Thread: coolhand's Account Talk

Originally Posted by justbizness45

A friend of mine is in a real financial quandry right now. He offered me 30 troy ounces of silver coins for $10/toz. I jumped on it and it is now safely in my safety deposit box with the rest of the stash. I figure in 5 years even if I don't use it it will double in value if Mr. O spends the economy healthy as he claims he will.

Oh, he will spend it, no doubt. Who wouldn't want to spend that kind of $.(especially when he (alone) doesn't have to repay it...his kids will) The sad thing is your stash will more than double because he is making our nation sicker.... the good thing is you are prepared.

Originally Posted by justbizness45

A friend of mine is in a real financial quandry right now. He offered me 30 troy ounces of silver coins for $10/toz. I jumped on it and it is now safely in my safety deposit box with the rest of the stash. I figure in 5 years even if I don't use it it will double in value if Mr. O spends the economy healthy as he claims he will.

Not very many folks who have stopped contributing to their TSP are using that money to buy gold/silver; so they aren't hedging at all. They've simply stopped funding their retirement and the money is going somewhere else.

There's no financial strategy in that. At least you have a strategy.

I've caught the itch to make a small investment in gold in either coins or bullion.

Anyone recommend how and where to buy some?

Turbo,

Why invest in a frothy market? It is very likely the worst time to purchase precious metals.

If the American economy collapses, the world economy collapses. If that happens we will be in a barter economy. It would be MUCH better to have a skill to barter (I mean a real manly man skill - not stock broking or whatever), some produce to trade, or some housing you can rent at a low price. Gold is a form of money, and money is not a directly tradable item. There has to be confidence that it will be tradable.

Regardless, why does gold at $850/oz look good now when it was $250/oz in 2005? Why did a 660 sq ft house in Santa Monica look good at a million bucks in 2006 and can't be sold for 700 oz of gold now???

Buy low, sell high

I hear you.

I'm sure I got this idea in my head by listening to commercials on CNBC and nothing more concrete that. The deeper level connection for me was that I have a passing interest in collecting coins and the idea of investing in gold coins follows that interest. So no, I was not thinking of a buying gold bars from Fort Knox, just a few trinkets...

Funny thing is that I searched Google for how to buy gold and the results didn't inspire confidence, if you know what I mean. So that's why I asked the question.

And apologies to CH for highjacking his thread.

Just so folks don't misunderstand my position on metals, I personally do not buy them. I'm not even interested in them. They are a very manipulated market. However, having said that I'm also not going to discourage those who feel it's a wise move. It's a personal decision based on each individuals perception of the market. It is possible that it could pay off.

My own perception is that if the economy were to fall off the cliff, and I seriously do not believe that will happen, I'll deal with it. Those in power at the top are not going to destroy their bread and butter if they can help it. That doesn't mean there won't be pain, maybe in spades, but we'll weather it.

Originally Posted by turbo23dog

I've caught the itch to make a small investment in gold in either coins or bullion.

Anyone recommend how and where to buy some?

Since I don't have the financial where with all to buy large amounts from the bullion brokers I have been buying on ebay and locally. There is a coin shop locally that sells $5 gold pieces and other investment coins. I calculate what it is worth spot price and +10% is my limit.

My personal opinion is that gold/silver will continue to go up over the next five years as the world currencies are devalued. Let me also stress that this is a hedge against one possible outcome. I am still investing in TSP and Roth acounts for me and my wife. If anyone wants to discuss further just post it on my thread. CH hijack complete, thanks for the use of your thread.

http://www.chartoftheday.com/20090109.gif

Coolhand,

The STA make a similar assessment. We had a record breaker this past year when the presidential election year crash in stead of rallied.

America: Is This the End of an Era?
by: Teeka Tiwari January 09, 2009 | about stocks: SPY

http://seekingalpha.com/symbol/spy

Can you imagine a world without the United States in it?
The latest headlines would have you believe that we are moments away from
such an eventuality. But while history has taught us that all empires must
end, America shall continue to endure far longer than the nay sayers would
have us believe.

