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Is it time to convert your gold to silver?.


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21 minutes ago, sixgun said:

Switching in paper is quick and easy but i expect the metal allegedly backing these up is not there or will disappear when you most need it.

 

trading in paper is a better way to trade the gsr.

needing the metal is mostly fear mongering.

(you can hold emergency reserves and trade

everything else in paper?)

physical metals sellers don't want people to

trade in paper at all because it does not

increase sales.

 

 

HH

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It's nice that I started a debate which was my intent...we have had time when people have bartered silver and yes gold for goods...the metal detecting forum I was on and still am had people buying detectors, digging knifes, etc with face value..as the price of silver or gold rose and fell so did the offers, to match it as would any market In fiat...the fact is that holders are willing to exchange their silver or their goods for each other...this is a scary thought for the bosses that be...as we don't need them, we can buy and sell pm's with cash, no taxes if people are selling person to person in not so vast a sum.

I used the GSR to explain that right now gold is not at its high as neither is silver but the exchange rate is....this doesn't say silver is too low or gold is too high, maybe they are both just in a swing as most currencies are hense the exchange rate mechanism..metals more extreme as they are not tied to currency any more.

The offer put up for 20 oz of silver for one gold sovereign is a good debatable stance....obviously some will say they would never sell their gold and others their silver, some will say the exchange rate offer is too high and others too low, some argue the fact that middle man charges in general are less then I have offered or more...it's a healthy debate...will we most of us fall on the side of keep the horde going or start the thought that if we have talked about moving our silver over to gold when the GSR going to 40 then why is it so hard to think of the opposite?...and is it greed or hope that makes us demand 40-1 or 100-1 respectively?.

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For me personally silver is a means to gold. Once I get gold I feel an accomplishment, almost like a win that I got another ounce of gold in my stack. Silver is not the same buzz or rush when purchasing. I have thousands of oz's of silver and yet only have 20 oz of gold.. Once my stack converts to gold I would never think about going back... 

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The high premium + VAT on silver may take the juiciness out of swapping from gold in the immediacy, but you should get those premiums back when it comes to selling the silver in however many years (best to sell them on this forum or somewhere away from the bullion dealers, obviously).

So really, swapping gold for silver means having less physical silver in it's place than you might like, plus the future premiums which must sit in thin air for the years in between. If you can live with that, then it might be a good time to swap some.

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8 minutes ago, NorthEast said:

For me personally silver is a means to gold. Once I get gold I feel an accomplishment, almost like a win that I got another ounce of gold in my stack. Silver is not the same buzz or rush when purchasing. I have thousands of oz's of silver and yet only have 20 oz of gold.. Once my stack converts to gold I would never think about going back... 

So if you were offered the same deal, not my deal of 20 silver to one sovereign but say any ratio straight deal would you take it?...liquidating some of your silver to gold this minute?

I think we hear too many here talking about their si,very buys and that one day it will be their pensions or the inheritance for their kids, that talk about exchanging their silver for gold at 40 to 1 but never talk about it the other way around...because the achievement is to go to gold, not gold to silver...the gold horder are those 'out of my cold dead hands' followers for the main part, the collectors are willing to sell their gold to but rarer gold...numistacker sold some of his sovereigns to buy a rarer sovereign and I'm sure would have made a much better deal had he swapped for the soverign with the other owner and skipped the auction, the auction prices and the slices every side but them two take from it.

 

We seem to be locked mentally into this ratio to buy gold in the future when silver is at its highest rate but we don't take into account that people may not want to sell their gold at this rate and will hold on like silver owners right now.

 

My ownership ratio is silly, I have collected gold for decades, not high premium but gold, as some have sqid, that golden glow is superior to silver and that silver is a poor man's gold...but I have not seen anyone jump at exchanging their silver for gold right now...not even offer some better exchange rate, they are subconsciously locked into some moment when something will happen or nothing will happen and they grow old and die and their kids maybe think nothing and sell everything for fiat or get locked into the same mental battle.

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13 minutes ago, DarkChameleon said:

and is it geeed or hope that makes us demand 40-1 or 100-1 respectively?

 

with the gsr you need to be able pick tops and

bottoms. picking above average is not good

enough as with time your above average may be

the new gsr norm. which means you've just lost

out on years if not over a decade of gsr trading.

and of course there is fixed spread to reduce

your returns.

people that have done the maths are just being

practical.

