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 Replies: 69 / Views: 4,386 |
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Pillar of the Community
United States
2049 Posts |
For those who think our dollar will never become worthless, you might be right. However, you also might want to do some reading up on fiat currencies and their failures over the years among many different cultures and countries.
For those that dont know, a fiat currency is one where money has nothing to back it (i.e. gold like it used to be) and it is decreed by the issuing government to have value.
Here's another way to look at silver and gold...compare it to the DOW. When the DOW hit its high back on 10/9/07 at 14164.53, silver spot was $13.49, gold spot was $738.70. Today the DOW is at 8000.85, silver at $12.71, gold at $928.10. So the DOW has lost 43.5%, silver only 5.8%, and gold has GAINED 25.6%. Something to think about...
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Valued Member
United States
405 Posts |
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I own a self sustaining ranch with a lot of land with water in California and Montana. Guess that Doctor and many others will be giving me a lot of gold. Or paying a gang of mercenaries to take it away from you! |
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Moderator
 United States
6563 Posts |
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as with all currencies, lead needs to be backed by something. In this case, by gunpowder  |
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Pillar of the Community
United States
819 Posts |
Doomsdayers have always been around, and always will be. Hard times may be ahead, but I believe my family and I will get through them. My preparations have not been to hoard gold and silve, I just invested in a John Deere tractor, disc, plow, shredder, etc and have turned two acres into row crop ready to plant.
If you dont know what a Victory Garden is look it up. While you are looking up stuff, look up Psalm 37 verse 25. It won't apply to many who do, but some will understand.
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Pillar of the Community
United States
2335 Posts |
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Here's another way to look at silver and gold...compare it to the DOW. When the DOW hit its high back on 10/9/07 at 14164.53, silver spot was $13.49, gold spot was $738.70. Today the DOW is at 8000.85, silver at $12.71, gold at $928.10. So the DOW has lost 43.5%, silver only 5.8%, and gold has GAINED 25.6%. Something to think about... You could also look at the period between the late 70's & now. That includes the stock market slump in the 80's, the one in the early 2000's & what's happening now(sorry I don't have exact dates). If you compare the gains/losses of stocks & precious metals I think you would find that stocks were a much better investment during that time period. I believe you could pick almost any type of investment & find a short time period in which it did better than any other asset class. On a side note, according to research I have read Doctors are no better as a group at managing investments than any other profession. Edited by trdhrdr007
01/30/2009 7:55 pm
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Pillar of the Community
United States
2049 Posts |
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You could also look at the period between the late 70's & now. That includes the stock market slump in the 80's, the one in the early 2000's & what's happening now(sorry I don't have exact dates). If you compare the gains/losses of stocks & precious metals I think you would find that stocks were a much better investment during that time period. I believe you could pick almost any type of investment & find a short time period in which it did better than any other asset class. I dont doubt that...but my point earlier about gold never being nearly worthless is supported by thousands of years of history. With stocks, they can go to zero (or literrally pennies) if you are investing in individual stocks. Of course a diversified portfolio is smart so my thinking agrees with others where they say to have 10-15% of your portfolio in physical PM's. I'm not saying to stay away from stocks by any means, but in this economic climate, I would rather be in something safer like PM's. I might make a mention that during the last depression when the stock market crashed, it took until 1954 or 1955 for the DOW to again reach the level of it's high before it crashed. I dont know what the prices of gold or silver were during that timeframe but that's something I should look up. |
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Pillar of the Community
United States
1984 Posts |
Physicians are lagging indicators.
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Pillar of the Community
United States
2270 Posts |
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Doomsdayers have always been around, and always will be. Hard times may be ahead, but I believe my family and I will get through them. My preparations have not been to hoard gold and silve, I just invested in a John Deere tractor, disc, plow, shredder, etc and have turned two acres into row crop ready to plant.
