Do you own physical Gold or Silver or Both?

Do you own physical Gold or Silver or Both?

  • I own physical Gold

    Votes: 31 9.6%
  • I own physical Silver

    Votes: 52 16.1%
  • I own Both

    Votes: 91 28.3%
  • I own neither

    Votes: 125 38.8%
  • I only own paper metals

    Votes: 23 7.1%

  • Total voters
    322
With Bitcoin available, gold is largely irrelevant. I mean, sure, it's better than stocks, but it's not as good as Bitcoin so why even bother?
 

Tail Gunner

Hummingbird
Gold Member
MrLemon said:
With Bitcoin available, gold is largely irrelevant. I mean, sure, it's better than stocks, but it's not as good as Bitcoin so why even bother?
That is one damn crazy statement. How can something that has had intrinsic value for all of mankind's existence suddenly be replaced by something that might not even exist in a few years? Gold is insurance; Bitcoin is speculation.

Gold will always exist and always be valuable. There is no guarantee that Bitcoin will even exist in a few years.
 

Jaydublin

Pelican
I have an idea for a trade on what is going on in these markets. Let me first say that I am not an experienced trader and I don't know much about options trading though I have played around in the past. So enjoy and try not to make too much fun haha

What I am looking for here is mainly contrary information and opinions. Otherwise I will be making the Trades in the AM. I will be using ETFs GLD and SLV while also referring to to Gold and Silver physical prices in charts and with the GSR.

The GSR(Gold Silver Ratio) is at 92 right now. This is a 30 year high. and other than that is a 100 year high.
This ratio swings wildly when these markets get going. As stated in posts above Gold just broke 6 year resistance and IMO it is not only due middle east tensions and trade wars. It has bumped up against the 1350-1370 range 4+ times in those 6 years and created higher lows on the way. I believe this move is for real and it could head much higher with a pullback or 2. Likely in the next 6 months, maybe 12. Remember, everything in the world has gone way up in price in the last 8 years EXCEPT a few things including Gold and Silver.




Gold often drags silver until the trade gets hot then Silver usually spike ahead % wise.




1 of 3 thing will happen.
1. Both of the metals will continue up, moving more or less in tandem.
2. Silver will explode at some point and put the GSR at 65-75
3. Both metals will move down, likely with silver going down more than gold... but possibly staying stagnant while gold moves down slightly.

Or I guess
4. Both metals stay stagnant for the next 6 months( I can't imagine this happening, especially after the move we just had)

I have been following the Silver and Gold markets since 2008, religiously(I used to be obsessed because I had listened to too much Peter Schiff) and I have looked back over historic charts a good amount. I do not see another outcome. I especially do not see gold going higher while silver doesn't move, not at the current GSR(Gold Silver Ratio).

I see option 2 being very likely and silver quite possibly going up to 20-25$ in the next 6 months. This would be an increase of ~33-66% on the current price. Gold should be in the 1550-1700$ range in this case.

There is even a chance Silver rockets higher than this. Similar to the quick silver move in 2010 which continued into 2011. Gold had been moving and making 30 year highs and silver was stagnant in comparison. Remember, while gold recently broke a 6 year high, silver is still far off its 6 year high.



Now let me say I have made a lot of stupid option trades when I was in my mid 20s and I rarely make them anymore. I used to make a couple of 500$ long shot bets a year looking for a homerun that could return tens of thousands. Often looking for a market crash or something silly(Thanks Schiff). It was silly but I had a lot of disposable income and like the thrill. I hit a couple things but overall lost.

With this high GSR I was thinking of making a similar trade with a expiration date either in October or December. But now rather than gambling on this I think I can cover the other side. I think I can for example make the similar bet, but far more conservative, that gold will go down a couple %. I think this is better than put options on SLV due to golds recent spike and multiple closings in a row at 6 year highs.

This way it covers me on all my 3 scenarios above. Even if they both crash my GLD puts will cover my SLV call options. Could even profit nicely if gold gets smashed back below 1370.


I can't figure out how to get the options profit/loss charts to post but let me just say that if SLV were to go to these levels around 19-24 on just roughly 20$ strike prices for Dec 31 expire. We are talking 1,000%-3,000% gains. And though unlikely I think a high 20s silver spike this year is possible.

While the same expire date for GLD a put can be bought at a strike of roughly 2% less than the current price. This is an easy double if gold tests the 1370ish floor(previous resistance) anytime within the next few months. Which would pay for the entire silver longshot.