 

HH

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7 minutes ago, HawkHybrid said:

 

with the gsr you need to be able pick tops and

bottoms. picking above average is not good

enough as with time your above average may be

the new gsr norm. which means you've just lost

out on years if not over a decade of gsr trading.

and of course there is fixed spread to reduce

your returns.

people that have done the maths are just being

practical.

 

HH

I agree totally...a rate of exchange is the same as a demand for cash, you get what the buyer or seller is willing to accept, you take the first offer or no offer at all, you hold or let go of everything or just some, my offer was bullion for bullion, in fact a sovereign does have a certain collectability to it which is why I bought so many for so long...but why do we demand so much for what we have or are so afraid to do anything with our stuff but look at it...like someone once said, the man with a barrel of gold has nothing it's only when they sell it is when they have wealth.

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1 minute ago, DarkChameleon said:

We seem to be locked mentally into this ratio to buy gold in the future when silver is at its highest rate but we don't take into account that people may not want to sell their gold at this rate and will hold on like silver owners right now.

I don't think there will be a shortage of options for buying gold if the GSR becomes 1:20 or whatever. People will still sell. People are selling their silver on this forum even now despite the 1:85 GSR, and people were selling both metals during the 2011 bubble.

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3 minutes ago, bluemoon said:

I don't think there will be a shortage of options for buying gold if the GSR becomes 1:20 or whatever. People will still sell. People are selling their silver on this forum even now despite the 1:85 GSR, and people were selling both metals during the 2011 bubble.

Then why is the argument so heated about a simple thing like GSR?....and do you think people who bought their gold at $1500 will want to sell when it's say $800 and not simple convert their thinking to a hold and wait or hold and leave to the kids or hope that they achieve 100 to 1 again in the future which so many of us silver bugs are doing right now..why is it good for the goose and not the gander?...if our passion it to have that childhood dream of a treasure Island chest overflowing with gold dabloons then why even consider one day offloading it drip by drip to fund our retirement lifestyle...like any pension which we hope will be worth significantly more one day, we hope it grows by the trades made by us or in our name by dealers, selling apple shares to buy Indian bank debt and MUNI's to buy stock...then why not shift constantly as the waves rise and lower to gain our pm stash on the swings?....I think it's more the mental freeze we have to terrify ourselves that we are making a bad deal or risking sending our wealth through the post or being cut up by those same LCS we talk about so dearly when buying the next 'fix' from.

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a low gsr usually means both metals are more expensive

than average.

a high gsr means both are cheaper than average.

everyone knows that a gsr of 85 means both metals are

currently cheaper than average. few are prepared to

make the swap because although silver is cheap compared

to gold, the trend is for it to get cheaper before it reverses.

immediate trend favours holding gold, longer term trend

favours holding silver. neither gold>silver or silver>gold

makes sense as it's a decade long trade and the conditions

have not yet been met to make the trade profitable.

playing the gsr requires you to correctly pick the tops and

bottom to be profitable. as we are neither at a top or a

bottom neither trade make sense.

the gsr will favour silver, just not yet. it still makes the most

sense to wait.

 

HH

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56 minutes ago, HawkHybrid said:

 

trading in paper is a better way to trade the gsr.

Agreed - most of the potential profit of these switches is lost otherwise

Quote

needing the metal is mostly fear mongering.

(you can hold emergency reserves and trade everything else in paper?)

physical metals sellers don't want people to trade in paper at all because it does not increase sales.

This may be intended as fear mongering by some - indeed i am certain it is.

i have spent some time looking at SLV and GLD. You cannot redeem the shares - fine you don't need to, just sell them and buy the physical. i do not believe there is the requisite amount of physical. Well these outfits are have the metal held by the likes of JPM and HSBC so what can you expect but blatant criminality. If the price tracks the price of the metals does it matter?

My issue is there will be a reset and there will be a point when the physical price will not reflect paper and you will struggle to get physical. This has happened so it is not theoretical. This will happen quickly and you will get a fraction of what the physical value would have been, the physical will be bailed in or spirited away and the profits you made of trading the GSR will be gone along with your principal.

