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Precious Metals, Commodities Sink On Fed Worries, Strong Dollar
Never have and never will understand the allure of commodities and gold and silver. The later two seemingly in the domain of the doomsters. But then I am admittedly biased!!
I just don't understand why you don't understand. When the whole thing falls apart, as will surely happen pretty soon now, you can take your gold and silver to the supermarket and trade it for stuff because they won't accept money anymore. When you present your gold or silver for payment the clerk will try to kill you and take all of it. But you won't worry, because you will be accompanied by your armed troop of NRA bodyguards, who will surely volunteer to protect innocent citizens such as yourself. Unless, of course, they decide to kill and rob you.
I just don't understand why you don't understand. When the whole thing falls apart, as will surely happen pretty soon now, you can take your gold and silver to the supermarket and trade it for stuff because they won't accept money anymore. When you present your gold or silver for payment the clerk will try to kill you and take all of it. But you won't worry, because you will be accompanied by your armed troop of NRA bodyguards, who will surely volunteer to protect innocent citizens such as yourself. Unless, of course, they decide to kill and rob you.
I hope that this helps.
Ha! Ha! But you are 53 years too late. Back then was when my friend's John Birch Society's brother-in-law kept preaching to me the same scenario.
I just don't understand why you don't understand. When the whole thing falls apart, as will surely happen pretty soon now, you can take your gold and silver to the supermarket and trade it for stuff because they won't accept money anymore. When you present your gold or silver for payment the clerk will try to kill you and take all of it. But you won't worry, because you will be accompanied by your armed troop of NRA bodyguards, who will surely volunteer to protect innocent citizens such as yourself. Unless, of course, they decide to kill and rob you.
I hope that this helps.
I suppose one view is that fiat currencies don't last forever (not just me, history speaking, the dollar has lasted longer than many, but to think that this country is just so exceptional that the dollar will be around forever is not realistic) and gold is a monetary asset that is easily stored and is accepted and recognized whether you're in the US or China, whether it's the dollar or the dollero or whatever else comes down the line.
People view it to some degree as an insurance policy, ask Rono who unfortunately doesn't post here that much anymore.
If I had a gold coin for every time I've read the "grocery store won't take it" thing, I'd be pretty happy and I'd guess most posters on here would be, as well...
The problem becomes that gold offers no income. However, a number of major countries also now have negative interest rates (wouldn't shock me if it happened here, either, Yellen has discussed her views on NIRP), so...
Personally, I like hard assets but my interests lie in productive hard assets (real estate, yadda yadda). Not into the metals, but not against those who are.
@hank Body armor is illegal for the public citizen. 'Cept, if OJ has to take precious metals to the grocery store for food; there are likely many more things to be concerned about, eh? And for those so inclined, we always maintain our "onhand" silver in the form of primarily quarters and dimes. As silver will be several hundreds of dollars per ounce, anything larger denomination silver dollars will be for the more expensive items. You and yours will do alright for a longer period of time under these dire conditions; as the big cities will be the first to burn. On a clear night I will be able to determine which are ablaze in downstate Michigan. Although I won't be able to let you know, cause there won't be any cell or online service. Wet dog food with Tabasco sauce will keep us going for awhile.
Wet dog food with Tabasco sauce will keep us going for awhile.
My cat's going to be out of luck if things go seriously South. It's amazing what's in some of the boutique-y pet foods these days, it's certainly no friskies.
With all due respect Scott, I thought he laid that out pretty well. At first blush I thought it was meant seriously as a put-down of Junkster's expressed incredulity. Than ... oh boy.
Yeh - I've heard the general idea before too and tend to agree. Wouldn't want to be walking down the street with a pocket full of gold or anything else of great value during periods of civil unrest.
With all due respect Scott, I thought he laid that out pretty well. At first blush I thought it was meant seriously as a put-down of Junkster's expressed incredulity. Than ... oh boy.
Yeh - I've heard the general idea before too and tend to agree. Wouldn't want to be walking down the street with a pocket full of gold or anything else of great value during periods of civil unrest.
Well, if I'm going to go into detail:
1. I don't care what people invest in. If you want to buy Beanie Babies, that's great. If someone wants to invest in metals or baseball cards (as for the latter, good lord I wish I'd sold mine years ago before the bottom fell out. I literally called a dealer who I knew used to sell them, along other things - coins, stamps, jewelry, etc) and asked last year if they still did and they laughed.
