This past week I was consulting w/ a friend this past week who was seeking my advice as he invested in Silver for the first time we were actually selecting his purchases when the market suddenly dropped $1.58 an ounce. I’ve never personally seen that happen while someone was mid-purchase before so it was cool to see what unfolded next. Basically the market started a downward trend that none of us anticipated. It wasn’t fueled by Washington, Bernanke, Jobs Report, or anything like that. Not even the strength of the dollar was mentioned on CNN or CNBC at all that morning, it was totally out of the blue, but the market was dropping and the time for jumping in was totally at hand. I didn’t have a lot of disposable cash on hand w/ me at the time but I did jump in myself and get in on the action.
Fast forward to this week, the markets are recovering, but they are doing it slowly. I’ve seen a lot of people jumping in that have been on the fence for a long time by taking money out of a savings account that is basically earning them nothing and is basically their wealth being stored up in a currency that’s not stable or backed by anything of value (like the Gold Standard) and tie it up into something that could potentially reach $48 oz by the end of summer, and possibly more if you think that the US Dollar is going to weaken and inflation is going to be more. Precious metals are always an awesome hedge against hyper-inflation, examples of hyperinflation include $5 gasoline and $175 oil. Both, could happen.
I’m not a genius by any means, and surely not an economist. Just a normal guy that is pretty observant. I usually keep my opinions to myself regarding issues that are directly tied to my industry but I figured if I could share this information w/ one person that took my advice and it made a difference in their lives and their financial stability, then it’s worth my time…
By the way, precious metals are trading at:
It’s important to note that while Silver could be purchased around $26 an ounce on Thursday of last week, it was trading near $50 just last year. Something else I always like to throw out to friends when we discuss precious metals, especially Gold in comparison to Silver, is that yes, Gold is obviously way more valuable an ounce, it’s seen almost $2k an ounce before but the thing you have to keep in mind when tying up your assets in something is what the rate of return is going to be. Gold, while valuable, is already priced more than Platinum, so what does that tell you about the upside of Gold in terms of future gains. Yes, it could go up, but is it likely? Silver, on the other hand, is being put to use in more and more areas, from electronics and computer component manufacturing to the healthcare industry. In fact, many doomsday preppers (one of the fastest growing movements right now that have spawned their own television show) are purchasing silver at pawn shops, estate sales, and anywhere else they can get their hands on it. Another consideration regarding precious metals right now, for a person to invest in Gold, they need a minimum of $2k just about to attain just one ounce of Gold, Silver on the other hand you can acquire for approximately $30 an ounce.
Again, not an expert, just making observations out loud but I firmly believe that there’s never been a better time to grab a lockbox at your bank and get started stacking.