There is no question that as a nation we must make massive changes in order
to right our economic ship. Our national debt is ridiculously high ... our
government spends more money than it takes in ... and our financial
regulation enforcement is a joke. (More regulation, by the way, is not the
answer; more and better enforcement of existing rules is.)
In 1999, for example, a concerned Wall Street insider sent the SEC a 19 page
document http://www.scribd.com/doc/9189285/Ma...doff-Complaint
that explained in clear, easily understood English the exact nature of the
alleged fraud being perpetrated by Bernard Madoff.

Point by point he laid out how Madoff had to be lying. All the SEC had to do
was match the trade tickets with the reported counter parties and they would
have busted this fraud wide open. I'd like to believe that they weren't paid off ... but
if corruption wasn't at the root of this evil, then the only
other explanation left is utter incompetence. The idea of a corrupt agency
would sit better with me than a toothless, incompetent one.

Barack Obama promised change, and now it's rubber meets the road time. The
SEC essentially needs to be deep sixed, and the government has to start over
again. In the months ahead, the U.S. Government will enact the largest
stimulus package in American history (and hopefully they'll earmark some of
that money to funding greater enforcement efforts).

Some clear winners from all of this government largess will be the green
technology sector, infrastructure, heavy equipment and education companies.
That leads us to the question of who is going to pay for all of this lavish
spending?

The rest of the world will, that's who. They will buy up our bonds with an
almost religious fervor.
Why?

Because the fastest way to get their economies to turn is to help turn ours
first. The U.S. is the engine of global economic growth. It won't always be
that way ... Asia's catching up and the Europeans will finally get their act
together at some point and start acting in a more collective fashion. But
for right now, in the world we live in today, our economy drives the world
economy.

Where do you think China, Japan and the Arab world's foreign reserves came
from? From me, from you, from all of our massive buying habits. That's where
all of that global wealth came from. Our buying habits paid for China's
shiny new roads, our buying habits paid for Dubai's gleaming new towers, and
our buying habits have given Japan the world's second largest GNP.
Our buying habits, not theirs. They have nothing, they build nothing, they
sell nothing without OUR demand.

We are the most efficient and hardest working group of people in the
developed world. Our collective earnings power is truly magnificent. Our
limitless belief in ourselves and in a brighter tomorrow is our greatest
economic weapon.

Let me be clear, we've gorged ourselves on a horn of plenty that was fueled
by easy credit and massive financial leverage, and now we have to pay the
price. That means 2009 will be a very tough year. Unemployment will rise,
crime will increase and many more families will lose their homes.

In short, we will experience the hardest recession we've seen since the
1930's. I don't see government intervention reaching consumers fast enough
to stave off severe pain in the so called "real" economy.

But let's not confuse a broken leg with a broken neck. And that's what I see
happening: I see so many people jumping on the "America is finished"
bandwagon that it makes me sick. America is you and me ... it's not some
abstract idea. And so long as there are people like you and me that refuse
to embrace this media-fueled dark and dim view of America's future, we will
overcome.

We may be battered, we may be bruised, but we will never be beaten.

Coolhand,

Are we assuming that it will be the private sector that will be clank-fooed by the recession (depression...)?

If so, why???

Why should this economic transition follow the model of the past economic challenge? When we started dealing with the Depression our government was much smaller and had little or no debt. Now, our Federal government is the epitome of an unworthy borrower. We have lived beyond our means for 48 years+. Even in boom years we run deficits - excepting two years. And, most of those 48 years were growth years. That is one reason I do not like to have my retirement assets in Social Security bonds (that is, the ‘G Fund’). The ‘G Fund’ can be raided by the treasury when the government must, absolutely must, blow past the congresscritter defined ‘debt ceiling’…

So, I ask another question:

What would an economic tsunami (to use a blow dried talking head term) look and act like if it targeted the government sector?