My main purpose for silver:
As I mentioned in my previous post, there are basically 3 reasons people invest in silver; and gold. 1) Long Term Investment; 2) Survival, SHTF, etc... and 3) To pay off debt and/or purchase items at a discount price.
Of course some fall into more than 1 category. For instance, while I don't really believe in the Survival/SHTF need for silver, I could be wrong. Therefor, I keep about $100 face value of silver coins. (Pre-1965 dimes, quarters, and half dollar coins). Currently, that would be worth about $2,400 in silver. (Approximately 70 ounces). If there was a SHTF dollar crash type scenario, and there was time before a new currency took over, I have enough silver (Definitely more than the average person in society) to get me by.
But my main reason for owning silver is to reduce debt and to buy high cost items at a discount. I've done this many, many, times. But as I've mentioned before; Time must be on your side. You can't have a deadline. It's got to be money that you can spend on silver and be prepared to let it sit for a long time if necessary. While I did do some silver buying and selling in the 80's; most has been over the lst 6-7 years. For almost a 20 year period; 1986-2006, the price of silver and gold stayed very flat. Silver was around $5-$10. But you could actually make good money then to pay off debt and buy things at a discount. It's a lot easier for silver to double by going from $5 to $10 an ounce, than to go from $34 to $68 an ounce to double. That's not to say it's not possible. 1979 through 1981 had silver prices spiking up to the $50 an ounce range. There were a lot of reasons for that big spike. The hunt brothers tried to corner the market; industrial use for telecom and other purposes was started to skyrocket and the end of high interest rates. Then why did the price dive back to $5-$10 and stay that way for almost 20 years? Most silver mined was a by-product of other mining. The demand wasn't that big. Mining for silver became intentional and the supply started keeping up with demand. Thus, the price went down. So what about the last 6-7 years? Big changes in industrial use; recession; but mainly, the dollar getting weaker because of all the printing of new dollars with nothing to back it with but a weak economy. And that's why I believe that silver probably won't drop back down to the $5-$10 range again. Too much industrial use and our country's debt is too high with printing too much monopoly dollars.
This is why I buy now. In 2010, when silver was in the $20 - $25 an ounce range, I solve enough silver to buy an almost new (5,000 miles 1 year old Toyota Rav4) for $20,000. I sold back close to 1000 ounces. But I bought most of that silver when it was in the $9 - $10 range. My investment was around $8,000 - $9,000. Basically, I bought the new Rav4 for half price. And I've bought a lot of other things at a discount price this way. The key is to NOT BE GREEDY!!! Silver prices will go up. But they will also go down to. And none of us know when. Except for that $100 face value (70 ounces) I mentioned earlier "IN CASE"; my goal when I buy silver, is for it to double. That's all. Just double. The last 4-5 years, I've taken $5,000+/- in silver that I paid, watched it go to $10,000 and put that towards my house loan principle. Some people don't think you should pay off a mortgage. With very few exceptions, those people are wrong. But I'll discuss that in a future post. Anyway; having this "Free" extra $5,000 to put down on the principle of my home loan, has significantly reduced the amount on my loan. I will pay off THIS HOME LOAN in the summer of 2013 if silver reaches the $50 - $60 an ounce range. (Which I believe it will). My 30 year mortgage will be paid off in 15 years. And MOST of the paying off early came from being able to add an additional $5,000 - $10,000 per year. ALL FROM SILVER. I got this home loan in 1998. Until about 2008, I couldn't really use silver as a means to get the loan down. Since 2008, it's been easy.
In my next post, I'll go into details on what my method is for buying and selling. You could simply buy silver and sit on it and hope for the best. Eventually, the silver will definitely be worth more than you paid for it. But you could have to sit on it for a long time. Then again; that's the greatest thing about silver. It will ALWAYS be worth SOMETHING. And the chance of it NEVER being worth again what you paid for it, or more, is slim to none. Again; you need to have TIME on your side. Again; I'll write more about that next time. CYA: SE
As I mentioned in my previous post, there are basically 3 reasons people invest in silver; and gold. 1) Long Term Investment; 2) Survival, SHTF, etc... and 3) To pay off debt and/or purchase items at a discount price.
