Next Level: GOLD $1,350.00

I'm an accountant so lets run the numbers. Lets assume that you have $10,000 to invest in silver ASE. At $20.80 a 1% move is $.21, so the price could go down to $20.59 or up to $21.01 for that 1%.

On a $10,000 investment 1% is equal to $100. A hundred dollars is a lot of money but when investing ten thousand dollars it doesn't seem like so much. Is timing your purchase to make an extra $100 needed to make a profit on $10,000?

If Silver goes to $22 from $20.80 that is 5.7% increase. Based on the premiums/ discounts that dealers charge, (difference between Bid and Ask prices), you wouldn't break even.

Based on the spread between Bid and Ask prices, PM must be a long term investment in order to make any money or you need to be risking Millions of $$.

Whats that old saying: "don't sweat the little stuff"

 

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Totally agree. Depending on where things go with PM's, it just might be a forever long term goal where I pass the unused PM's to my kids. (who right now don't exist). There might be never a time for me to actually sell.

Say I am lucky enough to have a job for a long length of time in which my slowly debasing dollars are able to provide me shelter and food. Well then the PM's just sit around appreciating....(well let's hope they appreciate)....

If I never have kids, then I will follow a motto of an old friend of mine, "the last check I write before I die will bounce"....

 

CURRENTLY: In Asia-Pac markets for Tuesday 9/21/10...

GOLD: $1,278.50
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Silver: $20.79

Platinum: $1629
​

Palladium: $541​

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And don't forget to add in the 28% on the gain (it would serve to reduce net profit, yes?_ Or is there a way to avoid 28%, say for long term capital gains at a lesser amount (isn't bullion treated same as numismatic? I hope and wish I was wrong on that; capital gains I THINK is less than the 28% for the time being, again not sure..) Or perhaps, sell when you are set to take a loss elsewhere, hopefully offsetting the gain (gee, isn't that a way to think...sigh..)(hope for a loss???_ But wait, I think someone did recommend in past posts to sell a little at a time, so that gains might not have to be recognized?) Sheesh! Hope for kids. But WAIT! The little bit I know about that, is if you leave it to someone other than your spouse (with current estate values of up to 3.5 though I think that is/has changed) then THEY have to pay the tax on the gifted amount, well, unless it is included somewhere in your once in a lifetime gift of ....not sure the number anymore. Can't think of what that's called; unified tax credit comes to mind, but somehow I don't think that's it. Oh well, just more thinking on the subject. Myself, I would like to cash it all in at a gain, pay the tax, and then run and hide with what's left, spend it ALL, pay for my funeral, then go "POOF"! Don't sweat the small stuff, is the saying. Good advice, especially now with these little ups and downs.

 

OOPS! Maybe that's just MICHIGAN!!!

 

Krispy,

hit me with a pm.

gary

 

CURRENTLY: In US markets for Tuesday 9/21/10...

GOLD: $1,275.80
​

Silver: $20.61

Platinum: $1619
​

Palladium: $532​

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CURRENTLY: quieter the metals seem today, awaiting Fed comments today (2:15 pm EST) maybe?

GOLD: $1,277.10
​

Silver: $20.62

Platinum: $1623
​

Palladium: $533​

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CURRENTLY:

GOLD: $1,275.40
​

Silver: $20.59

Platinum: $1621
​

Palladium: $533​

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CURRENTLY:

GOLD: $1,274.40
​

Silver: $20.57

Platinum: $1613
​

Palladium: $534​

​

 

Lots of things wrong with these tax rates and estate advice, but it doesn't matter since all of it change with the looming deficits. Right now short term cap gain is normal rate, long term is 10-15%, but scheduled to expire 12/31/10. The Unified gift and estate credit is now millions, (not sure exact this year), but used to be 600k for decades. It also is scheduled to expire 12/31/10 and revert to 600k.

PM investment is fine as diversification, and yes you need to be long term holder to conteract dealer profits. The problem is if you are a long term holder most likely they will not be as good a long term investment as equities. So diversification is the best way to hold PM, or as part of your hobby.

 

I did a Wiki search on the S&P 500 return:
5yr. -.06
10yr -1.19
15yr + 7.87

Gold price now is $1275
5yrs $423
10yrs $284
15yrs $378

Which return would you prefer over the last 5, 10, or 15 yrs? Gold or the S&P 500?
Gold looks a lot better to me, especially in the last ten years, and I guess it will do a lot better going forward.

 

CURRENTLY: Nice little leap in PM prices here after the Fed announcement. link from Bloomberg.com

GOLD: $1,282.80
​

Silver: $20.79

Platinum: $1622
​

Palladium: $536​

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I did not intend any of my own 'rant' for advice; sorry if it appeared that way. This is all info that I am dealing with personally. The numbers may not be right (as you say): Unified tax credit was max of 192,800 in 1992 (not 600k). Really, what my point was is this: it all sounds so easy -- buy coins/metals (whatever) at a nice price, and sell them when you feel you've reached your expectations. In (my ) reality, it just isn't that simple. Darned taxes.. It's not fiscally 'smart' to not count ALL the costs.. I believe this is a hobby here, for most, and I enjoy reading for that reason. For me, it is very serious. "If I knew then what I know now..."

And one more thing; I actually lost a whole nights sleep this past week because I read an article on Gold, about the fact that bullion is treated as 'numismatic' with regard to taxes (hence 28%) and I have been under a different "illusion" for a long time(long term capital gains..). Now, since your post, I feel a bit better, but will sleep better when my cpa tells me true! They believe I should consider selling this year due to the changes in the taxes forthcoming..

 

CURRENTLY:

GOLD: $1,287.30
​

Silver: $20.87

Platinum: $1629
​

Palladium: $538​

​

 

The credit was $192,800. I quoted 600k since $192,800 let you shield $600,000 from taxes, same thing different ways of saying it.

Regarding capital gains, it doesn't matter if it is coins or gold, long term cap gain is long term cap gain, same rate. I agree it could be very prudent to recognize gains this year versus next, but you never know what the politicians are going to do. There is talk of extending the cap gains rate, but it hasn't happened yet.

Sorry if my first post sounded short. I did not mean it to be Lucy. Your point about taxes was extremely spot on, as they are another cost associated with investing in PM, though the same cost is associated with most investments.

 

True Dave, but choose a different or longer time frame. Your answer would change. The last ten or 15 year time frame has been very advantageous to gold, but historically has not been.

 

CURRENTLY:

GOLD: $1,288.30 -- High today $1,292.00
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Silver: $21.00 -- High today $21.10

Platinum: $1629
​

Palladium: $532​

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Maybe the cheerleader is out buying more.

 

Here I'll take her place!! Rah, rah sisk koom bah! go gold!!