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DarkChameleon

Is it time to convert your gold to silver?.

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The ratio of gold to silver is now almost 85 ounces of silver to one ounce of gold, there have been peop,e waiting for the ratio to go to 40 to 1 to convert their si,very stash to gold but it's in reverse and speeding up...could it go to 100 to 1 in the near future?.

 

Is it worth trading in gold to get silver now or still the pie in the sky 40 to 1 dream?.

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the problem with the gsr is they make it up as they go

along. last time it was 75+ was a good deal, now it's

80+, and then 85+... (notice how the gsr is peddled by

those selling pm's, usually silver)

from the charts the odds of gold falling further by the

end of the year is quite high. you can choose to shuffle.

longer term holders might want to wait until then to

decide.

(I'm going to guess gsr will rise by year end, maybe

$1220/$14 or a gsr ~87)

 

HH

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1 hour ago, HawkHybrid said:

the problem with the gsr is they make it up as they go

along. last time it was 75+ was a good deal, now it's

80+, and then 85+... (notice how the gsr is peddled by

those selling pm's, usually silver)

from the charts the odds of gold falling further by the

end of the year is quite high. you can choose to shuffle.

longer term holders might want to wait until then to

decide.

(I'm going to guess gsr will rise by year end, maybe

$1220/$14 or a gsr ~87)

 

HH

I was basing it on the goldprice.org, which is a simple ratio, no advice, but since the 80s it hasn't been this high, now the talk of recession has started in Ernest with the inversion which has only been wrong once in 50 years...if the recession kicks I  then the metals will rise but the rise in silver should outpace the rise in gold..thjnm $1700 versus $47...I have a few spare bits of gold might shuffleover, was thinking of shuffling to platinum for the cyclical platinum, palladium trade but I  the last few years going for a ratio of 70 to 56 is a high ratio jump...I have kept ratios at about a 70 to 1 j  my stash but maybe it's time to shuffle over and see if the preppers will make me rich...the only way I'd lose would be if it got to 100 to in the near future.

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It really depends on what you're stacking for.  If you're stacking for a future radical change in the economy and the nature of common currency, then you certainly want a lot of fractional silver.  Not all of your stash in silver, but a significant amount of it.  But if you have too much silver to be reasonable handled, then convert some of it to gold.

If you're mostly an investor, well, then I can't give you much advice.

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the gsr is effectively marketing for sellers of silver.

it's not even remotely close to reality. it's like comparing

a plane with a car as a transport indicator, totally

irrelevant.

 

having said that, best guess is that sometime within the

next 10 years silver would outpace gold in total gains.

 

do the maths to check for risk/reward.

9 hours ago, DarkChameleon said:

$1700 versus $47

don't use this. blow off tops are an unrealistic set of data

for the basis of risk/reward. why didn't you use $800

versus $50(1980 blow off top)?

 

if you want to make the trade then collect sufficient data

first. for many the risk/reward is not worth it for the time

and effort they have to spend using the amounts they are

willing to commit. this is especially true for those who

already own some gold/silver.

 

trading the gsr is a multi decade cycle trade. committing

too much of your resources to it can leave you over

exposed.

 

HH

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3 hours ago, mr-dead said:

I think the wife would cut my nuts off if I switched my gold for over a tonne of silver lol

She might like the shiny new three piece in the living room though....but seriously though it might be time to switch some of the stash, not all of it or I'd be in the same position. most of my gold is collection but some is investment the same as silver...then it's a simple investment strategy for the past, those generic bullion...maybe a lazy boy chair and not the whole three piece.

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1 minute ago, RoughDog said:

Don't think I would ever swap gold for silver.

Never say never what if the gold to silver ratio say got to 150 to 1? I must admit I would not swop my gold for silver either.

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I think the GSR is a bit of a throwback to when folks were on a dual-metal currency system, as was the case in the late 1700s in the States and UK. In this case, there were two critical ratios - the ratio of exchange the government would convert the metals relative to the respective legal tender and the ratio the two metals could be extracted from the ground. An imbalance here leads to all kinds of problems and currency manipulation until the system effectively collapses [e.g. Coinage Act of 1873, Wikipedia.com]. 

In modern times, my feeling is the GSR is simply a marketing tool for (dodgy?) dealers to move silver products. There seems to be an idea that gold/silver is a "real" form of money and there is some "natural" historical value ratio. I've observed that the GSR "distortion" is often described in the context of silver price manipulation that is perpetrated through global conspiracy by [insert boogieman here: often central banks, shadowy elites or governments] to prevent the collapse of fiat as a concept. 

