OT: Silver and Gold

Juice will trade you 10,000 shares of Hertz stock for some gold.

We just spent $3 Trillion trying to keep the economy afloat. And several more Trillion doing monetary stimulus. Congress is talking about doing another Trillion in stimulus.
Maybe there are some investors out there that don't think that currency is all that stable ?
I"m not there yet. But if Biden wins and he is indeed the most Progressive President ever. We may get to that point very quickly. We can't take an extended Recession right now.

I"m not taking it as payment. But maybe I should put some in my safe.

Yeah loving how my dollar goes about 9-10% less far than the beginning of the year. Also loving these 25% increased food prices. Throw another trill on the pile lets see what happens.

The funny part will be the TJ mongers with surprised pikachu faces when prices (in dollars) go up on reopening.

The S&P 500 is up 49% since the recent low on March 23. If you are looking for an inflation hedge, that’s a better landing spot than gold.

@ desertscrub, that is a fair question

@ Warrior15, That sounds like a good idea, however, if you were to buy it and put it in your safe. A little more about this particular deal, right now silver is selling for $7-10 over spot price. This client of mine has a contact where he thinks he can get it for probably $1-2 over spot, and if so he would give it to me if I credit him at the price he pays for it. He will be buying from this contact of his anyway, so not a big deal for him. If this worked out as described, why wouldn't you accept it as payment?

@mark94, That is a good gain, definitely better than gold. Silver was the best performing asset though during that time, when compared to the stock markets in general. It hit it's low on March 19th of $11.79. Today it ranged around $27.00. That is over 100%, somewhere around 125%!

@crazyjoe
Just created an acc to let you know

Watch the fakes, if you can't figure fake bars from real ones, buy from an established seller.

Real problem with using commodities as money is the storage and non fungible nature of those items.

Unless you are talking about coins with numismatic vale or things like silver from Tiffany, silver and gold are perfectly fungible.

@crazyjoe “Has anyone noticed the rally in silver and gold lately? Especially silver.”

Ummm why yes now that you mention it: https://tuscl.net/discussion/72999/


Your deal makes no sense to me: “so he would give it to me if I credit him at the price he pays for it.”

-- If your client already had the silver in his possession it would be one thing but what advantage would there be to change cash into silver to use as payment. The answer is NONE. Not to you or your client.

IMO using precious metals as an investment vehicle is high risk and better used as insurance. And be careful about being blinded by numbers. For instance: “It hit it's low on March 19th of $11.79. Today it ranged around $27.00. That is over 100%, somewhere around 125%!”

-- That $11.79 price was a momentary flash price and no one anywhere was able to buy physical silver at that price. In fact the spread percentage wise between spot and physical was never greater than it was on that day. Right now the premium for physical silver due to high demand is very pricey IMO. And a different measure of silver’s price appreciation could be to look at year to date which is about 55% vs. the S&P’s 3% gain but as you can see picking when you get in makes a big difference. Chasing the latest hot thing isn’t usually the best strategy to get rich (as I type silver is at $28.25 up another 5.11% this morning. I think the word is speculative or was it irrational…)


“Where do you think silver and gold will go in price over the next few months or years?”

-- I think it is going up but as I said in my post last week as soon as I decide to buy it is guaranteed to crash. I’ll be sure to let you know if I were ever to do that.



“Would you accept silver or gold as payment?”

-- No


My last word is to agree with @dadaf’s “Watch the fakes” comment. Fakes are very common. Use a dealer but know that even careless dealers have been stuck with fakes.

https://www.jmbullion.com/investing-guid…

^ not really buddy in order to buy something using silver or gold not in coin form you need a middleman someone to set a value and make a market even with coin to reap the appreciation you need a market maker.
For example the stated values of a US five dollar gold double eagle is five dollars, in order to get the appreciable value you need a middleman and just because the market value is x after sale you will only receive X minus market costs(commissions and fees)

^ That was to winex

@Twentyfive - you could have attempted to save some credibility by saying it was a typo.

