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So ya thought you owned Silver eh ?

JamesMurrayJamesMurray Posts: 4,036 ✭
in Precious Metals
Nothing we havn't known for years , an interesting read nonetheless.

Is your Silver really yours?

"I am not trying to start a panic, but those who think they own a position in precious metals because they own a paper contract should seriously consider either arranging to take physical delivery on a prompt basis, or else sell the paper position and simultaneously purchase an offsetting amount of physical gold and silver."

Comments

  • derrybderryb Posts: 36,793 ✭✭✭✭✭
    It will take more than you or me to start a panic. Bullion dealers have been pushing this panic for years. The more unstable our economy becomes, the more plausible the arguement becomes.

    However, paper metal is no different than any other paper, such as dollars. Our bartering systems is based on paper. Paper makes trading goods and services convenient. Paper allows me to trade so many minutes of my labor for a gallon of gasoline instead of working so many minutes directly for the gas station owner just to get a gallon of gas. Paper allows me to have just one job instead of working directly for all I do business with. With paper comes risk. Tomorrow all my dollars just might be worthless, so I keep my store of value in as few of them as possible.

    Yes, physical bullion is safer than paper promises for bullion. If your goal is to eventually turn the paper promise into actual metal then yes, you should just buy the physical metal in the first place. The fear of paper has been oversold by those trying to sell you the bullion. Until there is a complete collapse of the economy, paper bullion will always have its place and its advantages. The only people who will get screwed by paper metal are the last one's trying to convert it to cash in an economic collapse. I refuse to have all of my value tied up in physical bullion. It's just too darn difficult to swap for dollars when I want dollars. The paper metal makes it easier while it protects my value. I will continue to take advantage of trading in paper until we are much, much, much, much, much closer to economic collapse.

    I think of it has having my checking account in paper metal and my savings account in physical metal. There is a place for both.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • JamesMurrayJamesMurray Posts: 4,036 ✭
    The "I don't want to start a panic" bit is a quote from the linked article derryb , not my words : ) I could care less if people panic about paper , it occured to me when i began investing in metals initially it might be an idea to have physical only.Ive thought for years exactly what the article is saying though "when she got there , the cupboard was bare" stuff.
  • BigRickBigRick Posts: 1,334
    Total BS.

    There is ample supply to meet expected demand.

    99.9% of people WANT to settle in cash rather than trekking accross the world to a delivery point and schlepping the metal back home again with 416.67 (Troy) pounds of silver for each 5000 ounce contract hence making transaction costs - of accepting physical delivery - a limiting & prohibitive factor (though you could probably easily do it for about 50 cents an ounce or so plus your time) - not to mention the security implications of carrying a quarter of a million dollars of silver (approx) for each contract.

    If you really need it thoguh it's there for your to pick up. Maybe sending Brink's for a 100 contract 5000 ounce delivery is the sweet spot as far as economies of scale goes (i.e. to minimize transaction costs per ounce).

    Who knows???
    My Sets
  • derrybderryb Posts: 36,793 ✭✭✭✭✭


    << <i>The "I don't want to start a panic" bit is a quote from the linked article derryb , not my words : ) I could care less if people panic about paper , it occured to me when i began investing in metals initially it might be an idea to have physical only.Ive thought for years exactly what the article is saying though "when she got there , the cupboard was bare" stuff. >>


    Apologies, overlooked the quotes.



    << <i>There is ample supply to meet expected demand. >>


    Depends on what you call "expected demand." Those that claim to be backed by physical should be required to meet a 100% demand run. There are many paper PM products on the market that are known to not be backed by physical and don't claim to be. I suspect there are a lot of "backed by physical" funds that could not meet 100% delivery demand. COMEX is a prime example. COMEX is no different than the ponzi scheme bullion pre-sellers on ebay.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • ttownttown Posts: 4,472 ✭✭✭
    Does iShares SLV ETF Really Hold Silver?
  • cladkingcladking Posts: 28,637 ✭✭✭✭✭


    << <i>Nothing we havn't known for years , an interesting read nonetheless.

    Is your Silver really yours?

    "I am not trying to start a panic, but those who think they own a position in precious metals because they own a paper contract should seriously consider either arranging to take physical delivery on a prompt basis, or else sell the paper position and simultaneously purchase an offsetting amount of physical gold and silver." >>



    A lot of people believe the bankers have sold every ounce of silver to a dozen different
    buyers and charge each of them an annual fee to keep it dusted and shiny.

    I've warned before that this is going to get messy and the longer his scam goes on the
    messier it'sgoing to get. This time the bankers went too far because they've been de-
    frauding the rich. It's OK to cheat widows and orphans but when you start cheating rich
    people you just might get some real trouble.
    Tempus fugit.
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