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Beano

When Siver goes through the roof!

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Apologies If this has already been discussed on here but I couldn't find it. Basically I've been thinking for a few days about what I would do say, silver reaches £50 an oz. I have no idea what I will do. I'm in it for the long haul and have no plans in selling for at least 15-20 years. My stack is still embarrassingly small so selling would be pointless. But I don't think buying it at £50 an oz would be wise. What's your guys opinion? If silver goes to £50 this year you staying in? Or running away into the sunset with pockets full of cash? Thank in advance for any replies :)

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It's a case of crystal ball time, guessing whether the price is going to stabilise, increase or fall.

One strategy would be to take some profits with low cost bullion coins or coins your not keen on and hold back collector coins.

Which is why it's not good to have nothing but collector coins.

The reasons for the rise will obvious have a affect on any decision.  The price of gold will too.

 

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23 minutes ago, RoughDog said:

It's a case of crystal ball time, guessing whether the price is going to stabilise, increase or fall.

One strategy would be to take some profits with low cost bullion coins or coins your not keen on and hold back collector coins.

Which is why it's not good to have nothing but collector coins.

The reasons for the rise will obvious have a affect on any decision.  The price of gold will too.

 

That's actually a nice idea, I could have half and half. Maybe half Brits, half coins I wish to keep. If the price shoots up I can sell all my Brits and keep the others. Thanks for the reply ;)

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Looking at just the price in £ will not give you the answer. What about the price in USD (and the exchange between USD/GBP). What about the value of stocks to gold/silver, value to house prices, value to other commodities. The GSR. Lots of metrics to measure to determine when to sell - look to history to find out when to sell. Don't sell all at once, sell bits at a time, with any luck you will see on the way up and not on the way down, but you will never sell right at the top - thats like winning the lottery twice, once on your silver lottery ticket and then again in your timing lottery ticket :P

Are you buying silver as a lottery ticket? :D

Having said that, looking at the price in £ may very well give you the answer! What is a meaningful amount of pound sterling to you? Would £50 an ounce give you a meaningful amount based on your stack or not? If the answer is yes then its easy that is when you sell. Will we ever see £50 an ounce? No. (I could be wrong :D)

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Something I've wondered. If silver shoots up,will those lovely "collector" coins that we've all probably got stashed away,rise at the same rate. Or will the premium people are willing to pay drop. I know if silver did rise say ×4, I wouldn't/couldn't pay £300ish for a 1oz proof britannia.

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12 hours ago, RoughDog said:

It's a case of crystal ball time, guessing whether the price is going to stabilise, increase or fall.

One strategy would be to take some profits with low cost bullion coins or coins your not keen on and hold back collector coins.

Which is why it's not good to have nothing but collector coins.

The reasons for the rise will obvious have a affect on any decision.  The price of gold will too.

 

What do you mean by collector coins?

 

do you mean the low mintage runs?

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By collector coins I mean coins that are purchased for a large premium.  Whether that's proofs, new coins or back dated coins.

 

Something I have been thinking about recently is that when USD goes down gold goes up, when USD goes up gold goes down.  They seem to be linked.

Not having any qualifications or even a single financial lesson in my life just pure guess work here.

Could this mean that USD is being sold to buy gold when gold goes up.  Gold is being sold for USD when gold price goes down.

If so, I'm guessing it's those big financial pension fund type companies making big moves based on predictions, maybe about the economy.  Interest rates seems to be something that is reacted to.

That said if gold suddenly starts going up significantly and USD is not going down much that could be a sign for "lift off" as some people describe it.

My guess again would be that those with the gold don't want to sell it for the asking price so it keeps increasing to a price they will accept because they know something we don't.

A bit like if google or apple were to build their new headquarters a stones throw from your house, your house real value might suddenly be worth a whole lot more.

 

Can silver reach £50 an ounce?  Possibly, If the big boys want it and the holders don't want to sell it.  Could go way higher.  What would cause that situation?  No idea.

Lets say it went to £100 an ounce.  Do you think the bullion dealers are suddenly going to buy your silver coins at £100 an ounce.  My instincts say no. 

They would only buy them if they could sell them.  Who they gonna sell to?

 

Just some thoughts.  Not much to do here.

 

 

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I will sell 75% or more of my stack when I deem that PMs have become fully valued. I don't work in fiat price, but how cheap or expensive PMs are compared to other asset classes.

It will not be as chaotic as "drive everything to the coinstore" one day. I will sell in chunks. First when the Dow/Gold ratio falls below 5, and then in further increments as it goes lower. If it goes as low as 2:1 then I can see myself selling as much as 90% of my stack.

Edited by vand

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I know what I would do, because .. I did it .. after lows in the 1990's I stopped buying once silver started heading north of 20$us/oz.

In future, if it went really high, I think it would depend on WHY it went really high in price.  If it was because of currency devaluation, there's no point in "selling" silver (i.e. trading for paper money) because the "high price" is only "high" because the money is worthless, so even though you're making bank vs. your currency, you're just breaking even against food and gasoline.

If, however, it went through the roof because of speculative buying, then that's a good reason to sell.

I personally think another good reason to trade out of PM is vs. other commodities .. so, if, for example, the GSR was really high (like it is now) then disregarding the European silver embargo (VAT) it would probably be smart to trade out of gold and into silver, then back again when the GSR is low.  I can think of other commodity trades where that would make sense too if other commodities were cheap enough vs PM.

