Confession Of An Ex-Stacker

All right, so maybe my story isn't quite as lurid as the title suggests, but bear with me...

When I got back into coin collecting a few years ago after a long absence, I was purely interested in coins from a numismatic value. The only silver and gold I cared about were old coins that I needed to fill various holes in my albums. And prior to that time I had NEVER been interested in buying gold and silver as an investment since I always felt that the fact that prices had basically remained constant during the 80s and 90s was an indication that PMs simply weren't a very good investment compared to, say, stocks, real estate or even bank interest.

When gold hit $1300 and silver hit $20 back around September of 2010, my wife tried to convince me that we should start buying some. I told her that it was a bad idea since PMs were not traditionally a good long-term investment and likely wouldn't go much higher.

By the time gold hit $1600 and silver was above $40 nearly a year later, I finally let myself be convinced that maybe things had indeed fundamentally changed and that gold and silver really did have long-term investment potential. My wife was absolutely convinced that the economy was heading for a long-term disaster and there was certainly a lot of support for her views all over the Internet (including here on this very forum). And so I started buying pure silver bullion for the first time. And I continued to do so regularly over the next couple of years, "buying the dips" as spot price slowly dropped during that entire period. A small amount of gold as well, especially in recent months.

Now, just to be clear about a few things... My wife and I have both worked hard for many years and had put away a sizable amount of money toward our son's eventual college education. Any PM purchases I made came from current income that we otherwise would have added to savings, not from existing savings. Also, I never bought into the doomsday scenarios that predicted total economic collapse. Instead, I always looked as PMs as a way to preserve wealth from the vicissitudes of inflation in the long-term and planned to either spend it as necessary upon retirement in 20 years or else pass it along to my son if I didn't need to spend it. All of which is to say that we never spent money we didn't have or couldn't afford, and I don't regret "buying the dips" on the way down since (a) I still think prices will go up again and (b) buying a little at a time over a couple of years let me buy much more than had I waited two years and purchased now since there's no way I would have ever dropped $100K at once.

So now, what with prices lower than they've been in years, you'd think I'd be backing up the truck, right? Wrong, actually. And this is where the "ex-stacker" part comes in. Lately I've gotten into the habit of buying simply because I'm in the habit of buying. But I've recently realized that we now have a significant amount stashed away and there's really no reason for us to buy anything else purely for the sake of stacking. Sure, if I were convinced that the economy were going to collapse and silver and gold would be the only thing that would let us survive, I would liquidate my son's college fund in a heartbeat. Same thing if I were absolutely convinced that silver was going to hit $500 someday. But I'm not convinced of either of those scenarios (even though I admit they could happen).

I'm still planning on purchasing "specialty" PM items, such as the 5-ounce ATB pucks, the yearly ASE sets, etc. But I honestly have no plans to buy any more 100-ounce silver bars, tubes (or monster boxes) of ASEs, etc. I certainly don't regret the purchases I have made and I'm not at all depressed about the current spot price which is below what I paid. But with PMs making up approximately 1/3 of our investments right now (not including our house and 401K plans), I think it's time to stop buying PMs simply because I'm in the habit of doing so.