Again, I am just looking for contrary opinions if anybody can throw some at me. I try to see all sides these days.

Disclaimer: This a risky bet and you probably shouldn't do it unless you can handle losing all of the money you put in. You should also do your own thorough research.
 

Tail Gunner

Hummingbird
Gold Member
Jaydublin said:
1 of 3 thing will happen.
1. Both of the metals will continue up, moving more or less in tandem.
2. Silver will explode at some point and put the GSR at 65-75
3. Both metals will move down, likely with silver going down more than gold... but possibly staying stagnant while gold moves down slightly.

Or I guess
4. Both metals stay stagnant for the next 6 months( I can't imagine this happening, especially after the move we just had)

Again, I am just looking for contrary opinions if anybody can throw some at me. I try to see all sides these days.
You are missing at least one other plausible scenario. I am not saying that it is a likely scenario, just that it is plausible -- especially if gold has more or less permanently eclipsed silver as safe haven insurance. The price of gold could continue to rise as the price of silver stays more-or-less stagnant.

Zooming out a bit, the consistency of the trend in the gold/silver ratio chart for the past three years is even more striking: Ever since the early-2016 precious-metals rally peaked and ended in the summer of 2016, gold has outperformed silver so steadily and consistently that the gold/silver ratio chart is almost perfectly smooth in its ascent:

* * *

But in the medium and long term, the global economic and industrial slowdown and the long-term gold/silver ratio uptrend do not favor silver over gold.

Investors should never forget that silver is more of an industrial metal than gold is. As such, silver has an unusual dynamic, being part precious metal, part industrial metal. Silver is most valuable in periods when there is inflation along with healthy or growing global industrial activity. For example, historically the silver price has soared in times of large-scale global military conflict, such as during World Wars I and II.

But this also means that silver is not purely a "safe haven" precious metal asset in the same way that gold is. Demand for silver declines when global economic and industrial activity are slowing down rather than growing. In the Great Depression, gold held its value but silver did not. The gold/silver ratio soared up to as high as 100:1 back then as well.
https://seekingalpha.com/article/4270470-watch-gold-silver-ratio-gold-price-rallies
 

Jaydublin

Pelican
TG thanks for the input. Great point.

I did recognize that smoother move up to the current GSR. It seems that the reversal of the GSR usually reflects the move up(based on a longer term chart) which would mean that silver will not spike in this case but at best slightly gain on gold over the coarse of years.
 
MrLemon said:
With Bitcoin available, gold is largely irrelevant. I mean, sure, it's better than stocks, but it's not as good as Bitcoin so why even bother?
How much Bitcoin has any central bank bought up? Not being sarcastic... has any significant central bank bought Bitcoin?

I ask because of this:

Central bank gold buying hits highest level in half a century

Jan 31 2019

The amount of gold bought by central banks in 2018 reached the second highest annual total on record, according to the World Gold Council (WGC).

Central banks bought the most gold by volume since 1967, according to the industry research firm, which also highlighted it was the largest amount since former U.S. President Nixon Richard’s decision to end the dollar’s peg to bullion in 1971.

Central bank net purchases reached 651.5 metric tons in 2018, 74 percent higher than in the previous year when 375 tons were bought. The WGC has estimated that central banks now hold nearly 34,000 tons of gold.

The Federal Reserve is reported to hold the most, amounting for almost three quarters of the nation’s foreign-exchange reserve pot.

Taking the current spot price of $1,321.15 per troy ounce, gold purchases by central banks in 2018 amounted to a $27.7 billion spending splurge on the precious metal.

“Heightened geopolitical and economic uncertainty throughout the year increasingly drove central banks to diversify their reserves and re-focus their attention on the principal objective of investing in safe and liquid assets,” said the report released on Thursday.

The WGC said the bulk of the buying was carried out by a handful of central banks with Russia leading the way as it looks to swap out dollars from its portfolio. The Russian central bank sold almost all of its U.S. Treasury stock to buy 274.3 tons of gold in 2018.

The central bank of Turkey increased gold reserves by 51.5 tons in 2018. That marked a second consecutive year of net purchases but was 40 percent lower than the volume it bought in 2017.

Other big central bank buyers were Kazakhstan, India, Iraq, Poland and Hungary.

Net sales of gold from central banks remained small, totaling less than 15 tons. Australia, Germany, Sri Lanka, Indonesia and Ukraine accounted for almost all of that figure.

