If you’ve been investing in precious metals then you’ve likely made a pretty decent profit on your wealth preservation investment over the last several years. With the popularity of precious metals increasing exponentially as the economic crisis and geopolitical climate heats up, investors looking for protection against inflation and instability have been pouring into precious metals ETFs, stocks, contracts, and pool accounts. For many, the physical metal has become the investment vehicle of choice, but a large portion of investors, especially large buyers, choose to store those metals with their brokers/dealers.
When all hell finally breaks loose, and it’s time to finally sell those assets and trade them in for either paper currency, real estate or other investments, how sure are you that you will be able to take physical delivery of the metals you’ve purchased?
Bill Cramer of St. Louis was pretty confident everything was on the up-and-up. He purchased 5000 ounces of silver back in 2003 for a spot price of $4.94 and stored them with an east coast broker. When he was discussing his holdings with his coin dealer, the dealer dared him to try and take delivery of the metal.
Bill took him up on that dare and contacted his broker requesting to take delivery of his supposed physical metal holdings, for which he had been paying storage fees for years. As you may have guessed, the broker advised him that physically delivering the metals was not possible:
So, I took his dare, I called them up, it was June of last year. The metal I had purchased in January of ’03. I said “I’d really like to take delivery of my metal – the five thousand ounces.” They go “well, that’s not possible.” And, I go “well, I’ve been paying storage fees since January of ’03, what do you mean I can’t take delivery.”
“Well, it’s part of the account. It’s called a pool account. And, you don’t take delivery, you just participate in the appreciation.”
So I immediately sold that 5000 ounces at $18.33 and I had my cell phone in my hand and I immediately purchased 2500 silver eagles at $18.41 and that’s how I reconciled the problem of not being able to take delivery of my physical metal from a brokerage account.
Source: CNBC
If you’re holding metals outside of your immediate possession (i.e. in a safe deposit box, with a family member, an off premises safe or a hole in your backyard), then we strongly suggest you understand what your investment is and is not. If it’s paper, understand that if and when the swindle in paper markets for precious metals is finally understood by mainstream investors, and the paper assets collapse, you will likely be left with nothing.
If you happened to recently purchase $1 billion dollars in gold and have it “safely” stored in a New York bank several thousand miles away, you may want to think twice about whether or not that metal is actually stored, in physical form, or if it’s just another paper swap. If there’s one group of people who have no scruples whatsoever when it comes to the investments and life savings of individuals for whom they manage funds, it’s New York firms and brokers.
Be forewarned and forearmed.
This kind of thing makes me laugh and feel angry at the same time. I laugh because this is certainly a case of “get ALL of the details-assuming makes and ass of u and me”. If this guy had gotten all of the details at the start, he would have known he could not get physical delivery of the gold! I am glad that in the end he got an excellent return on his initial investment though.
I feel angry at the same time because, as I have stated previously, I haven’t been in a state where there isn’t someone is all too happy to take advantage of Joe America for their own gain. Lies by ommission are STILL LIES! Thanks for the great write-up Mac.
What an incredible story, but you knew what he’d find out even before reading it. At least he did the smart thing by immediatelt cashing out and reinvesting in stuff he could hold. It could have been a lot worse. Sadly, most stories don’t end this well.
And a good reminder about safe deposit boxes at banks. They’re just great in stable times but what if the gov decides to force the bank to open all boxes so they can do a little “requisitioning for the public good?” Best to have anything really valuable where you KNOW it’s accessable to you.
My personal favorite is a really strong coffee can in a deep hole in the back yard. Don’t spread this around but that’s where I have all $9.45 of my retirement funds. Just a bit more saving and I can get one of those crisp new $10 federal reserve notes that we know will last forever 🙂
Put the coffe can in a pair of panty hose and it will be bullet proof then put a diaper around it and it will last for 10 years.
He’s lucky, I know a dozen people who bought into oil wells the same way, they’re all out thousands of dollars and the seller(scammer) is in some slammer in Texas
Who is that stupid to trust anything of value with someone else?
The word FEE always screams YOU’RE BEING SCREWED!!
The word FEE means you pay up the ass and get nothing.
FEE is the same as TAX. Look it up.
They’ve been raiding safe deposit boxes. Dig a hole somewhere.