For those who have the mindset of buying metals as an "insurance policy" against any number of scenarios, I'd hope that they have some level of diversification to their holdings, as in my view - the mentality that leads to owning gold in that regard does not mean just holding gold.
If things go "Mad Max" (and the trailer for the remake of that looks nuts), then you hold your gold with the hope that you have some "monetary" asset that can be traded for the new currency on the other side if it ever gets there. If we go "Mad Max" for whatever reason, hopefully you have other such preparations (seeds, essentials, some skills including gardening, etc.) You hope that you are able to hold onto your gold until the "other side" of it. Your stocks aren't going to do you any good, the gold is at least tangible if you can go through the period and hopefully you've created enough friends (even, gasp, Republicans! It's amazing how much energy is spent in this country on anger over someone else's political views, left or right wing) that you may be able to trade the gold within your network.
However, in Weimar Germany (see the book "When Money Dies"), things didn't go "Mad Max", but they were awful. Still, restaurants were open (although the actual total for the cost of your meal may have changed by the time you were done with it) and someone with some gold coins may suddenly be able to pay off their mortgage with one. From "When Money Dies", "...I, too, have exchanged by husband's gold watch for four sacks of potatoes, which will at all events carry us through the Winter." If you were the farmer with a ton of potatoes to sell and a field to grow more, you were likely in better shape than the person with no field and some gold, but that person was in better shape than the person with a bunch of Papiermarks whose value was depreciating so rapidly that some used them as wallpaper.
"A liter of milk, which had cost 7 marks in April 1922 and 16 in August, by mid-September cost 26 marks. In only nine months, Mr Seed's chauffeur's weekly bill for an identical food basket had risen from 370 marks to 2,615. ...An increase in wages granted at the end of one week would not meet the rise in prices the following Tuesday."
then:
"In the meantime, September's 26 mark liter of milk became October's 50-mark litre." (202 by December.)
It goes on (again, it's been a while since I've read it and an understandably dark and depressing read but an interesting look at history.)
Again, I swing towards the idea of productive assets, but I don't have anything against those who go for metals - although I do think that if they are entirely in metals that's a mistake as there are any number of things that could fall under someone looking for "insurance policy" assets (seeds - even, gasp, GMO ones! lol)
---
As for the idea that other things do well and that land (ag land) is a good idea: "Her Hans-Georg von der Osten recollects that in February 1922, with a loan from a friendly banker, he bought an estate neighboring his own property in Pomerania for 4 million marks. He then paid the debt in the autumn with the sale of less than half the crop of one of his potato fields. In June of the same year, when prices were shooting up ahead of the mark, he bought 100 tons of maize from a dealer for 8 million marks. A week later, he sold it back to the dealer for double the amount. Only the country people were surviving in Germany in any comfort: anyone who lived off the land had the readiest access to real values."
Everything is also not either "black or white", there are periods in history where things were awful but things still functioned and metals were not a bad thing to have. However, I think those who have the mentality of gold as an insurance policy would be mistaken to just go for that alone.
Additionally, I guess it goes back to my philosophy when it comes to investing in the present day. While there are admittedly a couple of exceptions, I sleep well at night from the standpoint of the majority of what I'm invested in are things are hard assets and/or that serve a need, including energy, ag, health care, railroads (I own CP, CNI, UNP, BNSF (BRk-B) and KSU, so that covers Canada, most of America and Mexico, as KSU goes into Mexico and UNP owns a 26% stake in Ferromex) and the like. I mean, even Visa and Mastercard - who take a % of every transaction and prices go up over time. There's "bad" where society is still functioning, and if that happens, I do believe that these things will fare better. If things don't get bad, these are still necessities in many cases.
@scott, let's hope things don't go that far. The idea of the country people having it better is not only due to the land but also that they work hard to achieve success. Farming is like having your own business.
The cities will become dread zones in a Mad Max scenario. The possibility is that the city folk will head out in the country to look for food. The landowners will have to band together to protect what they have but also have some compassion towards those who are hungry. A lot of people have an entitlement mentality and those will be the instigators of trouble.
The other possible scenario is that another country will see that America is weak and use the timing to invade and establish a new rule. That would only be if there was a power vacuum present.
In the meantime, futures are red once again. No stock will be spared today, not even SHAK.
"The other possible scenario is that another country will see that America is weak and use the timing to invade and establish a new rule. That would only be if there was a power vacuum present. "
That would be a possibility, or if something happens to the dollar, other countries just come in and strip mine, buying up useful assets on the cheap if the dollar tanks.