WGC said total gold demand in 2018 reached a total of 4,345.1 tons. The biggest demand came from jewelry which, while flat on the 2017 figure, accounted for just over half of the total. Bars and coins contributed 1,090 tons in 2018, marking a 4 percent rise from the previous year. Gold used in technology climbed marginally to 334.6 tons.

The price of gold has risen around 9 percent in the last three months.

Source: https://www.cnbc.com/2019/01/31/world-gold-council-central-banks-buy-most-gold-since-1967-.html
If the central banks are buying up a ton of gold and a bunch of billionaires are as well, then ask yourself: what do THEY know that I don't?

I'm very bullish on Gold in the medium-long term. It has a clear floor of around 1200 and can go as high as 3,000-5000 very easily if a major insolvency/debt/currency crisis hits somewhere; which we are on the verge of having any day now between today and the November 2020 US election.

There are also a TON of things on the horizon that could blow everything up:

1. Iran War - Oil shoots up in price and economy crashes.

2. A socialist gets elected and the US currency goes right down the tubes.

3. Hard Brexit

4. Corporate debt crisis - the tech industry is especially vulnerable with all their stupid ass unprofitable companies valued in the billions. We saw what happened in fall 2018 when the FED said they were going to hike rates... the markets had a heart attack. What happens if the FED is forced to raise rates for some reason? Bye Bye Silicon Valley and a bunch of other non-tech stupid companies that have used cheap debt for a decade to buy back stock as oppose to building up business operations.

EVERYTHING is on the down slope already real economy wise ... it's just a matter of waiting for the trigger now. The stock market is extremely over-valued and overdue for a massive correction. A lot of made-up value is suddenly going to evaporate and many currencies are going to be re-pegged to be worth FAR less than before. You can't debase currencies forever to prop up make believe economies. A long time... but not forever. Russia and other countries see the writing on the wall and are stocking up on gold for a reason; not because they are bored or want to make nice gold earrings for their mistresses.

Hence, get some gold as an insurance policy at a bare minimum. If the central banks are stocking up, you better stock up as well. They know what's up with their paper currencies and how worthless they are compared to their current perceived value. The upside of gold is solid at this stage and the downside risk is minimal.

Silver is a bit more of a wild card. I would honestly put money in Bitcoin or maybe a gold-backed crypto vs silver since half the argument it seems about silver is: "It's cheaper than Gold and the common man will use it."

If the aforementioned is the standard for why silver is valuable as a store of value/currency, then crypto is the better fit in the 21st century. Assuming crypto, WHICH crypto is up for debate. I'm exploring gold-backed cryptos right now to see what's out there as well as privacy oriented coins. Real potential in both of those long-term. Bitcoin might end up as the best of the lot but I feel like Bitcoin is phase 1 in the cryptocurrency realm. Like AOL, Netscape, MySpace, etc. All were the overwhelming first big players in their field for a time and all got wiped out by something a bit better and/or had better marketing. BitCoin is still a technology product and if there is one constant with technology, things can change VERY fast in EITHER direction.

Anyway, this next possible pullback in Gold might be the last chance to get in before the major run-up to 2-3k. I'm waiting to see what happens with this trade deal/G20 stuff this week before I make any moves. If it breaches 1450, I'll probably pull the trigger on the assumption there won't be a significant correction for a while.

Anyone who wants to poke holes in my theories or offer constructive criticism, PLEASE DO!
 

Sword and Board

Woodpecker
I remember reading some preppers collecting Silver/Gold for a SHTF scenario. I could wrong but I would have thought bullets and food would be a more usable currency in a lawless world of starving people.
 
The Black Knight said:
4. Corporate debt crisis -
This is where it's at. My best guess is that it's in the next 3-6 years.

Possibly 2, if there is a mini quake and then the back breaker is after the 2024 election.

Notice that it's bubbling up with worldwide sovereign debt crises as well.

I think all we can say for sure is that major confidence loss in every major "institution" will occur in the next 10-12 years, we're talking paradigm shift.
 
I own some Credit Suisse gold bars (of the smaller variety). As far as coins I have some Eagles, and Austrian Philharmonics.

With silver I just buy anything that's 90 percent or more silver.
 

Jaydublin

Pelican
I closed out the majority of the trade I mentioned a couple of posts above. I ended up straddling both sides of GLD and SLV. Everything was closed at a small profit except my GLD 130$ Dec 19 PUTS was a 50% loss and I sold half of my SLV 19$ Dec 19 Calls at 2x. Which was also the largest position.