I know where silver/gold is going and kinda when but how much longer is the McDonalds $ menu going to stay a dollar?
Spread would have been higher for ASE’s. I wonder what his fee’s were? I’ll bet he already has a pool. 44 silver anybody, guaranteed to scare a werewolf & dracula.
Comments….. I’m sure those that have paper, call in their marker and are informed that their SOL, will kindly inject lead/copper suppositories into the arses of their brokers. Just sit back and watch.
So why did he only get 2500 silver eagles? Why not the whole 5000?
Just saying…
I guess I missed the scam. What I did see was someone who made a stupid investment by virtue of ignorant assumptions. Read your contracts before you spend your money………..problem solved.
Comments…..YA Know!! I purchased several thousand onces on e bay in 06/07/08,eagles,prospectors,morgans,onzas,some really beeeeutifull!! one of a kind coins,you name’em I bought em,my wife thought i was nuts. Not any more!! when I WOULD SHOW THEM TO HER, SHE WOULD SAY OH!!!!! THATS A PRETTY ONE…LOOK HOW SHINY…NOW, I SAY THIS ONE SHINY COIN WILL BUY YOU A NICE PAIR OF SANDALS FOR THE SUMMER.i WILL NEED TWO WAS HER REPLY!!!
Comments….. I would rather buy SEEDS. You cant eat silver or gold but with heirloom seeds you can feed your family for years!
I was waiting for some knuckle head to tell me I can’t eat gold or silver. You win! My parrot eats seeds.
I have invested in metals too
Lead
and i have it all where i can touch it, feel it, and load it!
i have that to
I don’t think I could store that many seeds……
Silver just hit 44. Happy birthday again.
Comments…..I WOULD BUY A HOT MAMA…..LOVE IS ALL I NEED
Invest in anything but paper unless it is toilet paper. Get rid of those dollars while you still can!
GLD and SLV = LOL
buy from a dealer so you have it in hand! EMP or collapse or? At least you have it to trade it when the time comes. If everyone walked away from the market things would get interesting real fast.
Seeds sound nice, however, if they are not Monsanto terminator seeds, be prepared to be sent to the U.S. FEMA death camp nearest you. Passage of U.S. Senate Bill 510 in January, 2011, ensures that only Monsanto terminator seeds can be used to grow food crops and other valuable agricultural commodities in the future. Violators who grow crops using heirloom seeds will face the wrath of the tyrannical U.S. Government.
Anyone think ole Bernie Made-off was the only Ponzi schemer?
I know I wouldn’t store a case Of Johnnie Walker Red with an alcoholic. Don’t kid yourself for one minute. If you don’t take possession immediately, it may not be there and probably won’t be there in the future. Traders not only trade, but they borrow and loan. If you aren’t the biggest dog, the bone you thought you had; you don’t.
Being at the bottom of the economic pile means I have to invest in myself aka skill sets and tools. Hierloom seeds- no. Open pollinated – yes. Just ask a woman how much she values toilet paper.
In Japan they put gold leaf on salads, and silver is an excellent anti-microbial substance which can be ingested.
So there! You can eat gold and silver! It’ll help you to shit change at the cash register!
If you don’t have physical possession, you do not own it!
QB, that’s one of the funniest comments I’ve read in a while. Thanks for that. SDBs or any other type of “storage strategy” that doesn’t involve your direct control and possession is (and has always been) a mistake… going back to the olden days of goldsmiths who guaranteed your deposits (for a fee, of course) to the modern day FDIC Insured bank, it’s all the same scam. All it takes is one more executive order for Mr. Obama to sign and what currently belongs to you now belongs to them. Banks, unfortunately, still have a wonderful reputation with the average person – especially old people. Not everyone will take this advice, but don’t YOU be in that crowd. Think about it folks. What is all the fear associated with keeping cash, jewelry, gold, silver, etc in your home? If you are so afraid people are going to break in and take what is yours then why don’t you keep your wife and kids in a safety deposit box at a bank. Lord knows they are more precious than gold and silver.
