How much GOLD is enough, to provide security for your family ?

Discussion in 'Bullion Investing' started by mpcusa, Feb 19, 2023.

  1. ToughCOINS

    ToughCOINS Dealer Member Moderator

    I'm certainly no financial expert, but I think I have pretty good instincts.

    I don't like stocks at all right now. I think many who sat sidelined for months have convinced themselves that the predicted recession will not come, and have re-entered the market for FOMO. The lag between anticipation of, and arrival of a recession has been unusually long this time around. I chalk that up to a number of contributors:
    • Broader-based recognition of the precursors than normally attends a downturn. Most people are not normally so attuned to economic conditions as they have been during and since COVID.
    • Many opened their reserve spigots during COVID and I suspect that, not wanting to compromise their standard of living, a fair number of those were not very disciplined about shutting that spigot off when COVID abated. For some, that has meant tapping retirement accounts, and charging on credit cards for others. I also think the next will turn out to be pivotally important . . .
    • The resumption of borrowing against the equity in homes currently at artificially high valuations, those driven by (1) the shift in investment after the exodus of so many investors from the stock market, (2) the bumped cost of construction materials due to our COVID-related supply chain woes, and (3) by immigration pressures on the supply of dwellings.
    I strongly sense that, as personal debt rises unacceptably, recession will ensue, and both its severity and duration will be no less unusual than its delayed arrival.

    As for bonds, I do think that current yields are quite attractive. But, and to me this is extremely important in the current economic climate, I'd rather keep my powder dry . . . even if I'm risking 5% to do so. There are many years behind us when investing aggressively for high returns was incredibly rewarding. I think now is finally a good time to be defensive-minded and opportunistic. While bonds are a defensive instrument, they restrain one's ability to seize those opportunities . . .
    Last edited: Mar 5, 2023
    -jeffB and mpcusa like this.
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  3. GoldFinger1969

    GoldFinger1969 Supporter! Supporter

    TC, HELOC loans are NOTHING compared to pre-2008. Maybe 1/5th the total outstanding.

    Short-term bonds provide yield AND are a source of cash if you see any "opportunities."

    The economy remains strong, and monetary policy acts with a lag, hence the strong NFP numbers, steady inflation, etc.
    -jeffB likes this.
  4. Eric the Red

    Eric the Red Well-Known Member

    The US economy is heading towards stagflation at a rapid rate. Getting into stocks and bonds now is complete suicide. That ship has sailed and we all made a ton of money. Retail investors entering the market now will be slaughtered and take the fall as they always do.

    Best investments for stagflation are
    1) Get out of debt as fast as you can
    2) Real Estate
    3) Precious metals
  5. ToughCOINS

    ToughCOINS Dealer Member Moderator

    While I can’t speak to the percentage of all debt that is HELOC loans, HELOC debt is up . Importantly, if that debt is already high, that leaves less headroom with which to sustain the current economic condition going forward.

    Yes, if the opportunity can wait until the bond matures. Otherwise, markdowns and selling into rising rates can eat your lunch.

    I think that makes my point. Everything looks hunky dory . . . Right now.
  6. GoldFinger1969

    GoldFinger1969 Supporter! Supporter

    That's a pretty ballsy prediction, ETR. It COULD happen -- but I doubt it, even among bears.

    Stocks are not dirt-cheap but they are no expensive, with the exception of the FAANGs and a few mega-cap tech stocks.
  7. GoldFinger1969

    GoldFinger1969 Supporter! Supporter

    Not on anything 2 years and in. If they rose in yield/fell in price, equities would get hit anyway. You'd still own the Best House in a Lousy Neighborhood (well, 2nd Best House next to MMFs !! :D )
    We just had a huge negative economic hit 3 years ago. It's unlikely we get anything like anytime soon.

    S&P 3,200 is the target, you buy on the way down.
  8. livingwater

    livingwater New Member

    Gold and silver have been valued for thousands of years, ancient China, Egypt, Babylon, Persia, Greek, Roman, etc. to today. Look at the history, all the empires, wars, conquests, they all coveted looted the gold, silver. Soldiers were paid in silver. The gold in Jews teeth was pulled from their bodies in the concentration camps WWII. If SHTF, gold and silver will still be valued and used as barter IMO. The central banks have been buying record amounts of gold recently. India has imported record amounts of silver. Some dealers have reported record or near record sales of gold, silver. I'm not aware of any evidence suggesting societies are becoming less interested in gold, silver. Obviously if SHTF it's better to have food, water, ammo, but gold/silver will have value and be traded unless we're all reduced to being zombies only caring about water and eating human flesh.

