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Gold or Silver?

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SR8216 Posted: Fri, Oct 19 2007 12:35 PM


Good afternoon,

 My question is simple, which is a better purchase at this point in time, gold or silver? If I were to suggest one or the other to my loved ones in order to protect their wealth, i.e. get them out of the dollar and into assets. I realize that throughout history an ounce of silver has pretty much the same purchasing power no matter what decade or century it is. I.e. There is a sub shop down the street from where I work, the owner has an old picture up on the wall with 1950's prices; a steakbomb was .75 cents and now costs 7.50; If you take the value of 1950's silver quarters today you can still purchase the same sub; so to me that is pretty telling. Anways I have a gut feeling that silver is more undervalued than gold i.e. a better buy although, I know from being a poor man that silver is my gold. So after having said all that what is the general concensus here gold or silver?

 Thanks for advance for all your advice...

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James Grant wrote a Dec 03 piece indicating he was bullish on Silver but not as much as gold.


($2 fee to purchase)

 the case for gold:

 (I like gold a lot better)




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Walt replied on Sat, Oct 20 2007 12:02 AM

G'day there SR8216!

I'm definitely no expert and certainly not a financial adviser, just a minnoe attempting to make sense of this very confusing world we find ourselves in at this juncture. However I believe you pose the most pertinant question of the day - Gold or Silver? Congratulations, for what it's worth, as I firmly believe (along with many others - although certainly not the "masses" - yet) that you're on the right path. Since you pose a question I think I can help answer, I'd like to share a few random thoughts with you. But first I'll answer you straight off: If you can't do both, then SILVER. The clincher for me is 1. Silver in above ground, deliverable form is rarer than gold. 2. You can get quite a bit for your money in comparison to Gold, and as far as wealth preservation they should both pretty much do the same job... 3: Silver has been money for 5000 years (up until the last 50 or so - the first time in history). Although not so much a monetary metal now, it is certainly an industrial one, with new uses being found virtually every other day. It's unique properties make it indespensable in many modern applications. In fact life as we know it (with all our gadgets and gizmos, jet engines and missiles etc) would be impossible without it. It will probably replace antibiotics as they become more and more ineffective. Heard of the commodities boom?.... Gold is pretty much "just",  well, gold. And lastly, 4. The Gold / Silver ratio is way out of wack from a historical context, this will need to be resolved and my guess it will be Silver which will play catch up.

  • I will firstly say you need to devote as much time as you can possibly spare researching both Gold and Silver. Essays, articles, charts, everything you can find. And I mean the internet, not the MSM. Give Google a thorough work out - it's mindboggling how much information is available. It is imperative that you check, confirm, verify etc. because there's a lot of nonsense out there too.
  • To start you off with your research, may I suggest you read EVERY article by:

Rather than me explain, both those Gents should do a pretty good job. Another essay (there are quite a few good ones) I strongly suggest you peruse and thoroughly digest would be:

Lastly, "Never put all your eggs in one basket". Which ever you decide to lean towards, I would suggest a little of the other as well. The physical stuff. Bars and coins - NO PAPER.

I truly wish you well and hope I've been of some small assistance, Walt (from Down Under)


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MikeL replied on Sun, Oct 21 2007 12:01 PM

The trouble with silver is that you have to buy A LOT of it. Add storage costs to the price of any metal, but especially the cheaper ones like silver.

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I can only offer an opinion based upon what I personally do in the precious metals.

I consider gold as my emergency insurance, much like insuring a home, car, aircraft, Harley-Davidson Hog, etc...That is: large financial commitments.

I consider silver as my emergency funds for food, gas, medical, etc...That is: day-to-day expenses.

That being said, it is my personal opinion to hold gold bars, since there is virtually no premium and are priced at virtual spot price. These are one ounce COMEX approved names. These bars are in storage, some at Bullion Direct and others in a secure deposit box.

I hold a sizeable amount of silver. The bars are held at Bullion Direct while the coins are held in a secure place for ready access. These are in several forms: Silver Eagles, Silver Maples, Silver Libertads and ten-ounce bars.

Think about it for a moment. If you hold gold coins in your possession, for what would you possibly spend/trade? How would you get "change" in return?

Silver has always been used because it makes sense for smaller transactions.

I have also studied the silver/gold markets for several years. I entered the gold market in 2000 and the silver market in 2003. I am of the opinion that silver will outperform gold in the early stages of the coming PM Rush, as it has outperformed, to date from 2003. At some point, I will exchange a large portion of my physical silver holdings for gold, real estate, and any other undervalued appreciating hard asset that will then appreciate more than silver.
At present, in my opinion, silver is the most undervalued asset on the planet.

So in a nutshell: I see gold as a store of value for large emergencies and silver as a store of value for daily expenses and both gold and silver should be held, with a present ratio of about 1:10 (gold/silver).

All in my humble opinion and worth what it cost. :)

Good luck and I am sure others will have different and various opinions.....

LoneStarHog (Hog) Cool
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SR8216 replied on Mon, Oct 22 2007 9:31 AM

Thank you everyone for your opinions...

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