Of course some fall into more than 1 category. For instance, while I don't really believe in the Survival/SHTF need for silver, I could be wrong. Therefor, I keep about $100 face value of silver coins. (Pre-1965 dimes, quarters, and half dollar coins). Currently, that would be worth about $2,400 in silver. (Approximately 70 ounces). If there was a SHTF dollar crash type scenario, and there was time before a new currency took over, I have enough silver (Definitely more than the average person in society) to get me by.
But my main reason for owning silver is to reduce debt and to buy high cost items at a discount. I've done this many, many, times. But as I've mentioned before; Time must be on your side. You can't have a deadline. It's got to be money that you can spend on silver and be prepared to let it sit for a long time if necessary. While I did do some silver buying and selling in the 80's; most has been over the lst 6-7 years. For almost a 20 year period; 1986-2006, the price of silver and gold stayed very flat. Silver was around $5-$10. But you could actually make good money then to pay off debt and buy things at a discount. It's a lot easier for silver to double by going from $5 to $10 an ounce, than to go from $34 to $68 an ounce to double. That's not to say it's not possible. 1979 through 1981 had silver prices spiking up to the $50 an ounce range. There were a lot of reasons for that big spike. The hunt brothers tried to corner the market; industrial use for telecom and other purposes was started to skyrocket and the end of high interest rates. Then why did the price dive back to $5-$10 and stay that way for almost 20 years? Most silver mined was a by-product of other mining. The demand wasn't that big. Mining for silver became intentional and the supply started keeping up with demand. Thus, the price went down. So what about the last 6-7 years? Big changes in industrial use; recession; but mainly, the dollar getting weaker because of all the printing of new dollars with nothing to back it with but a weak economy. And that's why I believe that silver probably won't drop back down to the $5-$10 range again. Too much industrial use and our country's debt is too high with printing too much monopoly dollars.
This is why I buy now. In 2010, when silver was in the $20 - $25 an ounce range, I solve enough silver to buy an almost new (5,000 miles 1 year old Toyota Rav4) for $20,000. I sold back close to 1000 ounces. But I bought most of that silver when it was in the $9 - $10 range. My investment was around $8,000 - $9,000. Basically, I bought the new Rav4 for half price. And I've bought a lot of other things at a discount price this way. The key is to NOT BE GREEDY!!! Silver prices will go up. But they will also go down to. And none of us know when. Except for that $100 face value (70 ounces) I mentioned earlier "IN CASE"; my goal when I buy silver, is for it to double. That's all. Just double. The last 4-5 years, I've taken $5,000+/- in silver that I paid, watched it go to $10,000 and put that towards my house loan principle. Some people don't think you should pay off a mortgage. With very few exceptions, those people are wrong. But I'll discuss that in a future post. Anyway; having this "Free" extra $5,000 to put down on the principle of my home loan, has significantly reduced the amount on my loan. I will pay off THIS HOME LOAN in the summer of 2013 if silver reaches the $50 - $60 an ounce range. (Which I believe it will). My 30 year mortgage will be paid off in 15 years. And MOST of the paying off early came from being able to add an additional $5,000 - $10,000 per year. ALL FROM SILVER. I got this home loan in 1998. Until about 2008, I couldn't really use silver as a means to get the loan down. Since 2008, it's been easy.
In my next post, I'll go into details on what my method is for buying and selling. You could simply buy silver and sit on it and hope for the best. Eventually, the silver will definitely be worth more than you paid for it. But you could have to sit on it for a long time. Then again; that's the greatest thing about silver. It will ALWAYS be worth SOMETHING. And the chance of it NEVER being worth again what you paid for it, or more, is slim to none. Again; you need to have TIME on your side. Again; I'll write more about that next time. CYA: SE
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