Should You Store Your Wealth In Silver?

By: Tom Chatham

There has been much talk in the past few years of how to store your excess wealth to preserve its value. Many people have advised that gold and silver are the best vehicles for doing so but there are many detractors in the mainstream that disagree.

If you look at the price of gold and silver over the years and compare the prices to crude oil you will see a good correlation. As crude oil has moved up and down the price of precious metals has moved in close lockstep with it over the years. That makes very good sense due to the fact that the world runs on energy and gold and silver are real money. No modern economy can have growth without using more energy.

In 1980 the average price of silver was $16.39 and the price of silver spiked to around $50 an ounce, the price of crude that year averaged about $37.42. Adjusted for inflation, in today’s dollars that would make oil about $106 a barrel. Does that number look familiar?

If you take 1980 prices and compare them to 2014 prices you can see that silver is vastly under priced compared to oil. With oil at $106 a barrel silver should be much higher than it is. It is much lower due to price manipulation by the banking cartel that wants to hide the devaluation of the dollar from unsuspecting rubes.

This undervaluation will not last forever. Once the price manipulation fails the price of gold and silver will rise substantially. Now is a good time to lock in some low prices and preserve your wealth for future use. This current undervaluation will even help to increase your purchasing power when the prices adjust.

Primary focus should be spent on supplies and equipment to provide food, shelter, energy security and transportation for your family in the future. Excess funds after that need to be stored in a form that will allow you to continue paying rent or mortgage, taxes, utilities, medical care and other expenses that cannot be prepaid long term. When the petrodollar collapses and the U.S. loses reserve currency status, prices will rise on just about everything people depend on to live. Those that are not prepared to maintain their standard of living will fall into poverty and likely remain there for the foreseeable future.

Jim Willie is predicting an 80% drop in the value of the dollar in the next three years. This will almost insure much higher prices for commodities in the future. Having the supplies you need so you do not have to trade in a system that is breaking down is only part of the solution to preserving your standard of living. The other part is to have a medium of exchange that will maintain its purchasing power throughout the turmoil that occurs. This will allow you to trade in the future for the things you cannot store.

What you do with your wealth is ultimately up to you to decide. In these troubling times it is important for you to do your own research and decide what is best for you. How you fare in the future is your responsibility and you cannot blame someone else for your failure to plan ahead.

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Posted on March 12, 2014, in Economics and tagged , , . Bookmark the permalink. 6 Comments.

  1. Most folks don’t have any wealth….excess or otherwise. Those are the ones you will find hollering “You can’t eat gold/silver”….or “I wouldn’t trade a can of beans for a metal coin when the SHTF”. They simply don’t have the option to purchase metals AND other supplies…..and for some reason think nobody else has that option either.

    The fact is, by design, our Federal Reserve Note becomes more and more worthless as time goes on. 1913, you could swap one ounce of gold for 20 paper dollars…..and buy a truck load of groceries with either. Today, you can swap one ounce of gold for 1350 paper dollars, and 20 of those paper dollars will barely fill a grocery sack.

    Even if Jim Willie is wrong, and the paper FRN doesn’t decline by 80% over the next 3 years, it’s a SURE bet it will decline by 10-15%….because that’s exactly what it has done over the last 3 years.

    So, yes, IF one has excess wealth ( and I’m assuming they already have a good stock of beans/bullets/bandaids ), you’re crazy not to store a good size portion of it in gold and silver. Silver is probably the better option at this point, being kept so low for so long in relation to it’s true value. The more one studies silver, and the thousands of uses for it besides wealth retention, and the decreasing mine supply, and the increasing cost to extract it, the only conclusion you could reach is the sky is the limit for what it will do one day. Not only do you stand a good chance at wealth retention, you stand a good chance at actually getting wealthy off silver.

  2. Very well said Andy! I buy silver bullion and rounds 2 or 3 times a year. Usually 3k at a time. Most folks don’t have that kind of buying power but you can still buy 50 or 100 bucks worth a few times a year. It’s only prudent to do so. My 20 YRO son works for a car dealership and he’s been buying silver in small amounts as he can for the last year and it’s surprising how much silver he’s accumulated.

    I too believe that silver prices per ounce have been kept artificially low. While I’m not sure where the end price of silver will be in few years it certainly gives me peace of mind and hedges my bets against the fall of the dollar.

    Snake Plisken

  3. I would still like to know what to do with the metals when the time comes? Trade it for the new currency?buy rentals? ????????? Any opinions would be helpful

    • Gold and silver should be thought of as your forever money. It should be viewed in terms of purchasing power rather than dollar value. The whole point of buying it is to preserve your purchasing power during times of currency chaos, meaning devaluation. During currency chaos you could see the purchasing power of metals surge or spike on occasion meaning you have more buying power. When that happens you may find deals that you want to grab such as land, equipment or supplies of some sort. As time goes on you will look at your metals as just another type of savings account and from time to time decide what is more important to you , the metal or the thing you want to buy, just as you do now with paper currency. If the currency is replaced at some point you may decide to convert some of your holdings to make it easier to spend but that is a personal decision you need to make based on the economic situation. Just remember gold and silver are a means to get your purchasing power from the present to the future with as little loss as possible. If you hold metals you need to concider now what your plans are for the future and decide now what you might be willing to trade them for at some future date so you will be aware of what you are looking for and can keep an eye out for it. You may even be just holding it to the end for retirement. That is for you to decide. Thats just my opinion on the matter, ultimately you need to decide what is best for you.

  4. The end game for metals ? Who knows at this point ? All I feel really confident about is the fact the paper buck will continue to go down in value over time, and holding some metals is going to put you miles ahead of NOT holding some metals. You’ll have options where a lot of people will not. Rentals might be the way to go (or not, given most folks may not have any money to pay you the rent if things get that bad)….it might be something else. You’ll know it when you see it. You were smart enough to get of out the FRN for you long term savings, so you didn’t get killed.
    .
    I got into buying silver for one reason…..to squirrel away some REAL money to pay my property taxes so I wouldn’t loose them to the county for lack of a little money. LOT of folks in the 30’s did just that…..it wasn’t that the taxes were that high, it’s just that they had almost no money to pay them. My thought was put away a few thousand ounces ( back when it was 5-6 bucks), and that should take care of my property taxes for the rest of my life. (They run a shade under 1,000 FRN/yr right now) Now those couple thousand ounces are fetching 40-42,000 FRNs. I’m fairly confident that will handle my property tax for the rest of my life.

  5. I started acquiring silver for a few reasons. First and foremost as a hedge against the coming dollar collapse, which is inevitable. When the day comes where a loaf of bread costs $100, a person would be able to buy it with a few pre-1965 so-called junk coins. Maybe a Kennedy head half dollar, or maybe a few quarters or dimes. If you have extra guns and ammo and no silver, we could barter and come to an agreeable, equitable trade. This of course is along the lines of worst case scenario should times become that draconian.

    My other reason for acquiring PMs is so that, in the event I don’t need to use them, I can pass them on to my children and grand-child, under the radar of the gov’t and the IRS with their penchant for stealing, yes, stealing one’s wealth after their death. My stash will be divvied as I see fit to my progeny, and it will be theirs to do with as they see fit. I can think of no better way to “preserve wealth” than that.

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