Personally, I don't see any real reason for there to be linked ratio. Neither are mined in the same manner (silver is rarely mined directly, usually as a byproduct of extracting other minerals), one is commonly used as a means of exchange between international governments/financial institutions where the other is not, one is an industrial metal where the other is not, etc, etc, list goes on. Thus, my feelings are gold and silver are their own products with their own markets, their own supply and demand with no real, rational link in their price ratios. 

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I wouldn't as I have too much space taken up with silver already.  Reselling it always results in a pretty poor price if you want to sell any amount and go through a dealer.  The Vat and premium kill us in the UK. 

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Just now, DanShanks said:

If somebody like Jim Rogers wanted to trade all his gold in for 85x the amount of silver then it would be like another Hunt brother episode?

The Hunt brothers were buying silver on margin (credit). When the rules changed, a bunch of their positions were called (had to square the balance sheets with cash), they didn't have the money and the positions were liquidated to cover. This caused the sliver market to crash. Completely different than someone converting a bunch of gold into silver. 

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1 minute ago, SiliconToad said:

The Hunt brothers were buying silver on margin (credit). When the rules changed, a bunch of their positions were called (had to square the balance sheets with cash), they didn't have the money and the positions were liquidated to cover. This caused the sliver market to crash. Completely different than someone converting a bunch of gold into silver. 

True, but I was referring to some entity taking a large position in silver.

 

There just isnt that much silver in physical form available out there.

 

While the ratio is so high it would be a smart move for somebody to trade all their gold for silver, watch the price shoot up then trade back for much more gold down the line

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1 minute ago, DanShanks said:

True, but I was referring to some entity taking a large position in silver.

 

There just isnt that much silver in physical form available out there.

 

While the ratio is so high it would be a smart move for somebody to trade all their gold for silver, watch the price shoot up then trade back for much more gold down the line

I think it would depend on who was on the other side of that transaction. Because it's a small market, major moves can't be easily hidden by private individuals. It's also not easy to move huge volumes of metals outside the Good Delivery network quickly, and everyone in that network knows each other. I suppose one way to do it would be to use the gold as collateral for a loan that is then used to purchase silver futures in the paper market and then opt to take actual physical delivery of the silver. *IF* (huge if) this caused the price to stabilize at a higher level, the silver could be sold off to cover the initial loan, financing fees and interest with the rest going into one's pocket.  

I suspect, however, that if it were this simple it would have already been done many times over...

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Quote

 If the ratio goes back to 17, I’ll do just fine. But I’m not holding my breath.

 

it a decades long trade.(look at the multi decade charts)

you will be tying up your reserves for decades if you

were to take that trade.

this is why silver miners love pushing the gsr, as

anyone making that trade won't sell their silver back

into the market for decades.

 

(I just can't emphasize enough that it's not a trade

worth taking for most people. buy silver is you think

it's going to go up. but don't buy it based on irrelevant

data on multi decade gsr charts.)

 

HH

Edited by HawkHybrid

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On 31/03/2019 at 21:43, Downs523 said:

I sold my silver in 2011/2012 when I was getting 1 ounce of gold for selling 27/28 ounces of silver 😁

yeah, last time i was getting 45 oz for my gold include shipping, locally i got less than 40

then turned those 32 oz of silver back to gold again

it was worthwhile to be swapping

vs now

there is near little difference to be doing that, better off just buy the silver, when gold is premium closer to silver premium

 

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3 hours ago, DanShanks said:

True, but I was referring to some entity taking a large position in silver.

 

There just isnt that much silver in physical form available out there.

 

While the ratio is so high it would be a smart move for somebody to trade all their gold for silver, watch the price shoot up then trade back for much more gold down the line

There is an assumption that position taken expect delivery.  If the instruments used do not settle in physical silver but cash, and the interesting party is happy with that, there is no need for enough physical to cover all positions. 

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I wasn't thinking of trading thousands of oz's but maybe 20 or so...taking some money off the table gold wise and then increasing silver...after all so many of us are thinking of trading the other way...if trading has a point of silver to gold then why not gold to silver?...imagine having done it now and then go to those days of under 40 to 1 when trading it back...after all aren't many of use thinking exactly of holding to our stash for decades or inheritance...is gold really so much shinier then silver?.

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1 hour ago, DarkChameleon said:

after all aren't many of use thinking exactly of holding to our stash for decades or inheritance...is gold really so much shinier then silver?.

 

gold is a good hold.

silver is an awful hold.(just ask anyone holding since

2011. or maybe since dec 2015. in fact ask anyone who

has bought any time in the recent multiple decades that

the gsr has been rising. you need a crystal ball to

successfully trade the gsr.)

 

I'm beginning to think that some forum members are

unwilling to disclose personal interest in promoting

physical silver.

there are so many problems with holding physical

silver. you can hold gold, trade paper silver etc.

there are many better alternatives.

why would anyone move from a winning trade(gold)

to a losing trade(silver)?

 

HH

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