Why Buy Gold And Silver As Investment?

Anyone who invests takes risks. Doesn't matter if it is your own business, education, shocks and scares, interest bearing deposits, bonds, pork belly futures, or whatever.
The motivation is to make a profit, eventually.
Same with PM's.

Invest in a market that you like, and have greatest knowledge in, and what you think will benefit you the most.
If you don't really know, and still wish to invest, diversify.
I have had advice from a professional advisor, that it would not hurt in most cases, to put some, but no more than 5%, into PM's.

Sounds rational to me!

My 5% is not into PM's, but into numismatic items.
One problem for me. It has to be a lifetime investment. That's OK; I have had a lifetime interest in numismatics.

The concept I think you're hinting at is opportunity cost. Both durable and consumable goods are used up over time. A textbook is information and information is notorious for growing stale very quickly.

However, you said, "You can store your wealth in anything?" That's not quite true. The goods that you and I buy everyday, the goods that make our lives more comfortable, have value but that value has a finite time frame. There's no way to "store value" in a pizza, or a month's worth of A/C in the middle of summer. Sure we benefit, but once consumed, these goods are gone and must be replaced. There is no "store of value" in these expenditures.

So what about gold and silver? Well, for centuries precious metals have been the go to store of wealth in times of trouble and uncertainty. Additionally, for much of human history, gold and silver has, quite literally, been "money" or the base of exchange for all transactions throughout much of the world. The reason for this is pretty simple: gold and silver (unless damaged or otherwise lost) doesn't physically degrade. They are durable and thus a store of wealth.

So, what to do with that $200.00? Well, if you need to eat? I'd buy food. If you need to pay rent to keep a roof over your head? I'd pay rent. If all of your basic needs are met, I'd put that money toward a retirement plan in stocks or another age appropriate investment vehicle of your choice. Once all of that is covered? I'd consider buying gold and silver... or Beanie Babies...or Magic the Gathering cards...or whatever sounds right for you. In other words, put it toward something you understand, and more importantly, something you enjoy.

BB's thoughts pretty much echo my own, which generally tends to be the case. It's not a popular stance to take on a PM forum but I believe buying PMs as an investment vehicle is a losing proposition unless one is fortunate enough to buy when silver- for instance- flatlines below $10, its traditional stabilization point. Even if one times things perfectly, its a potentially decades-long waiting game before metals once again explode into prominence and the opportunity arises to make a substantial profit commensurate with one's initial grubstake (that's an odd word, isn't it?).

My personal interests lies in buying limited release numismatics below market price and (hopefully) watching these coins increase in value over time. If they don't, and here's the key, I only buy coins I personally like. I view them more along the lines of family heirlooms than true investments.

In the last year, I've had the opportunity to sell a coin for $2000 that I paid $75 for and never once seriously considered pulling the trigger. That test case leads me to believe that most of the coins I own will likely remain in my possession for generations to come, barring some future unforeseen tragedy that forces my hand.

The idea is to split risks and not keep all your wealth in paper money/bank accounts, because they are extremely risky.

Gold and silver are known to hold value better, but as you see, their prices kind-of crashed recently... so many who bought gold and silver lost part of their investments.

I think it's great to buy real estate, because prices now are very low - compared to earlier years. So go for land, homes and also buy some gold.

No, I wouldn't buy another computer, if I were you... it eventually gets old, obsolete and might not even work after a while.

Static hard values are best buying: gold, silver, land, homes... etc.
Or, invest in a business that produces profit for you.

The idea is to buy some of this and some of that... I don't believe 100 % in anything.

I'd add a couple of thoughts to bekiz and VintageRacer's comments.

First, unlike real estate, small amounts of gold and silver don't have a carrying cost (annual taxes, maintenance) while still having durability and appreciation potential.

Second, outside of buying a wedding band or two, and maybe a few pieces of nice jewelry for the wife over the years, buying gold and silver isn't for everyone. Especially for non-numismatic gold and silver, buying ETF's often makes more sense than buying physical. Be honest with yourself. If gold and silver isn't for you, that's completely okay.

Well why not just wait to invest money until you have enough money to buy one ounce of silver with the interest you earn each month from putting your money in a bank account?

I find it interesting that according to this website

http://coins.about.com/library/US-C...t-Prices.htm

There hasn't been a single s-mint proof set that has gone under what it was originally sold for, not one. Do you think it's a good idea to buy silver proof sets?

I like silver proof sets but plenty have sold for less than the original mint price. I've only purchased 2 sets from the mint, the rest I waited until the mint stopped selling them and then bought on ebay for a bit over spot. I did get burned on the 2012 which doubled in price one the Mint stopped selling them.