That is going to happen. It is one of those political economic certainties. When it happens it could well be like a light switch. You will be settled at some sh1tty paper price with worthless fiat and no physical. i don't know when this will happen but it will happen. The USD is getting dumped. The exchange stabilisation fund has been buying the bulk of US Treasuries for the last 4 - 5 years to keep up appearances. Inflation is 10% - the published figures say nonsense like 2%. Gold is priced off the bond market and bond prices are way out of line. Bond prices based on real inflation should be much lower and so gold much higher. It will break - maybe next week, maybe next year maybe in 2 or 3 years but it is rapidly reaching that point. The 2007/2008 rumbled on for months and then there was the massive electronic run on the banks and the house started coming down over a morning. It will be too late to get physical and too late to get out. SLV and GLD will be crashed - and then settle for cash and the physical is stolen by the usual suspects.

i have traded SLV and GLD - they are great but like all paper they will burn when there is a big bonfire.

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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11 hours ago, sixgun said:

Silver is a currency - it is traded as a currency pair with gold XAU/XAG - the so called gold silver ratio and it is traded with other currencies, XAG/USD, XAG/EUR, XAG/GBP and so on. It is not a currency as far as US citizens are concerned b/c they aren't allowed to trade gold and silver on the currency markets - but that doesn't mean it isn't a currency.

Last week the Kinesis Currency Exchange opened - those with accounts (me) - (again US citizens can't join at the moment) - can mint KAU and KAG. These are the gold and silver title of ownership cryptocurrency coins. Basically you buy multiple of 100g gold or 200oz silver for USD and blockchain title of ownership is issued. In July this goes public. In August - September a debit card will be released and you will be able to go spend your gold and silver everywhere there is a VISA/Master card sign. The retailer will likely want fiat and this will happen on the card but if they want KAU or KAG then you will directly spend your gold and silver. It will be money. It will be fungible. It will be divisible to multiple decimal places. This is the way of the future. There will be others.

The paper market will control price for as long as those who can blow this market out of the water allow it to control price. When the West can no longer sell gold to China/Russia they will reset the price and the paper markets as they are are finished. The Western central banks may try to get in ahead of this and do a reset themselves but there will be a reset. We have seen Canada get rid of all her gold, the US doesn't audit it so likely there is a big deficit, the BoE refused to give Venezuala her gold back, the Germans only got half their gold back, the Australians can only see a few of their bars with plenty of notice given.... To me it all indicates stocks are running out. When the reset will come is just a guess unless you are a Fed/BoE central banker but it isn't a guess the gold will run out and then a reset comes and the likes of the gold/silver COMEX are done.

 

Interesting insights here, lots to unpack. First, Silver is not a currency no matter how much some folks wish it were. In your own next breath after saying it so, you indicate XAG value in a basket of true currencies. It's a common, fundamental error in thinking I've observed in a number of people buying into silver - they confuse an asset for currency. When debts and purchases, private or public, can be settled with grams of precious metal, enshrined in the laws of the land, then it will be a currency and not before. This is a critical point and getting it wrong leads to all manner of false conclusions and logic contortions. 

 

With regard to "cryptocurrency coins," that's not a currency either. It's an asset backed security that is no different from traditional paper other than it is traded on a different exchange via a different technology. The vendor in your scenario by your own admission is getting  paid in fiat of the land, the currency enshrined in law to settle debts public and private. What your talking about is a form of barter, where the metal asset is converted to fiat in real time at the point of sale though a 3rd party exchange. The key point here is that fiat is the recognized money in the transaction, which goes back to my previous point that many precious metal enthusiasts don't really understand what money is (or they do and simply don't like / refuse to accept it). 

 

I think we have some common ground on your 3rd point. Using fractionally secured debt instruments to shuffle money between international banking institutions though a non-transparent system is begging for problems. I think we do disagree that the problem will be because there isn't enough precious metal to go around. The metal doesn't matter (or mortgages, or land, or [insert underlying asset here]), rather its the fact that the collateral for a debt is not worth the face value. Should those debts be called en mass, then there will be a financial shock as they are realized at a loss. 

