Thinking Of Investing In Precious Metals? Now Is The Time.

[Gixxus Christ!]

Gold is down to $1275, silver is at $~20. Lowest prices I've seen in 4 or 5 years. You'd probably double your money on silver within a year or so. Looking at making $400-500 an ounce on gold within two years.

Apmex.com

I'm taking cash out of my safe and putting it in my checking account so I can buy a few pounds of silver today.

[C-bus]

Unless it keeps going down to pre-over-inflated rates.

[Casper]

I could be horribly wrong, but it sure looks like this is the downward trend after a popped bubble. And there's more to drop I think. 

[Revelstoker]

It is a safe bet bond prices are going to fall. Gold was a bubble related to uncertainty and that has been largely removed. Look for gold to fall back to trend levels. Only real upside now is equities for sector rotation.

 

My sure bet is RYJUX an inverse bond fund. Sadly it is tied to the 30yr but is an almost no brainer for the next year or so. Gold may hold with Chinese uncertainty and could go up a bit but mostly, I see equities resuming their rise after the holidays and real trading begins in Aug.

Edited June 25, 2013 by Revelstoker

[Gixxus Christ!]

Gold and silver are also industrial metals and used heavily in the manufacture of electronics. Demand for electronics is only going up, that should drive the market. I saw this happen in 07 or 08, silver dipped from around $20 to $9. Then I started buying it. 9 mos later it was at $18. A year after that, $35. Its going to go over that again and I'm gonna cash in when the bubble gets big enough.

[Tpoppa]

I think investing in gold is a huge mistake right now.

 

People invest in precious metals when the economy sucks.  They pull their money out of stocks and invest in something more tangible like gold.  When stocks and interest rates climb, gold will drop...like you are already starting to see.  When interest rates climb significantly from their historic lows, I wouldn't want my $$ in gold.  YMMV.

[jester3681]

I doubt silver will drop much lower than $18/oz.  I've got a bit of silver, and bought a bit more as the price has fallen.  I tend to hedge my bets with bullion coins to have the numismatic value as well.  I also doubt it'll double in such a short time.  Much of the inflated $30-35 price seen last year was due to unrest in the other less tangible markets that has since corrected.  Industrial demand is what keeps it from dropping back to $10.  There is still a fairly good secondary demand for silver - you can almost buy it from APMEX or another vendor and eBay it for a profit, because the uninformed are still grasping for it anywhere they can get it.  

 

That said, now is a good time to buy silver and gold for long term investment as a hedge against natural inflation.  I feel that much of the bubble-related over-pricing is done with and the spot prices we see now are more of the "natural" pricing for these metals.

[ReconRat]

China popped their bubble, or will if things go as they go. That dropped the bottom in the Canadian metals market. Europe isn't helping any, and neither is the US economy.

 

All metals dropping. Ammo prices dropping also.

[Revelstoker]

Gold and silver are also industrial metals and used heavily in the manufacture of electronics. Demand for electronics is only going up, that should drive the market.

 You are correct and the long-term fundamentals still support this but you have to go back to debacle levels of 2006-2007 to see the industrial driven demand. Everything else has been risk flight. Market is correcting with money flowing back into equities and out of bonds. Gold is going down below $1000 or around that level. Short GLD if you want to have a position in metals. Sell your coins now.

 

BTW, I am short GLD at $165. Cha-Ching!!

[Medina]

I could be horribly wrong, but it sure looks like this is the downward trend after a popped bubble. And there's more to drop I think. 

ding ding ding ^ Buy food and water purifiers and bullets

[ScubaCinci]

I'm taking cash out of my safe and putting it in my checking account so I can buy a few pounds of silver today.

FAIL

[Gixxus Christ!]

Eh, I only bought ten oz. Ill see a return on it. The cash wasn't doing anything sitting in there, at least this has growth potential. Prices will stay forever right? Because nobody manipulates markets and our world is free of war and other global events that effect metals prices right?

[ScubaCinci]

I've never been a fan of buying "precious" metals but if you time it right, you can make some cash. Those that horde it for the time when the economy collapses are the real idiots. It really has no inherent value. When all goes to shit, the things that will have real value - food, water and land. Oh and sammiches.

[Gixxus Christ!]

As throughout history, those with lots of food, water and land are often willing to trade some of it for shiny metals...not that I'm hoarding silver and gold for the apocalypse, for me its a medium term investment. Last time silver dipped I bought ten oz a week. When it doubled I sold out and bought an AR with the proceeds.

[marca]

Don't think of gold only as an investment.  Think of gold as insurance if things go really bad and your dollars aren't worth a crap.

[smccrory]

I'd like to own a media outlet that terrifies people about coming financial/meteor/social/zombie apocalypses, while maintaining controlling interests in commodity brokerages. But others have beaten me to it - damn them!

[Gixxus Christ!]

Then I guess you better learn to play the game.

[myhondas]

I invested 10K in jan. in gold and so far I lost about 2k+ in it.....so got I just sold out of the gold and got into something more stable.  If I were ever to get into gold again, it would be in old gold coins. Not even the new ones would be in my sights....they lost just like the bars did.

[Gixxus Christ!]

Jan was not the time to invest dude. Gold and silver rise and fall in the short term but over history have a clear upward trend.

[smccrory]

Gold has indeed been climbing nicely since 2001, but gold is also down 21% over past 12 months, so timing is critical. At extremes, gold peaked at over $2500 in 1980 and again to $1900 in 2011, which makes it look fabulous compared to year 2000 and pre-1973 prices. In fact, if you bought gold in 1970, you will have tripled the Dow's performance. That said, just like with the rest of the market, if you time it wrong, which is exceedingly easy, you could wait 20 years or more to regain steep losses.

Is now a good time to buy, with gold pulling back from a pair of 201X peaks? Technical analysis of peak behavior suggests "no" and I'd factor in the social factors that have driven Gold's run-up since 2000, especially since the 2008 housing market crash. Confidence in the stock market is coming back and performance is largely there, housing market is coming back, consumer confidence is up, consumer and commercial lending is heating up and real unemployment is decreasing (slowly). All those are in sharp contrast with the last 4-5 years, so the argument of investing in Gold as a shelter against negative market events has been weakened. The classical argument of gold as a hedge against inflation is dubious, because large cap stock usually perform as good or better in those periods, and appear to have the same downside risk as commodities.

I guess the reason why I'm saying this (as alluded from my first comment), is that it makes me sick to see certain media outlets, special interest organizations and trading houses tout Gold as an investment vehicle with special attributes making it safer to pour large sums of money into. They summon specters of fear about government, the fed, the mint, the treasury, social unrest, inflation and the stock market itself as reasons to invest in something more "durable." The marketing angle and language is absolutely brilliant, but predatory to the average Joe who, IMHO, isn't in the end any better off investing in gold than he is in SP500, ETFs, bonds, etc. unless he takes the time to understand the underlying market drivers and times his purchase. And all the while, the media outlets, special interest organizations and trading houses make craploads of money from pumped transaction fees, management fees, advertising dollars and relationship spifs.

Please note that I'm trying not making any political statements in any way - only economic ones - we have enough political debate on the Internet already. And I'm delighted that others have made money with gold, but its not a slam-dunk by any stretch, and potential investors should be very wary about timing their investments into any commodity, security, index, derivative, etc., that's all.