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Ugh.. I hope it stays low for the next 5 years.. I'm not nearly done with hoarding silver. I don't know when to sell,  I have thought about it but the manipulation in the market that I perceive prevents me from selling at a what I think is a good value. I will probably hold till we get in very high ranges 100 euro + and even then I'm not sure, it depends on the situation. For me that's easy since I have another 35 years to go till retirement. In my mind it will go up as time passes and the only reasons I would sell before retirement is because I'm broke or I am really confident I can sell and buy back more within a year or so. 

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Just an aside here. If we ever did get sky high prices do you think it would be feasible to cut a deal with your local "we buy any silver merchant"? That is to say you provide him with x amount of mixed silver and he gives you a receipt to say you cashed in silver Britannias. This way you keep all the profit with no CGT. Obviously you would get less than market value but would make up for this with 0 tax. Just a thought as I have a right mixed bag ATM.

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5 minutes ago, Stu said:

Just an aside here. If we ever did get sky high prices do you think it would be feasible to cut a deal with your local "we buy any silver merchant"? That is to say you provide him with x amount of mixed silver and he gives you a receipt to say you cashed in silver Britannias. This way you keep all the profit with no CGT. Obviously you would get less than market value but would make up for this with 0 tax. Just a thought as I have a right mixed bag ATM.

Do what they did in the housing market boom.  They sold all the rubbish houses that nobody would buy prior to the boom due to panic buying.

Sell all your silver that your not happy with.  Milk spots, scuffed, bored of etc.

Edited by RoughDog

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On 5/5/2018 at 15:27, Beano said:

Basically I've been thinking for a few days about what I would do say, silver reaches £50 an oz. I have no idea what I will do. I'm in it for the long haul and have no plans in selling for at least 15-20 years.

The bigger question is what will you do if in 15-20 years silver is still at $17/oz ?  ;)

For me, I have a small core position of silver that I'll probably hold until it hits $50/oz or I die.  The rest of my PM money is in gold for the long haul.  But thats just me.

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If silver is flying then gold is flying. What will colour the decision making process of quite a number here is the previous strong rise of the metals. Price almost halved for gold in USD terms and it fell to something like a quarter of its peak price in silver. If the same occurred in silver again you would be kicking yourself not to get out, if only to reinvest again. Silver has done this before. Once bitten, twice shy, three times and you need your head testing.

Clif High whose predictive abilities in silver are verging on nil has suggested price will zoom up and then there will be a dishoarding taking price down but this time price will pick up its skirts and absolutely rocket so that eventually silver is more valuable than gold. That silver is so key to new technologies there will be people coming door-to-door for silver, including plate. 

Who knows but i do not intend to sell mine when it reaches £50.

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I think an important point to mention is that if silver/gold goes through the roof (hopefully more like when) what will be the implication on the prices of goods and services. In an inflationary environment prices of goods and services could also skyrocket. Back to the topic, if silver goes through the roof I would deffinately consider selling a set %, but I would definately also consider using the silver in a barter economy if possible. 

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I haven't thought too much beyond simply hedging against the death of the financial system we are presently living under. But if silver goes through the roof, I will probably use it to buy land and a house.

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First thing fix the bloody big hole in my roof! :P

£50, would be very nice, however I don't really think (careful) like that. If you have, say, £1,000 in an ISA you may make a 'profit' of 1.3%, £13 in a year, or 3 pints, not very good. Yet I believe in more of a better percentage return. If you can get hold of Maples, Brit, ASE and the like for £20 and then sell each at, £25 that's 25% (I think) profit.

I have set my target, and will stick to it. If the price goes beyond that and I miss it, I have still made my bit.

 

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If silver goes moonwards, say, close to £100, I intend to sell my bigger pieces first, perhaps by 1kg, 500g and 250g umicore bars. At £100, that should net me a tidy £6000 or so.

However, I will hold the majority of my stack back and wait. The issue I see is that a huge spike in PM prices is likely to precede a major reset of the financial system. So that £6000 I just netted might be worth nothing of the sort when push comes to shove.

Im stacking for two outcomes. 1) The hunky dory fiat world somehow makes it to my retirement and I have a lovely stack of shiny to use and/or pass down to my family or 2) The system resets and my stack of shiny has material value that I can use to buy houses, land, new stocks etc.

 

In any case, Im confident my stack will be a useful tool for me.

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58 minutes ago, Oldun said:

Silver reflects deflation/inflation. That is all you need to know.

Silver and gold certainly track inflation (which is one reason we know we are actually in a deflation right now), and so are a great hedge. But, and heres the real appeal, silver is so obviously undervalued it has enormous upside. So, since it tracks inflation, and since it is also surpressed, the risk/benefit profile of silver is probably the most favourable of anything you can think to invest in.

To me, its important to know more than just the fact that silver is a great store of wealth. If you really want to convince the masses, you have to reveal the upside which is almost a certainty, and the downside which is so low as to be negligible.

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I think this year, you will see generational lows in silver......as inflation is on its way....eventually.....Silver or gold are not a great store of wealth if your timing blows. Price and Time is everything. You can have a correction in price but also a stable price but a correction in time......there is much to learn young Padwan.

Check out Gann, Tunnels through the Air which will take years......if you have the time, pun intended, for it.

Edited by Oldun

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