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THE Precious Metals: Silver Thread Pt. 2

Discussions about the economic and financial ramifications of PEAK OIL
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Re: Silver as retirement savings

Unread postby Pretorian » Wed 12 Aug 2009, 10:40:35

$this->bbcode_second_pass_quote('Arsenal', '')$this->bbcode_second_pass_quote('Pretorian', 'a')s were glass beads and toilet paper.


And are they still? Hmm.. Lets compare how many years silver/gold are used as currency against glass beads. In fact, I will make you a deal. I will send you 10 glass beads if you send me 10 1oz Gold Eagles.

$this->bbcode_second_pass_quote('Pretorian', 'B')eg your pardon? Facts? Sounds like you've heard something about History. Any fresh gossips about silver prices in Ancient Egypt, Greek Egypt, Roman Egypt, Byzantine Egypt, Mamluk Egypt, Turkish Egypt, British Egypt, ets? No? Any idea about prices in ancient Greece, Carthage and Rome? Not really, huh?


Fresh gossips about silver from ancient civilizations. Come on. Funny thing is almost all those civilizations you mentioned used gold and silver for eons. Silver, in the form of electrum (a gold-silver alloy), was coined to produce money in around 700 BCE. So if you can add, please tell me how many years silver/gold has been used as money vs your freaking glass beads and TP. If you paid for an education please ask for a refund.


You really not a sharpest lamp in the barn are you Arsenal. You probably don't even know what I am talking about, since I definitely didn't state that glass beads are more expensive than gold or was used as money longer.You know I'd love an intelligent debate about the topic but it looks like I wont find a partner in this thread at least. Since I didnt pledge war on your ignorance nor do I care much about your retirement I won't elaborate more than I already did, so have fun playing with your pile of silver .
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Re: Silver as retirement savings

Unread postby Arsenal » Wed 12 Aug 2009, 11:29:41

Sure Pretorian. You are the smartest man alive. :roll: :roll: Keep telling yourself that and you will start to believe it.

I'll do my own thing and you do yours.

Good luck. :roll:
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Re: Silver as retirement savings

Unread postby Jellric » Wed 12 Aug 2009, 16:51:22

More glass beads and toilet paper can easily be manufactured whereas silver and gold cannot. This scarcity is one reason why silver and gold have historically been used as money especially when governments are printing paper money like mad. Like today.
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Re: Silver as retirement savings

Unread postby kublikhan » Wed 12 Aug 2009, 17:37:18

$this->bbcode_second_pass_quote('Pretorian', 'w')hat do you think happened with all that silver that was mined in the last 6000 years? Do you think it has a half-life or something?
Arsenal already answered this one but I just wanted to reiterate his point. Much of the "consumed" silver is sitting in a landfill and no longer available for use. It is not economically recoverable. Because worldwide stockpiles of silver have been undergoing depletion for the last 60 years, the world now has 5 times as much gold as it does silver:

$this->bbcode_second_pass_quote('', 'W')orld gold inventories, including jewelery, have increased from 1 billion ounces in 1940 to 5 billion ounces today. In contrast, silver inventories have declined from 10 billion ounces in 1940 to 1 billion ounces today.


$this->bbcode_second_pass_quote('Pretorian', 'i')f you want to hedge , why silver? You can pick pretty much anything be that honey , salt , knives, diapers or glass beads and have same result or better.
It is a lot easier to store $10,000 worth of silver than $10,000 worth of diapers, knives, or glass beads. And silver is more easily liquidated than any of the above items.