Chromium Knight, you wrote:
Seeds sound nice, however, if they are not Monsanto terminator seeds, be prepared to be sent to the U.S. FEMA death camp nearest you. Passage of U.S. Senate Bill 510 in January, 2011, ensures that only Monsanto terminator seeds can be used to grow food crops and other valuable agricultural commodities in the future. Violators who grow crops using heirloom seeds will face the wrath of the tyrannical U.S. Government.
While I agree Bill 510 is a huge pile of crap, what you wrote isn’t exactly true… unless you have a huge farm bringing in over $500,000 or think the gubment actually has the time and manpower to check every back yard garden in the nation!
Mark and VRF: I totally agree on seeds and lead ammo! Silver and gold not practical for me and others, plus prices fluctuate widely. Chromium knight: Why haven’t people I know with heirloom seeds been arrested for growing veg. with these seeds??
Well I’m sure everyone read about U of Texas taking delivery of about $1B in gold. At a Comex-registered vault owned by HSBC. Hope someone is going to audit it or chances are its being leased out like fractional lending many, many times over.
Chromium knight- Probably by the time they get around to enforcing s501 it’ll be the tyrannical government facing the wrath of millions of “violators”
overtheedge- thanks for the reminder. I gotta go get that case of scotch out of my drunken brother-in-laws basement. He keeps stalling me but I think it’s still there.
And a note to everybody here- I love your sarcasm, your wit, your whole damned attitude that’s evident in the comments. And especially the stuff that makes me think or teaches me stuff I didn’t know. Thanks to all 🙂
Why are people so trusting?
If you don’t hold it, YOU DON’T OWN IT!
That goes for 401K’s, pensions and even dollars in the bank.
Gosh. An unallocated pool. I’m too chicken to even use an allocated pool at the Perth Mint. Even though you CAN take delivery of your silver from unallocated at Perth Mint. I knew this would happen to the unallocated, at some point. i’m nervous enough when my coins are in the post, from wherever I’ve ordered them.
I think that prepping requires balance and diversity. If you put all of your eggs into only one basket …. then you’re gonna get ‘diddled’ for sure. If any of your assets are under the control of another, then they aren’t yours.
God Bless & good luck to all.
I am sure this movie will be shown many times, often with a sad ending for at least one of the parties. A lot of us have had paper assets in the past, myself included (401(k) scam). I cannot drain it because I am still at the same job, so I did the best I could and borrowed all I could. If the shtf soon, I will not have to pay it back (if it goes deep enough). At the very least, I pay back this loan in less valuable FRNs.
Comments…..
For all yous guys burying the goods. Be sure you bury them under a bunch of scrap metal, cans, broken tools, stuff. This way a metal detectorist treasure hunting will probably stop digging at the scrap and not dig another foot or two for your pot of gold. Yeah, you wouldn’t be the first guy to have his yard dug up when he and wifey were at worky.
Good thing it was just scotch. Single blend? No way. Jameson is the only way. QB, I’ve heard that some count change South of the border, LOL but I’m with you on sushi. You’re right there Suzy. I’ve had four brokers that I’ve been broken into & I’m not talking broke back mt, I’m worn out and they are still changing the rules & then I have to explain the female robot head to the USPS or FedX guy. It’s getting difficult to buy & sell beneath the radar. Deliver time is delayed & waiting for prem to jack up, priceless. I like physical. You are the Alfa dog okie. Take the lead & run with it. Don’t stick you toe below the thermacline.
And the beat goes on. Buying Precious medals is a defensive tactic. It’s time to go on the offense.
“JOIN THE REVOLUTION“
Read “Common Sense 3.1” at ( http://www.revolution2.osixs.org )
We don’t have to live like this anymore. “Spread the News”
People are proven guilty until proven innocent, dam nit you know what I mean! That slug you showed me. It’s still states evidence. I want it! Eat it. I think you’ve mis-judged me.
A bit too late to get into precious metals.
I would never put my PM’s in a safe deposit box. If there is a run on the banks they’ll lock the doors tight. If there is a total breakdown then the employees might steal your stuff.
Again with the Monsanto terminator seeds stuff I always hear about.
