Is Gold too High to Buy Now? 1 1

[Henri Charriere]

Where do you stand on Gold right now, and why?

[Mike Meenderink]

I myself if I had enough gold to stand on would likely choose to stand on the middle of the pile. I would do so as not to cause a massive gold slide that might possibly injure one of my servants.

[Henri Charriere]

On 3/7/2024 at 12:33 PM, Mike Meenderink said:

I myself if I had enough gold to stand on would likely choose to stand on the middle of the pile. I would do so as not to cause a massive gold slide that might possibly injure one of my servants.

Very considerate of you.  I don't think the Hunt brothers were that thoughtful when they tried to corner the silver market back in '80.

[GoldFinger1969]

 

Is Gold too High to Buy Now?

Absolutely NOT !!!  

That's not to say that it can't go down 5-10% in a few days/weeks...but if the next $1,000 is UP -- and I think we all agree it's more likely to hit $3,100 than $1,000 -- why worry about a few hundred dollars moves here ? 

Let me be specific and tell you what I would tell my Private Bank clients.  Let's say someone wanted 100 ounces of gold.  They have the $$$ right now...sold some stock, inheritance, windfall, whatever.  I'd have them buy 20 Double Eagles or coins or bars or whatever they wanted TODAY....I'd wait a few weeks and then I'd buy more.

If the price is HIGHER....we bought the first 20 low.  If it FALLS....we buy the 2nd batch of 20 cheaper than the first batch.  I would repeat this using a time interval that was consistent with the client's risk-tolerance.  I would assume that with gold he/she wouldn't care if God Forbid we bought them all at an average price of $2,000 and then it fell to $1,500 and they panic and want to sell.  I assume this is NOT an investment but insurance and/or stuff they want to collect or show their kids/grandkids.

As long as it is $$$ that is not needed if the gold falls in price, you can either buy all-in at once...or spread it out (my choice).  The person may also want to invest some TIME researching all the different ways to buy 1 ounce of gold and/or gold coins and then decide they want a little of everything:  some SG DEs...Liberty Head DEs....modern AGEs....Kurggerands....Maple Leafs....Buffalos...maybe some Vatican or Mexican coins...etc...etc...etc.

Edited March 7 by GoldFinger1969

[RWB]

On 3/7/2024 at 11:17 AM, Henri Charriere said:

Where do you stand on Gold right now, and why?

Uhhh, I don't know. I just have wooden floors, so no gold to stand on.

[CIII]

I would say it depends upon when you want to sell. 

[Henri Charriere]

There a great many variables involved in this, one of which is rarely mentioned on the Forum: age. If you are an old dinosaur like me, getting rich quick, which ought not to be a consideration for anyone, except perhaps gamblers, is out of the question. A sensible person, unlike me, would not put all his eggs in one basket. The word sell is not a part of my vocabulary but for the benefit of those for whom it is, they may wish to consider this: if you sell, when gold has hit what you believe to be is its zenith, you have effectively ruled out the opportunity to buy again in the here and now unless you are privy to information not generally available to others.  For me, unlike most reasonable people, I am a Set Registrant.  The die was cast.  It doesn't matter what the price is because like marriage, I must be prepared, for better or worse, to defend my ranking, with upgrades, whether I wish to or not, at all costs.

If you are young, you can enjoy the luxury of taking risks.  If you are retired and living on a fixed income, you have to exercise extreme caution. GF1969 is correct on one thing: investment strategy. Diversify your investment holdings. And just as errors and varieties ought not to be the province of the novice collector, I would advise a conservative approach with gold.  Whether gold is too high to buy is a question I am ill-equipped to answer conclusively.  

[GoldFinger1969]

On 3/7/2024 at 5:31 PM, Henri Charriere said:

There a great many variables involved in this, one of which is rarely mentioned on the Forum: age. If you are an old dinosaur like me, getting rich quick, which ought not to be a consideration for anyone, except perhaps gamblers, is out of the question. A sensible person, unlike me, would not put all his eggs in one basket. The word sell is not a part of my vocabulary but for the benefit of those for whom it is, they may wish to consider this: if you sell, when gold has hit what you believe to be is its zenith, you have effectively ruled out the opportunity to buy again in the here and now unless you are privy to information not generally available to others.  For me, unlike most reasonable people, I am a Set Registrant.  The die was cast.  It doesn't matter what the price is because like marriage, I must be prepared, for better or worse, to defend my ranking, with upgrades, whether I wish to or not, at all costs.  If you are young, you can enjoy the luxury of taking risks.  If you are retired and living on a fixed income, you have to exercise extreme caution. GF1969 is correct on one thing: investment strategy. Diversify your investment holdings. And just as errors and varieties ought not to be the province of the novice collector, I would advise a conservative approach with gold.  Whether gold is too high to buy is a question I am ill-equipped to answer conclusively.  

