When people ask me when I would consider selling bullion, my canned answer is “When the day arrives that people will voluntarily share the excesses of their production without mention of reciprocity”

That is the day that the anti-Gold monetarists will have won, but even on that day, I think I will simply become a metal sculptor who uses Gold as his medium… proving invalid the premise that Gold has no utility… 🙂

Rick,

I looked at the agenda for the vancouver conference and thought I should go, but shite got in the way. Had I known you were speaking, i surely would have attended.

Merek

silver seasonally—–http://seasonalcharts.com/future_metalle_silver.html

Surely the answer is to have your core holdings in physical metal and not in “paper”. Holding paper PM’s should be used as a leveraging /hedging strategy, never as a store of wealth. Some people appear to have difficulty being short-term bearish because they hold physical PM’s – this is not clever. During pullbacks, short the PM’s using paper, take profits early and convert the profits into physical! During rallies, take advantage of the leverage afforded by derivative instruments (this can of course include shares in mining companies), take profits early and use the profits to buy physical.

One you have your core position in physical metal, you of course need a pool of money to allow you trade – money was invented for making trading easier, not to be an asset! There is nothing wrong being all in cash or all long or all short in your money pool (depending on you short term views), as long as it is always understood that the size of the pool should not be any bigger than what you need to trade (and what you can afford to loose without significantly impacting on your wealth).

I prefer to think of assets as things that I can touch. This may be a means of production or something that has been considered as a store of wealth for many centuries and is likely to remain so for many more centuries.

Paper contracts (futures, options, warrants, even share certificates) are only verbal promises reduced to writing. So is paper money. Promises may or may not be kept. When you live in 1st world country, it is easy to assume that the rule of law will always apply and that contracts can readily be enforced, but is there anybody left that still believes that laws applies to the big banks?

Fiat money is defined as something where the intrinsic value of the material substance is divorced from its monetary face value, that is created and issued by the State, but is not convertible by law into anything other than itself, and has no fixed value in terms of an objective standard. How can this ever be an asset and be seen as a seen a store of wealth?

The real debate thus should not be on what to use as a store of wealth (and of course a way to benefit from a boom in precious metals), but rather how to secure this physical wealth against the actions of governments intent on taking it from you and redistributing it!

True! True! True! Never, ever treat your gold and silver as disposable, or secondary. They are your Plan B when other things don’t work out. They are, your savings, your lifes work.

And I’ve found no better way (that I’m comfortable with) than ratio trading. Look at it like this: Until the world returns to sanity, that ratio chart is going to be moving. You can wait for big swings, but if you’ve enough of a solid base and plenty to play with, you can grab some more on smaller ones. Depending on what I see coming up, I might increase my play amount or my savings. But once done, I don’t shift anything back and forth. Final is final. Once in savings, there it stays until I have to sell any. And even if the price crashes allll the way back down, the ratio probably won’t stop moving, nor would it kill me, as that kind of price move would mean (hyper?) deflation.

Of course, everyone has their differnt needs and different plans. But the rule still holds regardless of what those are: The metals serve you best only when treated with discipline and respect.