If you dont know what a Victory Garden is look it up. While you are looking up stuff, look up Psalm 37 verse 25. It won't apply to many who do, but some will understand. The psalm was written when most food came from the land and it supported only thirty million people. Now the food comes from factories and there are six billion in waiting. Time don't fly, it bounds and leaps.
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Pillar of the Community
United States
2270 Posts |
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I have a friend my age who is a practicing Psychiatrist. He believes that the US should still be on the silver standard - every paper dollar backed by an appropriate amount of silver. As I have pointed out to him that the price of silver can also flucuate, causing the amount of silver needed to back the dollar to also flucuate. In other words it doesn't do anything to stop inflation. My Dr. friend is buying all the bulk silver he can get his hands on believing the 2010 will bring about run away inflation like Brazil had in the 80's. If you believe this will happen than that provides the only reason I can think of to buy silver and gold, as a hedge against real inflation. On the other hand don't buy it to get rich. If gold goes to $2000 an ounce in all likelihood your $2000 will only buy as much goods and services as $900 will buy today. Use your money to buy a house or pay off your mortgage, or like me to buy old coins.
You might mention to him that silver would have to be about $30,000 per ounce to back all the currency. :) A roll of silver dollars would buy a pretty nice house. Time don't fly, it bounds and leaps.
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Pillar of the Community
United States
2270 Posts |
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When in the history of gold (thousands of years) has it been "nearly worthless"? It's never happened before of course. It may have come close in Egypt however and for the same reasons that it would here. http://74.6.239.67/search/cache?ei=...p=1&.intl=usIf it blows the link away just look up the admonitions of Ipuwer. In the past a complete shut down of systems was highly improbable and of relatively little importance. In the depression most people lived on farms anyway so as long as the seed crop was OK the farmers could feed themselves. Today only 1% of the population lives on farms and these are more like factories than farms. They run on capital and require vast amount of chemicals and fuel. The output goes to chemical plants that turn it into "food" and other products. Even the water supplies require much more human intervention and and work to operate and maintain. Factories operate on just in time delivery and require capital and profit to work. No, I don't think things are going to break down but if they did I'd expect a draconian drop in food production from which there might be no recovery for many years. Under these conditions gold would have almost no value. Time don't fly, it bounds and leaps.
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Valued Member
United States
294 Posts |
I have enjoyed reading the posts and getting educated about economics.  If you are the sharpest pencil in the box.(like a Doctor).Why would you buy us gold coins when you can buy foreign ones that have lesser dollar value ? Seeking: Were did photoeric21 come up with the seeking thing  (I have a patten rights)  Rainman  |
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Valued Member
United States
245 Posts |
"No, I don't think things are going to break down but if they did I'd expect a draconian drop in food production from which there might be no recovery for many years. Under these conditions gold would have almost no value."
As a person who is three generations California San Joaquin Valley Farming, I would agree. Transportation and distribution of food would be the biggest issue. The Farms in case of a emergency would work for the government and also be "protected" by the government. .
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Pillar of the Community
United States
2270 Posts |
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As a person who is three generations California San Joaquin Valley Farming, I would agree. Transportation and distribution of food would be the biggest issue. The Farms in case of a emergency would work for the government and also be "protected" by the government. .
There's a lot that can be done to prevent catastrophe. The economy is much more interrelated then at any time of the past and this even extends across national borders now. Every part of it has to function. Fortunately our leaders do seem to understand this. Unfortunately this might take us closer to central planning than anyone should want to go. Time don't fly, it bounds and leaps.
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Valued Member
United States
81 Posts |
I have been doing a lot of study on having some gold on hand. It has never been worth nothing and it is the only item that is traded about all over the world. I plan to put about 15 percent of my worth into gold in the near future. i.e. don't have all of your eggs in one basket. Oboma is getting ready to screw up the works big time.
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Pillar of the Community
United States
1083 Posts |
"Oboma is getting ready to screw up the works big time."
The works were pretty messed up before he took office, remember? Lets keep politics out of the discussion please?
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Replies: 69 / Views: 4,386 |
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Posted 01/30/2009 7:31 pm