Of course, I hope that doesn't occur and I think those who like the shiny stuff - like Rono, who hasn't posted in a while - hope that it doesn't, too.
As for SHAK, the funny thing is - if you were to say that the person behind it (Danny Meyer) was taking his COMPANY public (Union Square Hospitality Group and then you get Shake Shack as part of that whole) I'd be very interested.
I think the idea of the boutique restaurant company is highly interesting and it's too bad that Meyer didn't do that. The closest thing that there is to that right now is Ark Restaurants (ARKR), which I've pondered at times. That does pay a huge dividend.
One concept? Nah, or at the very least, I'll wait and see how it goes, as I think 5M shares is a TINY float and the volatility of the thing in the early days is going to require Dramamine. If anything, I'll sit and watch it tick-by-tick today for a little while, as I'm curious to watch how fast that will move with that few shares.
The concept I'd be much more interested in investing in is Lyfe Kitchen (http://www.lyfekitchen.com/), which is rapidly expanding.
Isn't there a "Catch-22" in here somewhere? Governments aren't particularily fond of their citizens owning gold for a variety of reasons. It competes against their fiat currency and is hard to tax for starters. In an emergency, the government may restrict citizens' right to hold it or attempt to tax it out of existence. So, while owning gold in some other (paper) form may alleviate the problems storing, transporting and exchanging it, it also makes it much more "visible" in the eyes of the government than if you had it stuffed into your freezer along with the frozen pork chops or hidden behind some bricks in the basement wall.
Comments
I hope that this helps.
Ha! Ha! But you are 53 years too late. Back then was when my friend's John Birch Society's brother-in-law kept preaching to me the same scenario.
(Be sure to wear your body armor on that trip to the market too. And a gas mask might not be bad idea either.)
People view it to some degree as an insurance policy, ask Rono who unfortunately doesn't post here that much anymore.
If I had a gold coin for every time I've read the "grocery store won't take it" thing, I'd be pretty happy and I'd guess most posters on here would be, as well...
The problem becomes that gold offers no income. However, a number of major countries also now have negative interest rates (wouldn't shock me if it happened here, either, Yellen has discussed her views on NIRP), so...
Personally, I like hard assets but my interests lie in productive hard assets (real estate, yadda yadda). Not into the metals, but not against those who are.
Body armor is illegal for the public citizen. 'Cept, if OJ has to take precious metals to the grocery store for food; there are likely many more things to be concerned about, eh?
And for those so inclined, we always maintain our "onhand" silver in the form of primarily quarters and dimes. As silver will be several hundreds of dollars per ounce, anything larger denomination silver dollars will be for the more expensive items.
You and yours will do alright for a longer period of time under these dire conditions; as the big cities will be the first to burn. On a clear night I will be able to determine which are ablaze in downstate Michigan. Although I won't be able to let you know, cause there won't be any cell or online service.
Wet dog food with Tabasco sauce will keep us going for awhile.
Yeh - I've heard the general idea before too and tend to agree. Wouldn't want to be walking down the street with a pocket full of gold or anything else of great value during periods of civil unrest.
1. I don't care what people invest in. If you want to buy Beanie Babies, that's great. If someone wants to invest in metals or baseball cards (as for the latter, good lord I wish I'd sold mine years ago before the bottom fell out. I literally called a dealer who I knew used to sell them, along other things - coins, stamps, jewelry, etc) and asked last year if they still did and they laughed.
For those who have the mindset of buying metals as an "insurance policy" against any number of scenarios, I'd hope that they have some level of diversification to their holdings, as in my view - the mentality that leads to owning gold in that regard does not mean just holding gold.
If things go "Mad Max" (and the trailer for the remake of that looks nuts), then you hold your gold with the hope that you have some "monetary" asset that can be traded for the new currency on the other side if it ever gets there. If we go "Mad Max" for whatever reason, hopefully you have other such preparations (seeds, essentials, some skills including gardening, etc.) You hope that you are able to hold onto your gold until the "other side" of it. Your stocks aren't going to do you any good, the gold is at least tangible if you can go through the period and hopefully you've created enough friends (even, gasp, Republicans! It's amazing how much energy is spent in this country on anger over someone else's political views, left or right wing) that you may be able to trade the gold within your network.
