http://en.wikipedia.org/wiki/Midas This is a legend of a man whose "insatiable prayer" in the words of Aristotle essentially ruined his life: "When the use of coin had once been discovered, out of the barter of necessary articles arose the other art of wealth getting, namely, retail trade; which was at first probably a simple matter, but became more complicated as soon as men learned by experience whence and by what exchanges the greatest profit might be made. Originating in the use of coin, the art of getting wealth is generally thought to be chiefly concerned with it, and to be the art which produces riches and wealth; having to consider how they may be accumulated. Indeed, riches is assumed by many to be only a quantity of coin, because the arts of getting wealth and retail trade are concerned with coin. Others maintain that coined money is a mere sham, a thing not natural, but conventional only, because, if the users substitute another commodity for it, it is worthless, and because it is not useful as a means to any of the necessities of life, and, indeed, he who is rich in coin may often be in want of necessary food. But how can that be wealth of which a man may have a great abundance and yet perish with hunger, like Midas in the fable, whose insatiable prayer turned everything that was set before him into gold?" Politics I:9 Many of us who have invested in precious metals out of principle, either to diversify or through mistrust of Wall Street or the Federal Reserve, have at times been perplexed as the precious metals keep rising in terms of dollars. You can't take it with you, you don't want to leave it to greedy lawyers or relatives or the government, you want to make use of your wise investments while you are able to do so. In the legend Midas probably had good motives in wanting to be rich but it did not work for him. Have those on this forum who have wisely invested in gold and other precious metals been able to do so without having problematic situations connected to doing so?
No problems here. I don't consider my wife and kids to be greedy relatives so it doesn't bother me at all that I might leave something to them. Gold and silver are investment vehicles to make life better, just like stocks, bonds and real estate. Each of them has a time and place in a portfolio over a lifetime. If the lawyers and government get a cut, it's just part of the game.
As of yet I have had no problems. Although I have only been in the game for about 3 years, and admittedly I am spread a little thinner in dollars than I would like to be as purchase power declines and cost of living goes up, but I do feel that this was easily the best move in hindsight. Had I not gotten into silver when I did I would not be in as good of a position right now. Of course whether to get in now is a tougher decision than it was in 2008, but in any case it boils down to keeping enough cash on hand that you don't ever have to sell your metals unless you want to. I think the story you bring up is a good one though. The love of money is the root of all evil, and to put your faith in any kind of money is foolish IMO. I have no problem leaving mine behind in my will and getting a cut taken out. It's still less than the cut taken out by the printing presses, and I am invested in metals for the well being of myself and my family so I have no problem if they reap the benefits.
It comes down to a matter of maintaining balance and playing by the rules. There was no one in my family who invested in precious metals. But the precious metals have done much better than their paper investments. I find it surprizing that The New York Times and The Wall Street Journal devote so little attention to the precious metals even as they have skyrocketted compared to the Dow or Nasdaq. Is this a bias? It appears to be so. In many other countries, such as India, gold is money and will always be so. American investment advisors have perennially tried to steer their clients away from precious metals into paper assets with various lines of reasoning. It may be a Keynesian school of economics vs. the Austrian school, or the organic, living world vs. the inorganic one as was Midas' stumbling block.
I wouldn't be that jaded Owle. PM is a commodity, just a storable one. Investing in corn would have been just a lucrative as an PM recently, and cotton even more so. I think a lot of financial professionals also worry about security as well as returns. The advantage of paper assets is they cannot be robbed at gunpoint from you. Bottom line there is no assurance really you can keep you PM, houses are robbed, "home invasions" take place where the combination of safes are demanded at gunpoint, even banks do not insure your SDB. If you are a financial professional and recommend gold coins, the client gets robbed of their life savings, you can be brought up on charges of giving poor investment advice. Is it too skewed towards paper assets? Yeah, probably, but most won't deny their ARE downsides to physically owning valuable, easily carried and easily fenced items as your life savings. I like PM in a portfolio, but I personally would NEVER put my entire retirement funds into anything that could physically be taken away from me, either through a break in to a SDB or a home invasion.
But the chances of loss through computer or speculator manipulation are far greater than a holdup. I personally have lost several thousand market dollars in the last week through forces that I had no control over. I believe it will rebound, but it's not a pleasant feeling that ones wealth is so easily controlled by outside forces. I agree in principle, even though the chances of a paper loss is thousands of times greater than a forcible physical taking of your assets.
I can't really think of a situation where that is true... A bond held in a brokerage account is safer than a bond in a SDB. A stock held in a brokerage account is safer than a certificate in a SDB. A warehouse certificate for a commodity is safer than the commodity stored in your basement. Gold and silver owned by owning CEF is safer than physical ownership of gold and silver. A bank CD is safer than cash in your sock drawer.
I'm fairly certain that, during the past week, more money has been lost in the stock market than has been taken in robberies. My physical holdings are insured; the stock market offers no such protection.
All brokerage accounts are insured against theft and similar events. Your physical silver dropped in price as much as the stock market equivalents. Try calling your insurance company to collect on the drop in value and see where that gets you.
It looks like Carlos Slim lost a bundle this week: http://www.bloomberg.com/news/2011-...-in-four-days-as-mexican-holdings-suffer.html I doubt that a billionaire like John Paulsen would be in such a position. The smart ones know how to minimize risk and preserve their assets.
