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 Replies: 82 / Views: 7,900 |
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Bedrock of the Community
Australia
21786 Posts |
Cap Gains Tax in Australia is imposed on those those profits from investment that are above the inflation rate.
Those profits are added to income.
Income tax rates:
0-18k: 0%
18-37k: 19%
37-80k: 32.5%
80-180k: 37%
180k+: 45%
Example %100,000 in silver, sold 10 years later, growth rate 5% inflation rate 3%:
10 years later $100,000 after inflation: $134,392.
10 years later growth rate: 5% $162,889.
Real profit $28,497 which is added to income in the year sold.
Typical middle income tax rate 32.5%
Tax paid $28,497 x .325 = $9,262 tax to be paid.
I have a taxation accountant friend who holds the view that the rates for the highest tax brackets in the U.S. are too low. 10% to 15% more in the highest brackets would be in line with many other developed countries.
Edited by sel_69l
04/01/2013 10:32 pm
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Pillar of the Community
United States
1795 Posts |
Not much one can do about it. Most of my silver I got at cost from banks in the 60's and 70's. I might cry about some of the later silver I bought. I don't think it would affect slabbed silver coins at all if any. Who buys slabbed certified silver coins for melt...I sure don't. I have more important things to do in life than worry about that.
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Valued Member
United States
307 Posts |
In one sense I would like silver to go down so I can buy lots of ASEs. On the other hand, I would be upset that I missed a chance to sell junk silver and re-invest in coins with numismatic value.
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Pillar of the Community
United States
5818 Posts |
This is a double edge sword question, part of me wanted to see it goes down just enough to stack it up higher, the other part of me wanted to see silver go back up.
The way that I see it for the near future, silver will go back up higher, supplies is short from the big guys (Apmex, Goldmart)and Gainesville don't have what I wanted. The question is who bought them all?
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Pillar of the Community
United States
3789 Posts |
A silver crash? I say I would welcome it and would profit on it, I am always looking for the trend so I don't care what it does either way.
So yes, I welcome a crash because
a- would sell it short
b- would flush out weak hands and the fastest way to get some sort of floor or resolution to lower prices in a fast expedited manner
c- I would, once I got confirmation that prices had stopped dropped running lower, load up on silver
d- would pick up every single high prem silver 1 oz coin and set on the market.
So yes I would LOVE a crash, I would win all across the board.
Problem is-
1- That scenario is highly unlikely because there is too much price memory and points of support
2- Its really highly unlikely silver goes to single digits.
So I say, bring on lower prices, I have no problem whatsoever, I am hedged and will make money on the way down.
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Pillar of the Community
United States
556 Posts |
Since most of my meager silver collection is from roll hunting, I'd still end up making a (small) profit if silver prices crash as long as they don't go down to pre 1964 levels. And if there was a crash, I could probably load up on silver when prices are at their lowest, so in short, I wouldn't mind a crash.  |
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Pillar of the Community
United States
511 Posts |
Dream on if you think lower spot (an easily manipulated paper figure) values will equate to similar decreases in the price for bullion in hand. Premiums for 90 percent have risen from 3 to 4 percent to over 10 percent as spot silver has dropped from $33 to $28 in recent months.
Prediction: The more spot is manipulated, the less meaningful it will be as a real world price guide.
Edited by 3stooges
04/01/2013 11:31 pm
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Bedrock of the Community
 13014 Posts |
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What sort of event would have to happen for silver to lose nearly six times its current value? Really youd just need to restore confidence in the economy, theres much more attractive options for money in booming economies and no real fear to hedge your bet with metals. Quote:
On the other hand, I would be upset that I missed a chance to sell junk silver and re-invest in coins with numismatic value. Thatd be my one personal complaint, not selling all the bullion I had at the high price and just rebuying it cheaper. Quote:
The way that I see it for the near future, silver will go back up higher, supplies is short from the big guys (Apmex, Goldmart)and Gainesville don't have what I wanted. Silver supply isn't short, just whats minted. I still believe a significant amount of product is being held out for sale waiting to see if the price will go back up. The big boys can afford to sit on some stuff buy demand is still down from 08 when there really was an issue of not being able to put it out fast enough and leading to only bullion eagles for 09. Id avoid gainesville personally, I bought a commemorative coin from them and when it came the air tite and the coin inside were covered in some unknown gunk. When I contacted them they refused to even exchange it saying it was only bullion, when I asked when theyd be refunding the premium they charged since it was bullion they said it had numismatic value which would make it not bullion obviously. That went back and forth a bit until I got sick of it and just let them theyd lost my business for life. Quote:
Dream on if you think lower spot (an easily manipulated paper figure) values will equate to similar decreases in the price for bullion in hand. Premiums for 90 percent have risen from 3 to 4 percent to over 10 percent as spot silver has dropped from $33 to $28 in recent months. Maybe at first but that wont last for long. The smaller stores will try and remake as much money as they can because they have too and premiums would be high at first from their losses. But if they think people would keep buying at insane premiums over time theyre the ones that are insane. Theres plenty of big sellers that have the same standard premium as they did when it was higher. Mathematically it wouldnt really make a difference though. 10 percent of 10 percent of 28 is 2.80. If silver dropped to 5 and they charged 100 percent thats still only a 2.20 cent difference. The premium may have significantly increased but the price would still be significantly cheaper. If they had dreams of selling it where the premium is more than the value of the bullion well good luck to them |
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Bedrock of the Community
13014 Posts |
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I have a taxation accountant friend who holds the view that the rates for the highest tax brackets in the U.S. are too low. 10% to 15% more in the highest brackets would be in line with many other developed countries. The problem with that is our tax brackets lack common sense. For cap gains the middle class are lumped in with the super rich. Then throw in that a lot of states tax things as well and the rate is a lot higher than it appears, in California I believe its now close to 40 percent when you combine the two. Also If you dont hold it for a least a year it gets taxed like normal income. Dividends now get taxes as normal income as well. I do really like the aspect of the Australian system though where only real gains get taxed. In your example the full 62,889 would be hit with an 18% rate for taxes of 11,320 which comes out higher than your system. Its a 20 percent rate you sell after owning for a year but before the 5 year mark. |
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Pillar of the Community
United States
507 Posts |
To simply answer the question, I'd love a silver price crash. If you are a BUYER of silver, you want the price to be low. If you are a SELLER of silver, you want the price to be high. It is silly to bemoan the declining price of something you consider or 'know' to be a good long term investment. Consider this message from Warren Buffett, only substitute 'silver' for equities or stocks. Quote:
A short quiz: If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time but are not an auto manufacturer, should you prefer higher or lower car prices? These questions, of course, answer themselves.
