epoch Times - China’s CPI and PPI Drop Together in February

In London they are saying that inflation fears are likely overblown and deflation is possible can could prolong the recession: Inflation expectations fall to near 4-year low | Reuters

And here in the good old USA a warning that deflation could derail any progress toward a recover: The Associated Press: Obama adviser says 'excess of fear' must be broken


Like I said, your economic model is based on an economy that exists largely in a vacuum without any significant international play. These articles above, from every part of the globe show that the economies are all in trouble and that deflation is a real risk. I'm just pointing out that while HYPER INFLATION fears are common, there is another real risk.

You guys are talking econ 202 how about History 101, In Nazi Germany Hitler printed large quantities of money to finance his war machine. This devalued the Mark and caused massive inflation. A loaf of bread for 1000000 marks. Paper in only the ghost of money and not money itself...A wheel barrel full of paper is worthless when your family is hungry...

Again, this is a great example of a very isolated economy. Nazi Germany did not effectively participate in world trade, it traded largely with a few nations that it considered allies of its regime and existed in a vacuum within those economies. Look at the economy of Italy at the same time. Same problem. Italy was one of the few trading nations with Germany. I believe you are actually reinforcing my point that we have to look at the world economy because your example shows that Germany and its trading partners suffered similar fates.

 

[CarmelHP]

Using your own example, if all the pundits are saying deflation, then maybe inflation should be what we're looking for. You got a bump of slightly lower prices when credit shut down as expected, BUT a massive spigot of money was turned on and is just beginning to go out. What we're seeing is a temporary disinflation.

Cars, trucks, houses, rent, retail clothing prices, commercial real estate, commercial rent.

Here is an interesting article to consider, it explains the overall concept: CAN DEFLATION BE PREVENTED?

Here is a timely article, posted by Reuters 2 hours ago:
U.S. would need more borrowing if deflation sets in: Summers | Reuters

Deflation is briefly mentioned as a possibility in this article, posted in the Washington Post today: The Ticker - Summers: White House Stimulus Action May Have Stabilized Consumer Spending - Economy Watch *

News from India suggests that inflation fears are overblown and deflation is likely: Goodbye inflation, hello deflation!

The BUSINESS STANDARD predicts deflation: Inflation slips to 2.43%, experts predict deflation

Ireland's Irish Times says deflation is already starting: Deflation of 1.7% driven by interest, rent and clothing - The Irish Times - Fri, Mar 13, 2009

News from Switzerland saying that the Swiss are selling off currency to try to prevent deflation: EUobserver

And another from Switzerland saying deflation is starting: Swiss Central Bank Sounds Deflation Alarm, Targets Franc - DowJonesNewswires - Onet.pl Biznes - 12.03.2009

Forbes reports the European Central Bank is not predicting deflation but is saying that prices are dropping: ECB's Mersch sees disinflation in '09, no deflation - Forbes.com

News show that China is seeing both CPI and PPI dropping, but is not yet claiming full deflation: Epoch Times - China’s CPI and PPI Drop Together in February

In London they are saying that inflation fears are likely overblown and deflation is possible can could prolong the recession: Inflation expectations fall to near 4-year low | Reuters

And here in the good old USA a warning that deflation could derail any progress toward a recover: The Associated Press: Obama adviser says 'excess of fear' must be broken


Like I said, your economic model is based on an economy that exists largely in a vacuum without any significant international play. These articles above, from every part of the globe show that the economies are all in trouble and that deflation is a real risk. I'm just pointing out that while HYPER INFLATION fears are common, there is another real risk.



Again, this is a great example of a very isolated economy. Nazi Germany did not effectively participate in world trade, it traded largely with a few nations that it considered allies of its regime and existed in a vacuum within those economies. Look at the economy of Italy at the same time. Same problem. Italy was one of the few trading nations with Germany. I believe you are actually reinforcing my point that we have to look at the world economy because your example shows that Germany and its trading partners suffered similar fates.