S. 510: FDA Food Safety Modernization Act
This bill never became law. This bill was proposed in a previous session of Congress. Sessions of Congress last two years, and at the end of each session all proposed bills and resolutions that haven’t passed are cleared from the books. Members often reintroduce bills that did not come up for debate under a new number in the next session.
http://www.govtrack.us/congress/bill.xpd?bill=s111-510
Please people it didnt pass, and thank goodness it didnt cause its Fidyhbf Bu**sh^t
IN all seriousness, is there ANY precedent for safety deposit boxes being opened and the contents seized absent a court order of some type? What some are suggesting is a wholesale nationalization of everything, and at that point, we don’t have a country anymore but a communist revolution. and at that point, gold and silver ain’t really gonna matter much. Ammo, maybe.
Comments…..
If there is a “total breakdown,” why would your prescious metals be safe at a safe in your own house? I mean, there are certain risks that may not be worth taking–there’s gotta be a better way than personal storage. Foreign storage? Foreign real estate? I mean, on many levels, we live in a society and if TSHTF, we are going to lose on a lot of levels. Total preservation is not practical (at least not of ones financial assets). Of course, I live in LA, so I am basically toast if society comes apart.
Here’s my preferred method of metal delivery! Hickok 45 is my hero, right up there with Gene Simmons and TR. Life is good at the compound!
http://www.youtube.com/user/hickok45#p/search/2/WEtosDa5LMU
http://www.youtube.com/user/hickok45#p/search
I think the point about monsanto and seeds and S-510 is that they now have the tool in place to use when they see fit,like after they crack down and you get arrested for speaking out against the govicorp…then they raid your house and amoungst your stash of gold silver food and weapons they find real honest unregistered seeds they have another charge to throw at you and justify themselves in the eyes of a hungry and beaten down populace that will easily accept that the govicorp has “protected” them from evil people who refuse to comply and submit for the greater good.
The fact is we dont know where this thing will show up and be used but the fact that they passed it against overwhelming farmer/grower resistance tells me it isnt there for our good! Thanks.
The bank employees would never get the chance to rob you. The gubmint will not tolerate anyone on their turf. Safe deposit boxes are marginally safe in normal times. I hear that California seizes assets “left unattended” for three years now. This is so they can locate the owner (good luck with THAT).
I always get a kick out of the commercials that state that PMs can be delivered or “we can arrange storage for you”.
Comments…..dylan, the state of kalifornia already steals saf dep boxes, the commie chinese are chest deep in kalifornia, knee deep everywhere else. I wouldnt be surprised if the chinese pick our candidates!
Comments….. terry, you spelled kalifornia wrong!
Still not to late to get into metals .While yes the price has gone up , it still has a long way to go .when silver hits 100 bucks an oz in a year or 2 ,will you say that 44 bucks an oz was to much (especially when it doubled in price )?
They say that one needs to get 500 oz of silver and to sit on it and that it will buy you a small home in due time .This was said back in the 1980″s and i belive it still holds for today time in 2011 . When you can double your money in several years its better than drawing 1.9% from your average local Bank . People say its tool ayte because even when silver was 15 bucks an oz 3 years ago they said the same thing.Its too high and i cant afford it ! I have friends say that but every friday night and saturday they were buying cases of beer and throwing partys and buying motorcycles and new toys left and right .They still today do not even have a savings account of any kind .Just think if they invested that money 3 years ago, they would have almost tripled thier investment today .when ihear its too late or its too exspencive i hear an excuse .I still drive an 18 year old pickup truck and everybody around me has newer vehicles .They tell me about 6000 to 8000 dollar car payment and the cost of insurance .I then tell them i have no payment and my insurance is 344 a year .I said in 5 years time youll spend 30 to 40 grand on a car that will lose half of its value .I said that 30 to 40 grand could have been put into metals and your investment will have doubled, tripled or beyond .Stupid people continue to do stupid things and if in your 30 or 40 or 50 and you still have ,money problems, it tells me you just cant manage money or you just have real crappy luck in life .