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2 minutes ago, sixgun said:

Agreed - most of the potential profit of these switches is lost otherwise

This may be intended as fear mongering by some - indeed i am certain it is.

i have spent some time looking at SLV and GLD. You cannot redeem the shares - fine you don't need to, just sell them and buy the physical. i do not believe there is the requisite amount of physical. Well these outfits are have the metal held by the likes of JPM and HSBC so what can you expect but blatant criminality. If the price tracks the price of the metals does it matter?

My issue is there will be a reset and there will be a point when you the physical price will not reflect paper and you will struggle to get physical. This will just happen and you will get a fraction of what the physical value would have been, the physical will be bailed in or spirited away and the profits you made of trading the GSR will be gone along with your principal.

That is going to happen. It is one of those political economic certainties. When it happens it could well be like a light switch. You will be settled at some sh1tty paper price with worthless fiat and no physical. i don't know when this will happen but it will happen. The USD is getting dumped. The exchange stabilisation fund has been buying the bulk of US Treasuries for the last 4 - 5 years to keep up appearances. Inflation is 10% - the published figures say nonsense like 2%. Gold is priced off the bond market and bond prices are way out of line. Bond prices based on real inflation should be much lower and so gold much higher. It will break - maybe next week, maybe next year maybe in 2 or 3 years but it is rapidly reaching that point. The 2007/2008 rumbled on for months and then there was the massive electronic run on the banks and the house started coming down over a morning. It will be too late to get physical and too late to get out. SLV and GLD will be crashed - and then settle for cash and the physical is stolen by the usual suspects.

i have traded SLV and GLD - they are great but like all paper they will burn when there is a big bonfire.

So does this make you a fan of exchange of real goods for real goods...I think having to sell one to buy another through some medium that is in place to take as much as possible of your profit or make your lose even more painful is pointless, we seem to all be of an opinion right now to hold to as much of our wealth in pms as possible, so why not get what we want most, for some to change their silver to gold or platinum or old coins or jewelry, etc and for others to sell theirs...some aree holding onto their positions with a death grip yet talk about a time when they will stand high on the mountain but I doubt that day will arrive, not the mountain but them being able to then let go...being paralyzed to send their horde out there, even if for that box of silver then get a hand full of gold.

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1 hour ago, DarkChameleon said:

So does this make you a fan of exchange of real goods for real goods...I think having to sell one to buy another through some medium that is in place to take as much as possible of your profit or make your lose even more painful is pointless, we seem to all be of an opinion right now to hold to as much of our wealth in pms as possible, so why not get what we want most, for some to change their silver to gold or platinum or old coins or jewelry, etc and for others to sell theirs...some aree holding onto their positions with a death grip yet talk about a time when they will stand high on the mountain but I doubt that day will arrive, not the mountain but them being able to then let go...being paralyzed to send their horde out there, even if for that box of silver then get a hand full of gold.

i am a fan of whatever works best for me. Real goods for real goods is generally more difficult - Tom might want D1ck's bicycle but Tom doesn't have anything D1ck wants. It can work well in small communities, when things are face-to-face. i don't count gold and silver as real goods - specific gold and silver coins are specified units of weight of metal and so they are units of value, a 3 piece suite and a second car have value but quantifying them and subdividing in terms of other real goods is a problem. i think you put up some ASE for a sovereign. This sometimes works - most of the sovereigns are on one side of an ocean and the ASE's on another with pirates on the border coming into the Europe.

The medium you might use to swap one for another (say USD, GBP) is not the problem - it is the middlemen who don't pay you what you think you are due. If you can find fellow collectors then great - you can sell for fiat and then swap that out for what you want - swapping on a predominantly UK forum when you are Stateside is problematic.

i am holding on with a death grip for the reset - you will hear the well known characters talking about gold and silver shooting to the Moon - they predict a price and a time which they have plucked out of time air and are virtually always wrong. A reset will not happen according to a specific time - it is an event driven scenario. Things will happen when they happen. There are inevitable things and things that no-one expected, then 'all of a sudden' China says the price of gold is '50 000 RMB' an ounce (above $7500 USD at the moment). He who has the gold makes the rules.