    I've had good returns on my stock mutual funds for over 25 years. Sure there's bear markets, but stocks have always rebounded, at least so far. I think it's wise to have a mix of stocks, bonds, precious metals, no high interest credit card debt, pay off the mortgage, some emergency cash, at least that's what I do. If stock markets drop to zero and never recover we're all in survival mode.
    Last edited: Mar 5, 2023
  9. ToughCOINS

    ToughCOINS Dealer Member Moderator

    I guess, in support of the same time-tested store of value to which all societies ultimately resort, I'm swimming upstream against the loyalties of others to their respective modern faves.

    I just find it ironic that, in our current precarious economic environment, instead of the reliably safe precious metals they view as dull, antiquated stores of value, stocks, investment trusts, and crypto-currencies have become the shiny objects which draw the attention of today's profit-seekers.

    While I don't openly promote gold or silver, I understand if others perceive me to have a conflict of interest. After all, a fair amount of my inventory does fall in those categories. I guess that makes obvious my belief that my money should go there in times like these, even if no one else's should.
    Last edited: Mar 5, 2023
  10. -jeffB

    -jeffB Greshams LEO Supporter

    There's approving of an investment because you sell it, and there's selling it because you approve of it. It's perfectly okay to do both, but periodic disclaimers are welcome. :)

    I've always been an advocate of GMOs to address world hunger, but I found myself tempering my remarks during the time I was actually working for a company that was in that line of business. "Of course you won't bite the hand that feeds you" is always an easy accusation to make.

    But I guess I should ask you the same question I ask rhetorically in other discussions like this: if you believe fiat will inevitably go to zero, how can you stand to accept it in exchange for things that hold REAL value?
    Mr. Flute likes this.
  11. ToughCOINS

    ToughCOINS Dealer Member Moderator

    Excellent question . . . it's because that's still pretty much the only way I'm able to pay for replacement coins, "still" being the operative word.

    Even as the currency inflates, it makes more sense for me to continue selling and replacing the coins I have on hand to grow the business, rather than just sitting on them, assuming they'll go up in value on their own.
    Mr. Flute and -jeffB like this.
  12. -jeffB

    -jeffB Greshams LEO Supporter

    That's why I mostly stopped asking the rhetorical question. When you can make a profit on a completed round-trip transaction, the only sensible course of action is to keep round-tripping until you can't do it any more. Doesn't really matter if you think of it as "spend cash on gold, sell gold for cash, end up with more cash" or "sell gold for cash, spend cash on gold, end up with more gold".
    Mr. Flute, rte and ToughCOINS like this.
  13. Mr. Flute

    Mr. Flute Well-Known Member

    Because this is the foundation of our entire modern capitalist system/culture/lifestyle.

    I believe that none of us that genuinely understand our system want it to fundamentally change or shift out from under us. This is a system that works the best for us and I'm happy to let it change dramatically once I no longer need it (aka am dead).
  14. ToughCOINS

    ToughCOINS Dealer Member Moderator

    I don't think that those of us who genuinely understand our system (in its entirety) are the ones asking the government to print more money than we provide in taxes.
  15. Mr. Flute

    Mr. Flute Well-Known Member

    Then I don’t know if you genuinely understand our current system.

    As long as we stay the best of the group we’re ok.
  16. ToughCOINS

    ToughCOINS Dealer Member Moderator

    Educate me . . .
  17. Mr. Flute

    Mr. Flute Well-Known Member

    It's a feature of the system, not a bug.
  18. ToughCOINS

    ToughCOINS Dealer Member Moderator

    The government printing more money than we provide in taxes is neither a feature of, nor a bug in our system . . . it's an abuse of our system.
  19. ToughCOINS

    ToughCOINS Dealer Member Moderator

    I'm drifting into politics . . . enough of that. Bad Mike!

    Ten lashes of self with a wet noodle.
    slackaction1 likes this.
  20. Mr. Flute

    Mr. Flute Well-Known Member


    I shall move on...teh GoLd iS GooDER! ;)
  21. GoldFinger1969

    GoldFinger1969 Supporter! Supporter

    ....and 6-month, 1-1-year, and 2-year Treasuries all yielding close to over a bit over 5% aren't a bad place to hide out, either.

    Hell, even my Fidelity money market fund is at 4.25% now and should be 4.5% within a few weeks. :cigar:
  22. fretboard

    fretboard Defender of Old Coinage!

    Absolutely and the recession gets closer and closer every day, hopefully everyone here is ready for it! thumbsup.gif
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