Overall I am in the green enough for the other half of my SLV 19$ Dec 19 Calls to ride for free.

I wish I knew more about options. I know I did a couple of things wrong that hurt me but this time it seems to have paid off.

One lesson was not to use market orders at the open of a market when the volume is thin.


I've bought a decent bit of physical gold and silver in the last month, from the low 1300s to low 1400s. I think Silver is still a solid buy here.
 

Tail Gunner

Hummingbird
Gold Member
Jaydublin said:
One lesson was not to use market orders at the open of a market when the volume is thin.
Never use market orders . . . period. Market orders are just a license for market makers to steal. Even during options expiration Friday when I absolutely had to roll a position, I would use price discovery with limit orders over the course of the day rather than risk using a market order.
 

Foolsgo1d

Peacock
Yeah Trends in the News stated it would quite a bit ago and it will be the new normal. People are now going to start buying a lot more gold and silver. Could be a runaway train.
 

jeffreyjerpp

Kingfisher
BTC guy here...I think now is the time to be getting into gold and gold miners in a major way.

The financial markets are clearly spooked, and central banks have been accumulating huge amounts of gold, and also panicking to lower interest rates to stave off a collapse.

However, the RSI (a measure of buying intensity) on a weekly level for gold is insanely high right now, so there will probably be a short term pullback in the gold prices in the next few months.

I will be using any pullback as a buying opportunity, to establish a longer term position in GLD and GDX for the next few years.

Something else very important: the US dollar is going UP right now. So buying a dollar denominated gold equity is unlikely to have any downsides vs. holding physical gold.
 

Arado

Pelican
Gold Member
jeffreyjerpp said:
BTC guy here...I think now is the time to be getting into gold and gold miners in a major way.

The financial markets are clearly spooked, and central banks have been accumulating huge amounts of gold, and also panicking to lower interest rates to stave off a collapse.

However, the RSI (a measure of buying intensity) on a weekly level for gold is insanely high right now, so there will probably be a short term pullback in the gold prices in the next few months.

I will be using any pullback as a buying opportunity, to establish a longer term position in GLD and GDX for the next few years.

Something else very important: the US dollar is going UP right now. So buying a dollar denominated gold equity is unlikely to have any downsides vs. holding physical gold.
How much would a fall in the USD relative to other currencies impact U.S. based gold miners? Most of their debt is dollar based, no? I figured that as long as gold is appreciating relative to major currencies, then if the USD falls more than other currencies the miners are still in good shape since they aren't dependent on U.S. consumers.
 

jeffreyjerpp

Kingfisher
Arado said:
jeffreyjerpp said:
BTC guy here...I think now is the time to be getting into gold and gold miners in a major way.

The financial markets are clearly spooked, and central banks have been accumulating huge amounts of gold, and also panicking to lower interest rates to stave off a collapse.

However, the RSI (a measure of buying intensity) on a weekly level for gold is insanely high right now, so there will probably be a short term pullback in the gold prices in the next few months.

I will be using any pullback as a buying opportunity, to establish a longer term position in GLD and GDX for the next few years.

Something else very important: the US dollar is going UP right now. So buying a dollar denominated gold equity is unlikely to have any downsides vs. holding physical gold.
How much would a fall in the USD relative to other currencies impact U.S. based gold miners? Most of their debt is dollar based, no? I figured that as long as gold is appreciating relative to major currencies, then if the USD falls more than other currencies the miners are still in good shape since they aren't dependent on U.S. consumers.
Gold will continue to appreciate against the dollar, even as the dollar appreciates against all other major currencies. In the past few weeks, for example, gold hit an all time high against several other major currencies, but not the dollar.

If the miners were OK at $1200/oz they should (key word should) be in an excellent position for the next few years.
 
Gold and USD will continue to rise. It will be the entitlement/demographic boom that is the death blow to the US (paradigm shift, the US will still be fine in many ways just not like you know it), starting in 2021. My 2025 prediction +- a year has been looking great for 2 years, I see no reason to change it.
 
Correct me if I'm wrong but gold should be way higher right now in price than what it is. Despite all the buying and hoarding by China, India, Russia and other Western countries the price has barely moved in the last 7 years thanks to futures market suppressing the price. Like everything else The governments stop volatility with some combination of cutting interest rates and printing money but this might be coming to an end in the near future.
 
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