Naturally people get disappointed when these spin doctors are wrong - they think it will never happen and they have wasted opportunities on some stupid bits of shiny metal which have become tarnished and milk spotted etc etc. i can think of one member here who have been stacking silver for decades - at a guess 40 or 50 years. Will he ever see the benefit? Perhaps not. i have been following this drama since about 2010 - about 6 months before gold and silver took off. Do i think it will be another decade? - i do not believe so. The mess has got a lot messier. There will be a gold standard - this is why China and Russia have amassed 40+ thousand tonnes of gold each. Treasuries are being dumped, the ESF is the main buyer, inflation is picking up, there are bubbles everywhere, Saudi is selling in RMB....... there are too many holes in the dyke and not enough fingers to plug them.

Silver will tag along. Both will do what real money does - they will hold value and if you are in now there will be handsome profits. When will that happen? - no-one knows, Putin and Xi Jinping may have a good idea, the  gnomes in Zurich might, some of the City criminals might - the Fed is clueless, they are too busy plotting their dots.

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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1 hour ago, SiliconToad said:

 First, Silver is not a currency no matter how much some folks wish it were.

Gold and silver are traded as currency pairs in London. They are currencies - you cannot spend them like Federal Reserve Notes but they are currencies b/c the markets trade them as currency pairs - that is the spot price.

Quote

In your own next breath after saying it so, you indicate XAG alue in a basket of true currencies.

When you quote a traded currency, you quote it as a pair - GBP/ USD, EUR/USD, XAU/EUR which is what i did. i quoted XAG as its currency pairs - not a basket of currencies. US citizens for reasons best known to the UNITED STATES Federal corporation are disallowed for trading gold and silver currency pairs.

Quote

It's a common, fundamental error in thinking I've observed in a number of people buying into silver - they confuse an asset for currency.

Currencies are a form of asset - and as i say in London gold and silver are traded currencies. i have yet to meet any silver bug who thinks they can pay their electric bill with silver.

Quote

When debts and purchases, private or public, can be settled with grams of precious metal, enshrined in the laws of the land, then it will be a currency and not before.

You are getting legal tender and currency intertwined. The USD is legal tender and so you can settle public and private debt in US jurisdictions with Federal Reserve confetti - go to Waitrose supermarket in Chelsea (London) and they won't take that currency - it isn't legal tender. Not being legal tender does not mean something is not a currency - if it is traded as a currency then it is.

Quote

With regard to "cryptocurrency coins," that's not a currency either.

Japan for example has declared Bitcoin to be legal tender.

The state will try to convince you they have a monopoly on currency, legal tender and money. They have the monopoly on legal tender - in English legislation legal tender GBP is what the other side is forced to accept in settlement in court. It is also what you are forced to pay taxes in. This forces people to have some legal tender and so it escalates. Money is everything fiat is AND it is a store of value - we know fiat is a very lame store of value. The legal tender when it was tied to gold was a store of value and was money. The reason for stacking gold and silver is b/c fiat is constantly losing value - one can easily argue the point that fiat is not money or at least it is fake money pretending to be a store.

Quote

It's an asset backed security that is no different from traditional paper other than it is traded on a different exchange via a different technology. The vendor in your scenario by your own admission is getting  paid in fiat of the land, the currency enshrined in law to settle debts public and private. What your talking about is a form of barter, where the metal asset is converted to fiat in real time at the point of sale though a 3rd party exchange. The key point here is that fiat is the recognized money in the transaction, which goes back to my previous point that many precious metal enthusiasts don't really understand what money is (or they do and simply don't like / refuse to accept it).

In the scenario i mention this was using the KAU and KAG coins - not actually cryptocurrency as their number is not limited except by the amount of gold and silver in the Kinesis vaults. A true cryptocurrency has a finite number to be issued which is decided at launch.

The KAU and KAG are not legal tender anywhere (at the moment). They are not issued by a central bank - which is the whole point of them; to escape depreciating unbacked fiat.

The vendor can accept KAU or KAG - i would every time. Most will want the local legal tender so an exchange for this will happen on the card at the moment the transaction occurs.

i don't know of anyone except those living in a bunker with a beard down to his navel who won't accept fiat.

In summary and to cut to the chase. Gold and silver are not practical money - they are money, they are the only real money but they are not practical. What they are is a store of value when fiat keeps losing value - fiat is bad money. So how to make gold and silver practical money? - an asset backed crypto where the crypto can be accepted or it is converted on a debit card - that is a practical solution. You hold your value in good money and at the point of sale you convert just enough into fiat. What a wonderful world it will be.

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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