Let me say this one last time : when metals are at thier all time high, then homes are usually at thier lowest point .when homes are at theier al ltimes high then metals are at thier lowest point . Knowing when to transfer from one to the other depends on these very simple understandings , everything eventually turns into a bubble to which it rises and then must correct .When metals are at thier all times high is when i paln to buy a home-paid in full with the invest,ments in metals . You can turn 25 grand in meatls and in 5 years from now buy a modest home with it .Im convinced of it and i can do it now .But we are nowere near our peak in metals .Homes still have a ways to fall down in prices and the economic situation that is coming will prove why investment in metals will beat anything else thier .Im looking for a hugh market correction sometime later this year, 2000 to 4000 point drop .Gas prices will cause a bad effect on business.Mny are hanging and thanking god they survived the winter, but this winter will end up wipeing those bearkley hanging as thier sales wont increase ASas customers tihghtne thier wllat book because food, gas, clothes, school, medical insurance has rose in price so they will be staying home more instead of dropping a 100 bucks at the steak house Friday night .I love hamburgers ever since i was a kid,im now 41 years old .I have not ate a fastfood hamburger in 6 months ,instead i cook them at home .I beat you i spend about 25 bucks on fast food a week for the last 10 years of my life .Now i spend maybe 20 bucks a month and its very occasional .I shop at the canned food outlet and the bread outlets and save a lot of money doing so .This of cource kills the local business around me but i have to do what is best for me and my family .I have noticed a lot of changes in myarea of town .This winter will be crusher for many cities in many states . If your not prepareing now .You will be screwed later .I highly say that you start doing something rather than nothing. Your future depends alot on wh tyou fdo and what you dont do .Even doing nothign at all is still makeing a decesion . Try to buy 1000 oz of silver a year .Use your income Tax rebate , bonus check or any extra income you get on it .In 5 years from now ,you will be happy you did . In 5 years from now things will either be much worse or much better ,What do you think it will be ? Id base my investment and preparations on your answer . I think we will bre trillions more in debt, silve will be 150 bucks an oz , job situation will leved out but thie will be no more good paying jobs, all 10-12 bucks an hour jobs to were it will require dual incomes to even live humbly because outr standards have dropped .I believe more people than ever will be on foodstamps and the unemployment insurance funds will be bleak if not even functional with no extentions. The glut of homes will take many years to fill and even those with jobs will have hard time getting into one with out 20 to30 % down to secure a bank loan . states are so broke that plice an dfirfighters , prisions, jails will continue to beat cut as crime , rapes, muders and robbery increase . Ammuniton will be 25% higher in the next 3 years .A ton of lead has dobled in price in the last 3 years-google- LME – and look at the lead chart , you will see it . folks if you dont stock up on things now , you will be paying a lot more for them later . We are heading for crash, it will most likely happen overnight and then the world as we know it wil have changed.We will make it through but it will take years to come back and those that are on government support will be hurt the worse .Its coming people !!!!
600 to 800 dollar car payments per correction !
I recently invested in an actual gold mine…Timberline Resources (TLR). Anyone have any opinions about that?
These one dollar up days on silver is starting to get boring.
“A bit too late to get into precious metals.”
🙂
Yeah…..so I heard……at 10 buck silver, then 20, then 30, then 44…..and no doubt, it will be said at 100, 200, and 500.
.
So, by all means, save your long term cash in fresh, crisp 10 dollar bills. They are easy to find SINCE THEY ARE RUNNING THE FRICKING PRESSES NIGHT AND DAY. Start looking for the ones only printed on one side ( like Weimar Germany ) since it takes too long to print both sides, OR they have a 10_____ so you can bring them back to have extra zeros added…..ahahahaaaaaaa
I forgot, the other metal i have invested in , besides lead
Brass
In California they are seizing contents of safe deposit boxes. If you haven’t opened yours in 3 years you are risk for your contents being taken away from you.
They have a state law that law that requires the govt to take control of lost or abandoned assets.
The California Govt generates $400 million annually from the sale of its citizen’s personal property. If they take your property you can’t even sue to get it back. There is an immunity clause written into the law.
Here’s 2 articles about it.
http://the-classic-liberal.com/california-seizing-safe-deposit-boxes-balance-budget/
http://consumerist.com/2007/07/havent-checked-your-safe-deposit-box-in-3-years-california-may-have-seized-your-stuff.html
Will the GSR hit 32 this week?
I’m starting to like my gutter metal, keeps my water clean.
Silver closed OVER $45! Weeeeeeeehhooooooooo! Time for some more shootin!!!!!!!