First, the definition of fungible:

https://www.merriam-webster.com/dictiona…

being something (such as money or a commodity) of such a nature that one part or quantity may be replaced by another equal part or quantity in paying a debt or settling an account

From wikipedia:
https://en.wikipedia.org/wiki/Fungibilit…
In economics, fungibility is the property of a good or a commodity whose individual units are essentially interchangeable, and each of its parts is indistinguishable from another part.[1][2]

For example, since one kilogram of pure gold is equivalent to any other kilogram of pure gold, whether in the form of coins, ingots, or in other states, gold is fungible. Other fungible commodities include sweet crude oil, company shares, bonds, other precious metals, and currencies. Fungibility refers only to the equivalence and indistinguishability of each unit of a commodity with other units of the same commodity, and not to the exchange of one commodity for another.

Also from the same wikipedia link

Fungibility does not imply liquidity, and vice versa.

That's the end of the quotes - the rest is from me.

You really need to read up on your facts. There is no such thing as a US $5 double eagle.

The term "eagle" in American gold coins has two uses.

"American Eagle" refers to current, modern day bullion coins. Though these coins are stamped with dollar based denominations, they are not used as currency. (Though they legally could be) The $5 American Eagle is 1/10 of an ounce of gold, and it is worth 1/10 an ounce of gold. This is true regardless of the year or condition with limited exceptions. (Some of the West Point mint mark coins have numismatic value - but the same is true with West Point clad and silver coins)

The term "Double Eagle" refers to a $20 gold coin. The $5 gold coin in minted from the founding of the country until 1932 was called a "Half Eagle" (the $10 was an Eagle, and the 2 1/2 was a quarter Eagle)

But note that I specifically excluded gold with numismatic value in my original post. The amount of gold in a Double Eqgle is a little less than 1 oz. But if that gold is an 1870 CC Double Eagle, it is worth a hell of a lot more than an ounce of gold regardless of condition of the coin.

^ I’m sorry but I always believed that something was only fungible if the value was set and like money if the value fluctuates it is not truly fungible but if I’m mistaken I apologize for that, but it is my belief that in order to be fungible it needs to be commonly tradeable like money gold bullion or silver bullion may, or may not be in that category.

Fluctuation of value has nothing to do with fungibility.

Stability of value has a LOT to do with whether something is a currency or not.

For that reason, Bitcoin (or other crypto currencies) are fungible (within the same currency, not accross currencies), but they are not technically currency.

I thought in order to be fungible something needed to be tradeable across currencies, I will look at that later when I get finished for the day.

Buy pre1967 dimes, quarters and half dollars. I have a stash of quarters, one quarter might buy a bag of groceries if the economy completely fails. They are not likely to be counterfeited.

With the exception of half dollars and limited special mint issues, no US coin had silver after 1964.

Dimes, quarters, half dollars and silver dollars (which ended production in 1935) dated 1964 and before were 90% silver.

Half dollars made between 1965 and 1970 were 40% silver.

So what would the purpose of buying 1965 and 1966 dimes and quarters be?

* Note: Even though they are 40% silver, the only time you can really sell 1965 through 1970 half dollars is when silver prices are high. Most dealers won't bother with them at any other time.

@TwentyFive - whether or not you can buy a commodity for a currency is NOT part of the definition of fungibility. But is there a major currency that can't be used to buy gold or silver?

Note: I mentioned "major" because I have read of small Pacific Island nations that use shark's teeth as currency. Though shark's teeth can be sold outside of those small island nations, and the money raised could be used to buy gold or silver, a trade of shark's teeth for gold or silver is really more of a barter arrangement in the majority of the world because there are no exchanges for shark's teeth. Therefore, the quantity of shark's teeth for a given amount of gold or silver can and will vary widely.

But again, that has NOTHING to do with fungibility.

You are correct 'winex' pre1964 is all that I buy.

@Crazyjoe this statement alone would make me back off. This makes no sense. Why would anyone offer this kind of deal? Sounds like a scam or ripoff to me.

"@ Warrior15, That sounds like a good idea, however, if you were to buy it and put it in your safe. A little more about this particular deal, right now silver is selling for $7-10 over spot price. This client of mine has a contact where he thinks he can get it for probably $1-2 over spot, and if so he would give it to me if I credit him at the price he pays for it. He will be buying from this contact of his anyway, so not a big deal for him. If this worked out as described, why wouldn't you accept it as payment?"

I’m glad I stocked up on Ammo.
That will trump all when and if “The shit hits the fan”.