You make some excellent points:

• Gold is NOT an investment.  If anything, it's a speculation.  Buy it as insurance, because you like to collect, something to leave your heirs.  NOT to "make money."

• If a big drop would cause a problem......don't buy.

• DO NOT use leverage....EVER...but especially on a volatile illiquid asset.

[Jason Abshier]

I treat my gold coins like any other coin in my collection as numismatic collectible … I’m not all hyped up and hell bent buying gold like it’s a retirement investment …. I take joy in building and selecting certain coins for my collection that’s my purpose , a lot newer folks getting into the hobby mistakenly believe gold is best money can buy … sadly that’s not true ! We as collectors know that … 

now if you you’re investing into some gold to sell when hard times hit ? Now is okay time to buy some gold when price is dropping and sit on it for longer term when market spikes 

[GoldFinger1969]

On 3/7/2024 at 10:37 PM, Jason Abshier said:

I treat my gold coins like any other coin in my collection as numismatic collectible … I’m not all hyped up and hell bent buying gold like it’s a retirement investment …. I take joy in building and selecting certain coins for my collection that’s my purpose , a lot newer folks getting into the hobby mistakenly believe gold is best money can buy … sadly that’s not true ! We as collectors know that … now if you you’re investing into some gold to sell when hard times hit ? Now is okay time to buy some gold when price is dropping and sit on it for longer term when market spikes 

Well said. 

I think so many people got fooled by the 1970's 20-fold rise in gold and silver and the huge gains made by gold and silver stocks.  It was a once-in-a-lifetime scenario that never repeated.

Anybody can leave a bank account or brokerage account to a family relative or friend when they pass on.  But a gold coin or small collection...that's something that part of it may be kept and that person will think about you in posterity.  It will also stimulate interest in history and numismatics -- to some extent -- as they research the coins. 

[Jason Abshier]

@GoldFinger1969 I agree … some collectors love gold coins nothing wrong with that they earn their place in numismatic world I know several collectors that pretty much all they collect is gold coins simply because they are attracted to the coin and designs on the coins ….
 

As for investors ? I would not blow all my money buying graded Gold coins as an investment , there’s much better stuff to invest into during 21 century such as Real estates ? Stocks? I never really looked at a coin collection as an investment more of something I would want give my kids or my grandchildren some day if they are interested … I really don’t want a dime back from my collection but if my kids don’t want in further I guess I’ll just dump it out in auctions get whatever I can for it and turn around invest money into something the kids want 

[GoldFinger1969]

On 3/8/2024 at 6:18 AM, Jason Abshier said:

As for investors ? I would not blow all my money buying graded Gold coins as an investment , there’s much better stuff to invest into during 21 century such as Real estates ? Stocks? I never really looked at a coin collection as an investment more of something I would want give my kids or my grandchildren some day if they are interested … I really don’t want a dime back from my collection but if my kids don’t want in further I guess I’ll just dump it out in auctions get whatever I can for it and turn around invest money into something the kids want 

Gold and/or gold coins are NOT INVESTMENTS !!! 

As a professional money manager and investment analyst, I can assert UNEQUIVOCABLY that unless you are very lucky or very sharp (like some of our people here) it is virtually impossible to generate stock and bond returns from coins and/or precious metals.  Even trophy coins like the 1933 Double Eagle or other trophy coins struggle to generate returns higher than 5-7%, if not lower.  First, the starting price tends to be higher because some coins have inelastic demand.  Second, there is no dividend/income component to add to the capital gains.

While some of our veterans here have made lots of $$$, they are the minority making money (like daytraders) and they tend to be super-smart and at this game for a LONG time.  Partly it was a quirk of many of them having bought in the days when the gold and silver prices were fixed and suppressed; also, they got in on commemoratives and small denomination U.S. (or world) coins before the demographic bulge (high demand) kicked in during the 1970's, 1980's, and 1990's. 

So...make sure that your hobby $$$ or speculation $$$ for gold or PMs or gold coins are SEPARATE from your mutual funds, stocks, bonds, money markets, etc.   Mentally, I would write down the money I invest to coins/gold/PM's to ZERO and that way...anything I have in the future is a windfall.