Rapid fire with Hickok 45! Zombies Die! hehehehehe!
http://www.youtube.com/user/hickok45?blend=1&ob=5#p/search/24/iQygPC-4_kI
Enter the ambitious contestants into your own self-sponsored ‘Raspberry Preserve Beauty Contest’
The possibilities and applications are amazing and nearly endless regarding what can be contrived using a circular array of 5 shotgun shells in metal tubes and a spring loaded 5 pin plate in a Tupperware container.
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The precious metals bubble is going to burst this year.
Don’t invest if you CAN’T afford the loss. Just like all the past bubbles, people loose money.
The precious metals bubble is going to burst this year.
Don’t invest if you CAN’T afford the loss. Just like all the past bubbles, people loose money.
Don’t forget, the existing laws on the books:
– confiscation law
– the new tax law takes effect in Jan 2012 for selling precious metals for $600 or over
– and in the past they forced you to sell to the government and did not allow citizens to own precious metals etc…)
Hey, I pass …… Since I can’t afford the loss, Im not buying into their games.
As people have warned us it’s too dangerous to keep precious metals or other such valuables at home or in a safe box.
Rising prices alone do not constitute a ‘bubble’.
With less than 2% of investors, both individual and institutional, having any precious metals position, it can be stated with absolute assurance that there is presently no Lawrence Welk Show performing on the sidewalks and stairways of Wall Street.
Furthermore, what you are witnessing in the rise of precious metals prices is something of an illusion. It is not so much that the metals are going up in real price as it is that the dollar is going down in value, requiring more of them to purchase the same tangible product.
To graphically view this relationship…
http://stockcharts.com/freecharts/perf.html?$SILVER,$GOLD,$USD
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Jane, real money can never be a bubble. I’ve got a unicorn that shoots skittles about the back end that I want to sell you.
So if you have a little money, would buying junk silver now be a bad idea cause of it being about $46 an ounce??
Thoughts please
Well BJ, silver hasn’t been this high in a long time. Gold has gone over $1500/oz too though. Personally, I do agree that prices on precious metals (gold, silver, platinum, and palladium) will continue to rise or, (as Woroble Jr points out), the value of the dollar will continue to fall. Either way, you win.
Junk silver (old coins) are the best way to get going on the cheap. Most people already have old coin collections laying around and so you’re probably already started. Junk silver is the cheapest precious metal you can buy, and that makes it a good investment. I started in with the junk first, then on to the 1 ox rounds, and finally the bars up to 5 oz. The one problem with silver is that it does require some room to store it.
The other thing is that I started in when the price was about $17 oz. Mac pointed me in the right direction and I was a little freaky about the price. Now, I’ve almost tripled my money, and I’m still buying. Be aware when you buy however, that it is somewhat of a gamble. The price may go down even though most factors point to the price continuing to increase. However, the price will NEVER go to zero. I would expect some ups and downs, but you’ll never be left without.
I have bought around 12 ounces in junk silver off craigslist, but was just wondering if I should continue…right now at the current price x .90 then times .75 for weight on a silver dollar, I would have to buy at about 31 x face value to get any takers, well any smart takers any way…and then how smart are they to be selling at all??
While I have someones attention, I asked this before and didn’t get any responses…..what do people think of the idea of; selling food prep starter kits on craigslist? Say something like 100lbs of wheat, 50lbs of rice and 50 lbs of beans all in mylar bags and buckets??
Thanks
Speculate in silver, invest in gold, hoard lead.
I get all my silver (junk or otherwise) from my local coin dealer. I might look on craigslist if I could get it below the spot/premium price, but everyone around here seems to be asking way over, just like on ebay.
Don’t know about selling starter kits, I think lots of people would want to bicker the price down on craigslist and it might become a hassle. You might have better luck with that on ebay (and a bigger audience too).
I agree with the hoarding of lead and brass assets. Cheaperthandirt.com runs all kinds of good sales all the time.
No gamble JV. $’s are gamble but I’d rather have a BJ.
Comments…..DO not buy metals they are going to collapse . Bring your money to me!! you can trust me ! I also do property appraisals!! I can also sell you lots of paper stuff with fancy writing that is very valuable I promise!! please hurry I am going broke –P.S will trade for metal if you like
Jane says: “The precious metals bubble is going to burst this year.”
Uh, Jane, which office of JP Morgan Chase do you work at?