Should I invest? Gold or silver?

I've got $1600 Canadian dollars and I'm wondering weather to hold onto it or buy some gold or silver. I'm worried about the weakness of the US dollar. I don't want to buy gold at $1100CAD an ounce and if gold remains the same, and the US dollar weakens, I will loose money. Should I buy gold now at the current rate of $1.09CAD per $1USD, or gamble and wait for the
US dollar to get lower...but by running the risk of seeing gold rise.

What should I do with my Canadian dollars? Please help me! Thanks!

 

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I think that you should buy silver. Even with the recent rise in the spot silver prices, silver still has some more upside potential than gold does at these current levels. Gold has been having some problems breaking $1000. Silver is not even close to its 2009 high of $20+. The gold/silver ratio is currently at around 62 and IMO that still favors silver. I do not know what kind of silver premiums you will pay in Canada because I am in the U.S. but I think silver is the better choice than gold at these current price levels.

 

thanks, any opinions on my exchange rate dilema with gold?

 

I'd keep it in the bank and wait out this spike in prices then buy during the next dip.
I hate paying $20 for a silver eagle...yikes...but that's just me.

 

both. silver will be faster.

 

That also makes sense too. A mixture of both works for me. I will buy a few oz's of silver a month and at the same time I will save up some money to make a larger purchase in the summertime when PM prices have been traditionally weak. You would be somewhat hedging yourself because if silver keeps going up then the silver that you bought in the previous months would have gone up in $ value and you would have not have missed any upside. If silver went down from these levels, then the money that you saved up during the previous months can be used to buy silver at lower prices.

There is another factor in this also. Lets say that spot silver goes down to $10.00. Would the premiums go down that much when spot silver is $10-$11? For example, with spot silver at $15.79 (as of Fridays close) and SAE's at ,for example, say $20 then that is $4.21 over spot. If silver falls to $10 and the prices on SAE's fall to, for example, say $16.00, then that is $6 over spot silver. That is also assuming that the coin dealer bought the SAEs at a price where the coin dealer is still selling for a profit. Premiums will play a large part in purchasing silver if/when silver pulls back IMO.

 

I wouldn't be in a rush here for a couple of reasons: The CA$ is a much more stable currency than the USD at this point in history, and will probably appreciate against the USD. Secondly, silver prices are significantly more volatile than gold; so buy the dips.

That being said, go for the silver. Huge upside potential. Affordable in small lots. You hear a lot about how silver is primarily an industrial metal, disconnected from monetary value. What they don't say is that 95% of all the silver ever mined has been consumed by use, while gold never goes away.

And silver's use industrially is growing steadily, most significantly in the solar energy arena, while the stockpiles of metal dwindle. It's only now becoming cost effective at $15/ oz. to mine and refine the stuff and there is a significant time lag before it hits the market in usable form.

It is my personal opinion that a year or two from now, we are going to be looking back fondly at the time when it "was only $15/ oz." and kick ourselves for not taking a more substantial position in this irreplaceable metal.

You may also want to take a position in the major silver miners, SSRI, PAAS and SLW, all of which are on a tear. And remember, when Phase III metal mania hits shortly, it's "good for bullion, better for miners, but best for numismatic rarities". Good luck! :eating:

 

IMO The Gold/Silver Markets are a bit unstable, though they may seem only on the rise, they will trough relatively soon (within a few years). If I were you I would buy a nice key date, or something that would remain stable when silver/gold crashes, however if you just want to day trade silver/gold are great if you get in at the right time

 

Another important factor: Why are you buying gold and silver. If it is for making a short term profit, then I think the ETF's GLD and SLV are better choices for trading. If you are buying PM's for possible SHTF scenario, then you should go for lowest premiums on physical gold and silver. If it is for collecting, then you should buy what you like. This is just my take on this.

I do not know if this helps answer your question or not but I think the reason for buying gold and silver is an important factor in my opinion.

 

I found a website that is offering pure .999 silver bars and rounds directly from the company for $16 per ounce. That is a great price by any standards! Even if silver drops to $11-$12, I could still sell it on eBay at a premium of $15-$16 an ounce.

I think I should go for it! What do you think?

 

You should go for it. That sounds like an excellent price to me IMO. How much will you be charged for shipping?

 

Im not sure. First I request an order, and then they'll send me an invoice which Ill have to pay in two days. I guess I'll put in a request for 40 or 50 or 60 ounces and see what they quote for shipping. They offer 5oz, 10oz, or 32.15oz (1 kilo) bars, which one(s) should I go for?

 

I would put in a small order of a 5 oz silver bar and just see what they will quote you for shipping.

 

That's what people said nine months ago, and they were wrong. There was a time, not long ago, when Canadian "smaller dollars" were actually worth slightly more than US dollars.

But in the last nine months, the American dollar reached a high of $1.306 vs Canada.

So what do you do when you're "worried" about the weakness of the Canadian dollar ? What did you do when a US dollar bought $1.30 Canadian ?

Yes, things cycle up and down. When I look at the overall trends and the current price of $1.09, one thing is irrefutable : the US dollar is much lower than average vs Canadian "smaller dollars"*. If I were a worrier, which I'm not, I would bet on US dollars. Buy low, sell high !





* Interbank rates; 270 day avg = $1.201, high = $1.306, low = $1.0295

 

Okay, so they also come in tubes of 20 1oz rounds. I'm going to put an order in for 1 tube (20oz), 4 5oz bars (20oz), and 1 10 oz bar.

Would you recommend my order??? I'd get an invoice in about 3 days, and then have 2 days to pay...and there's no obligation to pay. So, I have 5 days to think about it. Should I place the order?

Please let me know, thanks.

 

Since it sounds like you are looking for a pure investment, and you are in Canada, take a look at CEF and GTU. They are probably the safest and easiest way to own gold and silver. There are certain tax features that make it undesirable for US taxpayers to own them except in a tax deferred account, but it might be just what you need.

 

There still is a 10-15% premium if I go for the CEF and GTU while I can get silver for just 30 cents above spot! I would also feel better if I have silver in hand.

I'm going to place an order for 40oz today, if you guys think it's a wise decision. It's silver for an AMAZING price, and it's bound to go up.

Should I go for this? Please let me know.

 

Yeah, I would go ahead and place the order.

 

Thanks! Will do today, or early tomorrow!

 

Okay, so I put in an order for 20 1oz rounds, 2 5oz bars, and 1 10oz bar. So, 40oz in total. I'll see what the shipping charges are, and if it all looks good, I'll purchase!

Now I need to find some gold...around 1/2oz I'm thinking...anyone know where to get any near spot?