$this->bbcode_second_pass_quote('Pretorian', 'I')'m not saying of course that silver has no potential for speculation but overpaying 30-40% over spot jsut because the silver round says "USA" does not lead anywhere but loss.
You have a point here, 40% premium over spot is too high for my taste. But it wasn't always this bad. I bought my eagles for a much smaller premium over spot. They are one of the most easily traded form of silver. I think that will hold no matter what the future holds, and worth a small premium over spot. However with such a high premium today, I would probably go for a bullion bar of silver if I were to buy today.
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Re: Silver as retirement savings

Unread postby kublikhan » Wed 12 Aug 2009, 17:45:16

I would not put 100% of my retirement savings in any single investment, including silver. I would say no more than 10-15% of your portfolio in precious metals.
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Re: Silver as retirement savings

Unread postby Jellric » Wed 12 Aug 2009, 18:06:33

Who is paying 40% over spot? Last week I bought silver rounds for 10% over the spot price.
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Re: Silver as retirement savings

Unread postby AgentR » Wed 12 Aug 2009, 18:19:34

I don't think much of the entire notion of retirement; but a nice little stash of precious metals may provide a reasonable defense against being prematurely unwound, with physical gold being the easiest to stash. If things got so bad that the peons were trading goods and services using silver coinage, I figure you can always just join the fray and trade your own goods and services for silver coinage as well. Gold on the other hand... much more effective for dealing with substantial purchases such as land or buildings; hard to bring enough silver to the table to purchase a field, workshop, or storefront.

Not exactly what I'd call an investment asset; much more of an end-game hedge. That 20oz of gold in a little box in the wall may make the difference between the bad ole bankster calling you a deadbeat and having you tossed out, versus "Hey there friend! I hear Bob is selling his metalshop, you wouldn't perchance be looking to expand now would ya?"
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Re: Silver as retirement savings

Unread postby kublikhan » Wed 12 Aug 2009, 19:44:10

$this->bbcode_second_pass_quote('Jellric', 'W')ho is paying 40% over spot? Last week I bought silver rounds for 10% over the spot price.
Silver American Eagles carry a higher premium than that: American Eagle Silver Coins

Spot is listed as 14.54. They list their sell prices as $17.82. $3.00 premium for a $14 coin? No thank you.

On the other hand: 1000 oz silver bars

Spot is 14.54 per oz. 1000 bar is $15.13 per oz. If you bought 1000 oz of silver, you would have to pay an extra $1700 if you bought coins vs buying the bullion bar(its only $1700 more not $2700 because they give you a discount if you buy in bulk).
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THE Precious Metals: Silver Thread Pt. 2

Unread postby Pretorian » Thu 13 Aug 2009, 13:54:00

$this->bbcode_second_pass_quote('kublikhan', '')$this->bbcode_second_pass_quote('Pretorian', 'w')hat do you think happened with all that silver that was mined in the last 6000 years? Do you think it has a half-life or something?
Arsenal already answered this one but I just wanted to reiterate his point. Much of the "consumed" silver is sitting in a landfill and no longer available for use. It is not economically recoverable.


It isnt? May be not for a guy who thinks his job has to give him a car, cable TV subscription and private quarters. I know a case when one guy got 400 kg of silver from junkyard. He went to prison for this. To be honest I do not know what was he recycling, but anyway, I'm sure when silver will be $30 an ounce and salaries $5 a month it will be quite recoverable.
Anyways, how much silver world without a central government and with 5 billion dead will need? Not much I can assure you.


$this->bbcode_second_pass_quote('kublikhan', '[')Because worldwide stockpiles of silver have been undergoing depletion for the last 60 years, the world now has 5 times as much gold as it does silver:

$this->bbcode_second_pass_quote('', 'W')orld gold inventories, including jewelery, have increased from 1 billion ounces in 1940 to 5 billion ounces today. In contrast, silver inventories have declined from 10 billion ounces in 1940 to 1 billion ounces today.


Really? Is there a reason why I dont see the origin of this quote? Is there a reason why it counted all gold that was ever mined ( with a looong leap) and aalll silver that was mined and recycled last year alone? What, none of the 2007 silver survived? neither from 2006? Nor from 2005? So what about that pound or two of silver in my drawers that were mined from 600BC till 400AD-- its all fake ? Its brand new and made in 2008?
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Re: Silver as retirement savings

Unread postby Arsenal » Thu 13 Aug 2009, 14:27:32

$this->bbcode_second_pass_quote('Pretorian', ' ')I'm sure when silver will be $30 an ounce and salaries $5 a month it will be quite recoverable.