However, in Weimar Germany (see the book "When Money Dies"), things didn't go "Mad Max", but they were awful. Still, restaurants were open (although the actual total for the cost of your meal may have changed by the time you were done with it) and someone with some gold coins may suddenly be able to pay off their mortgage with one. From "When Money Dies", "...I, too, have exchanged by husband's gold watch for four sacks of potatoes, which will at all events carry us through the Winter." If you were the farmer with a ton of potatoes to sell and a field to grow more, you were likely in better shape than the person with no field and some gold, but that person was in better shape than the person with a bunch of Papiermarks whose value was depreciating so rapidly that some used them as wallpaper.
"A liter of milk, which had cost 7 marks in April 1922 and 16 in August, by mid-September cost 26 marks. In only nine months, Mr Seed's chauffeur's weekly bill for an identical food basket had risen from 370 marks to 2,615. ...An increase in wages granted at the end of one week would not meet the rise in prices the following Tuesday."
then:
"In the meantime, September's 26 mark liter of milk became October's 50-mark litre." (202 by December.)
It goes on (again, it's been a while since I've read it and an understandably dark and depressing read but an interesting look at history.)
Again, I swing towards the idea of productive assets, but I don't have anything against those who go for metals - although I do think that if they are entirely in metals that's a mistake as there are any number of things that could fall under someone looking for "insurance policy" assets (seeds - even, gasp, GMO ones! lol)
---
As for the idea that other things do well and that land (ag land) is a good idea: "Her Hans-Georg von der Osten recollects that in February 1922, with a loan from a friendly banker, he bought an estate neighboring his own property in
Pomerania for 4 million marks. He then paid the debt in the autumn with the sale of less than half the crop of one of his potato fields. In June of the
same year, when prices were shooting up ahead of the mark, he bought 100 tons of maize from a dealer for 8 million marks. A week later, he sold it back to the dealer for
double the amount. Only the country people were surviving in Germany in any comfort: anyone who lived off the land had the readiest access to real values."
Everything is also not either "black or white", there are periods in history where things were awful but things still functioned and metals were not a bad thing to have. However, I think those who have the mentality of gold as an insurance policy would be mistaken to just go for that alone.
Additionally, I guess it goes back to my philosophy when it comes to investing in the present day. While there are admittedly a couple of exceptions, I sleep well at night from the standpoint of the majority of what I'm invested in are things are hard assets and/or that serve a need, including energy, ag, health care, railroads (I own CP, CNI, UNP, BNSF (BRk-B) and KSU, so that covers Canada, most of America and Mexico, as KSU goes into Mexico and UNP owns a 26% stake in Ferromex) and the like. I mean, even Visa and Mastercard - who take a % of every transaction and prices go up over time. There's "bad" where society is still functioning, and if that happens, I do believe that these things will fare better. If things don't get bad, these are still necessities in many cases.
The cities will become dread zones in a Mad Max scenario. The possibility is that the city folk will head out in the country to look for food. The landowners will have to band together to protect what they have but also have some compassion towards those who are hungry. A lot of people have an entitlement mentality and those will be the instigators of trouble.
The other possible scenario is that another country will see that America is weak and use the timing to invade and establish a new rule. That would only be if there was a power vacuum present.
In the meantime, futures are red once again. No stock will be spared today, not even SHAK.
That would be a possibility, or if something happens to the dollar, other countries just come in and strip mine, buying up useful assets on the cheap if the dollar tanks.
Of course, I hope that doesn't occur and I think those who like the shiny stuff - like Rono, who hasn't posted in a while - hope that it doesn't, too.
As for SHAK, the funny thing is - if you were to say that the person behind it (Danny Meyer) was taking his COMPANY public (Union Square Hospitality Group and then you get Shake Shack as part of that whole) I'd be very interested.
I think the idea of the boutique restaurant company is highly interesting and it's too bad that Meyer didn't do that. The closest thing that there is to that right now is Ark Restaurants (ARKR), which I've pondered at times. That does pay a huge dividend.
One concept? Nah, or at the very least, I'll wait and see how it goes, as I think 5M shares is a TINY float and the volatility of the thing in the early days is going to require Dramamine. If anything, I'll sit and watch it tick-by-tick today for a little while, as I'm curious to watch how fast that will move with that few shares.
The concept I'd be much more interested in investing in is Lyfe Kitchen (http://www.lyfekitchen.com/), which is rapidly expanding.
I knew that and thought your post was a scream. Some here take themselves far too seriously!!!!!