But now for the final exam: If you expect to be a net saver during the next five years, should you hope for a higher or lower stock market during that period? Many investors get this one wrong. Even though they are going to be net buyers of stocks for many years to come, they are elated when stock prices rise and depressed when they fall. In effect, they rejoice because prices have risen for the "hamburgers" they will soon be buying. This reaction makes no sense. Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices. In an ideal world, the price would be low while you are buying and spike before you sell. |
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Valued Member
United States
200 Posts |
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In an ideal world, the price would be low while you are buying and spike before you sell. That is a good one. Certainly in my ideal world :) |
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Pillar of the Community
United States
3789 Posts |
it doesn't have to be ideal... it is possible to exit positions with a sizable profit. You wont capture all of the gains at the high end but you can do a bang up job.
happens everyday in the markets.
now the game is to sell and continue to sell as it slides down.
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Pillar of the Community
United States
5821 Posts |
Quote:
now the game is to sell and continue to sell as it slides down But, but... I don't WANT to sell. I'm in it for the long term (20+ years), and unless you think silver is going go down and STAY down, this is the worst possible time to sell. Much, much smarter to wait until silver goes back up and then sell, if necessary. One thing I learned from watching the stock market over the last decade or so is that the people who panic sold when the market was heading south are the ones who ended up losing their shirts. The smart people were those who bought as the market was going down and then sold when it went back up. Sure, you could try and wait to see when the market had bottomed out before buying, but you ran the risk of waiting too long (as many people did). Again, all bets are off if you think the price of silver will never bounce back, just like it wouldn't have been good to buy a stock in a declining market for a company that eventually went out of business. But if you think that silver will eventually bounce back then it would be utterly foolish to sell now, especially if you paid more than $27 for the silver in the first place. I can see the wisdom in not buying anything else right now if you suspect that prices will continue to drop (although you have to keep in mind that there is no proof that this will be the case). Heaven knows I could have saved a few bucks waiting a week or two before making my last purchases. But now is most definitely not the time to sell unless you are either truly desperate for money or convinced that silver will not go back up before you actually need the money. |
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Bedrock of the Community
13014 Posts |
Quote:
One thing I learned from watching the stock market over the last decade or so is that the people who panic sold when the market was heading south are the ones who ended up losing their shirts.  The big funds and the Buffets do their biggest buying sprees when everyone is in panic selling mode. Like you mentioned it doesn't apply if a company is going under or silver stays at $5 dollars but generally speaking thats when the money is to be made if you are smart with it. That said if you believe in the historical trends of silver that it is going to come back down to its historic levels like I do, you also believe in the fact that it will spike again at some point and not sit there for ever. There was a spike in WWI, WWII, the 60s, the70s, the 80s, then another started in the 2000s which has basically been about every 20 years for the most part. Right now were still mimicking the last big spike with a run up in the 2000s a small pull back the big spike and now working its way down with spikes in between. If it follows that trend well normalize around the end of the decade and be due for a spike around 2040 with some serious money to be made. Nothing says it will follow the exact same course but if nothing else history has taught us the spikes will come down and it wont stay down forever. |
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Valued Member
United States
223 Posts |
I'm hitting my good LCS tomorrow afternoon. I just hope they have generic bullion in stock. There normal price is $1.25 over spot. With the price where it is at currently, I see a cautious buying opportunity.
Where is the next support level? We are pretty close to $27 and with the premium I will be lowering my average per oz.
I had thought about selling some of to fund another gun purchase but I can't sell at a loss as I see myself having another 20-30 years to retirement. Over the summer I was more than happy to be buying at these levels.
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Posted 04/01/2013 7:10 pm