I actually agree with you on this. If that is the way things pan out.

$this->bbcode_second_pass_quote('Pretorian', '
')Anyways, how much silver world without a central government and with 5 billion dead will need? Not much I can assure you.


With 5 billion dead, the governments won't exist and no one will be worried about their retirement which was the OP. The point is to diversify in PMs to combat inflation and possibility for a small scale TSHTF scenario.
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Re: Silver as retirement savings

Unread postby MRM » Thu 13 Aug 2009, 17:44:29

$this->bbcode_second_pass_quote('Pretorian', ' '), I'm sure when silver will be $30 an ounce and salaries $5 a month it will be quite recoverable. ?


Yes, when SIlver becomes much more expensive, it will be recovered again from junkyards.( I doubt that 30$/ounce would be enough ) And all those guys who buy silvercoins now, can sell them for much more then .... and have won :)

$this->bbcode_second_pass_quote('', 'I') find it hilarious when people say that everything will be so bad that there will be no governmental pensions but yet industrial demand for silver will be higher than it ever was in history. of mankind.


Well - the future might be a financial collapse, or an industrial boom - in both cases silver will be worth something ...

$this->bbcode_second_pass_quote('', 'S')orry but no, it doesn't come even close. If you take war , silver is by far not as essential as copper or nickel. Not even world war 3 with every country participating will match current industrial demand for silver let alone exceed it. In fact it will reduce it drastically as no one will have monies to buy silverware, jewelry, make film photographs, useless memorial coins ets
But modern warfare uses a lot of electronics - and therefore require silver. They even build torpedos with silver - zinc bateries

$this->bbcode_second_pass_quote('', ',') the design was change on last time, when China successfully developed silver-zinc battery, which enabled the torpedo to seek out targets at high speed, since electrically powered torpedo produced much less noise. The final propulsion of the Yu-3 torpedo selected was thus silver-zinc battery


http://en.wikipedia.org/wiki/Yu-3_torpedo

This silver is, unlike jewelry, after usage gone forever and will not be recyceled.

$this->bbcode_second_pass_quote('EnergyUnlimited', '')$this->bbcode_second_pass_quote('', 'B')atteries

Can be replaced.

$this->bbcode_second_pass_quote('', 'Q')uote:
Catalysts

Can be substituted

Again, if silver have become such expensive, that it have to be replaced - then those guys who buy silver now are much richer then ;)

and for catalysts - I read an articel, where they try to use silver as catalyst in order to replace much more expensive matereials, such as platinum. I guess we will see more silver usage here in the future - not less
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Re: Silver as retirement savings

Unread postby kublikhan » Thu 13 Aug 2009, 18:27:13

$this->bbcode_second_pass_quote('Pretorian', 'I')t isnt? May be not for a guy who thinks his job has to give him a car, cable TV subscription and private quarters. I know a case when one guy got 400 kg of silver from junkyard. He went to prison for this. To be honest I do not know what was he recycling, but anyway, I'm sure when silver will be $30 an ounce and salaries $5 a month it will be quite recoverable.
Perhaps I was a bit too hasty here. I happen to be a proponent of recycling. There is only a tiny amount of silver in solder in electronics, about 2% silver. Recycling to get only that small amount of silver in the solder is uneconomical. However if you are recycling and recovering the entire amount of e-waste, the economics make more sense. I don't think such a massive recycling initiative could happen quickly though. The amount of silver in each individual product is so tiny that even a large increase in the price of silver does not make it economical to try and recover the silver alone.
The KING of E-Waste Recycling

$this->bbcode_second_pass_quote('', 'I')t is basic economics that when an input of production is used in small amounts, then the price of this input is very “inelastic”. To explain this without the economic jargon, I'll refer one more time to the example of polyester sportswear. As I pointed out earlier, 1,200 tons of silver is enough to fabricate 20 million tons of polyester.