I expect my nephew and nieces to sell whatever mutual funds or stocks/bonds I leave them over time.  But should I be lucky enough to get an MCMVII HR, I would hope they would keep it and pass it on decades later as I hopefully am able to do. 

Edited March 8 by GoldFinger1969

[USAuPzlBxBob]

Where do I stand on gold right now?

For the past week I've been thinking about it night and day, even awakening at 3:00 am to ponder it further a couple of nights ago.

Just finished Ship of Gold in the Deep Blue Sea, received last Friday, 507 pages, and it is perhaps the best adventure book I've ever read in my entire life.

Gary Kinder's book is a masterpiece!  Highly recommend it!!

[Henri Charriere]

On 3/8/2024 at 9:45 AM, GoldFinger1969 said:

Gold and/or gold coins are NOT INVESTMENTS !!! 

Same genus, same species, but different sub-set or sub-species.

"When you're a jet, you're a jet all the way," but precious metals is different with a major divergence in branches going all the way back to pre-Cambrian times. That distinction must be recognized and accepted.  When the former owner of the '33 D.E. and one-cent magenta British Guiana postage stamp bid on those items, I seriously doubt it was because he was enamored of them. Those had INVESTMENT written all over them. There was the intent and expectation, whether expressed or not, that he would profit, and perhaps handsomely so, at some time in the future.

Briefly, there is gold bullion and numismatic gold collectibles. That distinction must be maintained.  All gold [and silver] coins are created equal within their respective series, but unlike bullion they are subject to the additional demands, or lackluster fickle ways of the market.

[GoldFinger1969]

On 3/8/2024 at 12:22 PM, Henri Charriere said:

Same genus, same species, but different sub-set or sub-species. "When you're a jet, you're a jet all the way," but precious metals is different with a major divergence in branches going all the way back to pre-Cambrian times. That distinction must be recognized and accepted.  When the former owner of the '33 D.E. and one-cent magenta British Guiana postage stamp bid on those items, I seriously doubt it was because he was enamored of them. Those had INVESTMENT written all over them. There was the intent and expectation, whether expressed or not, that he would profit, and perhaps handsomely so, at some time in the future. Briefly, there is gold bullion and numismatic gold collectibles. That distinction must be maintained.  All gold [and silver] coins are created equal within their respective series, but unlike bullion they are subject to the additional demands, or lackluster fickle ways of the market.

Even bullion is highly volatile and does NOT pay you for that volatility with income or interest.  It's why gold is a lousy investment vehicle, short- or long-term.  It's like running a race -- 100 meter dash or marathon -- with a 15 pound weight attached to one's leg.

I do think that gold will work somewhat to make gains since I believe the supply-demand fundamentals the next 5-10 years are very favorable.  5-10% CAGR is possible/likely.  

But using 30-year ROLLING time periods to eliminate timing bias, gold rarely works to ourperform stocks, bonds, or conventional investments like REITs or private equity.

[GoldFinger1969]

$2,200 intraday.  

[zadok]

On 3/8/2024 at 12:33 PM, GoldFinger1969 said:

Even bullion is highly volatile and does NOT pay you for that volatility with income or interest.  It's why gold is a lousy investment vehicle, short- or long-term.  It's like running a race -- 100 meter dash or marathon -- with a 15 pound weight attached to one's leg.

I do think that gold will work somewhat to make gains since I believe the supply-demand fundamentals the next 5-10 years are very favorable.  5-10% CAGR is possible/likely.  

But using 30-year ROLLING time periods to eliminate timing bias, gold rarely works to ourperform stocks, bonds, or conventional investments like REITs or private equity.

...u have to quit thinking bout everything in terms of investments...those that really know dont think that way....

[GoldFinger1969]

On 3/8/2024 at 2:13 PM, zadok said:

...u have to quit thinking bout everything in terms of investments...those that really know dont think that way....

I'm not...I'm saying it's not an investment.  Only super-savvy people like you can "invest" smartly and come out ahead, Zad. 

The average person or newcomer with Get Rich schemes is going to get burned.  That's my point. 

[VKurtB]

On 3/8/2024 at 1:29 PM, GoldFinger1969 said:

I'm not...I'm saying it's not an investment.  Only super-savvy people like you can "invest" smartly and come out ahead, Zad. 

The average person or newcomer with Get Rich schemes is going to get burned.  That's my point. 

Time in the market, not timing the market.