This means that (by weight) silver only represents a little more than 1/20,000th of the inputs in this product. Thus, if the price of silver were to double, this would have such a tiny impact on the final price of sportswear that demand would not change at all. In reality, the price of silver could likely increase 1000% with little to no effect on demand.
History of Silver, Part III: Inventories Are Gone

$this->bbcode_second_pass_quote('Pretorian', 'R')eally? Is there a reason why I dont see the origin of this quote? Is there a reason why it counted all gold that was ever mined ( with a looong leap) and aalll silver that was mined and recycled last year alone? What, none of the 2007 silver survived? neither from 2006? Nor from 2005? So what about that pound or two of silver in my drawers that were mined from 600BC till 400AD-- its all fake ? Its brand new and made in 2008?
The source was counting all gold AND all silver ever mined for the past 5000 years. Consumption of silver is higher than production + recycling of silver. The deficit is being met by drawing down government stockpiles of silver that have been accumulating for the past 5000 years. Yes, some silver is currently recycled. Much of the recycled silver comes from photographic film. Here are some links for you on the subject:

World has 5 times more gold than silver
Value of Silver vs. Value of the Dollar: Above the Ground, Silver is Rarer Than Gold

$this->bbcode_second_pass_quote('', 'M')ost of the silver inventories consumed over the past 60 years came from government holdings. The cumulative amount is staggering. It totals from 6 to 10 billion ounces. This means that 100 to 150 million ounces of silver came to market every year for 60 years, above and beyond what was mined and recycled. This exerted a tremendous influence on the supply/demand fundamentals.
Because of the silver deficit consumption pattern over the past 60 years and the dumping and destruction of many billions of ounces of inventory, tremendous imbalances and aberrations have been created. Most of these aberrations are unknown to world investors, and are not reflected in the price. That’s what creates the opportunity. Aberrations like 5000 years of cumulative silver production being consumed in the past 60 years. Aberrations like less silver now in existence than gold. Yes, above ground silver is rarer than gold. How many people do you think know that?
Silver 101

$this->bbcode_second_pass_quote('', ' ')the price ratio of gold and silver currently nearing 70:1 the actual amount of available silver and gold in the world is likely no more than 6:1[includes below ground gold/silver] History of Silver, Part III: Inventories Are Gone
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question buying silver

Unread postby dsula » Fri 17 Sep 2010, 14:08:36

I consider to buy some silver and went to one of the webpages offering it. As example I went to APMEX. Now I'm completely newbee to any of this and I'd appreciate if somebody could give me a crash course on what to buy and what to avoid and why. They have so much stuff I don't know what the difference is and if it actually matters.
Coins, bars, industrial, mexican coins. The have new and used!
I guess I'm looking for something that keeps its value and protects me from inflation.
Thank you very much for advice.
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Re: question buying silver

Unread postby wisconsin_cur » Fri 17 Sep 2010, 20:16:21

Well here are a couple of thoughts:

When you buy silver you are buying not only the silver but the cost of producing the coin or bar plus the brand of the people that produced it. A key question is when you plan to sell the silver, who do you expect to buy it? American Eagles have increased recognition and trust so they may be worth the premium.

I would avoid the junk silver because you do not know that your neighbors will know how much silver is in a silver quarter if you want to use it to barter. You would be better off storing little airplane liquers, in my opinion.

I would recommend the 2nd hand standard rounds or bars that the seller chooses to send to you. These are usually the cheapest (after junk silver) say "1oz silver" so everyone knows how much silver is there.

If you are just looking for an investment for an inflation hedge, I don't suppose it matters. The more you are getting, the more sense it makes to get the large bars which would save you the most extra expense.

Just don't get drunk in town some night and start bragging how you have it buried in the back yard.
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Re: question buying silver

Unread postby Blacksmith » Sat 18 Sep 2010, 05:56:51

In the past month gold and platinum have increased by 5%, silver by 11%, and Silver Weaton Corp by 21%.
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Re: question buying silver

Unread postby Ayoob » Sat 18 Sep 2010, 06:11:50

I would load up on a bag of pre 1964 silver dimes, and a couple hundred rounds.

If you were planning on buying more than that, then add another couple hundred silver rounds.

If you have a lot of money left over, pick up a couple 100oz bars.

Start with the most liquid, move to the least liquid. The silver dimes can literally be spent as cash immediately, although it would be stupid. You could if you absolutely had to.
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Re: question buying silver

Unread postby eastbay » Sat 18 Sep 2010, 13:44:02

Stick with the most recognizable silver. I would suggest not buying bars over 100 oz. Remember, silver takes up a lot of space and is heavy to carry.

Why not buy gold eagles or fractionally denominated eagles? Everyone, and I do mean everyone, knows what they look like. They are as liquid as water. Plus, $200,000 worth can be carried discreetly in the pockets of a pair of an ordinary jeans.
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Re: question buying silver

Unread postby pedalling_faster » Sun 19 Sep 2010, 08:21:16

$this->bbcode_second_pass_quote('eastbay', 'S')tick with the most recognizable silver. I would suggest not buying bars over 100 oz. Remember, silver takes up a lot of space and is heavy to carry.

Why not buy gold eagles or fractionally denominated eagles? Everyone, and I do mean everyone, knows what they look like. They are as liquid as water. Plus, $200,000 worth can be carried discreetly in the pockets of a pair of an ordinary jeans.


$200,000 ==> 153 ounces. a little over 10 pounds. i would need suspenders to keep my pants up !

but those are the kind of problems you want to have :mrgreen:

i'm not sure if there is a short answer. each of the silver & gold options has to be looked at from the point of -
* liquidity - how resellable is it. gold tends to score high here.
* spread - i.e., buy-sell spread.
* taxable-ness. in the EU, silver bullion sales have to pay a VAT tax. in the US, we might have a new tax law starting in 2012, so that every commercial transaction $600 & over requires a 1099. so if gold is $1600 & you try to sell even a half ounce ($800), the US government is informed of the transaction. this is related to why people like the gold fractionals.
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Re: question buying silver

Unread postby mattduke » Sun 19 Sep 2010, 11:24:07

Here's a a post on buying bullion I did a while ago.

the-precious-metals-silver-thread-merged-t87-360.html?hilit=100%20bars#p544057
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Re: question buying silver

Unread postby eastbay » Sun 19 Sep 2010, 12:14:19

$this->bbcode_second_pass_quote('pedalling_faster', '')$this->bbcode_second_pass_quote('eastbay', 'S')tick with the most recognizable silver. I would suggest not buying bars over 100 oz. Remember, silver takes up a lot of space and is heavy to carry.

Why not buy gold eagles or fractionally denominated eagles? Everyone, and I do mean everyone, knows what they look like. They are as liquid as water. Plus, $200,000 worth can be carried discreetly in the pockets of a pair of an ordinary jeans.


$200,000 ==> 153 ounces. a little over 10 pounds. i would need suspenders to keep my pants up !



It's a little under 10 lbs. A pound is 16 oz for those of you not in the USA. I know it's confusing. 160 coins (10 x 16) weighs less than my duty belt without radio. Two 20 coin rolls in each of four jeans pockets is hardly noticeable for anyone. That is the reason gold is more sensible. Oh we can all easily understand having smaller denominations so we keep, for example, a few kilos of pre-65 US dimes, quarters, and half dollars lying around too. But when it's time to get up and move da money you better have lots of one oz eagles ready to roll. There are few easier ways one can pick up and run ... and I do mean run... during a meltdown.

So yeah, have a bit of the silver for bread and eggs. Fine. But for moving relocation money quick it just doesn't work.
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